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ICYMI
These are the top stories on Going Concern this week
- You Can Sit for the CPA Exam in the Philippines Now
- Golf Fans Everywhere Now Think BDO Sells Dildos and Lube
- Just How Much Have Accounting Salaries Increased in the Last Five Years?
- Who Wants to See How Much Big 4 Revenue by Service Line Has Changed Since SOX?
- RSM US Had a Good Year
Tax
Super-rich being advised how to avoid Labour tax clampdown, undercover investigation suggests [Isle of Man Today]
Didn’t KPMG get in trouble for this years ago? Yes, yes they did.
The super-rich are being advised how to use a loophole in pensions investments to shelter their wealth from Labour’s clampdown on large-scale tax dodging, the Guardian can reveal. Undercover filming by the Guardian suggests multimillionaire UK residents are being pitched offshore products said to legally protect their fortunes from inheritance tax (IHT) and capital gains tax (CGT). At a private event held a week before the general election, the international accounting brand Baker Tilly told advisers to the ultra-wealthy how they could use offshore pension schemes to shield their clients’ fortunes from tens of millions of pounds of inheritance taxes. One promoter told how his client had placed £30m into a pension scheme to protect it from inheritance taxes. He told an undercover reporter at the exclusive event in the City of London that the government would not legislate to close the schemes down as ministers have “bigger fish to fry”.
IRS shares more warning signs of incorrect claims for the Employee Retention Credit; urges businesses to proactively resolve erroneous claims to avoid penalties, interest, audit [IRS]
The IRS issued today’s five new warning signs to give businesses and tax professionals additional time to prepare for an upcoming announcement involving new steps being taken to counter improper ERC claims. In coming days, the IRS plans to issue more information on new compliance work involving high-risk ERC claims as well as details about an anticipated short-term reopening of the Voluntary Disclosure Program and an important update about impending processing of low-risk payments to help small business with legitimate claims. This follows up on last month’s announcement that the IRS was denying more of the highest-risk ERC claims. “The IRS continues working aggressively to pursue improper claims as well as increase payments going out to businesses with legitimate claims on these complex credits,” said IRS Commissioner Danny Werfel. “As we prepare for the next major announcement, we want businesses to be aware of common errors our compliance teams are seeing, many of which reflect bad advice coming from promoters. The IRS continues to urge people with pending claims or previously approved payments to talk to a trusted tax professional rather than a promoter and see if any of these red flags apply to them.”
In the Workplace
Meet your Gen Z mentor: Why EY is tapping younger workers to bridge the generational skills divide [Fortune]
Professional services firm EY has an informal program called “reverse mentoring,” when two employees of different generations are paired together to share wisdom—with millennials and Gen Z at the helm. The company already has a global mentorship program that has been around since 2020, but EY decided to pilot the smaller concept earlier this year with five pairs of staffers. Dan Black, global leader of talent strategy for EY, tells Fortune the firm unofficially launched the initiative to better connect its dispersed and diverse group of employees. “We have this huge multi-generational workforce, almost 400,000 people, and helping to facilitate how those various generations work together is a really big thing that we continue to work on. That’s where reverse mentoring comes in,” he says.
Are the Olympics Going On?
Why EY, Visa are offering programs to attract athletes, ex-Olympians [WorkLife]
Athletes are disciplined, collaborative and deadline-driven. They usually have excellent time management, public speaking and interpersonal skills that lend themselves to a successful career. WorkLife previously reported on whether athletes perform as well in the workplace as they do in the field. The answer: yes, they usually do. In fact, student-athletes typically see a 60% increase in salary growth, while non-athletes only saw a 45.3% increase, according to data from workforce intelligence platform Revelio Labs. Here’s a deeper look at EY and Visa’s athlete charm offensives.
