After five tumultuous years as the global head of EY, Carmine Di Sibio is finally having some fun. Last week, the retiring Italian-born American jetted off to the firm’s towering Tokyo offices as part of his farewell tour. While there, the 61-year-old was treated to a Ken-shibu, a traditional Japanese sword ritual carried out by a highly skilled martial artist.
“A retirement celebration that I’ll carry with me forever,” the sports fanatic told his 300,000 followers on LinkedIn.
Carmine’s post:
The aftermath article goes on:
Schmoozing the firm’s Japanese partners alongside Di Sibio was his successor, Janet Truncale, the EY lifer from New Jersey who, in July, takes the reins at the firm she joined as an intern in 1991.
EY was not so convivial this time last spring. Then, its top brass were tearing themselves apart over the demise of Project Everest, the code name given to the firm’s ambitious plan to split its vast consulting and auditing practices. After months of squabbling — much of it played out in the press — last April, almost a year ago to the day, the giant firm begrudgingly halted the two-year project.
However, the Everest fiasco continues to cause ructions in the firm. Current and former EY partners have told The Sunday Times of large numbers of senior executives jumping ship to rival firms, a breakdown in the relationship between regional partnerships and Di Sibio’s global team, and aggressive staff appraisals leading to widespread job losses. Like its competitors, it also finds itself scrambling to cut costs as it battles with a downturn in demand for consulting work.
To top it all, Stuart Gregory, a rising star in the UK firm, just warned the remaining partners that profits could fall by as much as 15 per cent this year.
The accounting talent pipeline discussion in the press and social media has centered around the idea of modernizing the licensure requirements. NPAG’s scope has been broader, however, and the group has identified six major solution theme areas to create a comprehensive plan to minimize the leaks in the talent pipeline. The six themes include:
Telling a better story— All members of the profession can tell a more compelling story on why they chose a career in accounting, how it has benefited them and their clients, and what opportunities exist for others in the profession. Drawing in more underrepresented minorities— The accounting profession does not mirror the diversity within the US population, and NPAG seeks to increase the number of underrepresented minorities who choose a career in accounting. Making the educational experience more engaging— A career in accounting offers many opportunities and career paths, in addition to tax and auditing, which could be introduced earlier in students’ education. In addition, accounting programs could be designed to develop and shepherd more students through to graduation rather than weeding out Reducing the time and cost of education— The additional educational requirements to become a CPA present a barrier for some, and NPAG has been discussing a number of options to help. Providing better support to CPA exam takers — In order to increase the number of individuals choosing to sit for the CPA exam, employers could provide more support with mentoring, study time, scheduling, financial incentives, and more. Transforming cultures and business models to inspire a more inclusive, attractive employment experience— There are aspects of the accounting business model that are less appealing to the next generation of talent, such as starting salaries, workload compression, and the lack of work/life integration. Placing a focus on culture, career progression, and purpose in their work are some of the elements being discussed.
They also mention the two NPAG surveys open, one of these days I’ll get around to writing that up (maybe this week even).
At Deloitte, salaries range from $49,219 a year for entry-level analysts to as much as $875,000 a year for senior principals.
PricewaterhouseCoopers (PwC) pays its entry-level associate roles a minimum of $68,000 a year — and its highest-paid principals earn nearly $1.4 million, according to the US Office of Foreign Labor Certification data.
At KPMG, associates make at least $61,000 a year, while managing directors are paid up to $485,000.
According to the US Office of Foreign Labor Certification data, EY entry-level accountants and auditors earn $54,000 a year and up. Managers earn an average of $320,000 a year, while computer and information systems managers can earn up to $600,000 a year.
The evolution of skills for auditors is imperative in the era of AI integration. As technology transforms traditional audit practices, auditors must undergo a profound skills evolution, including the need to continuously upskill, to stay relevant. While automation and AI can streamline certain tasks, auditors should recognize the enduring value of specialized skills that cannot be easily replaced. Expertise in areas such as complex valuation processes where contextual understanding is vital, ethical dilemmas, forensic analysis, and industry-specific regulations remains indispensable.
Beyond foundational accounting expertise, auditors now benefit from proficiency in data analytics, understanding AI algorithms, and interpreting results generated by machine learning models. The ability to leverage advanced technologies to extract meaningful insights from complex datasets becomes a pivotal skill. Moreover, auditors need to elevate critical thinking and analytical reasoning to interpret AI-driven outputs and make informed decisions. Effective communication skills remain equally crucial, as auditors must continue to articulate complex findings and insights to stakeholders in a clear and comprehensible manner. In this dynamic landscape, continuous learning and adaptability become integral, forming the foundation of a modern auditor’s skill set. This ensures they navigate the intersection of audit practices and technological advancements with competence and confidence, while remaining professionally skeptical.
