Inb4 someone starts screeching about clickbait and how we sold out because we used to be cool but now we’re shilling for webcasts, shut the fuck up. No one paid for us to mention this, rather we’re posting about it just in case you’ve missed the numerous tweets and announcements and other shilling already done to promote it. Plus TPTB force me to write about the CPA exam at least once a week and this is all I’ve got, barring any public displays of hostility toward NASBA.

OK so here’s the deal. Mark your calendars for this Thursday, May 2. This worldwide event will cover CPA exam strategies, frequently asked questions, and a Q&A session with staff from the AICPA and NASBA.

Since we’re typical xenophobic Americans, we humbly suggest you attend the U.S. candidate webinar if you’re anywhere on this hemisphere, which starts at 1:30 pm EDT, but you can sign up for any of them regardless of location. According to the official event page on NASBA’s website, candidates (or interested third parties such as professors or, say, drunken accounting tabloid writers) can attend any of the webcasts that fit your schedule, but each of the webinars will cater to candidates from different parts of the world. So hey, good news for all the weebs out there, there’s even a Japanese cast for y’all.

The webinar schedule is as follows:

• Japan CPA Exam Candidate Webcast (7:00 pm JST)
• Other International CPA Exam Candidate Webcast (1:00 pm GMT)
• U.S. CPA Exam Candidate Webcast (1:30 pm EDT)

HEY. So seriously, if you have the time, or even if you don’t, I would suggest carving out a chunk of your Thursday to attend this if you are currently studying for the exam, graduating soon, or hell, even if you are an accounting major who is a bit of a way off from that part of your professional journey. These things don’t happen all the time and you have no way of knowing when it’ll happen again. Nothing they’re going to tell you will guarantee you’ll pass the exam, but you might as well learn a thing or two to at least make the process slightly less daunting.

To register, just follow this link. Just give them a little bit of your info and off you go.

Can’t attend? Don’t worry, we’ll catch you up on what you missed when all’s said and done.

The post Forget GoT, This Upcoming Webcast is the Hottest Streaming Event of the Year (for CPA Exam Candidates Anyway) appeared first on Going Concern.

2019 is supposed to be a record-breaking year for initial public offerings. At least that’s what the experts have been telling everyone. Barrett Daniels, Deloitte’s national IPO services leader, said the IPO market in 2019 “could end up being historic,” while Jackie Kelley, EY Americas IPO leader, said “this is going to be the best year for IPOs we’ve seen in ages.”

Companies that are expected to go public sometime this year include:

• Uber
• Palantir Technologies
• Airbnb
• Slack
• Postmates
• WeWork

But 2019 came in more like a lamb than a lion, due primarily to the government shutdown at the beginning of the year. According to Audit Analytics, between Jan. 1 and March 31, 40 IPOs raised more than $7.7 billion, a decrease of about $10 billion from the first quarter of 2018 and about $1.7 billion less than the fourth quarter of 2018.

You may have heard of the two companies with the largest IPOs in the first quarter:

• Lyft (raised $2.3 billion)
• Levi Strauss (raised $623 million)

Both of these deals were audited by PwC, by the way. In fact, the three IPOs audited by P. Dubs raised nearly $3.1 billion, the highest amount of total proceeds in the first quarter among audit firm clients, according to Audit Analytics’ analysis.

Withum ranked second in terms of proceeds, with its clients raising more than $1.4 billion, while EY ranked third, with its clients raising more than $1 billion in Q1.

And of the 40 IPOs in the first quarter, the Big 4 audited 17, which was 42.5% of the IPO market.

BUT! One non-Big 4 firm audited the most IPOs (eight, with a total of $896 million in proceeds) during Q1.

That

Firm

Was

:

This really isn’t too surprising, as Marcum completed 25 IPO audits last year, finishing 2018 as the top-ranked non-Big 4 IPO audit firm and tying for fourth place overall.

Here’s a chart from Audit Analytics showing the IPO auditor market share for Q1:

Some of the “other” firms, according to an analysis by Renaissance Capital, include:

• Grant Thornton: 2 IPOs, $331 million in proceeds
• UHY: 1 IPO, $50 million in proceeds
• Squar Milner, 1 IPO, $25 million in proceeds

Related articles:

10 Tips on How Controllers Can Survive Their First IPO
Supporting the CFO Through the IPO Process Is a Big Task for Controllers
No Matter the Timeline, Controllers and Their Teams Must Be Ready When the IPO Window Opens

The post Which Firm Topped the Big 4 in IPO Audits in Q1 of 2019? appeared first on Going Concern.

On this week’s episode of “KPMG Did Something Bad” …

A U.K. regulator on Tuesday fined KPMG LLP and three executives after an investigation that found misconduct in relation to the audit of financial statements of a Lloyd’s of London insurance syndicate.

The Financial Reporting Council, Britain’s watchdog for accounting and audit, fined KPMG £6 million ($7.8 million) and “severely reprimanded” the Big Four accounting firm for its failings in relation to audits of Lloyd’s Syndicate 218, a motor insurance provider.

The investigation zeroed in on KPMG U.K.’s audits of the 2007, 2008, and 2009 financial statements of Syndicate 218, which is also known as Equity Red Star Insurance.

Syndicate 218 had been bleeding money for several years due to a large number of personal injury claims.

KPMG put the audit in the hands of partners Mark Taylor and Anthony Hulse. Whoops! Bad move.

KPMG, Mr. Taylor and Mr. Hulse made insufficient inquiries into Syndicate 218’s processes to review insurance claims, and didn’t take action when reserves used to cover these claims declined, according to the FRC.

“We are disappointed that aspects of our 2008 and 2009 audits were found not to have met the standards set by our regulator,” a KPMG spokesman said. KPMG has since overhauled its approach to insurance audit, the spokesman said.

Taylor was fined £100,000 and will be required to have a second partner review his audits until the end of 2020, according to the WSJ. He also received a severe reprimand from the FRC.

Hulse, who no longer works for KPMG, received a fine of £100,000 and a severe reprimand. KPMG also agreed to conduct an internal review and to report to the FRC on aspects of its 2018 insurance audits.

Some dude from Equity Syndicate Management Ltd. was also reprimanded by the FRC.

Even though KPMG auditors have been on the struggle bus for quite some time now, the FRC decided now would be a good time to launch an investigation into why KPMG U.K.’s audit practice has been so bad.

The FRC will be examining KPMG’s risk management, controls, and the behavior of partners and other employees in the audit practice.

The FRC called it an “independent” investigation because it will be conducted by A&O Consulting, the consulting practice of international law firm Allen &  Overy LLP. But the FRC—which at this point has no fucks left to give because it will be abolished in less than a year in favor of the Audit, Reporting and Governance Authority—hired A&O despite its CEO, Sally Dewar, being an ex-Klynveldian, calling into question whether the review of KPMG’s audit practice will really be independent.

