Tag: Raises or Lack Thereof

Compensation Watch ’10: KPMG Puts Some Ballpark Figures Out There

Since it’s Monday in late July (and many people probably had one old fashioned too many last night) we figured this day would have gotten off to a slow start. Well, we’re in luck! KPMG comes roaring out of the gate today with a little compensation update from none othercall me Rudy” Veihmeyer and Henry Keizer.

The news? Well, the promotions bonuses have caused some belly aching so the boys thought they would give you a sneak peak at what you can expect come merit increase time:

Update on Our Plans for 2010 Compensation
A Message from John Veihmeyer and Henry Keizer
8:19 AM ET, July 26, 2010

In April, we told you that there would be compensation increases for the great majority of our people and, assuming KPMG meets its FY10 plan, higher bonuses than last year for EP performers, and bonuses for higher performing SP employees as well. Now, as we head into the fourth quarter, we would like to provide you with an update on this matter. As you view this information, please keep in mind that compensation increases are determined on an individual basis, and reflect each employee’s role, skills, performance, geography, and experience, among other factors.

· Merit and Promotion Increases – For employees who are not being promoted, we expect SP performers will receive merit increases that will range from the low to the mid-single digits; EP performers will receive increases up to the high-single digits and in rare cases double digits.

In addition to any merit increases, employees who have been promoted should expect to receive a promotion increase of approximately 5 percent, with one exception: newly promoted CSD Managers should expect to receive a promotion increase of approximately 10 percent.

· Variable Compensation – The FY10 pool for variable compensation will be more than double what it was last year. This means that EP-rated employees will generally receive bonuses that are significantly higher than those of last year. In addition, approximately the top half of our SP performers will also receive variable compensation awards.

Please keep in mind this information is preliminary. Final compensation decisions will be made based upon our full-year results, so the ranges above could be adjusted based upon our firm’s performance between now and September 30. But, consistent with our commitment to keeping the lines of communication open, we wanted to share with you our best current forecast about these important matters.

In line with our compensation philosophy and our focus on a high-performance culture, we remain committed to sharing the rewards of the firm’s financial performance with our employees and providing a competitive total compensation package that differentiates exceptional performers with superior rewards. As we have said before, the strong foundation we have built within the firm, as well as our near- and longer-term business prospects, make us very optimistic. But to finish this year strong and begin FY11 on a positive track, it is critical that we continue to drive a high-performance culture by doing our best work, providing the highest-quality service to our clients, growing our business, and operating efficiently.

Thanks again for your continued hard work and for all you do to help our firm succeed!

So now that you have that to chew on for your last Monday in July, feel free to discuss the “low to the mid-single digits” for the strong and “high-single digits and in rare cases double digits” for the exceptional. And if you’ve got thoughts on the variable comp pool, you can go there too, if you like. Keep us updated.

Show Me the Money: Six Tips to Getting the Raise You Deserve

Ed. note: The following post was submitted to Going Concern by a reader who wished to remain nameless. The author works at a “local” CPA firm somewhere in this great land of ours.

The topic is actually very amusing and can cause several different angles over the almighty dollar. As an American culture, we seem to be quick to talk about the personal financial well being enclosed in our own homes. The items that separate the big dogs from the goldfish are numerous. Below are the reasons why I am a big dog and why you need to show me the money.


Know who you’re trying to convince – People often equate success to dollar figures, and I personally think salary or raises don’t always speak of high ethics or quality of a peords of caution are: know how your boss judges success. My boss judges it on money. The buck stops at that point. Therefore, when I spoke of my personal salary to him, I adjusted my strategy accordingly. He always talks with me about how he is doing personally, and how he is doing better than people at his level. This is due to the amount of responsibility and client base he possesses. Therefore, I changed the pace of my conversation so my point of view mirrored his. I brought up the point that the work I do helps him with his client base, and that my level of responsibility is more than a vast amount of my peers. As such, my salary should be adjusted accordingly.

Have the math to prove your position – Being in public accounting, we deal with numbers every day. Therefore, I made a spreadsheet that listed out changeability and realization (for those who don’t know, we bill by the hour). My numbers are then compared against my peers and when they are, statistics don’t lie. I am a big dog swimming with mostly fish. Point is again related to your audience in a way they can understand you. Accountants love numbers.

Tout your level of responsibility – I manage a large client base so the partner I report to doesn’t have to get involved as often as most. The reason for this is because I have set up and maintained client relationships so the client calls me instead of the partner. The clients understand that this is cheaper for them and also job security for me. When you do this, you make yourself more marketable and the partners see me as someone that his clients trust. With those client relationships come higher dollars. You have to separate yourself from your peers by going above and beyond. If you want to do the average and be a run of the mill employee, then expect the run of the mill pay.