CVC Capital Partners, one of Europe’s biggest private equity firms, has approached Big Four accountancy group EY about buying its Italian consulting arm, according to people familiar with the matter.
The buyout group sent EY a letter in recent weeks expressing its interest in acquiring the unit, the people said, with one adding that there had been no talks between the two parties.
EY said the approach was a “preliminary expression of interest”, adding: “As part of our global strategy we continue to evaluate our strategic opportunities and will only entertain transactions at the right time and after careful consideration. There are no plans to sell any part of our business at this time.”
Ushering in a new era of collaborative innovation, KPMG in India launched its second KPMG Innovation Kaleidoscope – Insights Centre in Bengaluru today. This collaborative workspace fosters a dynamic environment where our people, clients, start-ups, and strategic alliance partners can engage to co-create solutions to solve dynamic business challenges.
Located within its Bengaluru office in Embassy Golf Links Business Park, the Centre showcases a blend of India and Global solutions to address real-world business requirements. Business leaders will gain access to immersive experiences, valuable insights, innovative technology, and the resources needed to propel their organisations forward. The centre also displays state of art solutions in specific sectors, insight driven solutions demonstrated through AR-VR devices, tax technologies, Digital solutions for ESG, Gen AI solutions across sectors and domains that will address the digital innovation needs of GCCs and clients across sectors.
A federal bankruptcy judge in New York City will allow a group of creditors to perform an extensive forensic accounting of Rudy Giuliani‘s assets, liabilities, conduct and financial position.
In a Friday order by U.S. Bankruptcy Judge Sean Lane, the Official Committee of Unsecured Creditors was given the go-ahead to hire Global Data Risk LLC as a “specialized forensic financial advisor” for the chapter 11 case initiated by Donald Trump’s erstwhile attorney.
The three-person creditors group have long harbored concerns about the financial statements filed by the former New York City mayor with the bankruptcy court — and have never been content to take those claims at face value. In January, Giuliani claimed he only had a “net income” of $2,308 per month after over $40,000 in monthly expenses in schedules and a statement of financial affairs.
Two months away, the election for the chairman of the Korean Association of Certified Public Accountants (KAC) has heated up. With the Yoon Suk Yeol government showing signs of retreating accounting reform, the accounting industry, which has to prevent it, is bound to pay special attention to the chairman’s election.
There is an atmosphere among accountants that they should vote for candidates who can keep the periodic auditor designation system and the standard audit time system.
I think this is middle guy who is uniquely qualified for the position:
Chairman Lee Jung-hee’s great advantage is that he has experience leading Deloitte Anjin, one of the big four accounting firms. He passed the accountant examination in 1982 and has worked at Anjin Accounting Firm since 1983, and has accumulated experience by working the longest hours in the accounting industry among candidates.
With the big firms restructuring and shuffling people around to address client demand imbalances in certain areas, this recent discrimination case that made it to the Supreme Court may be relevant later. JD Supra:
Supreme Court Says Forced Job Transfers Must Cause Harm, But it Doesn’t Have to be Significant
In Muldrow v. City of St. Louis, the U.S. Supreme Court considered what protections Title VII of the Civil Rights Act of 1964 provides to employees who claim they were the victims of a discriminatory transfer.
On April 17, 2024, the U.S. Supreme Court issued its opinion in Muldrow v. City of St. Louis, finding that an employee challenging a forced job transfer must show that the transfer caused some harm with respect to the terms or conditions of their employment. Importantly, however, the Court noted that this harm need not be significant. In so doing, the Supreme Court rejected the approach previously taken by many federal courts which had required a showing that the harm was significant. In Muldrow, the Supreme Court determined that while an employee must show some harm from a forced transfer, the employee need not satisfy any sort of significance test.
While the 8th Circuit and some other courts have required that such discrimination claims show “significant” or “material” harm, the Supreme Court said that is too high a bar. The anti-discrimination statute “targets practices that ‘treat a person worse’ ” because of their sex, race, religion or national origin, the court said.
Explaining why this higher threshold is necessary, Kagan said that “whether the harm is significant” turns out to be “in the eye of the beholder.” And to prove the point she cited examples that lower courts have held to be not significant:
an engineering technician is assigned to a new job site — in a 14-by-22- foot wind tunnel;
a shipping worker is transferred to a position involving only nighttime work;
and a school principal is transferred to a non-school-based administrative role supervising fewer employees.