The FRC’s review of KPMG will be concluded during the course of this year and could result in recommendations for changes at the firm.

The post KPMG Just Can’t Stay Out of Trouble appeared first on Going Concern.

In an interview with the Australian Financial Review, Nicola Mansfield talked about why she jumped ship from Deloitte Australia recently to become the managing director of Interbrand, a brand consulting firm owned by global advertising company Omnicom Group.

Mansfield joined Deloitte in late 2015 after the Big 4 firm bought the brand and spatial design startup Mash Up, and served as a director in Deloitte’s experience design team.

When talking about her time at Deloitte, Mansfield was very diplomatic, even complimentary, saying she “will treasure” the three and a half years she spent there. But when you think of the white-collar sweatshops that are the Big 4, “creative” doesn’t come to mind, like, not at all, and you can kinda read between the lines of what Mansfield says.

“There’s a limit to the type of creative work you can do in the big four model. You can do the replicable creative work but you can’t do the higher-order stuff.

“If you are at peak intensity all day, there’s no time for the peaks and troughs that the true creative process requires. What you end up doing is taking off the peaks to meet the intensity.”

She said that the “radical, higher-order creative work” is incompatible with the level of work that staff are expected to charge to clients at a big four firm.

Mansfield isn’t the only Green Dot consultant who has left the bland-white walls of a Big 4 firm to join an Omnicom-owned agency, according to the AFR. Nathan Birch, CEO of Interbrand in Sydney, Australia, used to work for Deloitte Digital, and Mansfield took over as managing director of Interbrand from another Deloitte alum, Davy Rennie, who is moving to digital agency Tribal as national managing director.

Perhaps this quote from Mansfield is the most damning when it comes to the Big 4 firms sapping the creativity out of their employees:

The big four “are built to deliver constant output” and “others in the broader business did not understand about the creative process or the way we needed to work”.

“Staring at a wall, or chatting through an idea adds value to creativity, but because it doesn’t always appear productive, it is not always respected,” she said.

So, let me get this straight: If you’re not staring at your computer all day, chained to your desk, or if you’re talking to other members of your team, trying to come up with fresh, new ideas to make your firm not look like a stale piece of bread, then you’re not being productive. Got it.

I guess Life at Deloitte isn’t all that it’s cracked up to be.

The post The Big 4 Will Stomp On Your Creativity Like a Grape appeared first on Going Concern.

Welcome back to another installment of “GC Shits on Legitimate Accounting Publications For Writing Stupid Advice.” I’m your host Adrienne. In today’s episode, we’re going to destroy this recent Journal of Accountancy article about how to improve cross-generational communication in a professional setting.

Now that Generation Z has entered the workforce, colleagues at a single employer may range from those who came of age faxing to ones who posted their prom pictures to Instagram.

“We have five unique generations in the workplace,” said Lindsey Pollak, a multigenerational workplace expert and author of the forthcoming book The Remix: How to Lead and Succeed in the Multigenerational Workplace. “You could be working with someone 50 or 60 years older or younger than you.”

I mean, yeah, technically I guess you could have bright-eyed Gen Zers cozied up to some relic from the Silent Generation, but come on, let’s not be dramatic here. There’s no way some kid who was born in a world without the Twin Towers who’s working closely with someone born before World War II ended is in any way the norm.

Really, as is the case with most articles like this, it’s about “the olds” versus “millennials,” the latter of whom will start to turn 40 soon by most metrics but really encompasses anyone under the age of 40 who understands memes. Hopefully old people can figure out to communicate with us whippersnappers before we start pulling Social Security, assuming they leave any for us. For argument’s sake, however, the article uses the Pew Research Center generational boundaries as follows:

• Generation Z: born after 1997
• Millennials: born between 1981 and 1996
• Gen X: born between 1965 and 1980
• Baby Boomers: born between 1946 and 1964
• Silent Generation: born before 1945

Looks about right. Personally I don’t mind getting lumped in with millennials, although it’s kind of funny considering I have back problems, a heart condition, and rapidly graying hair. I digress.

How different are they? “One co-worker may remember when the color TV came out; the other one may only have known Netflix,” said Jason Dorsey, a Gen Z and Millennial expert at the Center for Generational Kinetics, a generational research and thought-leadership firm based in Austin, Texas.

This matters because the technology that’s popular as we grow up tends to shape our communication styles for life, Dorsey explained.

“There is no one perfect way to communicate across generations. They all have different norms,” he said. “These communication differences are really causing a lot of problems right now because they are so pronounced.”

No shit. And? I guarantee you the fact that a colleague grew up with Atari and I the original Nintendo doesn’t affect our ability to communicate with one another; assuming, of course, that we’re not completely socially inept and therefore completely incapable of carrying on conversations in a professional capacity.

The article goes on to suggest that communication protocol should be established to prevent awkward situations, such as a rowdy Gen Z employee blowing up the group chat with dank memes. Well duh, that should kind of always be the case. Additionally, it recommends to consider the individual rather than the generation, and figure out how each person in the office best communicates. OK, we’re still doing good here. Moving on.

Don’t try to sound like you’re older or younger than you are. “If you are a very formal Baby Boomer, don’t talk about being ‘on fleek,'” which is another word for perfect, said Pollak. “It’s just weird.” If you are 22 and you’re very informal, don’t use phrases like ‘It has come to my attention,'” she added.

JESUS LORD who is this written for? Please tell me there isn’t a 60-year-old professional alive who is unironically referring to anything as “on fleek?” TBH I don’t know anyone of any age using that phrase unironically, but maybe I don’t hang out with enough youngsters. No one in the twilight of their professional career should need to be told not to speak like an imaginary youth.

Look, this is all well and good and Lord knows accountants aren’t known for being cunning linguists, so of course a little advice on communication is welcome, but come on, stop overthinking it. Be professional, don’t be a jackass, don’t text people at 8 p.m. when they’ve long left the office and expect an immediate response. There, done. Ur welcome lol.

The post Here’s Another Article Advising Dumb-Ass Old People On How to Talk to the Youths at Work appeared first on Going Concern.

Through the years, we’ve done several “Best Cities for Accounting Jobs” articles. We think they are pretty worthwhile, especially for those of you youngins who are looking to get your foot in the door and want to live and work in the hustle and bustle of a big city. Or maybe you want to work in a large city but live in a suburb where you can start a family.

And, really, who’s not looking for a new or better job opportunity?

The folks over at AdvisorSmith recently released a report on the best cities in which accountants can pursue their careers. AdvisorSmith ranked the top 399 U.S. cities for accountants by using three variables, based on information from the U.S. Bureau of Labor Statistics and Sperling’s Best Places cost of living index:

• Density of accounting jobs per city
• Average annual accounting salary per city
• City’s cost of living

Based on that data, AdvisorSmith narrowed its list down to the 50 best cities for accountants. The firm also ranked its top 10 small cities, midsize cities, and large cities. You can find those rankings here, as well as the full top 50 cities list.