I am involved in the community – By coaching little league football at a well known church, I interact with parents that might need a CPA firm to help them with tax issues or own a business that might need accounting services. Also by doing this, it shows the firm that I have no problems interacting with successful business people and can help them in various situations. I can grow the firm by doing this. Again, my peers don’t involve in the community as much as I do. This should be financially rewarded. I have an interest to bring in business, and should be compensated because of it.

I can leave this at any time – If my boss did not give me a descent raise, I was going to quit. I saw the storm coming, and therefore did all that I could prior to my salary evaluation. Quitting a job without another one lined up is a dumb move and would put my wife and me in jeopardy. I had (have) a job currently lined up and I could take it in a heartbeat. Therefore, I had my ducks in a row when I started to see the storm brewing three months ago. Always have a current résumé.

Be ready for the rebuttal – I know my weaknesses and had to be ready to discuss what I was lacking. I have not passed the CPA exam yet and that’s a huge drawback in my profession. So when I went in there, I had to tell him where I was in the process. Him knowing that I am taking care of it and not blowing it off, gives him a piece of mind that I am not average.

Case in point, just saying you want a raise and basing it off “because your deserve it” would make the employee look uneducated and should be embarrassed. You need to have a firm understanding of the reasons to justify your pay. In a pinch, always look at numbers. There is a reason 2+2=4 and will never equal 5. In a tough economy, you better have everything straight prior to walking into the boss’s office. When the economy settles, I’ll be expecting another sizable increase. If not, I will be very upset and will repeat the mentioned steps.

Are Ernst & Young and PwC Neck and Neck in the Compensation Race?

From the mailbag:

I heard some scoop and wanted to share with my fellow indentured servants in the big 4 field. Word on the street is that P-dubs gave 10% raises to staff 2s becoming senior 1s (early promote) and 16% raises to staff 3s becoming senior 1s.

However, P-dubs doesn’t hand out the 5k bonus that Uncle Ernies offers to its staff 2s becoming senior 1s. I’d like to see how EY will top this, per an earlier promise from a partner that EY raises will be higher than P-dubs (maybe can some low performing partners?). In addition, the variance between average performers and high performers at P-dubs is only .6% (not significant at all).


If you forgot what this is referring to, back in April we reported a tip out of the Ernstiverse that a partner had claimed that the raises at E&Y would beat PwC’s. The reports out of PwC have been better than expected, although not for everyone.

So if this partner’s prognostication holds up, how will they pull it off down the stretch? Seems like a good question. Conversations are going on right now and the official news will reportedly be out in a couple weeks.

Since we’ve got half of the Big 4 involved here we’ll just mention that the belly aching at KPMG is in full force on the bonus front but maybe there’s hope for a strong move down the stretch?

As for Deloitte, apparently communication has occurred for promotions but it sounds like word on comp could be more than a month out. If you’ve got the scoop get in touch with the details and discuss this four horse race but as it stands right now, it looks as if PwC has E&Y by a nose.

Compensation Watch: McGladrey Promises That the Good Times Will Keep Coming

Just last week we learned that compensation discussions at McGladrey were going to be occurring in the coming days and weeks and it appears things got rolling right away and there are even some numbers to report:

We just received correspondence from national regarding our Firms performance and a cryptic breakdown regarding upcoming comp discussions [memo after the jump].

Furthermore, they have begun the comp discussion process in the southeast. Apparently the partners received official compensation breakdowns for each employee either Wednesday or Thursday of this past week. A newly promoted senior itheir discussion already and he received a 11% raise and $1k bonus.

To circle back to correspondence from C.E., I think it’s particularly insulting that he mentioned that “this year, as in previous years, we will continue to follow a “pay-for-performance” approach when it comes to individual compensation”; Interesting how there were people who received 5s last year who received a 0% raise in 2009, and those promoted received what amount to an inflation adjusted raise-just under 4%.

So 11%/1%? Thoughts anyone? If you’ve received your numbers, report below.

It’s also worth noting the following from C to the E and Dave Scudder, “In spite of a very weak economy, we held our own. We had several unique one-time charges that impacted our profitability (see Rene’s financial update on The Point for more details). Without these, our pre-tax margin would have been essentially flat with last year.”

So “we had a pretty solid year if you ignore a few major things,” is more or less an echo from the H&R Block press release that we saw late last month. In case you forgot, those one-time charges include costs associated with the little divorce and reconciliation between RSM McGladrey and McGladrey & Pullen as well as a goodwill impairment charge.