EY: How is the Olympics Advocating Sustainability in Events? [Sustainability Magazine]
Matthew Bell, Global Climate Change & Sustainability Services Leader at EY, explores sustainability in large sporting events ahead of Paris 2024 Olympics. Compared to other industries, such as fashion, the impact of supply chain and sustainability issues in sports is not as widely known and is complex and difficult to measure. However, it is recognised that unsustainable activities in sports have been contributing to climate change.
News
Four distinguished leaders to be inducted into Spears Business Hall of Fame [Oklahoma State University]
Raised in Oklahoma City, Vickie Carr held various leadership positions throughout her career of nearly 40 years with Deloitte. The multinational accounting firm promoted Carr to partner in 1999. She also founded Deloitte’s National Tax Accounting Group and helped create its Global Tax Accounting Group, which she is leading until her September retirement. Eddy Ditzler is retired from public accounting and lives in Edmond, Oklahoma, with his wife of 39 years, Deniece. He remains active in business as a member of the Board of Directors and the Audit Committee Chair for The Reserve Petroleum Company. Ditzler is also a member of the audit committee of the Oklahoma City Community Foundation. He was honored in 2004 as a School of Accounting Distinguished Alumnus and in 2014 in the “Spears School Tributes: 100 for 100.”
Accounting for the Future: Empowering Tomorrow’s CPAs Today [Seton Hall University]
Seton Hall University recently hosted the “Accounting for the Future” Pre-College program, an inspiring two-day workshop designed to introduce high school students to the dynamic world of accounting. The program, held on Seton Hall’s picturesque campus, brought together students from ten different high schools, including participants who traveled from as far away as Miami, Florida. The workshop was uniquely crafted and led by six talented students from Seton Hall’s CPA Pathway Apprenticeship Program, Phillip Bender, Diana Cavero, Amaury Flores Jr., Michael Lombardi, Daniel McBratney and Tyler Woods, who chose this impactful initiative as their capstone project.
SF accounting firm owes Mitchell accountant $107K in non-compete dispute, high court rules [Mitchell Republic]
The South Dakota Supreme Court has ruled that a now-defunct Sioux Falls accounting firm owes a Mitchell accountant $107,000 after violating the terms of a business purchase. In a 4-0 opinion released Wednesday, July 24, the state’s high court ruled that Sioux Falls-based accounting firm FDJ violated the terms of an agreement to purchase Ross Determan’s Mitchell accounting firm by failing to pay Determan a share of the company’s revenue.
AI
Accountants Need Training in How to Use AI Effectively: Podcaster Blake Oliver [Techopedia]
Technology – from AI to Blockchain – will have huge implications for how accountants work. According to research last year by Moore Global and the Centre for Economics and Business Research in the UK, accountancy firms have spent nearly four-times as much implementing Artificial Intelligence (AI) systems as law firms and other professional services organisations. However, argues influential podcaster and accountant, Blake Oliver, a wholesale change in how accountants are trained is needed so that employees get the most from new tools. And a total overhaul of how accountancy firms work, including attitudes to employee wellbeing, is also long overdue.
Tax & accounting firms optimistic about GenAI, planning and adoption come next [Thomson Reuters]
As the technology around generative artificial intelligence (GenAI) advances, tax & accounting firms are facing an inflection point. Many tax & accounting professionals believe that GenAI will be a part of their future, with more than half saying they believe that GenAI can and should be applied to their work. At the same time, however, many professionals and their firms have not yet explored fully using GenAI for either personal or firm-wide work, and many said that adoption is still years away. Indeed, many tax & accounting firms are still in the early stages of discerning the business implications of GenAI technology, as well as how it fits into their policies and training programs.
Attention CFOs – invest the ‘AI dividend’ and elevate the role of the accountant [Diginomica]
Today, every forward-thinking enterprise and financial organization is exploring how AI and large language models (LLMs) can be integrated into their operations. Sage’s annual CFO research report, The Secrets of Successful CFOs, found that eight in 10 CFOs are embracing AI and automation to save time and increase their own strategic value. But is the excitement warranted? Properly applied, AI can transform and accelerate everything from financial reporting and investor communication to fraud detection, investment analyses, asset allocation, and more.
