The U.S. numbers are out, $10.7 billion, according to Deloitte’s U.S. website but the global page still only has the fiscal year ’08 numbers. The U.S. numbers are essentially flat from fiscal year ’08 revenue of approximately $11 billion.
We don’t really know what the problem is but we understand that math is hard sometimes so we’ll just wait patiently until the global numbers come out. God knows we’d have pandemonium if Deloitte was a SEC registrant filing the 10-K but hey, that’s one big advantage to a private company: We’ll report our revenue when we’re damn good and ready so you can all piss off.
Fine. We can wait.
In the meantime, some interesting data that is presented on the U.S. page so far includes:
• “Staff” dropping 1,490 while “Partners” went up 14 from FY ’08 to FY ’09
• Two offices were either closed or consolidated as the number went from 92 to 90
• Total number of CPA’s went up over 3200 from approximately 8,700 to just under 8,900
So at first glance, it appears that Big D had a similar ho-hum year to E&Y but we’ll withhold final judgment until the global numbers come out. Feel free to speculate on the delay of the global numbers or if you dare to eat donuts that look like a Smurf/Braveheart reenactment occurred on them.
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Sharon Allen Copes with Travel By Staying Hydrated, Listening to Kenny Chesney
Deloitte’s Sharon Allen recently had a little chat with our friends at FINS as part of their coverage of Women in the Workplace series over the next two weeks. Ms. Allen will be coasting into retirement as her second term as the firm’s Chairman (her preferred term) comes to end.
The Allen interview covers all kinds of fun stuff so let’s get to it, starting with those pesky regulators:
Some of us are still getting comfortable to having the PCAOB sticking their beak into audits:
The public accounting arena has indeed changed a lot. It’s now a regulated profession with oversight that’s provided through the Public Company Accounting Oversight Board. We are still, both the regulator and the profession, trying to work through that, with the common objective of improving audit quality. We’re learning how to work within a regulated environment that some years ago we just didn’t live with.
None of the firms chose to be the “Big 4” it just sorta worked out that way:
Just last week, we were talking at our global board meeting about how the profession got narrowed down to this number to begin with. The last reduction wasn’t the choice of the profession with [Arthur] Andersen out of business.
And speaking of four, she’s pretty comfortable with that number:
You have to have concentration of enough business to service the clients properly. If you spread that across eight firms, there just isn’t enough that supports that kind of that activity. In some of the major countries, the additional number of firms make sense, but when you look at it across the world, it doesn’t work. We’re not opposed to the competition; there are next-tier firms that are very good, and we encourage them to be in the mix in terms of proposal opportunities. It’s healthy. But the reality is the concentration will and probably should continue.
Term limits have somewhat led to SA’s retirement but there’s at least one person who’s especially happy about her quitting early:
I’m approaching the end of my second four-year term as chairman. We have a limit of two terms. While I’m not at mandatory retirement age yet, I concluded that it’s a really good time to make this move. I’ve had a fabulous 38-year career. But I’m also very comfortable with the transition leadership and the state of the firm. It’s a good time for me to leave at the top of my game. My husband is looking forward to spending more time with me.
FINS went ahead and asked Allen about the leadership election process, even though they already knew how the process went down.
We have a nomination process that we undertake. We interview through a nominating committee chosen by the board. They interview about 1,300 partners for their input on the type of attributes they’d like to see in the chairman and CEO positions. Then the committee interviews some individuals who match up with those qualities and ultimately proposed the nominated person.
One of the biggest challenges Allen has faced as Chairman was dealing with this clusterfuck of an economy. Luckily for the Green Dots out there, Deloitte management saw this coming and was able to save a bunch of you:
We were a little ahead of the game in anticipating the downturn that allowed us to prepare well for the difficult times to come. We had some reductions in our workforce, but they were not as substantial as they might have been had we not appropriately planned for the downturn.
And as a high-flying executive, there has to be coping mechanisms:
[Julie Steinberg of FINS]: How do you handle all the travel you do?
[Sharon Allen]: I drink a whole lot of water. I’m also fortunate to be able to adjust to time zone changes relatively easily. I work on domestic flights, and I do take my iPod and my computer.
JS: What are you listening to these days on your iPod?
SA: I’m a country music fan.
Chesney just came to mind for some reason (FYI Sharon: I can get you into the sold-out Red Rocks show, so reach out if you’re interested). But maybe she’s more of Toby Keith person, I can’t possibly know not having had the pleasure of seeing what ended up on the cutting-room floor. You’re invited to speculate as to artists (I’m pulling for Willie Nelson myself) and react to anything else you see above.
Deloitte’s Sharon Allen on Big Four Domination, Self-Promotion and the Corporate Lattice [FINS]
Earlier: Deloitte’s Sharon Allen Never Misses Date Night, Discovered Early on That She Wasn’t Meant to be a Car Hop
Deloitte Canada Fined $350,000 By the PCAOB For Fudging Audit Workpapers
Someone lit a fire under the asses of those who work in the PCAOB enforcement […]
Duoyuan Printing Is All Kinds of Screwed Up After Firing Deloitte
By “all kinds of screwed up” we mean “screwed 17 ways to Sunday”. After firing Deloitte last week, two top DY executives (CEO Christopher Holbert and CFO William Suh) have bailed, DYP shares are in the tank (down 47% as of publication) and, oh, they’re going to need to find a new audit committee chairman as their last one, James Zhang, ran for the hills.
Before running, however, he sent this really nice note explaining his motivations:
To: The Board of Duo Yuan Printing(DY).
6th Sept, 2010.
Dear Mr. Chairman and the follow directors of the Board:
Subject: My resignation as Company Audit Committee (AC) Chairman and Independent Director with immediate effect.
It has been almost one year since DY listed in the NYSE. I have to say that working closely with the Chairman, CEO and CFO of the company has been a great pleasure for me.
From Roughly one month ago, I got the phone call from Frank Li, the Audit Partner of Deloitte (DT) to express concerns to the Audit Committee over several financial irregularities and management control weakness. After hearing the full story, I immediately called an AC meeting and upon receiving unanimous approval from the AC as a well as support from the Chairman, the AC immediately engaged Latham Watkins, the US Law Firm, to handle the independent investigation not only to report back to the AC, but also as a part of the audit process requested by DT to give an opinion to the 2010 DY company financials. As our Chairman put it in the board Meeting just now that maybe due to the cross culture differences between US style work and maybe because of the second tier management don’t fully understand the US listing requirements, the investigation has not progressed in the last month. This delay could potentially render the company not filing its annual financial statements on time to the SEC.
In the past week, the Management has suggested to change the auditors of the company from DT to Frazer Frost (FF) who was the company prior auditors. This proposal has just been resolved in the full board meeting and Full AC meeting with voting taking place of 4 against 3 in favor and 2 against 1 in favor.
As the AC chairman and independent Director of the company, I respect the company democratic decision process as stipulated by the company Memorandum and Articles of Association. However, as a qualified UK Chartered Accountant and a trained Professional, I have brought to the attention of the board the following potential risks related to the change of auditors. These risks can be summarized as follows:
1. FF has not yet signed engagement letter with the company which is a risk to the company.
2. Change of auditors during the investigation process could potentially lead to further investigation from the SEC.
3. To change from a Big4 audit firm to a non-Big4 could have very negative impact in the investment community in terms of corporate governance thus lead to potential share price drop and subsequent US class law suit.
4. Even the Company US counsel has indicated in the meeting against change of auditors at this particular time frame.
Keep it classy, JZ, and good luck wherever you end up after this disaster of a company.