We are going to highlight the top 25 cities for accountants, which is heavy on the Texas and Alabama. So, break out your old Dale Earnhardt Sr. T-shirt, put on some George Strait, and take a look:

1. Springfield, IL

The state capital, home to the Illinois State Fair and a McDonald’s where I once knocked down its drive-thru clearance sign while driving a Penske moving truck. Springfield has 89% more accounting jobs than the average American city and an average accounting salary of $80,110, which exceeds the national average of roughly $77,920, according to AdvisorSmith. The city boasts a cost of living 13% below the average U.S. city. There are 1,750 accounting jobs in Springfield.

2. Parkersburg, WV

Located about three hours north of Bramwell, WV (seriously, that’s a real place), Parkersburg borders Ohio and is a city that Adrienne probably traveled to and/or through while playing “Fallout 76.” Accountants in Parkersburg earned an average salary of $76,920, and the city had a cost of living that was 17% below the national average. The city also hosted 68% more jobs for accountants than the average city. There are 540 total accounting jobs in Parkersburg.

3. Houston

The home of the Astros/Rockets/Texans/Dynamo boasts an average accounting salary of $89,270, 15% above the national average, while the cost of living is 7% below the national average. Additionally, Houston hosts 34,290 accounting jobs, which is 34% above the per-capita average.

4. Wilmington, DE

Accountants in Wilmington earn moderately more than the average salary, with pay of $81,430. There are 5,010 total accounting jobs in Wilmington, which is the largest city in Delaware, but the cost of living is 4% higher than the national average.

5. Midland, TX

With 1,140 accounting jobs, Midland has 48% more accounting jobs per capita than the average American city. Additionally, those accounting professionals earned an above-average salary of $83,600, and benefit from Midland’s lower-than-average cost of living (3% less). And if you have expertise in oil and gas, this is the place for you.

6. Dallas: $83,080, 32,880 jobs, 1% above COL national average

7. Denver: $81,650, 22,930 jobs, 26% above COL national average

8. Birmingham, AL: $73,070, 5,430 jobs, 16% below COL national average

9. Trenton, NJ: $84,860, 2,960 jobs, 13% above COL national average

10. Jefferson City, MO: $55,780, 1,130 jobs, 9% below COL national average

11. Montgomery, AL: $64,840, 2,150 jobs, 11% below COL national average

12. New York City: $101,520, 90,050 jobs, 46% above COL national average

13. Tulsa, OK: $75,380, 4,290 jobs, 13% below COL national average

14. Detroit: $82,430, 16,970 jobs, 11% below COL national average

15. Boulder, CO: $83,800, 2,730 jobs, 47% above COL national average

16. Columbus, OH: $74,630, 10,860 jobs, 9% below COL national average

17. Atlanta: $77,370, 28,690 jobs, 2% below COL national average

18. Huntsville, AL: $77,330, 2,280 jobs, 6% below COL national average

19. Charlotte, NC: $79,590, 11,940 jobs, 4% below COL national average

20. Cleveland: $75,850, 10,610 jobs, 7% below COL national average

21. Washington, DC: $93,900, 31,620 jobs, 35% above COL national average

22. Topeka, KS: $58,790, 1,330 jobs, 18% below COL national average

23. St. Louis: $76,860, 13,050 jobs, 9% below COL national average

24. Richmond, VA: $78,910, 7,260 jobs, 4% above COL national average

25. Pittsburgh: $72,000, 11,760 jobs, 9% below COL national average

The post Best Cities to Find a Job and Raise Your Little Accountants appeared first on Going Concern.

Exposure Drafts appears every other Wednesday. Send your accounting cartoon ideas to editor@goingconcern.com. You can follow Greg Kyte on Twitter.

The post Exposure Drafts: The Post-April 15 Forecast for Tax Accountants Includes an Extended Low-Pressure System appeared first on Going Concern.

A Dallas TV station obtained the audio recording of the 911 call made by now-former Dallas police officer Amber Guyger after she shot and killed PwC accountant Botham Jean in his apartment, in which she repeatedly tells the dispatcher that she thought she was entering her apartment.

Guyger, 30, is scheduled to go on trial for Jean’s murder beginning in September.

Guyger, who had just finished a shift but was still in full uniform, reportedly shot Jean once in the chest on the night of Sept. 6, 2018. According to published reports, Jean was sitting on his couch watching football before he was shot.

The police officer lived in an apartment one floor directly below Jean’s apartment. She told authorities that she parked on the wrong level of the South Side Flats apartment complex’s garage—the fourth floor instead of the third, where her apartment was located.

The door to his apartment was unlocked at the time, and it opened as Guyger tried to put her key in it. She told authorities that she thought she was entering her home and that the person in the darkened apartment was a burglar.

The 26-year-old Jean was a risk assurance associate in PwC’s Dallas office.

After she shot Jean, Guyger called 911 just before 10 p.m. In the audio recording, you can hear her tell Jean, “Get up, man” before the dispatcher answers the call. In a panicked voice, Guyger told the dispatcher that she was an off-duty officer and she needed EMS and the police sent to apartment No. 1478 at 1210 South Lamar. Guyger then said she thought she was in her apartment and she “shot a guy, thinking it was my apartment.”

Here’s an excerpt from that conversation:

Amber Guyger: Hi, this is an off-duty officer. Umm, can I get, I need EMS, umm, I’m in number, umm.

Dispatcher: Do you need police as well or just EMS?

Guyger: Yes, I need both.

Dispatcher: OK, what’s the address?

Guyger: Fuck. I’m at apartment number 1478. I’m in 1478.

Dispatcher: And what’s the address there?

Guyger: Umm it’s 1210 South Lamar, 1478, yeah, I…

Dispatcher: What’s going on?

Guyger: I’m an off-duty officer. I thought I was in my apartment and I shot a guy thinking that he was, thinking it was my apartment.

Dispatcher: You shot someone?

Guyger: Yes, I thought it was my apartment. I’m fucked. Oh my god. [To Jean] I’m sorry.

Dispatcher: Where are you at right now?

Guyger: I’m in. What do you mean? I’m inside the apartment with him. [To Jean] Hey, come on, man.

Dispatcher: What’s your name?

Guyger: I’m Amber Guyger. I need, get me. I’m in.

Dispatcher: OK, we have help on the way.

Guyger: I know but I’m, I’m going to lose my job. I thought it was my apartment.

Dispatcher: OK.

Guyger: [To Jean] Hey man.

Dispatcher: Hold on.

Guyger: Fuck.

Dispatcher: OK, stay with me. OK?

Guyger: I am. I am. I’m going to need a supervisor.

Guyger: [To Jean] Hey bud. Hey bud. Hey bud. Come on. [To dispatcher] Oh fuck. I thought it was my apartment.

