The big 4 accounting firms have to deal with large accounting scandals every year. It’s hard to keep track of all the accounting scandals, but that’s what the purpose of this page is.

We’ve tracked the largest accounting scandals of 2018 below.

There are different categories of scandals involving the big 4. Some of the general categories are below.

Accounting/Auditing Scandals – Accounting or auditing scandals typically involve a big 4 client that is having financial difficulties or accounting errors. These typically involve in investors suing the big 4 accounting firms. The investors typically allege that they relied on the financial statements of the big 4 client that the big 4 said were good.

Independence scandals – These type of scandals involve situations where big 4 professionals aren’t independent from their clients.

Ethical scandals – this involves big 4 professionals doing unethical things in the workplace including terrible things like sexual harassment. Other things that fall into this category are things like paying women and diverse people less.

KPMG Accounting Scandals 2018

Carillion audit

The Carillion scandal for KPMG was one of the largest scandals of 2018 if not the biggest audit scandal.

Carillion was one of the largest construction companies in the UK before they went under. They experienced financial issues in 2017 and went into bankruptcy in early 2018.

kpmg signed off on financial in march of 2016, so how could the firm have gone of the rails by 2017. Work found to be unacceptable according to UK watchdog in June 2018 as a result of their Carillion Audit.

KPMG PCAOB Leak Scandal

Type of scandal – ethical scandal

The PCAOB is the regulator of the big 4 accounting firms in the United States. It is important that the PCAOB selection process is random so that the big 4 can’t try to change workpapers ahead of the PCAOB audits. In this case, KPMG was given a heads up as to what audits were going to be selected by the PCAOB.

Former kpmg accountants were charged by the sec in January of 2018 for their role in leaking information to fellow KPMGers after leaving the PCAOB.

Gupta scandal

Type of scandal – ethical scandal

the gupta scandal involved government corruption. The gupta family was a family involved in political corruption in south Africa. KPMG was their auditors and was obviously conflicted because the partners on the account were very closely tied with the gupta family. KPMG faced many negative side effects as a result of their association with the scandal. They were investigated by the south African charted accountant organization.

South Africa chartered accountants probe. Kpmg set to audit own staff in april of 2018.

As a result of the Gupta scandal, KPMG lost a lot of clients in South Africa. Barclays Africa was one of these clients. They dropped KPMG as their auditor in May 2018.

Big 4 Foreign Affiliate scandal

Type of scandal – ethical scandal

KPMG Deloitte and BDO are set pay fines over their foreign affiliates trying to circumvent PCAOB probes.

VBS Bank Accounting Scandal

Type of scandal – accounting scandal

VBS Bank audit – vbs bank was placed under curatorship in 2018. KPMG partners turned out to have financial interests in the bank which made it worse for KPMG. Not only did they not spot the fraud, but they turned out to not be independent from the bank. KPMG should have also reported accounting irregularities but they did not.

Kpmg hong kong fraud

Type of scandal – auditing scandal and ethical scandal

China medical technologies defrauded investors of over $400 million. Some of these investors were in the U.S.

This was a case where the U.S. wanted to issue penalties against the U.S. listed subs of China medical technologies. KPMG Hong Kong did not comply with orders to provide workpapers. KPMG has said that they do not have the working papers.

KPMG was later freed from the suit by a judge in Massachusetts.

GE investors try to get rid of KPMG as auditor

Type of scandal – auditing scandal

After a huge write down by GE in 2018 relating to long term care insurance liabilities, investors called for a change of auditors. KPMG has been GE’s auditors for a long time.

Project management advisor to grenfell

Type of scandal – independence issue

Grenfell tower was a large building in London, UK, where a large fire occurred in 2017.  KPMG stepped down from that in january 2018. They stepped down due to a conflice of interest with a contractor that provided flammable material that may have caused the fire. They provided auditing services to Celotex which was the company that provided the potentially flammable material that was used in Grenfell tower.

Deloitte Accounting Scandals 2018

Steinhoff accounting Scandal

Type of scandal – auditing scandal

Deloitte was the auditor of Steinhoff. Steinhoff encountered financial troubles. Steinhoff investors sued deloitte in 2018.

Steinhoff audit issues were found by Deloitte in Decmeber of 2017. Investigations started in February2018.

Deloitte was fired as the auditor of Steinhoff in 2018.

Big 4 Affiliate Scandal

Type of scandal – auditing scandal

Fined by the PCAOB for work done by their foreign affiliates. $99k to PCAOB.

Carillion Scandal

Type of scandal – ethical scandal

Deloitte also got involved in the Carillion bankruptcy. They made over 10 million dollars off of Carillion over the years that Carillion was not performing well from a financial perspective, and they were called out for it.

Taylor Bean Scandal Settlement

Type of scandal – auditing scandal

Deloitte paid $150 million over failed mortgage lender. They failed to uncover errors by Taylor Bean. Deloitte was the auditor from 2002 to 2008. Deloitte settled to avoid litigation.

Gender Pay Gap

Type of scandal – ethical scandal

In the UK, the big 4 accounting firms have to disclose pay gaps between men and women. Deloitte Gender pay gap jumps to 43%. This means that women earn 43% less than men in the UK.

Ernst & Young Accounting Scandals 2018

EY Australia Sexual Harassment

Type of scandal – ethical scandal

Australia Sexual harassment allegations were made in February of 2018. Ey’s Senior Managing partner in Australia was accused of sexual harassment.

EY US Sexual Harassment

Type of scandal – ethical scandal

Ey faces sexual harassment complaint in april of 2018. The harassment occurred in a resort in Orlando in 2015. Ey later settled with the female partner who said she was groped.

PwC Accounting Scandals 2018

PwC India Scandal

Type of scandal – auditing scandal

Pwc banned from auditing in India for 2 years. Relates to their audit of Satyam. Satyam was one of India’s leading software providers. The company’s founder overstated profits by $1 billion in 2009. The securities and exchange board of india was the governing body that placed the ban on pwc india.

Colonial Bank Scandal

Type of scandal – auditing scandal

Pwc was found to be liable to the FDIC regarding their audit of Colonial bnak. PwC faced the largest ever accounting malpractice verdict of $625 million

Carillion Scandal

Type of scandal – ethical scandal

Pwc was accused of feasting on the carcass of Carillion. They were one of the big 4 accounting firms that charged Carillion millions of dollars all while Carillion was going down. They earned 21 million pounds all while Carillion was failing.

In September 2018, additional information came out that said PwC was paid 356 pounds per hour for the Carillion scandal.

PwC also managed the insolvency of Carillion and earned 50 million while doing so which also caused controversy.