Despite the tough year, leadership assures everyone that the good times will continue to roll at Mickey G’s, “You’ve seen a number of exciting announcements in the last month, and let us assure you that the good news is going to keep coming.” In other words, more golfers that aren’t Natalie Gulbis and plenty of refreshments.

McGladrey Comp

Promotion and Compensation Watch: Ernst & Young Communication to Come Eventually, Someday

Straight out of the Bubba Gump Shrimp location up the street from 5 Times Square:

Ernst & Young, Financial Services Office, NY
Received communication that our annual ratings were finalized and discussions between counselors and counselees to occur by July 30. Promotions are still not final, but promotions and compensation will start to be communicated in August (to be effective October).


So t-minus three weeks (give or take a day here or there) until “you’re not going to be disappointed with raises” which apparently could mean that they will make PwC’s raises look like chump change (for auditors anyway).

BUT! In case you need a refresher on the numbers so far: 3-5% is what we last heard for those in the meaty part of the curve. No word on what top performers are getting but speculation is welcome. Keep us updated.

Comp Watch: Sit Downs Starting at Deloitte; Anxiety Over Raises Picking Up

Lots of news this week on the compensation and promotion fronts with Grant Thornton, KPMG and PwC all making announcements or soon-to-be making announcements (that we’ve heard; are you holding out on us, E&Y?).

The latest out of Deloitte is that the discussions are starting (although maybe not today since it sounds like most are off) but the news on yay or nay on promotions is starting and now the anxiety around comp will increase over the next two month:

The year-end ratings and promotion decisions have been approved by National; so the process of communicating both to Deloittians is starting…At a high-level, I heard that promotions this year were tough – that being said, plenty of people made it through. For the most part, people are now waiting to hear about comp – scheduled for communication the last two weeks of August.

We did hear one rumor about the number of new partners expected, “at a recent partner meeting, it was announced that there will be more than 60 new PDPs nationally, with more than 10 being in the Northeast,” so you can toss that around your meat-ingestion fest this weekend if you so choose.

Discuss your epic/tragic news re: your new promotion if you’ve received word and keep us updated on the comp rumors.

Compensation Watch ’10: Rumors at Grant Thornton as Announcement Approaches

From the depths of 666 Third Ave:

In New York:

Associates look to come in at almost $10k less than they did in 2007
Senior 3’s are looking to make almost $10k less than Senior 3’s in 2007
New Managers are looking to make almost $15k less than New Managers in 2007
Senior Managers are looking to make almost $15-20k less than Senior Managers in 2007

Raises (without promotion) are looking to be:
3% for employees rated under a 4
6% for employees rated a 4 or 5

Our source indicates that these are all rumors at this point but based on the last Communique de Chipman, the official numbers should be known soon (“early July”).

In the previous thread lots of numbers were getting thrown so who knows; maybe GT is pulling a PwC and promising low, delivering high? Discuss.

Compensation Watch ’10: PwC Starts Spreading the News in New York

It’s raining bonuses and raises over at PricewaterhouseCoopers these days. Unfortunately, all I’m seeing are news tips (monetary tips or buybacks at the bar are always appreciated). All of my sources are from the NYC office, so if you’re elsewhere in the country, please share your numbers in the comments below. Here’s what we know so far:


• Advisory/Consulting senior associate received a raise north of 18.5%. No, that is not a typo. So in the advisory practice it’s safe to assume the spread is 0% to 19% for raises this year, with the average being about 6% as reported by Caleb earlier.

• A recently promoted associate to senior associate in advisory received a 10.5% raise and a $3,000 bonus.

• Tax bonuses are being handed out now as well. Size matters in this instance, people. Cough up the details below.

This indicates that resources are being spent on what is being determined to be the right people in the right practices. Average performers should expect to receive 4-6% and take it to the bank.

Audit people, what are your numbers looking like? Email us or post your comments below. Practice/office/level are always appreciated

Thanks to everyone that is sharing information. Enjoy the weekend.

Bonus and Compensation Watch ’10: Grant Thornton Delivers the Goods

Grant Thornton has been on strict radio silence lately which makes us wonder if Stephen Chipman had given up on blogging or if they had simply given everyone the summer off.

The blog remains a mystery but we do have some news on GT bonuses (the jury was out for awhile) and merit increases and it seems to be good news but extremely short on details and extremely long on Chipman prose:

Leadership announcement
Additional guidance on bonuses and compensation

On our last all-employee call, I told you that I was optimistic that the firm would award bonuses this year. I am pleased to share with you that we are now in a position to say with certainty that we will be paying bonuses for 2010.

As you know, the overall level of bonuses is dependent on our financial results at year end. We are currently working on this modeling based on our economic forecasts and will have the final numbers next month. However, I can let you know that we plan to pay the bonuses in the mid-September timeframe.