Dispatcher: I understand. We have help on the way.

Guyger: I thought it was my apartment. Hurry. Please.

Here’s the full audio of the nearly six-minute conversation. NSFW.

The Dallas Morning News talked to Jean’s mother, Allison, after she listened to the 911 call, which she had not heard until this week, and she still thinks Guyger is a “cold-blooded killer” who was more concerned about losing her job than trying to help her son.

“She does not sound like she was trying to help him at all,” Allison Jean said.

However, Dallas attorney George Milner III, who has defended police officers accused of breaking the law, told the Dallas Morning News that the 911 call is “helpful for her” because it supports her statement to authorities that she thought she was in her own apartment. He said a defense to the murder charge can be that Guyger made a “mistake of fact”when she killed Jean.

But he added: “None of that changes the fact that Botham Jean is dead, and he shouldn’t be.”

Guyger was arrested and charged with manslaughter on Sept. 9, three days after she shot and killed Jean. Guyger was released from jail on $300,000 bond.

The Dallas Police Department fired Guyger on Sept. 24 for engaging in adverse conduct. She had worked at the department for nearly five years.

After two days of hearing evidence in late November, a Dallas County grand jury on Nov. 30 upgraded Guyger’s charge from manslaughter to murder. She turned herself in to authorities that afternoon and was released on $200,000 bond.

The post ‘I’m F*cked’: What Amber Guyger Told 911 Dispatcher After She Killed PwC Accountant Botham Jean appeared first on Going Concern.

Catching you up on the latest fraud happenings in the world of accounting.

Two Samsung employees arrested over alleged cover-up [Financial Times]
Two executives of Samsung’s biopharmaceutical unit were arrested earlier this week on suspicion of destroying evidence to cover up an alleged $3.9 billion accounting fraud.

The Seoul Central District Prosecutors’ Office in South Korea on April 29 arrested an executive and another employee at Samsung Bioepis, the biosimilar unit of Samsung Group, for falsifying and destroying evidence and violating the country’s audit laws.

The two unnamed employees are the first to be arrested after prosecutors launched a probe into the case in late 2018. South Korea’s Securities and Futures Commission, the country’s financial watchdog, had already ruled that Samsung Biologics violated accounting rules by intentionally inflating the value of affiliate Samsung Bioepis.

Prosecutors said the two employees arrested are suspected of destroying key accounting records and internal documents ahead of the investigation by financial regulators and prosecutors. They are also accused of manipulating accounting data before submitting the data to regulators.

They admitted to destroying the evidence on their own, but prosecutors are investigating whether their superiors told them to do it.

Celadon Group to pay $42.2M in restitution for accounting fraud [Compliance Week]
Indianapolis-based trucking company Celadon Group will pay back $42.2 million for filing materially false and misleading statements to investors and falsifying books, records, and accounts.

The SEC alleges that between mid-2016 and April 2017, Celadon avoided recognizing at least $20 million in impairment charges and losses—almost two-thirds of its 2016 pre-tax income—by selling and buying used trucks at inflated prices from third parties. Because of the alleged scheme, Celadon overstated its pre-tax and net income and earnings per share in its annual report for the period ending June 30, 2016, and in its subsequent public filings for the first two fiscal quarters of 2017.

The SEC charged Celadon with fraud on April 25, in addition to reporting, books and records, and internal control violations. The company admitted to those violations and agreed to a permanent injunction and to remediate the material weaknesses in its internal control over financial reporting.

Celadon has also agreed to pay $7 million in disgorgement, which will be deemed satisfied by Celadon’s payment of restitution in a separate action announced by the U.S. Department of Justice.

British Telecom’s Italian job had London roots, say investigators [Reuters]
In February, we told you that a criminal investigation was underway into a 2017 accounting fraud at the Italian unit of British phone company BT, in which two dozen people at BT Global Services, including its CEO, CFO, and head of Europe, allegedly knew about inflated revenues and made-up transactions, among other things. In addition, Andrea Alessandri, the partner who led the PwC team in charge of auditing BT Italia’s accounts, is accused of falsifying the audit.

Reuters revealed late last month that emails show for the first time why Italian prosecutors allege that BT executives were at the heart of the problem, contrary to the company’s assertions that managers at its head office in London knew nothing about the misconduct.

“A series of emails between the top financial executives of BT Plc and managers of the (Italian) unit point to the existence of ‘insistent’ requests by the leadership of the parent company aimed at achieving ambitious economic targets, even using aggressive, anomalous and knowingly wrong accounting practices,” Italy’s financial police said in a 353-page report.

For example, the report includes emails from Brian More O’Ferrall, the then-CFO of BT Europe and current finance director at BT Wholesale, the company’s business-to-business division, who asked colleagues in Italy to find ways of adjusting their accounts to boost profits.

Several BT shareholders have filed a class-action lawsuit in the U.S. alleging the company misled investors and failed to promptly disclose the financial irregularities. BT has moved to have the case dismissed.

The post Accounting Fraud Watch: Samsung Bioepis, Celadon Group, More on BT Italy appeared first on Going Concern.

Back in November, EY and Tennessee state officials made a big to-do about the Big 4 firm signing a lease at a new 10-story office building being constructed in the Music Row district of Nashville. And during that press conference, EY announced that it would be adding 600 jobs in Nashville over the next five years—200 technology-focused and 400 tax-related.

The Black and Yellow is expanding its tendrils in Music City with the opening of the new EY Exceptional Delivery Growth Engine Center, or EY EDGE, which will include software development, design, and testing, as well as professionals delivering technology-enabled, tax-managed services for clients, the Nashville Business Journal reported last November.

EY is supposed to move into its new Nashville digs this August. The firm already employs 300 people in Nashville, who moved to a new downtown location earlier this year.

So, how’s that new hiring going? Nashville Business Journal recently provided an update, and the good news is you still have time to honky tonk your way over to Nashville for an interview:

EY is one-third of the way done hiring for its new Nashville office, but executives are already eager to double that headcount.

The accounting giant is actively scouting the Nashville market to fill 120 open positions for its new EY Exceptional Delivery Growth Engine Center, which the company announced in November, according to Dan Thibault, who’s spearheading the expansion. That’s on top of the 110 people the company has already hired for its new office, which will focus on using technology to create efficiencies for EY clients worldwide.

After the firm moves to Music Row in August, Thibault said EY plans to again double its local headcount within 12 to 18 months. Company officials previously said they hope to have all 600 jobs filled within five years.

Thibault told the NBJ that EY is looking for candidates in a variety of fields, from tax professionals and compliance officers to data scientists and software engineers.

“On the hiring side, I’m very optimistic about the technology side,” Thibault said. “I thought the technology side might be a little harder to [hire for] … but when we hit the ground in Nashville, we hit it hard.”

Of its new hires, 75 positions are technology-focused, with the remaining centered on the company’s tax business. The company previously said one-third of its new Nashville jobs would be technology focused.