Gender pay gap scandal

Type of scandal – ethical scandal

PwC had the highest gender pay gap of the big 4 in the Uk of 43.8%

Privatbank audit

Type of scandal – auditing scandal

Pwc was the auditor of Private bank from 2013-2015. Privatbank was nationalized in 2016 due to financial difficulties. They supposedly had many insider loans that weren’t paid back. Privatbank had a capital shortfall of $5.5 billion.

Ukraine Privatbank sued PwC for $3 billion dollars.

BHS Audit

Type of scandal – auditing scandal

PwC was the auditor of BHS.

BHS was a collapsed department store, and the PwC partner on the account faced a 15 year ban. The UK FRC launched an investigation in 2016. PwC was fined 6.5 million pounds as a result of the company’s collapse. They faced a 10 million pound fine, but the fine was reduced after PwC agreed to settle.

Grant Thornton

Type of Scandal – Conflict of Interest

Grant Thornton was also wrapped up in wrongdoing as far as accounting scandals go. They aren’t a big 4 accounting firm but they had to pay the largest fine by a non big 4 firm this year. They had to pay 4 million pounds in the UK in fines. They were fined by the FRC due to conflicts of interest at their audits of Nichols PLC and Univeristy of Stanford.

What is the E&Y entrepreneur of the year award and why does it matter?

It is a contest held by EY each year. You might have seen EY tweet about it frequently.

This is an important contest because EY blasts it all over their social media all year long as they select these winners and they just had their world entrepreneur of the year contest in Monaco.

First up let’s talk about who won the competition.

Who Won EY’s Entrepreneur of The Year Award in 2018

Ey recently awarded their world entrepreneur of the year award to Reubens menin who is the founder of MRV engenharia which is a leading low income house builder in brazil.

This organization is now Brazli’s leading residential real estate developer. 1 in 200 brazilian residents lives in an MRV home. Reubens menin is the founder and entrepreneur of the year.

So now that we know who the winner is of the program let’s go through some interesting facts about the competition.

When was the ey entrepreneur of the year award started

It started in 1986 in Milwaukee and was just one award

Where does the contest take place?

The contest is held in 50 countries and 145 cities.  However there is only one winner in the world contest held in Monaco. All country winners are eligible to win the overall world entrepreneur of the year award.

How are the winners selected?

The EY World Entrepreneur Of The Year judging panel is composed of prior-year EY Entrepreneur Of The Year winners and business leaders from all geographies around the world and in a variety of sectors

Each member of the EY World Entrepreneur Of The Year independent judging panel receives a detailed packet of information on each of the country winners in advance of the judging session. After a private meeting of the winners and judges while in Monaco, the panel convenes to discuss each candidate’s qualifications and to select the EY World Entrepreneur Of The Year. The winner is then announced at a black-tie award ceremony on Saturday evening.

The award is given on the basis of a balanced score card of six criteria, allowing all national winners an equal opportunity to compete:

• Entrepreneurial spirit
• Financial performance
• Strategic direction
• Innovation
• Global impact
• Personal integrity, influence and philanthropy

The winners are then memorialized in ey’s new York city times square office

Why did EY start the EOY program?

EY started the program to recognize the world’s most successful and innovative entrepreneurs. By identifying and recognizing the contributions and achievements of outstanding entrepreneurs within successful growing, dynamic businesses, they aim to encourage entrepreneurial activity around the world.

EY says that work with great entrepreneurs at every level of society: fresh thinkers at global corporations, visionaries at pre-IPO firms and social entrepreneurs working on society’s most pressing problems. We have learned a great deal from these interactions and recognize that entrepreneurialism isn’t about size; it’s about a state of mind. E&Y believes it’s something that all businesses can — and should — embrace.

Ernst & Young wants to encourage people around the world to think about what it takes to be an entrepreneur and how we can create an environment where innovation and creativity can thrive. The EY Entrepreneur Of The Year and EY World Entrepreneur Of The Year programs are a natural extension of this commitment.

What Other Benefits Does EY Enjoy As A Result of This Competition?

That’s what Ey says about why they run entrepreneur of the year but what is the real reason. All the big 4 have their own marketing campaigns whether its marketing campaigns for new recruits like PwC does with their promotion day and other events or in this case its ey entrepreneur of the year award. In this case, ey is literally getting on the ground level with companies by running a competition for entrepreneurs.

Entrepreneurs are typically people that are at the beginning stages of starting their companies. Oftentimes these people don’t like accounting and don’t know who the big 4 are. The reason ey is getting involved at this stage is to build their brand with the large corporations of the future. When one of these businesses get really big and IPO, they’ll remember EY or at least that’s what EY is hoping and use them as accountants.

They will hopefully use ey as their auditors or their consultants.

Additionally, it’s important for you to know this if you are interviewing with EY or if you work for EY. Also if you work at another big 4 this is a good idea. Getting involved with businesses early on in their life cycle is a good way to develop business.

If you are interviewing with EY, feel free to bring this up with the people that you interview with and ask them about the importance of the event to the firm.

EY formed a partnership with AIG on February 5, 2018. They’ve termed it a new innovative global tax compliance and technology operating agreement. It involves a combination of managed tax services and there will also be some AIG employees that move over to Ernst and Young. The partnership will last for 5 years.

AIG is one of the largest insurance companies in the world. At one point they were one of the largest organizations in the world and had one of the largest tax departments.

This is a similar deal to what GE did with PwC in April 2017 where PwC acquired GE’s tax department. In that deal PwC acquired Ge’s tax department for a 5 year term where they took on 600 of GE’s employees. In that deal PwC also signed a 5 year contract. Similar to what AIG and EY signed here.

The employees moving over to Ernst and young will focus on the compliance obligations of AIG while the people left at AIG will focus on more strategic initiatives.

So behind all the fancy words and press releases what does this mean. This means that AIG is outsourcing their tax department to Ernst and Young for 5 years. If they like the terms of the deal and the work they receive, then they will most likely make the deal permanent or extend it. You have to remember that Ernst and Young and the employees from AIG that are moving to Ernst and Young will be performing tax compliance services for AIG. What Ernst and Young plans to do is utilize the knowledge they gain from working inside of AIG to win more work at other clients.

PwC probably would have been doing this for AIG if they weren’t restricted by independence measures since PwC is their auditor.

1. Managed Tax Services Are The Way Of The Future

The big takeaway here though is that large fortune 500 companies are willing to outsource large back office functions to the big 4 accounting firms.

I don’t think this will just stop at tax departments or accounting departments.

The big 4 will be willing to manage any professional services for large companies like marketing, advertising, consulting, mergers and acquisitions, legal departments, tax departments and accounting departments.