Pandemic Aid That Isn’t ERC
Pop stars got millions in pandemic aid that raised red flags for their accountants — but they took the cash anyways [Business Insider]
A major Los Angeles accounting firm that caters to music stars was privately worried that its artists could be breaking the law by applying for millions of dollars in pandemic-era grants from the Small Business Administration, court records show. Congress created the Shuttered Venue Operators Grant in 2021 to help theaters and indie music venues stay in business during the pandemic lockdowns. As the name implies, the grants — which were not required to be paid back — were intended for theater owners, performing-arts companies, promoters, producers, and other behind-the-scenes businesses that had no money coming in.
Audit
B.C. accounting regulator criticized for anonymizing member misconduct [Business in Vancouver]
Since March 2021, the U.S. Public Company Accounting Oversight Board (PCAOB) has unleashed a wave of enforcement decisions against B.C. accountants, levying numerous practice restrictions and hundreds of thousands of dollars’ worth of fines against nine Vancouver firms that audit public companies. These penalties were issued under settlements in which the firms did not admit nor deny the serious violations alleged by board investigators. The Canadian Public Accountability Board (CPAB)—the regulator for public company auditors—has taken enforcement action against five of them. However, the Chartered Professional Accountants of British Columbia (CPABC), which is responsible for licensing and governing the 40,000 CPAs in this province, has not disclosed any of these enforcement cases on its website.
Stop undermining small audit firms, banks told [People Daily (Kenya)]
The Institute of Certified Public Accountants of Kenya (ICPAK) has raised an alarm over the prejudicial and partial profiling of some audit firms in the financial sector. “Institute has noted concerns from its members and various stakeholders that some of the Financial Institutions only recognise financial statements that are audited by one of the ‘big four’ audit firms which, they deem, to be the only valid and acceptable audit reports,” said Philip Kakai, Chairman at ICPAK. Kakai stressed that profiling audit firms or determining only financial statements by the “Big Four” as valid or acceptable is discriminatory, irregular, and does not foster competition in the market. “The terminology, ‘the big four audit firms’ is a terminology that does not exist in its regulatory framework as a regulator of all accounting/ audit firms in Kenya,” he added.
Talent
Attention accounting firms: This is your weekly reminder to sign up for Always-On Recruiting from Accountingfly if you’re in the market for talent. You’ll regularly receive a fresh batch of candidates in your inbox to browse at your leisure with no cost and no obligation to hire. Check out this week’s candidates below and find your next great hire today!
Sustainability and Those Other Two Letters
Sustainability reporting, ESG management roles on the rise: Deloitte [Supply Chain Dive]
The accounting firm, which conducted the survey in January, found 49% of respondents were conducting sustainability oversight by including ESG in the companies’ disclosure committee review while 48% were adjusting and accelerating reporting timelines. Respondents almost unanimously — 98% — said they had seen their company make progress toward sustainability goals set last year. Of these, 25% reported “significant progress,” 60% reported “moderate progress,” while 14% reported “minimal progress.” Nearly all respondents indicated they were preparing for increased disclosure requirements.
How CFOs Can Help Meet Corporate ESG Goals: SAP Concur and Deloitte’s Whitepaper [ESG News]
Investors and regulators demand better climate change disclosures, challenging companies to incorporate these into their financial judgments. Emerging regulations, like the EU’s Corporate Sustainability Reporting Directive (CSRD), require comprehensive reporting, including Scope 3 emissions, covering an entire value chain. CFOs are essential in ensuring the accuracy of non-financial information, connecting financial and sustainability data. They should lead ESG disclosures, influencing risk analysis, governance, and third-party assurance. Deloitte found only 37% of firms had CFOs leading sustainability efforts, highlighting the need for more active involvement.