So, those of you who live in or near Nashville, sharpen up those resumes and get on it.

The post Hiring Watch ’19: EY Is Looking for Warm Bodies to Fill New Tax and Tech Jobs In Nashville appeared first on Going Concern.

Maybe it’s because the PCAOB had a new chairman and a whole new board at the beginning of last year. Or maybe it’s because the audit regulator’s longtime enforcement chief bolted last May and the position still hasn’t been permanently filled. Whatever the reason, the PCAOB settled only 13 enforcement actions against accountants in 2018, down 63% from the 35 actions settled in 2017, which was the most in PCAOB history, according to a new analysis from Cornerstone Research.

The 13 cases were the lowest amount settled by the PCAOB since 2013, when the regulator settled only 11 enforcement actions.

The SEC wasn’t much better in 2018, as it finalized 32 enforcement actions against accountants, 20% less than the 40 in the previous year.

Cornerstone Research said the decrease in SEC settled enforcement actions was due to there only being 16 actions brought against CPAs employed by SEC registrants, down from 27 in 2017 and the lowest number of actions in the past six years. However, actions against auditors and audit firms rose slightly, from 12 in 2017 to 14 in 2018.

But the SEC is showing signs of buckling down more on accountants and auditors, as the agency settled more cases in the second half of 2018 than in the first half. And the SEC is continuing to target individuals more than audit firms. In 2018, 24 of the 32 settled cases were against individuals, and in six cases, the respondents were both individuals and firms.

Two of those six cases involving individuals and firms were Crowe and BDO USA, which settled with the SEC as a result of their crappy auditing.

The PCAOB was stuck in an enforcement drought during the latter part of 2018, as there were no settled actions involving U.S. auditors or audit firms after Oct. 2., according to Cornerstone Research.

Seven of the 13 cases were settled against auditors and audit firms, which is down significantly from prior years, as this graph from Cornerstone Research shows:

Deloitte & Touche was the biggest firm busted by the PCAOB last year for doing a lousy job auditing Jack Henry.

Seventy percent of final PCAOB actions involved both an audit firm and one or more auditors in 2018, up from the 2013–2017 average of 54%.

All told, monetary settlements in final SEC and PCAOB actions were levied against 32 of the 67 individual and audit firm respondents (48%), but totaled less than $3.3 million.

The post It Seems the PCAOB and SEC Are Giving Accountants the Benefit of the Doubt More These Days appeared first on Going Concern.

I tried earlier this week to gently encourage you little shits to attend the webcast held Thursday by folks from NASBA and the AICPA who think CPA exam candidates deserve to be as informed as possible, so hopefully you took my advice and were in attendance.

Now, for those of you who had to tend to your grandmother in the hospital or simply disregarded my advice because you think I’m stupid, I tuned in and took notes so I can report back on the important bits. Don’t say I’ve never done anything for you.

Overall, there wasn’t anything particularly groundbreaking revealed during the hour-ish webcast, although there was one tidbit you might be interested in. AICPA’s Joe Maslott, who is with the Examinations team, said that while the exam is currently offered on a “window” schedule, year-round testing could be a possibility “in the future.”

So yeah, maybe those of you currently tackling the exam don’t and shouldn’t care about something that you may or may not see during your active test taking, but who knows, maybe some now-16-year-old future accountant will Google this article in the future and be informed. Or something.

One thing to note from the webcast is that the AICPA and NASBA really, REALLY want you to use the resources they’ve developed to educate yourself on exam content. Contrary to popular belief, they don’t want you to fail miserably and end up flipping burgers at Wendy’s; they do genuinely want candidates to be prepared and well-informed. That said, a viewer poll during the webcast revealed that only 11.2% of participants have accessed and thoroughly reviewed the CPA Exam Blueprints, a pretty bad-ass document that highlights just about everything you need to know.

Back in the day, candidates were stuck with the Content Specification Outlines, a behemoth chunk of information slapped into some semblance of order. As pointed out during the webcast by Pat Hartman of NASBA, the CSOs sucked pretty hard compared to the snazzy Blueprints, hence candidates should be grateful for the effort. OK, that’s not exactly what she said, but it was alluded to.

In the Blueprints you will find:

• Content organized by Area, Group, and Topic along with score weighting.
• Sample task statements that represent what you may be asked to do when testing.
• Skill levels at which tasks are tested.
• Reference materials that support the sample task statements.
• Number of item types you must complete (multiple-choice questions, task-based simulations, and written communication tasks).
• Score weighting of each item type.

All shit that you need if you don’t want to go into this thing completely blind. So yeah, use it. You can download the Blueprints directly from the AICPA, as well as access other candidates resources at their CPA exam information page.

One other point beaten to death like a two-legged horse was candidate preparation. I’m not talking about review, I’m talking about being prepared for exam day.

“Biggest issue we still have is people forgetting to bring their NTS [Notice to Schedule],” Hartman said.

She recommends printing the NTS out and keeping it in your wallet as soon as you receive it because you will not be able to take the exam without it.

They also touched on what is and isn’t allowed at Prometric on test day, which boils down to this: bring your pretty little behind and not much else to the exam. As always, phones and any other crap you don’t leave in your car are stored in a locker, and don’t even think about checking your phone on break or you’re going to be out on your ass and one step closer to an illustrious career in food service. An on-screen calculator is provided, but if you need a larger one due to visual issues, contact NASBA. In fact, if you need any sort of accommodation due to disability, just talk to NASBA in advance of your test date and they will make sure your Prometric test center is prepared to hook you up.

What’s the biggest takeaway from the webcast? There’s no magic order in which to take your exam sections, the AICPA doesn’t want you to fail, and candidates should use the numerous resources that have been developed with them in mind. Bam.

The post Here’s What You Missed From This Week’s Mega CPA Exam Information Webcast appeared first on Going Concern.

A look at the best of the worst accountant malfeasance around the globe over the past month or so.

CA throttles wife to death, tries to pass it off as suicide, arrested [Times of India]
Here is a disturbing story out of India: Jaiveer Singh, a 52-year-old chartered accountant, was arrested on May 1 for allegedly strangling his 47-year-old wife to death in their apartment in Greater Noida City, India, on April 15.

Authorities said an autopsy revealed the cause of death of Singh’s wife, Kusum, was strangulation, not suicide, as Singh had told police. Reports say that Singh called in his 24-year-old son and 20-year-old daughter into the bedroom the morning of April 15 to show Kusum hanging from a ceiling fan.

BUT …

“In fact, it was Kusum’s brother Mahaveer Rausa who had informed us on April 16, a day after the crime, that the accused was on his way to Bulandshahr to cremate the body,” said Arvind Pathak, SHO of the Knowledge Park police station.

“We had immediately contacted the local police, stopped the cremation and sent the body for post-mortem,” Pathak added.