2. Ask About Managed Tax Services In Social Situations

Ask about managed tax services during recruiting or at networking events.

Ask about managed services in general when interacting with big 4 professionals.

Whether you are recruiting or you currently work for the big 4, bringing up managed tax services will make you seem like you are in the know. This is on the mind of CFO’s and big 4 partner’s minds.

You can build rapport and establish your brand by bringing this up in recruiting or in networking events.

3. Cost cutting is important to large organizations

What’s really astonishing is that all of this is happening with tax reform. Tax reform was just passed at the end of 2017 yet these deals are still going through. Companies are so willing to cut costs that they are doing it through a very tough time in tax law.  There is a huge transition that will come along with the new tax laws in the U.S. These are U.S. companies that are doing these managed tax service deals.

They are willing to go through a huge change in tax law while also simultaneously outsourcing their tax functions and dealing with all the headaches that come with that.

That tells me that these companies are prioritizing long term cost cutting over short term headaches. I don’t think tax departments are the most bloated departments either.

I just think that was the first department to be targeted by the big four because individuals inside of PwC had close ties with tax people at GE. That got the pattern moving on outsourcing whole veteran departments to be replaced by younger talent at the big 4. However other bloated departments within large organizations will likely get targeted next.

4. Technology is going to change the nature of the workforce

I think another reason these deals are happening is because of technology.

I think everyone knows the deal about the accounting industry for the large part.

FIrst, you go to the big 4 to crank out a bunch of work over a number of years and get your experience. Then you use that experience to get a good job in industry and chill out.

I think the baby boomers and gen x took full advantage of that.

The change in technology has come so fast though that chilling out in industry has made people’s skills diminish in value.

So many of the older generations were working at half speed and not learning about new technologies where the big 4 are filled with young people eager to learn new technology.

Even if those young people don’t know everything about new technologies they are more willing to learn. They are also cheaper than baby boomers and gen xers.

Technology is the way of the future at the big 4 and in industry. Embrace it and learn as much as possible about it. Learn about new technologies like blockchain, virtual reality, artificial intelligence, alteryx, and tableau.

5. Consider working for a startup or young company like the FANG companies (facebook, amazon, Netflix, or google)

Another thing that this means is that if you are considering going into industry you shouldn’t work for a more mature company with a large market cap. Right now you should consider working for a company that was created in the past couple of decades with smaller accounting and tax departments.

Consider working for a startup or a relatively young tech company like facebook, amazon, Netflix, google, spotify or another similar company. Don’t work for an old school company. If you go into an interview and the department is filled with baby boomers that have worked there for decades, then you are considering working for the wrong company.

Where will transactions like this happen next?

To understand where this will happen next we have to analyze facts about AIG and GE to learn why this happened to them.

GE pays $142,900,000 in auditing fees to KPMG. GE has been in existence since. They had a market cap of over $200 billion when the deal took place. Now they only have a market cap of about $100 billion.

Aig pays $79.2 million to PwC. AIG has a market cap of $51 billion, but they used to be the biggest company in the world at one point.

Both of these companies are headquartered in the New York area.

Both of these companies are huge as was evidenced by their market cap numbers.

Both of them have been around for a long time. AIG was founded in 1919. GE had its origins in 1890.

Why is this happening to both of these companies? Both of these companies had hundreds of people in their tax departments. They were both very bloated and mature tax organizations. They didn’t want to keep high payroll anymore. This will happen to similar organizations with large back office departments.

Similar companies in the New York area are companies like IBM, Goldman Sachs, Chubb, Citigroup, Metlife, Prudential, Pfizer, 21st Century Fox, and Chase.

A lot happened in March 2018 for the big 4 accounting firms. A few of the biggest news stories are included below.

Top UK watchdog looks into breaking up the big 4

There have been a lot of scandals related to the big 4 accounting firms in the past few years which leads many people to say how can this issue be addressed as the big 4 don’t appear to be regulating themselves.

Many of these issues might be popping up due to improvements in technology and information. As technology increases, issues in the accounting of large companies might be spotted sooner.

As a result of all these issues, Stephen Haddrill has called for an investigation into whether the big 4 accounting firms should be broken up. Stephen is the head of the Financial Reporting Council which is the UK regulator of the big 4 accounting firms.

This comes after a series of scandals that have occurred related to the big 4 over the past couple of years the latest of which is the Carillion scandal. It seems that these large accounting firms should be experts in accounting and business since they are large professional service firms, but it seems that they just care less about learning their clients businesses the bigger they get.

The FRC believes that competition might help the big 4 become more diligent in their work. Since natural competition has not been a problem for the big 4 in more than a decade, the UK is trying to induce some forced competition by potentially breaking the big 4.

In the Carillion scandal, KPMG was the auditor and all the audit firms combined made almost 100 million dollars off carillion in the past year before their downfall.

There is obviously a huge problem when the audit firm can’t catch a problem at one of the Uk’s largest construction companies, but there is no downside into missing an issue because another big 4 benefits form the downfall. KPMG doesn’t care about losing a large audit because they know that one of the big 4 will likely have a scandal at their clients, and then they will be able to pick up an audit off of that.

What makes this worse is mandatory audit rotations. The big 4 just change clients every few years. It’s meant to increase independence and scrutiny, but it does little to increase competition.

Will the big 4 accoutning firms be broken up? Make sure to subscribe to our newsletter to find out.

PwC seen as milking the Carillion administration dry in the UK

In addition to scrutiny that the big 4 are receiving over the Carillion account, PwC is receiving a lot of scrutiny in particular over the Carillion bankruptcy in the UK.

PwC has been charging about 2.5 million pounds a week for the administration of the Carillion bankruptcy. They were accused by government regulators of milking the Carillion cow dry because this company was already going under and government agencies were trying to salvage what was left to provide money for pensions, but pwc says they are experts at being liquidators and need to be paid a hefty fee.

PwC was previously accused of being a bad actor as they used to be the accountants for Carillion and their pension funds. They made millions from that work yet they could not spot that the company was in financial trouble. Carillion is a huge scandal in Europe right now. It has many in Europe questioning whether the Big 4 should be broken up.

Foreign Affiliates of the Big 4 Penalized by SEC

Foreign affiliates of big 4 accounting firms were penalized by the SEC for auditing public companies in the United States without properly registering with the Public Company Accounting Oversight Board. The PCAOB is the regulator of the big 4 accounting firms. They audit the work of any accounting firm that audits public companies. Since the big 4 audit the large majority of the public companies in the United States you can understand how the PCAOB is their main regulator.

