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.
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.
- They illimunate a path to leadership for these individuals
- They create a culture that enables flexibility for all
- 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 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.