Rausa told the Times of India that there’s no way his sister would have hanged herself in that bedroom because, “My sister used to sleep separately with her daughter.”

Director of Deep Purple royalty management firms jailed for stealing £2.2million from company accounts [SurreyLive]
Dipak Shanker Rao, the longtime accountant for ’70s rock band Deep Purple, was sentenced to six years and four months in prison on April 30 for stealing £2.2 million from two companies that managed the royalties for the band, best known for their stoner anthem “Smoke on the Water.”

Rao, 71, transferred large sums of money from the accounts of Deep Purple Overseas Ltd. and HEC Enterprises Ltd. into his own. He then invested the money into a number of money-making schemes, all of which turned out to be scams and resulted in Rao losing the money.

Prosecutors said Rao’s thieving began in 2008 and lasted until 2014 when the children of Deep Purple’s former manager Tony Edwards voiced concerns about the companies’ accounts after inheriting parts upon their father’s death in 2010.

Rao pleaded guilty to two offences—fraud by abuse of position and transferring criminal property—on March 29.

Accountant buys $6-million in Apple iPhones and iPads on company credit cards and nobody notices for five years [National Post]
Just in case you missed this story out of Canada last month: Nadia Minetto, who was the accounting manager for Wescom Solutions in Mississauga, Ontario, charged 5,321 iPads and 4,942 iPhones, worth more than $6 million, to her company American Express card over a two-and-a-half-year period and sold them to a guy who would resell them either through his electronics store in a mall north of Toronto or to Hong Kong companies or to wholesalers. It wasn’t until a consultant was hired in 2014 that the company discovered Minetto’s wild spending sprees.

Former Cascade County Sheriff’s Office accountant sentenced to prison for theft [KRTV]
An accountant-gone-bad incident in Montana:

A former Cascade County Sheriff’s Office accountant has been sentenced for taking money from the Sheriff’s Office while employed there.

Michele Levesey Woods, also known as Michele Levesey Saubak, was sentenced to three months in federal prison. She is required to pay back over $31,614.37.

Woods stole the money over a two-year period to feed her gambling addiction, according to court documents.

She has since started a 12-step program and paid back $5,000.

Accountant stole over $73,000 from Syracuse company, district attorney’s office says [Syracuse.com]
Deborah Sabotka, a former accountant of Syracuse Signal Systems in New York, was accused of stealing more than $73,000 from the traffic signal company.

Sabotka, 60, was charged in late March with second-degree grand larceny, a felony, Onondaga County First Chief Assistant District Attorney Rick Trunfio said in April.

She is accused of stealing $73,432.73 between Aug. 22, 2017 and Oct. 26, 2018. She allegedly deposited the funds into her personal Discover account on several different dates, times, and amounts, according to court documents.

The theft was discovered by the current controller of Syracuse Signal Systems as well as an outside accounting company that conducted a forensic accountant report.

Lansing accountant pleads guilty to bankruptcy and mail fraud [The Ithaca Voice]
Andrew LaVigne, an accountant in Lansing, N.Y., pleaded guilty in federal court in late March to bankruptcy fraud, mail fraud, and money laundering.

Authorities said LaVigne used his CPA practice to conceal millions in assets:

When he filed for bankruptcy [in 2004], he owed about $7.6 million to more than 80 unsecured creditors after what the U.S. Attorney’s Office said was “a failed scheme to use their money to purchase sports and entertainment memorabilia and resell it for a profit.” During his bankruptcy, he reportedly claimed his home as his only asset and did not pay back the 80 investors he owed. With his guilty plea Wednesday, he admitted to using his CPA practice’s bank accounts to conceal between $3.5 and $9.5 million in assets from the United States Bankruptcy Court and the Office of the United States Trust, which he laundered by depositing funds unrelated to his CPA practice into his business accounts. He then used that money for his own benefit, including to buy sports memorabilia, the U.S. Attorney’s Office said.

And in a separate mail fraud scheme, LaVigne admitted to defrauding a senior-citizen client of more than $1 million.

The post Accountants Behaving Badly: Strangling Wife, Stealing Money From a Band, Shopping Spree on Company’s Dime appeared first on Going Concern.

Last week, we perused a report from AdvisorSmith on the 50 best U.S. cities in which accountants can pursue their careers and gave you the top 25. Two of the variables used by AdvisorSmith for its ranking were average annual accounting salaries per city and cost of living, so let’s focus on those today.

Using data from the U.S. Bureau of Labor Statistics and Sperling’s Best Places cost of living index, AdvisorSmith reviewed the average annual salaries, total number of accounting jobs, number of accounting jobs per capita, and the cost of living for 399 cities and whittled its list down to the top 50.

Based on its analysis, AdvisorSmith said the average salary for accountants was about $77,920. Of the 50 cities in its ranking, 18 topped that amount. However, only five of those 18 cities have a cost of living below the average U.S. city.

Here are those 18 cities, with their average annual accounting salary and their cost of living index in parenthesis:

1. New York City: $101,520 (46% above COL national average)
2. Washington, DC: $93,900 (35% above COL national average)
3. Bridgeport, CT: $89,640 (50% above COL national average)
4. Houston: $89,270 (7% below COL national average)
5. Trenton, NJ: $84,860 (13% above COL national average)
6. Boulder, CO: $83,800 (47% above COL national average)
7. Midland, TX: $83,600 (3% below COL national average)
8. Dallas: $83,080 (1% above COL national average)
9. Chicago: $82,660 (9% above COL national average)
10. Detroit: $82,430 (11% below COL national average)
11. Philadelphia: $82,370 (%11 above COL national average)
12. Denver: $81,650 (26% above COL national average)
13. Wilmington, DE: $81,430 (4% above COL national average)
14. Springfield, IL: $80,110 (13% below COL national average)
15. Burlington, VT: $79,600 (20% above COL national average)
16. Charlotte, NC: $79,590 (4% below COL national average)
17. Baltimore: $79,100 (12% above COL national average)
18. Richmond, VA: $78,910 (4% above COL national average)

Related article:

Best Cities to Find a Job and Raise Your Little Accountants

The post Compensation Watch ’19: Highest-Paying Cities Don’t Give Accountants the Most Bang for Their Buck appeared first on Going Concern.

First Nashville, now the EY hiring caravan is heading to New Orleans.

Ernst & Young, an international accounting and business services firm, will create an administrative support center in New Orleans that will add 200 employees in the next three years, city, state and economic development officials announced Monday (May 6).

The center will be part of an expansion at Ernst & Young’s local offices, at 701 Poydras St. In addition to 175 workers for its National Executive Assistance Team (NEAT), the company will add another 25 employees in its risk services division.

Last October, EY told Accounting Today that the firm had a recruiting goal for fiscal year 2019 of 15,700 new hires in the U.S.—6,300 “experienced and executive-level positions” in full-time capacities, as well as 9,400 students for jobs and internships—which we were skeptical about, given that EY only increased its headcount worldwide by 14,000 people in FY 2018.