• BDO Canada agreed to pay a $50,000 penalty
• KPMG in South Africa agreed to pay $100,000 penalty
• Deloitte in Zimbabwe agreed to pay disgorgement and interest totaling $99,057
• KPMG agreed to pay $141,304 in Zimbabwe

PwC and KPMG release new gender pay gap numbers

The gender pay gap results of the large accounting firms have been trickling out over the past month. PwC and KPMG were the most recent accounting firms to release their numbers.

• PwC reported a mean gender pay gap of 43.8% and a median pay gap of 18.7%.
• KPMG stated that they have a 42% mean pay gap and a 27% median pay gap.

Each firm said that they have work to do in trying to even the playing field for women in the workplace. They all tried to describe factors that contribute to this issue, but they admitted that the current gap was not satisfactory.

Deloitte hires spies to head up their Cybersecurity

Deloitte hired a former UK spy to head up their Europe Cyber intelligence practice. His name is Rob Wainwright and he joinged Deloitte from Europol which is a EU intelligence agency similar to the CIA in the United States. Rob has 28 years of experience working in the MI5 in the Uk which is pretty much the same unit where James Bond worked.

This is a huge hire for Delotite. They are obviously seeing the demand from their corporate clients around cyber intelligence as more and more hacks happen. The latest news is this manipulation of datat from facebook accounts. Obviously facebook and other major corporations would like to pretect their private data and avoid huge headline risks from unknown technologies.

Deloitte plans to add an additional 500 people to its European cyber security practice alone.

Deloitte acquires leading AWS provider in New Zealand

Deloitte acquired a firm by the name of API Talent. API talent is considered and advanced AWS consulting partner. This is no surprise as deloitte continues to gobble up amazon web services providers across the globe. They seem to be the only big 4 firm actively acquiring in this space. Although the other big 4 offer these cloud services, Deloitte is the only one that is actively acquiring them.

Maybe it’s because Deloitte is the largest accounting firm in the world which provides them with enough capital to acquire other companies.

PwC begins utilizing Blockchain to audit

PwC has partnered with Northern trust to begin auditing on the blockchain. Northern trust developed a private blockchain for private equity transactions. This blockchain manages ownership shares. PwC was granted access to the blockchain as a node. They can see transactions happen in real time by participating as a node.

We actually suggested that this would happen in one of our previous blockchain articles. We suggested that the big 4 could not only audit via becoming a node, but they can also offer being a node as a services. These private blockchains need multiple nodes to work, but who can these companies trust? Well theoretically you wouldn’t trust anyone more than your trusty CPA right. Well that’s at least what we think many large companies would see with the big 4. It appears to be happening slowly.

PwC will be able to see the data as read only. This blockchain was developed using Linux Foundation hyperledger fabric.

This doesn’t surprise me because private equity firms are the most active in the blockchain space because they have been using blockchains to track ownership. This is pretty risky depending on who else is on Northern Trusts blockchain. We’ve spoken about this on other podcasts. It would be interesting to see who else is on this blockchain.

KPMG expands its masters of accounting with data and analytics program

As we have previously covered, KPMG offered scholarships to students to get a masters in data and analytics with accounting degree. They launched their pilot program at Ohio State and Villanova University. They have since expanded that to 9 universities

1. Arizona State University
2. Baylor University in Texas
3. Ohio State Max Fish College of Business
4. The University of Georgia’s Terry College of Business
5. University of Mississippi
6. The University of Missouri
7. University of Southern California
8. Villanova School of Business
9. Virginia Tech

KPMG will offer 135 scholarships to qualified students. The focus of the curriculum will focus on technology solutions like data and analytics, robotics, natural language processing, predictive analysis, cognitive capabilities, and workflow automation. All things that we’ve previously covered. KPMG is fully aware that these technologies are the future of accounting so that’s why they are investing in developing these leaders.

Sonoma Partners Joins Ernst and Young

Sonoma partners merged with E&Y in early march. Sonoma partners is a leading consulting firm that specializes in Microsoft Dynamics CRM and Salesforce CRM solutions. CRM stands for client relationship management. The transaction builds on EY’s high quality CRM offerings.

This will help EY build out their digital transformation offerings.

E&Y hires 400 people in charlotte North Carolina

EY is opening another wavespace center and this time they are opening it in Charlotte North Carolina. They will add 375 jobs over the next five years. The wavespace centers focus on new technologies in accounting like artificial intelligence and data & analytics.

EY will receive a 3.2 million tax incentive as part of the deal that will be spread over 12 years. E&Y is set to invest 8.2 million over the life of the project.

EY will pay an average of 75,000 per wavespace job. EY has wavespace centers in NY, San Francisco and Seattle.

In Summary

It is an exciting time in the big 4 as they invest heavily in technology. We’ve seen Deloitte acquire amazon and salesforce consultancies and we’ve seen pwc begin auditing blockchains. EY & KPMG are also investing heavily in tech jobs. EY opening a new innovation center in charlotte north Carolina and KPMG providing scholarships for data & analytics accountants. If you want to work for the big 4, it is extremely apparent that you need to learn about the new technologies that they are using.

It is also important that we don’t skim over the recent scandals and threats to the big 4 accounting firms existence.

It is essential that these scandals are highlighted and prevented in the future. How can they be prevented? I think they can be prevented by new technologies, but I also think big 4 partners and leadership need to be held accountable. I’m not going after the big 4 accounting firms because I am bitter. I am criticizing certain parts of the big 4 accounting firms because they can be great places to work, but the bad apples that work at the big 4 jeopardize their future. If big 4 partners on large accounts are not held more accountable, then regulators will ban the big 4 in certain countries like they have in India or they will break them up and force competition. Unfortunately, the big 4 aren’t really holding their partners accountable right now. All they do is release materials saying they are focusing on audit quality, but it those materials don’t seem to be making their way to leadership at the accounting firms.

It’s not just accountin scandals either. It’s gender pay gaps as can be seen in the latest pay gap releases from PwC and KPMG. Top executives at the big 4 need to be held accountable across the board as it relates to scandals, discrimination and equal pay.

If you want to help our push to keep the big 4 accounting firms accountable, forward this article on to a friend or colleague and start raising awareness on the need for change and need for accountability from top professionals in the big 4. For many of you, your futures will take place at these firms. Make sure that they are great places to work and start raising awareness today. Thanks for reading. Feel free to let us know your thoughts in the comments below.

There were a number of positive news stories about the Big Four accounting firms in second week of March 2018. The big 4 gained significant positive recognition and introduced new programs for community-building and social development, a complete turnaround from the criticisms thrown their way the week prior.

