Is that Sister Minnie in the stock photo? She and I share the same iblis.
Good morning! I trust everyone had a good weekend.
Thomson Reuters covers value pricing versus traditional fee. Important quote:
“To me, the idea of value pricing is that someone is buying a relationship, not a transaction.”
— Paul Miller, President of Business by Design, Edina, MN
Anyone looking to bring their accounting practice into the 21st century should give that a look.
With the 2024 INSIDE Public Accounting Top 500 officially out, expect many more press releases like this one from RSM:
“As the leading provider of professional services to the middle market, our vision is to be known globally for delivering innovative solutions, lasting value and confidence,” said Jiten Shah, chief financial officer with RSM US LLP. “Being once again named number five on the IPA Top 100 list demonstrates how our global purpose of instilling confidence in a world of change is resonating with clients who turn to us for our insights and services, and with our people who consistently rank us as a great place to work.”
RSM took the fifth spot on this year’s IPA Top 500, we’ll be doing a full dive of this much-anticipated annual dick measuring contest later in the week.
How are CEOs feeling these days? The summer 2024 Fortune/Deloitte CEO Survey finds:
- Seventy-three percent of CEOs are optimistic about their company performance for the next 12 months.
- Over half (51%) of CEOs are confident in their organization’s ability to weather geopolitical instability, which is the top concern of 60% of survey respondents.
- Forty-three percent of CEOs are confident in their organization’s ability to navigate inflation.
- Approximately 4 in 10 (43%) of CEOs have implemented Generative AI (GenAI) into their organizations to drive innovation.
Financial Review says government contracts are way down at down under Big 4 firms. Gee, wonder why?
The value of federal government work outsourced to the big four consulting firms has crashed under Labor, with KPMG, EY, PwC and Deloitte inking just $607 million in new deals last year, the lowest level in five years.
That was down nearly 50 per cent from a peak of $1.2 billion in 2021-22, excluding extensions, with KPMG, EY and PwC all recording substantial revenue falls, which contributed to a wave of layoffs.
LOL PwC. Scyne is the government advisory practice PwC sold off for an Aussie dollar last summer.
Related to the above, Financial Review published an excellent long read on what it was like inside PwC when the tax scandal story was breaking last year, part one in a series.
Describing an emergency webcast attended by the firm’s 900-some partners and led by then-CEO Tom Seymour that broke the news to the partners that some, uh, not good stuff was happening:
He faltered as he delivered his own bombshells: “six to eight” partners who shared the confidential tax information were still at the firm and, worse, Seymour himself had received some of the emails. The disclosures were not well received.
“We thought Tom was going to go,” says one attendee. “We couldn’t believe it, he was quite cocky … when he said he was on the emails, that’s when I knew we were f—ed.”
A second says: “Everyone couldn’t believe he had lied to us. Nobody wanted him as leader. A third says: “Tom was in a really bad state … [he] knew he was toast.“
“The webcast was their first chance to hear from the CEO. On a split screen to Seymour’s right was then-chairwoman Tracey Kennair; she said little, but cycled through various glum expressions,” writes Edmund Tadros.
Go read it.
Here’s a topic we haven’t discussed in a while: IFRS and fair value. Andy Haldane, who is chief executive of the Royal Society of Arts and former chief economist at the Bank of England, writes an FT opinion piece:
Accounting rules rarely arouse excitement — even among accountants. This neglect is misplaced. Accounting is the DNA of capitalism. And accounting rules have been pivotal in shaping the fortunes of companies and economies over many centuries, for good and ill.
Historically, accounting systems have been used to explain the rise and fall of nations ever since their emergence in ancient Mesopotamia. Goethe called double-entry bookkeeping one of the finest inventions of the human mind. Political philosophers such as Adam Smith and Max Weber assigned accounting systems a central role in explaining the flourishing of modern corporations and economies.
That is not to say these rules have been uncontroversial. A particular bone of contention has been the accounting valuation of assets, whether at market prices (“fair value”) or historic cost.
…
Today, as in Depression-era America, IFRS may not be among the finest inventions of the human mind.
Two recent SCOTUS cases are making CPAs nervous according to soon-to-be-exiting AICPA President, CEO, and 17th century doily collector Barry Melancon:
Two recent Supreme Court decisions involving the power of government agencies are a “big deal” for the accounting profession because they introduce a level of uncertainty that makes some tax practitioners uncomfortable, AICPA & CIMA’s CEO said recently.
The reality, in the area of tax law, is that “our profession generally likes certainty,” CEO Barry Melancon, CPA, CGMA, said on a recent AICPA Town Hall. ” … We like to be able to get to a conclusion. We’d like to know something can be done and [that] there’s this precedent and there’s [an] interpretation that this supports a tax strategy. And there’s going to be a significant amount of uncertainty in these things going forward, absent some new, different court decisions.”
“Under Loper Bright, federal judges can rely on IRS expertise and experience, but they do not have to, she said. Thus, Loper Bright ‘most likely will affect future rulemaking within the IRS.’ Under Corner Post, on the other hand, ‘you could have a regulation that’s over 20 years old, but you’re injured now,’ and since the statute of limitation does not start to run until the taxpayer is injured, the regulation can be challenged long after it was promulgated. This will cause ‘lots of exposure for the IRS,'” said Melanie Lauridsen, the AICPA’s vice president–Tax Policy & Advocacy.
Aaaaand that’s it for now. If you see an interesting story, have a tip, or just want to gripe do feel free to send me an email or text the tipline at 202-505-8885. And you better have a good week OR ELSE.