But Dan Black, global recruitment and hiring leader at EY, reiterated that ambitious 15,000-person hiring goal during an appearance on Bloomberg TV on May 2:

“In my own organization this year, in the U.S. alone, we’re going to hire over 15,000 people. That’s actually slightly up from last year, and that number globally is actually over 80,000 hires for us.”

EY currently has 180 people working in NOLA, so the Black and Yellow will more than double its headcount there in the next few years.

Will EY get to that 15,000-person hiring goal in the U.S. and 80,000 new hires globally this year? I have my doubts. But give EY credit for sending media alerts to the press in Nashville and New Orleans so local reporters can cover these dull press conferences and write articles about the firm’s expansions and new hires, so dumb websites like this one can write about them after the fact.

[NOLA.com]

The post Hiring Watch ’19: EY Is Looking for Some Fresh Faces In New Orleans appeared first on Going Concern.

Get excited, Tax Twitter, you’re about to get your moment in the sun. Granted it’s a moment of total panic, but still, a moment.

So, if you haven’t heard, CCH has been borked since yesterday. When we say borked, we don’t mean “some users are having access problems,” rather the entire thing has been nuked to hell. Like POOF.

It appears this was a prophylactic measure by Wolters Kluwer, though why they would feel compelled to take down the whole enchilada is speculation we’ll save for a minute.

Need CCH support? Yeah, good luck with that.

Late last night, Wolters Kluwer made a statement on Facebook that, as expected, was greeted with a cacophony of criticism and littered with angry emojis.

On May 6, 2019, Wolters Kluwer experienced network and service interruptions affecting certain Wolters Kluwer platforms and applications. Out of an abundance of caution, we proactively took offline a number of other applications as we continue to investigate any impact. This prevented us from having adequate time to provide you advance notice, and for that we sincerely apologize.

We are working diligently around the clock to restore service as soon as possible.

We apologize to our customers for the inconvenience and appreciate your patience. We will provide further updates as they become available.

Obviously we’re not going to be able to get someone from CCH on the phone to ask what’s up, so as is tradition around here, we will instead fuel the rumor mill and speculate wildly as to what could be so bad CCH had to go bye-bye to hide from it.

Let’s start in /r/sysadmin. The popular theory is obviously some type of breach (“hackers” for you olds) or virus. Friendly reminder, people on Reddit are often full of shit so take this with a giant grain of salt.

I have a buddy who works there who said the Canada Office shutdown due to a potential virus outbreak, the other locations shut down as a precautionary.

EDIT: I learned that it may have made it out to some of the other locations before they got most end users to shutdown their systems. I saw another comment here saying they thought it was Megacortex, which would likely mean someone with Domain Admin rights had their credentials ripped off/stolen. I expect the next few days to be quite interesting, as this is no small company.

Someone who probably should have kept his mouth shut and stopped powerleveling on Reddit chimed in in a now-deleted post confirming the cooties in the system.

Sounds similar to what my wife said (she’s an employee). She they found the malware/ransonware in several locations across their network including the New York, New Jersey, Canada and Minnesota office. I know they use Dell for a lot of the cloud based systems.

Here’s another powerleveling blabbermouth who must have rethought doxing himself in the middle of a security breach as he later deleted his comments:

I’m a system engineer with WK. The issue is quite large and is not just affecting CCH Axcess, but rather all customer facing products across the health, Tax & Accounting, Governance, Risk & Compliance, and Legal & Regulatory. My office was not affected directly but was told to turn off our backup software and turn off all domain controllers effectively ending our work day.

He went on to “confirm” the attack is of the MegaCortex ransomware variety, which everyone has been assuming anyway. Again, this is all rumor so no one knows at this point, nor should one expect Wolters Kluwer to come out and say they were hit by ransomware while the attack is still in progress. If, of course, that’s what’s happening.

It seems a lot of people are twiddling their precious little thumbs waiting for CCH to come back.

We’ll update when we know more, and in the meantime … I dunno, not really much that can be done.

The post What In the Hell Is Happening to CCH? appeared first on Going Concern.

Here we go again …

A U.K. regulator on Wednesday fined KPMG LLP and a partner at the firm after they admitted to misconduct in relation to the audit of financial statements of Co-operative Bank PLC.

The Financial Reporting Council, Britain’s watchdog for accounting and audit, handed KPMG a fine of £5 million ($6.51 million) and “severely reprimanded” the Big Four accounting firm for its failings in connection with the audit of financial statements of Co-op Bank for 2009, the year the lender merged with Britannia Building Society. The penalty was reduced to £4 million because KPMG agreed to settle.

So in just a little more than a week, KPMG U.K. has been fined £11 million ($14.3 million) by the FRC because of bad auditing. What a shitshow.

How much actual auditing was lacking in this latest effort? The Wall Street Journal reported:

The FRC said KPMG and its audit partner Andrew Walker admitted that their conduct fell short in two areas: the audit of fair-value adjustments of loans in the commercial loan book acquired from Britannia, and the audit of a series of securities acquired from Britannia called leek notes.

KPMG and Mr. Walker failed to obtain “sufficient appropriate audit evidence” and to exercise “sufficient professional skepticism,” the FRC said. They also failed to inform Co-op Bank about inadequacies in disclosures relating to the leek notes.

The FRC handed down the following punishments:

• KPMG was fined £5 million (discounted for settlement to £4 million) and severely reprimanded. The firm will also pay £500,000 toward the FRC’s costs.
• Walker was fined £125,000 (discounted for settlement to £100,000) and severely reprimanded.
• All of KPMG’s audit engagements with credit institutions for audits with 2019, 2020, and 2021 year-ends will be subjected to an additional review by a separate KPMG audit quality team, who will provide reports to the FRC.

Statements from KPMG U.K. spokespeople have become boilerplate at this point:

“We [regret/are disappointed] that some [aspects/specific elements] of our audits of [INSERT COMPANY NAME] did not meet the appropriate standards. We have improved our audit practices since then.”

Well, see you back here around the same time next week for news of another KPMG fine (probably).

[Wall Street Journal]

Related article:

KPMG Just Can’t Stay Out of Trouble

The post Another Day, Another Fine for KPMG appeared first on Going Concern.

Yooooo. Sorry I’m late on this… wait, no, fuck that I’m not sorry. Saying sorry for things you’re not actually sorry for is for bitches.

Let’s start over. Heyyyyyy! Here’s your open thread for the very first CPA exam score release of the second quarter 2019. Exciting stuff. Stalking Reddit and Twitter yesterday after scores hit was really exciting, and it’s nice to see CPA exam candidates get good news and push ever-forward toward licensure, especially after the inevitable Q4 and Q1 slumps. I dunno, maybe it’s because busy season is over, or maybe it’s because spring has sprung and the tree jizz is in the air. Who knows, I’m just glad people are cracking at it and getting this beast done.