Deloitte and KPMG Recognized by Junior Achievement USA

Deloitte was among the 57 organizations recently recognized by the Junior Achievement USA (JA) for their continued support and invaluable contribution to JA’s community-building and education work for students across the United States. Deloitte received a gold level 2016-2017 US President’s Volunteer Service Award for totaling some 15,000 employee volunteer hours and for helping local JA offices teach students about entrepreneurship, financial literacy, and work preparedness. Deloitte Consulting LLP’s principal, Ainar D. Aijala, Jr., who received the award on behalf of the firm, proudly noted that their employees have regularly volunteered to work with JA and that the company itself donated over $1 million in 2003 to support the development of an ethics curriculum for grade 4 to 12 students.

KPMG was conferred the gold level status for the US President’s Volunteer Service Award for doing more than 15,000 hours of volunteer work to support the entrepreneurship and financial literacy program of the JA. This is the same award given to the Deloitte and their employee volunteers. Rob Arning, KPMG Foundation Chairman, described their employees as “extraordinary people” and reaffirmed the company’s commitment to curb illiteracy and unemployment by engaging middle and high school students.

Deloitte Wins In the Middle East

Next up we are going to discuss some significant investments and wins that Deloitte has made in the middle east.

Deloitte Helps Dubai’s Department of Finance

As part of its expansion program in the Middle East, Deloitte entered into a partnership agreement with Dubai government’s Department of Finance (DOF) to assist in the implementation phase of the International Public Sector Accounting Standards (IPSAS). The partnership hopes to improve the quality of financial reporting of government agencies, with the end view of strengthening transparency, reliability and accountability. Abdulrahman Saleh Al-Saleh, Director General, represented the DOF, while Maher Al-Khalil, who sits on the Board of Deloitte Middle East and is the Managing Partner of the firm’s Consulting Operations services, signed the agreement on behalf of Deloitte. This move is a testament to the government’s commitment to financial effectiveness by upholding high-quality international standards of financial reporting in the government and public sector.

Deloitte builds state of the art facility in Saudi Arabia

Meanwhile, in the Kingdom of Saudi Arabia (KSA), Deloitte will invest in building the Deloitte Digital Center (DDC) in Riyadh to support the Ministry of Communication and Information Technology (MCIT)’s thrust for digital skills development. Through this state-of-the-art facility, Deloitte not only hopes to educate the young people about digital technologies, but more importantly, “contribute to building a thriving economy and vibrant innovative society with new job opportunities for many Saudi citizens,” as Deloitte Global CEO Punit Renjen puts it.

Deloitte builds social development accelerator in the Middle East

Deloitte also intends to support the Middle East’s social development agenda by launching the Deloitte Accelerator for Social Innovation (DASI), a program in collaboration with Ashoka Arab World and Communication Design that will provide technical assistance valued at over $100,000 to organizations that adopt a viable and scalable social development and environmental protection strategy, and ideally have women in leadership roles. Two social enterprises will be chosen from the 14 countries in the Middle East and receive expert advice and training from Deloitte. Winners will also enjoy other learning and networking opportunities to further develop their plans. Deloitte Middle East Chief Executive Omar Fahoum explained that “DASI is an exemplification of Deloitte’s corporate responsibility, where we aim to positively impact the greatest number of people in the Middle East communities through our core expertise and our global Deloitte WorldClass initiative that aims to empower 50 million futures by 2030”.

These developments in the Middle East just go to show what sets the big 4 accounting firms apart from their mid tier counterparts.

KPMG Earns Record Audit Fee from General Electric (GE)

In other news, KPMG received a $142.9 million in fees from General Electric Co. (GE), the biggest so far in their more than 100 years of working together. This news came out from GE’s latest financials and proxy statement.

GE decided to stick with KPMG as their auditor for at least another year because of the firm’s institutional knowledge of the company and their accounting issues with the federal securities regulators. The amount GE paid KPMG in 2017 increased by 59 percent compared to the previous year, primarily due to the GE-Baker Hughes merger. Despite questions from a small percentage of the shareholders, GE Chief Financial Officer Jamie Miller continued to show confidence in KPMG and said that while there are no plans to let go of the firm this year, it is a discussion they have to make on a yearly basis.

KPMG Wins Carluccio’s

KPMG was also brought in by Carluccio’s, an Italian restaurant chain with 102 outlets in the UK, Turkey and UAE, to be their financial advisor amidst poor sales and performance, as well as leadership transition. Carluccio’s pre-tax profits significantly dropped from £5.2 million to only £0.98 million, which led to the closing of their restaurants in various locations.

EY ventures into robotics in Canada

EY launched their robotic services facility in Halifax – the first of its kind in Canada – in response to growing interest in digital transformation. Said facility is part of the EY Global Centers of Excellence which boasts of having completed Robotic Process Automation (RPA) projects in over 20 countries worldwide. It looks to deliver more RPA-based digital services to back office functions of Canadian companies.

The decision to build the facility in Halifax was made because it is known to be a “hub for talent and innovation” and because of its “access to a well-educated and diverse workforce, accessible airport, and a relatively affordable cost of living, per Jad Shimaly, EY Canada Advisory Services managing partner. Through this centre, EY hopes to contribute to the growth of the city and the region as a technology expert.

PwC tests tool to track cryptocurrencies

To help companies trace their digital tokens after their initial coin offering (ICO), PwC is testing a blockchain analytics tool developed by over 80 technology experts. This tool is more than a ledger. It is intended to complement the blockchain technology by enabling the user to not only track the transaction amounts, but also to locate digital coins and know how these cryptocurrencies are being used. This way, companies can lessen the risks associated with misuse and theft post-issuance, and better anticipate the potential circulations of digital tokens. PwC is looking to offer this tool to companies planning to launch ICOs.

It was a week full of damage control for the world’s leading accounting firms as they try to save their reputation and keep their clientele engaged amidst allegations of employee misconduct and large gender pay gaps.

Ernst & Young faces harassment controversy & UK gender pay gap

Take for instance, Ernst and Young’s (EY) office managing partner in South Australia, Don Manifold, who recently left his post at the firm’s Adelaide office because he was found guilty of violating their code of conduct.

After a rigid six-week investigation following sexual harassment allegations, the firm revealed that there was, indeed, a breach of workplace policies involving Mr. Manifold and a female colleague whose name was left out of the investigation report. However, the firm was quick to clarify that the sexual harassment claims against Mr. Manifold were not corroborated.

As a sign of transparency and commitment to clean their ranks of such unacceptable behaviors, Tony Johnson, Ernst and Young’s Australian chief executive, notified EY Australia employees via email about the investigation report and stressed the firm’s stance on bullying and harassment. Mr. Johnson likewise urged employees to report such cases and assured them that each report will be taken seriously and in confidence. “My ask of all staff and partners is to recognize and reward positive behaviors and to call-out unacceptable behavior whenever you see it; whether in the workplace or out of the workplace,” he said.