In each of those sex or race discrimination cases, the lower courts found that there was no “significant” harm to conditions of employment.
People of color are more likely to work long, irregular hours that could lead to severe health issues by age 50
The often tongue-in-cheek remark that work may be killing you—long hours, a demanding schedule, and mounds of stress resulting in restless nights—might literally be true, according to new research.
Volatile work schedules, defined as working early mornings and well into the evening, late nights, or anything outside the traditional nine-to-five, can have material consequences for employees’ overall health and well-being, according to Wen-Jui Han, a professor at NYU Silver School of Social Work. That’s all the more true for racial and ethnic minorities.
The health impact disproportionately affects people of color, who are more likely to work jobs with irregular hours, varied shifts, or multiple jobs. But even when Black professionals and other minorities work office jobs, Han says, they often feel the need to work harder and put in longer hours in order to succeed.
But along with the hype, there’s been plenty of attention on its limitations. Generative AI comes with risks that organisations aren’t yet equipped to deal with. That’s why our survey found that most organisations still have many unanswered questions, and can find it difficult to prioritise AI transformation in the right areas.
ChatGPT has been trained on pretty much the whole of the internet, which means it’s not especially good at answering specialised queries. It’s prone to errors, and to ‘hallucinations’ – making answers up. But given its natural language patterns, its wrong responses sound pretty convincing.
In our own testing, for example, we asked ChatGPT questions about certain areas of the UK tax code. Its responses were confident, and came complete with citations. The only problem being, they were nonsense: we’d asked about provisions in the tax code that don’t actually exist.
Gen AI also comes with data privacy risks. To be effective in an organisational context, generative AI needs to be trained on the organisation’s data – which means sharing that data with the third party providing the solution.
In my view, generative AI is going through the early stages of Gartner’s famous ‘hype cycle’ (see diagram).
Ground-breaking new technologies are often saddled with unrealistic expectations, which then rapidly sink (along with the hype) once its limitations become clear. But the experts who understand the technology continue to develop it, and to discover its practical uses. As a result, it comes into common use over time.
Right now, generative AI is at the ‘inflated expectations’ point in the cycle. It will take a while to become a genuinely valuable tool for businesses. And getting the most from it will require human input. Tax professionals shouldn’t worry about their jobs just yet.
I think that’s it. It is a Monday after all, don’t want to overexert myself. Let me know if you see anything interesting or newsworthy and have a great week!
Rangel Censured for Ethics Violations [WSJ]
“I truly feel good,” said Mr. Rangel, 80 years old, who has represented Harlem for 40 years. “A lot of it has to do with the fact that I know in my heart that I am not going to be judged by this Congress, but I am going to be judged by my life.”
Baucus introduces tax, unemployment bill as accord appears possible [On the Money/The Hill] There he goes again, attempting to don the bipartisan armor, “Senate Finance Chairman Max Baucus (D-Mont.) introduced legislation Thursday to permanently extend tax cuts for the middle class, patch the alternative minimum tax for two years and reinstate the estate tax.
Besides the tax provisions, the legislation calls for a yearlong extension of federal unemployment insurance through 2011. Baucus introduced a $56.4 billion bill earlier this week to federal extend benefits, which began lapsing on Wednesday.”
BofA Drags Balance Sheet Confidence Backward [Jonathan Weil/Bloomberg]
PwC may be in a bit of a pickle over Bank of America’s mortgage mess.
Is the IRS Racist? [Time]
Total headline bait trash from Time. Obviously the IRS isn’t racist. Their methods need some serious tweaking and they need help setting their priorities but they aren’t bloody racist.
Tax Breaks for Bailout Recipients Stir Up Debate [WSJ]
A series of tax relief measures is saving companies bailed out by the government billions of dollars at a time when concern over tax revenues has risen.
Although the Treasury Department first provided the tax guidance in the fall of 2008, the magnitude of the tax savings has become clearer in the past year. The tax relief drew new scrutiny last month after Wall Street bankers touted it to investors in the initial public offering of General Motors Corp.
The Fed’s Full Disclosure: Don’t Forget About Government GAAP [Forbes]
Francine may have lost it, “What do Ben Bernanke and Julian Assange have in common besides that sexy ‘come hither’ look?” Shudder.
The Big Risks of Little GAAP [CFO]
Careful what you wish for?
Clifton Gunderson relocating headquarters within Tosa’s Research Park [MJS]
CG is expanding into new digs of 28,000 square feet.
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