Similar to our merit increases, our bonus payments are based on our pay-for-performance philosophy, where we strive to recognize and reward individuals commensurate with performance. We’ve held this philosophy for a number of years, but could have done better executing on it. You reminded us of this in our Voice Your Experience pulse survey, and we are striving to do better. This year — and even more so going forward — we will be giving larger merit increases and bonuses to our top-rated performers to ensure greater differentiation.

Merit increases should be finalized in the next couple of weeks and your local office will begin communicating with you in early July. New compensation is effective on August 1. The increases are based on extensive market information for each of our practices and your individual contributions.

As we work to differentiate our firm through providing consistently distinctive client service, we will continue to move towards a model that rewards each of our people relative to their contributions to the success of the firm.

I’m excited about our direction as a world-class firm that truly makes a difference, and hope you are too. Thank you for all that you have done, and continue to do, for Grant Thornton.

Stephen

So whether or not this puts your anxiety to rest is another matter. Discuss and keep us updated in the coming weeks.

Compensation Watch ’10: Deloitte Is Kicking Around Some Numbers

Last we checked on Deloitte’s compensation news, it was news of the wealth being spread around more than last year, although no one was really impressed based on the discussion that followed.

But now out of Ronaldo Fan Club HQ we’ve got an opening bid:

“It was announced at a Tax meeting last Monday that the average raise for NE Tax would be 5% this year.”


Since Dr. Phil recently said that raises weren’t going to return to “pre-recession levels” an average raise of 5% may be in the ballpark. Then again, this is only the tax practice…

Anyhoo, our source told us that reactions boiled down to:

1. After axing or transferring everybody from the Stamford, Wilton and Hartford offices, they better pay the remaining people more!

2. At least it’s more than the average of 0% last year…

If you don’t fall into either camp 1 or 2, make your opinion known. Otherwise, get back to watching your fantasy team suck.

(UPDATE) Compensation Watch ’10: Are Raises Looking Bleak at E&Y?

It’s been awhile since we’ve heard any news on the E&Y comp front but we finally received a preliminary report from one source late last week:

[Roundtables] went the same way they always go. Surprisingly, less pushback on proposed ratings for the portion I was involved in. I really think they may be scared to lose more people. Indications are raises will be low (3-5% range for most, more for 4/5 rated people) Bonuses are probably non-existent for the masses. Annoucements of promotions for other levels will be made in August (staff to senior, senior to manager, manager to senior manager) they will also do comp increase discussions then. Effective 10/1…


So despite Ernst & Young re-reassuring merit increases the 3-5% for the meaty part of the curve and no bonuses isn’t exactly what “the masses” were expecting.

That being said, this office may be catching some bad luck since we that at least one E&Y partner was confident that the raises would beat PwC’s.

Although, some lucky E&Y soldiers have seen some “spot bonuses” for their hard work but it’s not clear how widespread that generosity is.

On a marginally-related note, we’ve received word that the partner promotions were announced but we’re still trying to run down some details. Get in touch with us if you’ve got the scoop on the new partners, what you’re hearing about comp in your office and discuss below.

UPDATE, Wednesday June 16th: A couple more accountants familiar with E&Y have their own take on the comp situation:

I heard that we “we’re not going to be disappointed with raises” here at EY. I don’t know what that means. And I tend to believe, that as you posted today, 3-5%, is a more realistic view of what’s going to happen (though that’s just my own pessimism).

and that is coupled with another source, “Haven’t heard anything further on comp other than ‘moderate.’

Continue attempting to decipher the latest. As you were.

Promotion Watch ’10: Latest Details on KPMG’s New Managers

From a Klynveld Quaker:

In recent meetings with PA Business Unit leadership with all audit staff (i.e. A and SA’s), we were told that of the 32 inidivudals up for promotion to Manager in the combined three offices (Philly, Harrisburg, Pittsburgh), that 22 were officially promoted. Of the 10 that weren’t, at least 1 just came back from international rotation, and either 2 or 3 (can’t remember which) hadn’t passed the CPA exam and therefore couldn’t be considered for promotions. All raise and bonus theories were squashed (as to hard percentages), though we were told to expect some form of raise as well as variable comp at FYE.


So just a shade better than two-thirds of the Keystone KPMGers eligible for manager will be in the new manager class. As you may remember, this is pretty close to the breakdown for one office in the Rockies but a little less than an office in the northwest.

Since the firm has four months to go in its fiscal year, the fact that the local leadership wouldn’t even give a hint comes as no surprise. That said, it hasn’t stopped people from speculating about what they think the increases will be. We encourage you to share what you know, what you’ve heard, or your own wild-ass guess. And keep us updated with the latest in your office.