Mr. Manifold will be replaced by Mark Phelps, a senior auditor of the firm’s Adelaide office and is associated with several reputable organizations such as the Adelaide Football Club, Catherine House, Access2Place, and United Way SA in various capacities.

Other names were also announced to support Mr. Phelps’ new leadership team, including Linzi Carr as people partner, Mark Stewart and Craig Whiteman as service line leaders, and Ben Bishop as transaction advisory services partner.

On the heels of this controversy EY released their gender pay gap numbers in the UK. EY reported

• a mean gender pay gap of 38.1%
• and a median pay gap of 19.5%

Not only do women working at EY face harassment, but it seems like you have to earn less than the men harassing you. EY stated that they are invested in transparency around this issue, and they are also invested in over 20 initiatives to reduce the gender pay gap.

KPMG faces harassment controversy as well

It wasn’t just Ernst and Young that was all over the news last week because of a ‘scandal’. In fact, KPMG had to do damage control themselves when Adrian Lanzilli, their South Australian partner, was involved in a sexual harassment case. He, too, tendered his resignation, but without even waiting for the investigation to begin. And, yes, it doesn’t just end in Australia as KPMG’s reputation has been tarnished in the United States, United Kingdom, and in South Africa due to serious allegations of misconduct and questionable work quality.

KPMG and Big 4 Benefit Globally But Keep Scandals Local

To make matters worse, KPMG along with the rest of the Big Four accounting firms have been called out because of the way they manage controversies – either related to their employees or the actual audit work they produce – in their local partner offices. Critics say that the very nature of the organization’s structure is to blame the lack of accountability on the firms’ headquarters. Critics claim that while the firms’ global offices uphold a strong brand and reputation, and provide strategic guidance and oversight, they have little to no control over what their local employees are doing and how they are executing their work. The critics also assert the the Big Four’s global offices actually prefer it that way to keep their risk low. They want their affiliates’ issues to be resolved locally, as if putting up a firewall, so that the local noise won’t get escalated to the global level and make the firms lose their major clients. “The only time you hear ‘Well, we’re not all KPMG’ is when they get sued”, quipped Steven W. Thomas, a lawyer handling cases against accounting firms.

To address this problem, the Public Company Accounting Oversight Board (PCAOB) required accounting firms to disclose if they are working with local affiliates in conducting an audit. This move, which started last year, hopes to tighten global controls over local affiliates and protect US-based firms and their clientele. Ultimately, scandalous local offices may have to be dissociated from the global network to maintain the firm’s credibility. PCAOB Chairman William Duhnke, however, acknowledges that this might be a bit challenging given that the local affiliates are also protected by their country’s policies on licensing and ownership, and will thus be difficult to open an investigation if needed.

Deloitte Reports Huge Pay Gap in the UK

Meanwhile, Deloitte is faced with a somewhat different yet still workplace-related issue. Their UK branch is being slammed by critics for paying their female employees 43.2 percent lower compared to their male counterparts. The gap represents a wide disparity between the opportunities available to male and female workers, particularly at the senior management level. This was supported by the statement made by Emma Codd, Deloitte UK’s managing partner for talent. She said, “These calculations again serve as a stark reminder that we don’t have enough women in senior roles – this is not about unequal pay, but the shape of our firm.”

Deloitte UK revealed this information in response to the requirement imposed by the UK government to companies with over 250 staff.

Last year, Deloitte UK reported that the mean salary gap is only at 18.2 percent because they deliberately excluded highly-paid executives and partners from the equation. Political groups harshly criticized the accounting firm, as well as other global companies like Ernst and Young and Barclays for inaccurately reporting their pay gap. Lawmaker Nicky Morgan even accused them of exploiting a technical and legal loophole through their selective computations.

However, Deloitte wanted to make things right and revised their report. We “listened to the calls for firms such as ours to do more in how we report gender pay data. We are firmly committed to transparency and achieving consistency in gender pay reporting standards,” explained David Sproul, Deloitte UK’s senior executive.

Needless to say, issues like this can have a huge and lasting impact on the reputation of accounting firms and other global brands. If left unresolved, they may lead to less clients or may even throw a company to a downward spiral pretty quickly. Deloitte, partly because of controversies in their local affiliates, has actually lost six clients, which in turn, made them slide from the top to third place of the FTSE 250 auditor rankings.

PwC Moves to First Place in FTSE 250 Auditor Rankings

On a more positive note, PricewaterhouseCoopers (PwC)  added six new clients in the first quarter of 2018 shooting them to the top of the FTSE 250 auditor rankings.

• This means that PwC audits the most companies listed in the FTSE 250. They now audit 69 clients in the FTSE 250.
• KPMG took on the second spot as they audit 66 clients in the FTSE 250.
• Deloitte dropped from first to third place in the rankings after dropping 6 clients in Q1 2018. This takes them down to 63 clients in the top 250.
• EY landed in fourth as it dropped two clients and is now at 42 clients in the FTSE 250

In a move to even widen its lead, PwC created the role of a Chief Experience Officer and handpicked Roger Gagnon to be the first executive to fill up this important post. With this, PwC looks to carry out its new consulting strategy of “combining business, experience and technology to help clients accelerate their business transformations.” This role will help PwC expand their growth into marketing and design as this role will focus on user design in the technology industry.

Mr. Gagnon’s credentials, with over 15 years of working in this field across the globe, make him perfect for the job.

EY had an activity filled November of 2017. They entered into some key partnerships and are going to be making some big office moves. We cover the most important news about Ernst & Young below.

EY was featured in a blog post on Forbes about Artificial Intelligence

Forbes published an article on Forbes that highlighted a number of ways that EY is currently utilizing artificial intelligence.

EY uses AI to review lease accounting standards. When the IRS issues a new lease regulation, large companies have to manually re-examine tens of thousands of leases to comply with the new law. Ernst and young uses natural language processing to the new standards and assure compliance with them.This new AI process is twice as fast and 3 times more effective than using humans alone. According to EY the system reached break-even point in less than a year.

EY also uses machine learning to detect faulty invoices for clients. One of their clients processes millions of invoices a year, and this system identifies all the faulty invoices. The fraud detection accuracy is 97%. That is really high for AI. The success threshold for most AI projects is 90%.

One thing to note here is that invoice processing and auditing used to be a very manual job, and this is being done by artificial intelligence. This leads me to believe that other more manual audit jobs like inventory counting are going to be done by AI as well. If we jump down the road a couple of steps, there are many manual parts of an audit that are now in danger of being replaced by AI and this forbes article highlights quite a few ways this might happen.