OK so since we were late to this thread due to minor technical issues you don’t need to concern yourself over, every single candidate waiting for a score should have one in their hands by now.

On May 7, 2019, NASBA received and processed the following scores from the @AICPA. pic.twitter.com/0nHcfCRtSo

— NASBA (@NASBA) May 7, 2019

Feel free to share your victory (or defeat) in the comments or don’t, I don’t care either way. And if you’re still waiting on your score, I suggest you publicly shame NASBA so we can talk about it next week.

The post Here’s Your (Late) Open Thread For the First CPA Exam Score Release of Q2 2019 appeared first on Going Concern.

Testing internal control over financial reporting, assessing risks of material misstatement, and auditing accounting estimates (you know, the yoozh) continue to trip up auditors, according to the PCAOB, which offered a sneak preview of what we can expect in 2018 audit firm inspection reports.

More than 160 U.S. audit firms were inspected by the PCAOB in 2018 and portions of about 700 audits of public companies were reviewed by inspectors. The regulator also inspected a bunch of audit firms overseas.

Did RSM US and KPMG turn things around during the 2018 inspection cycle, after both had abysmal 2017 inspection reports? Did Grant Thornton come back down to earth in 2018 following a mind-blowingly good 2017 inspection report after many years of suck? Did Deloitte and PwC auditors finally figure out internal controls and controls testing? Inquiring minds want to know. (Or maybe we just do.)

The news isn’t all bad—the PCAOB observed “good practices” by audit firms during its 2018 inspections. For example, firms are continuing to take steps to improve audit quality. The problem is the PCAOB says this every year. It’s almost like the PCAOB purposely teases all of the “champions of audit quality” out there that auditors have finally got their shit together, only to find out otherwise when inspection reports like RSM’s and KPMG’s are released.

Here are some other good practices that PCAOB inspectors saw in 2018:

Root-cause analyses: Again, the PCAOB seems to tell us every year in these inspection “previews” that firms are doing root-cause analyses more and more. But supposedly audit firms made improvements in 2018 by performing root-cause analyses to “understand the primary factors that contributed to positive and negative audit quality,” as well as “designing and implementing remedial actions that drive audit quality.”

Expanding accountability for audit quality beyond the lead engagement partner: So maybe we’ll see the lead engagement partner take the fall less for crappy auditing whenever the PCAOB takes enforcement action against a firm?

The PCAOB said:

Some firms have established accountability programs for the engagement quality reviewer (EQR) and other partners in leadership roles to reward or penalize these individuals depending on whether the audits in which they participated are found by external or internal inspections to have deficiencies. We saw positive behaviors where firms have placed an emphasis on the importance of audit quality through extending accountability to other key leaders at the firm such as audit quality leaders, technical experts, and office leaders.

Developing and refining guidance to help auditors identify and assess risks of material misstatement: Firms have laid out steps that the auditor should take, such as having focused team discussions, to better identify the types of potential misstatements that could occur—and turn a good inspection report into a KPMG-type inspection report.

Revising training programs: Firms are using real-world examples to more effectively show auditors where things might go horribly wrong in an audit.

For example, training programs may include case studies utilizing audit work papers that contain deficiencies in the audit testing. Participants reviewed these work papers and identified points in the process that resulted in the deficiencies.

Now for the bad, which if you know PCAOB inspection reports usually always starts with deficiencies related to testing ICFR:

Auditors did not sufficiently test the design and operating effectiveness of controls that include a review element. We observed that auditors did not obtain an understanding or evaluate the activities performed and factors considered by the control owner when reviewing the reasonableness of certain estimates and assumptions.

Auditors did not select controls for testing that address the specific risks of material misstatement. We observed that auditors did not obtain a sufficient understanding of whether the control addressed the assessed risk of material misstatement.

Here are some other areas where auditors struggled:

Auditing revenue: Auditors agreed revenue transactions to company-prepared invoices without doing the proper testing, and they limited their testing to revenue transactions exceeding a certain amount or transactions recorded near year-end without considering the need to test the remainder of the population, the PCAOB said.

Based on our observations, auditors should apply due professional care in areas of significant risks, including the risk of fraud. Auditors should also perform sufficient risk assessment procedures to identify the risks of material misstatement and to design procedures responsive to the assessed risks.

Auditing accounting estimates: The most significant deficiencies were found in the areas of allowances for loan and lease losses, accounting for business combinations, and financial instruments.

Engagement quality reviews (EQRs): Many deficiencies inspectors identified occurred in areas that were reviewed by EQRs that failed to spot problems, the PCAOB said.

In some instances, EQRs may have placed too much reliance on discussions with the engagement team. In other instances, EQRs may have limited their review by reading summary memos that did not provide sufficient detail to allow for a review with due professional care.

While some 2018 inspection reports have begun trickling out for smaller U.S. and overseas firms, the 2017 inspection report season is still ongoing, as we’re still awaiting the PCAOB to release exams for EY and BDO USA, among others. So we still have several months to go before we know whether audit firms overall made progress on improving audit quality in 2018 or if the PCAOB is once again blowing smoke up our asses.

The post PCAOB Releases Teaser Trailer of 2018 Inspection Findings appeared first on Going Concern.

Here’s something that Adrienne and I are completely in agreement with:

In a recent survey from staffing firm Accountemps, employees said the best summer perks their companies could provide to them are flexible schedules (52 percent) and early departure on Fridays (27 percent).

But which perks are employers actually offering? Fifty-four percent of senior managers said flexible schedules, and only about one in three (32 percent) reported allowing staff to leave early on Fridays. Other common warm-weather benefits cited by companies were relaxed dress codes (53 percent) and activities such as picnics or potlucks (48 percent). Unfortunately, these were the least likely to win over employees, according to the survey.

To our dismay, freezers stocked with popsicles and ice cream bars, ice cream packages, ping-pong tournaments, and the grandaddy of all summer perks, Omaha Steaks, didn’t make the cut.

While some people would kill to be able to wear jeans to work on Fridays in the summer (like my wife) and grilled meats and ice cream are good, give me those half-day Fridays and just be done with it.

I agree with what Caleb wrote a couple years back:

Fridays in June through August are a waste. [E]veryone’s bloodthirsty for long weekends again. Even if you do need to go in on a Friday, don’t plan on using email or the phone because no one will respond.

According to Accountemps, professionals in Atlanta and Tampa, FL, want “summer Fridays” the most, while firms in Charlotte, NC, and Denver are most likely to allow early Fridays. The firms with the biggest jerks, who are least likely to offer this perk, are located in Detroit, Cleveland, and Sacramento, CA.

[Accountemps]

The post Survey: Accountants Want to Spend As Little Time In the Office As Humanly Possible This Summer appeared first on Going Concern.