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.