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Get your Free Big 4 Accounting Firms November 2017 News Ebook

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EY is Hiring over 14,000 Candidates in 2018

EY will hire 14,200 candidates in the United States for their FY 2018.  5,400 of these candidates will be experienced candidates while 8,800 will be students. The student jobs will be split between 4,880 college grads for full time jobs and 3,920 will be for internships.

EY also mentioned that they are interested in hiring candidates in fields other than accounting. They were looking towards scientific fields to hire their candidates as they look for candidates to be more analytical and innovative.

They will still be hiring in the typical accounting fields of audit, tax and advisory though.

EY also mentioned that they are look for candidates that are ethnically diverse and women. They said that they apply a 3 pronged approach to helping women and ethnically diverse women advance in their careers.

1. They illimunate a path to leadership for these individuals
2. They create a culture that enables flexibility for all
3. Finally they build a supportive and inclusive environment where all differences are valued

I think EY is taking credit for a bunch of things that people can’t really measure here in case their diversity measures fail. They don’t cite number of diverse people they will hire or retention goals

There were also some unique statistics that came out of this press release

30 percent of the firms US executive hires were women

49 percent of the firms entry level hires were women

EY invested 500 million in training their employees

Over 50 percent of their experienced hires were found via referrals. Through this referral program EY paid out $4 million.

EY Partnerships

EY Partners with SAP on Blockchain solution

EY is extending its relationship with SAP to build out blockchain solutions on various SAP ERP platforms. The specifics of the partnership are that EY will use SAP’s Leonardo platform.

One product that has already been developed is EY’s Ops Chain which is designed to ehlp customers manage their supply chain. It uses smart contracts developed on the blockchain to manage ownership in the supply chain.

This is just proof that blockchain is becoming more common in the accounting industry if EY which is one of the largest accounting firms is building solutions with SAP which is one of the largest accounting ERP developers. It’s only a matter of time before every ERP is in the cloud and has many blockchain solutions.

There are also many quotes from EY leadership and SAP leadership such as

Paul Brody, EY Global Innovation Leader, Blockchain Technology, says:

“Blockchains are quickly becoming routine tools for business processing that companies can use to manage and take action from the huge amounts of data their systems collect and process. This data is often collected across a disconnected, fragmented infrastructure. EY Ops Chain on SAP Leonardo will help companies quickly develop and deploy blockchain solutions that connect business operations across their systems, on a platform already widely used by companies worldwide.”

Saurabh Gupta, Chief Strategy Officer, HfS Research, says:

“Blockchain use cases are expanding to almost every vertical as enterprises realize its potential to create more distributed, equitable and more ‘tamper-proof’ business models. EY’s holistic understanding of a blockchain-based business strategy, combined with SAP Leonardo’s digital innovation capabilities, is a significant step forward in the deployment of blockchain for supply chain. Collaboration between industry leaders like EY and SAP will be essential to fulfilling the promise of blockchain.”

Juergen Mueller, SAP Chief Innovation Officer, says:

“Blockchain helps deliver secure and simplified data sharing in complex multi-party processes. With SAP Leonardo, we provide a toolbox for our customers to access and innovate with all the latest technologies, such as SAP Leonardo Blockchain capabilities. By joining forces with EY, we will work together on blockchain use cases for our customers to help them streamline their complex transactions in the digital economy.”

EY forms tax partnerships with Concur

EY has partnered with Concur which is also an SAP company. Concur is the world’s leading provider of travel, expense and invoice management solutions. The solution that EY and Concur have teamed up to build will allow business travelers manage real time immigration and tax assessments. It will capture all the relevant data within concur. The main offering here is Concurs technology with EY tax and immigration technology and knowledge. This will allow business travelers to see their immigration and tax obligations that results from their travel before they travel.

EY November 2017 Office Moves

San Antonio Office Location

Ernst and young will be opening a new office in San Antonio where 600 new jobs will be created. EY received a tax incentive to locate new jobs in San Antonio Texas.

What’s weird is that the jobs will not be accounting jobs. They will be jobs created for English majors, psychology majors and criminial justice majors. The reason for this is because EY will use the location as a financial services client delivery service center. This means they will be outsourcing back office functions to this location. EY has 6 years to add the jobs in order to receive the tax incentives. The tax incentives could be worth about $3 milion. EY will spend about $ 8 million to finish development and furnish the site.

The average salary of the employees working at this location will be $55,000. They will also hire local graduates from San Antonio.

One Manhattan West Office Location

EY will be occupying the new building hitting Manhattan’s skyline. They are slated to occupy 17 floors of the new Brookfield property. They will move from their current location of 5 times square which is located right in the heart of times square. This is welcome news to all the current employees who do not like working in the heart of Manhattan with all the tourist foot traffic.

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In order to understand who won #auditorproud day 2017 we are going to assess the popularity of posts across 4 social media platforms. We will see which one is the most popular by assessing the  number of likes, comments and retweets.

AuditorProud on Instagram

On Instagram it’s not even close. If you were to search #auditorproud on Instagram you’d think auditorproud was a hashtag invented by EY. EY is the only big 4 to show up for like the first 20 posts. EY obviously executed their auditorproud day very well on Instagram or they just taught their people how to use hashtags really well.

Next up let’s check on youtube to see who did the best with video.

Ok PwC did a great job on youtube as they are the majority of the top results. The only other videos that show up here are our video for auditorproud day from the last year and the center for audit quality’s video from 2015. I will say that auditorrpoud doesn’t seem to be very popluar on youtube as the most popular video here has only 14k views. All the rest have like 100 views. All the pwc videos are auditorproud videos from the pwc offices. PwC atlanta, PwC Detroit and PwC Miami all feature videos on youtube. The most popular video is called “PwC shatters accountant stereotype on #auditorproud day” and this video went up last year. I remember this video from last year. It was pretty popular at the time. I’ll include a link to this video in the show notes and a link to our video as well.

AuditorProud on Youtube

Next up let’s check on youtube to see who did the best with video.

Ok PwC did a great job on youtube as they are the majority of the top results.

The only other videos that show up here are our video for auditorproud day from the last year and the center for audit quality’s video from 2015. I will say that auditorproud doesn’t seem to be very popular on youtube as the most popular video here has only 14k views.

All the rest have like 100 views.

All the pwc videos are auditorproud videos from the pwc offices. PwC Atlanta, PwC Detroit and PwC Miami all feature videos on youtube. The most popular video is called “PwC shatters accountant stereotype on #auditorproud day” and this video went up last year. I remember this video from last year. It was pretty popular at the time.

If you are keeping score at home you should have 1 win for EY and 1 win for PwC.

AuditorProud on Twitter

Now let’s check which big 4 did the best on twitter

Twitter is pretty obvious that EY dominates on twitter as well. Just search under the hashtag #auditorproud and you will see that EY got their people to get the most likes and retweets on twitter out of the big 4.

The most popular EY tweet is from EY CEO Mark Weinberger which has 62 retweets and 111 likes

 

No better time to be #AuditorProud: tech; diversity; making a difference. We’re building a #BetterWorkingWorld #EY https://t.co/yR6PzjlK6O

— Mark Weinberger (@Mark_Weinberger) September 28, 2017

while the most popular tweet from PwC which is from Mary Castanon Moats has 21 retweets and 42 likes. Mary Castanon Moats heads up PwC’s diversity practice.

Tomorrow – show your pride in the audit profession. Tell us why you’re #AuditorProud: https://t.co/rqI3POy6Vl #PwC pic.twitter.com/ThdIATPtfG

— Maria Castañón Moats (@Maria_Moats) September 28, 2017

There really is no sign of KPMG and Deloitte in the top tweets for the auditor proud hashtag.

There are some dark horse candidates that I didn’t even consider who made the top tweets on twitter.

They include the Center for Audit Quality which we’ve spoken about on our website before because members of the big 4 sit on the board of the CAQ. Every time one  of the big 4 changes leadership in the US they appoint a new chairperson to the center for audit quality. Now the center for audit quailty’s mission is to advocate for policies and standards that promote public company auditors’ objectivity, effectiveness and responsiveness to dynamic market conditions. Their tweet had 23 retweets and 39 likes.

At IFAC, we are #AuditorProud today & every day. We salute today’s auditors and those considering a career as an auditor. pic.twitter.com/dR9HYBO3A2

— IFAC (@IFAC_Update) September 28, 2017

Another surprising top tweet is from IFAC which is the international federation for accountants. IFAC’s tweet had 46 retweets and 62 likes which is surprising. It’s mainly surprising because I’ve never heard of IFAC before and I’ve been an accountant for a while now. IFAC stands for international federation of accountants.

According to their website, IFAC is a global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of over 175 members and associates in more than 130 countries and jurisdictions, representing almost 3 million accountants in public practice, education, government service, industry, and commerce.

So if you are keeping track that is 2 for EY and 1 for PwC. Now let’s check out our last social media source for today which is facebook.

AuditorProud on Facebook

If you search for the hashtag auditorproud on facebook you will see that once again EY has dominated this hashtag.

EY dominates the top spots on facebook with their posts garnering anywhere from 59 reactions to 135 reactions on facebook. I’m not sure how EY spread the word about auditorproud but however they did it they did it right. They used the auditorproud hashtag on all social media platforms and paired with the #EY hashtag in many scenarios. Maybe that’s what differentiated them is the use of several hashtage to scale the charts.

The only big 4 firm that was even close on auditorproud day was PwC. PwC at leat put up an attempt while the other big 4 didn’t even try.

As you may or may not remember auditorproud day was started by the center for audit quality in 2015. The main reason that it was started was to give the big 4 an opportunity to showcase that the audit profession was an exciting and rewarding career path and guess who made that statement. That statement was made by Cathy Englebert last year. She is the chair for the Center of Audit Quality and she is also the US CEO of Deloitte.

Well Cathy you didn’t do too good of a job showing how great auditing is in 2017 because your firm didn’t show up in many social media platforms showcasing it’s pride for auditing on auditorproud day.

In conclusion, maybe it’s time to retire auditorproud day if the firms that created it don’t even participate other than EY. Otherwise it seems like it’s just EYpride day to me. Maybe next year the Center for audit quality will change it to EYpride day. If you want to change the results that I just mentioned than make sure to go on social media and start liking your favorite firm.

All eyes were on EY after what happened at the 2017 Oscars. As you may or may not remember Pricewaterhousecoopers botched the 2017 Oscars. The two partners Martha Ruiz and Brian Cullinan got the envelope for best picture mixed up. They awarded the Oscar to La La Land when it should have gone to moonlight. They ended up correcting the matter but not before PwC’s reputation was permanently damaged. There was also some worry as to whether PwC would lose the engagement, but PwC leadership got involved and they were able to retain the engagements.

So entering the 2017 Emmy’s there was so much spotlight on the EY accountants, but it appears like the night went off without a hitch. There was a lot of joking around and references to EY though. That isn’t a bad thing. Having focus on you for the entirety of the show was free advertising for Ernst and Young. They can thank PwC for that.

Let’s go over what happened specifically to EY during the 69th Emmy’s broadcast:

Television Academy President Discuss Emmy’s Accountants

First off the television academy president Hayma Washington was approached on the red carpet about the Emmy’s  accountants and their role. He said that he was confident that there wouldn’t be a La La Land type mistake at the 69th Emmy awards.

“Our accounting firm is Ernst & Young,” he said on the red carpet Sunday. “We’ve reviewed our policies and procedures. Really confident that it’s something that we won’t have happen.”

Hayma Washington said that he felt bad for the people that produced the Oscars and offered the following statement:

“I feel for the producers of that show. They’re all professionals,” he said. “That had to be something very hard for them to swallow. They handled it very professionally.”

Rachael Bloom Introduces E&Y

Rachel Bloom introduced EY for the standard nod to the accountants during the show which is the only time the actual accountants are in front of the TV.

She said the following

There’s only one reason to watch the Emmys you know, and here it is,” sang Bloom as she tap-danced. “The best part of the show. The accountants from Ernst & Young … After the accountants, it’s all downhill from here. Accountants, let’s make out.”

Stephen Colbert Sketch with Ru Paul

THere was a sketch where Stephen Colbert was pretending to talk to the Emmy statue which was played by Ru Paul. He asked Ru Paul a number of questions. He also said that he hooked up with the Emmy statue a few times in the past, and he was referring to times where he had won emmy’s. He was also using a little bit of innuendo there. He then asked the statue if there was any chance that they could hook up that night. Ru Paul said sure but it was up to the accountants at Ernst & Young. THey both had a laugh at that one.

Jimmy Kimmel Sketch

Jimmy Kimmel made a joke about how sometimes they put the wrong name on the envelopes and Stepehn Colbert said, “nope not tonight.” Clearly another joke about PwC’s screwup at the 2017 Oscar’s.

In conclusion, the night went off without a hitch which was what everyone was hoping for. This makes Ernst and Young look amazing compared to PwC. Now all that’s left is to see how PwC performs at the 2018 Oscars.