Bramwell’s Lunch Beat: Lynne Doughtie to Become First Female CEO of KPMGby
PwC to pay $65 million to settle lawsuit over MF Global
PricewaterhouseCoopers (PwC) LLP agreed on Friday to pay $65 million to settle class-action litigation over failed brokerage MF Global Holdings Ltd., a case in which investors claimed PwC botched its audits of the firm before it collapsed into bankruptcy in 2011, wrote Michael Rapoport of the Wall Street Journal. MF Global shareholders had contended that PwC’s audits gave MF Global a clean bill of health even though the accounting firm knew or should have known that the firm’s financial statements were erroneous and its internal controls weren’t effective. PwC denied any wrongdoing. In a statement on Friday, the firm said it is “pleased to resolve this matter and avoid the cost and distraction of prolonged securities litigation.” The firm “stands behind its audit work and its opinions on MF Global’s financial statements,” PwC said.
KPMG taps veteran as first female CEO
Michael Rapoport also reported for the Wall Street Journal that KPMG LLP has promoted Lynne Doughtie, head of the accounting firm’s fast-growing advisory business, to the role of chairman and CEO, the latest move reflecting women’s advancement to leadership roles in the accounting industry. Doughtie, who was elected by KPMG’s partners to a five-year term as chairman and CEO, will assume her new role on July 1. Doughtie will succeed John Veihmeyer, who has been US chairman and CEO since 2010. Veihmeyer will remain KPMG’s global chairman. Doughtie, 52, has led KPMG’s US consulting practice since 2011. That practice is KPMG’s fastest-growing business, with fiscal 2014 revenues of $2.65 billion and a 17 percent compound annual growth rate since she took over. Now, two of the four largest accounting firms in the United States will soon have women as CEOs. In February, Deloitte LLP named Cathy Engelbert as its CEO, the first time a woman had been named as CEO of one of the Big Four.
Lynne Doughtie statement on her promotion to KPMG CEO
In a press release issued by KPMG LLP on Tuesday, Lynne Doughtie said of her promotion to chairman and CEO: “It is an honor to have the chance to lead KPMG at such a pivotal moment, when ensuring quality and confidence in the work we do has never been more important. Our firm, our clients, and the entire marketplace are looking at a future of unprecedented change and extraordinary opportunity, where ‘business as usual’ is going to mean constant innovation and transformation. I’m excited to team with our incredibly talented people, as we work closely with companies and other organizations to help them address their most complex challenges and opportunities.”
John Veihmeyer, who has been KPMG US chairman and CEO since 2010, said: “Lynne Doughtie is an incredibly innovative, thoughtful, and inspiring leader, who has the exact qualities needed to lead our firm and our people in a time of increasing complexity and change. She has been a key member of our management team during a period in which we have built a strong culture within KPMG, that promotes integrity, high performance, and diversity and inclusion, and I know Lynne will continue to champion these values. She has led our US advisory practice to unprecedented levels of success and established it as KPMG’s fastest-growing business. Lynne will be an extraordinary and inspiring leader for KPMG and our people.”
IASB considers deferral for revenue recognition standard
Now that the new revenue recognition standard is likely to be delayed by a year in the United States, international rule-makers are considering the same for companies that file under IFRS, wrote Tammy Whitehouse of Compliance Week. The staff of the International Accounting Standards Board (IASB) is recommending the board consider deferring the required effective date for the new standard to Jan. 1, 2018, just as the Financial Accounting Standards Board (FASB) is already advocating for companies that file under US GAAP. IASB staff points out that FASB’s move toward a deferral would result in significant timing differences in application of the new standard, with GAAP filers waiting until 2018 to apply the standard and IFRS filers applying it for the first time in 2017. The staff also noted the IASB already permits early adoption, and the FASB is moving toward allowing early adoption, which will already produce some timing differences in adoption.
Leader of SEC’s accounting fraud task force to leave agency
The head of the US Securities and Exchange Commission’s (SEC) accounting fraud task force is leaving the agency, wrote Dave Michaels of Bloomberg. David Woodcock, who was appointed two years ago to root out improper financial reporting, will step down by June, the SEC said in a statement on Monday, without specifying his future plans. SEC Chair Mary Jo White launched the accounting fraud task force in 2013 after the number of such cases declined in previous years. Investigators scanned financial statements for red flags, such as restatements and revisions, to find possible frauds.
Clinton floats tax-code changes as she campaigns in New Hampshire
Democratic presidential candidate Hillary Clinton said on Monday she would consider changes to the US tax code to reward companies that produce goods and services as opposed to trading, which she likened to “playing games,” wrote Amanda Becker of Reuters. “I think what we have to do is look at the whole tax system and try to figure out what is an economic investment as opposed to one without economic purpose,” Clinton said in response to a question during a visit to Whitney Brothers Inc., a family-owned business in Keene, New Hampshire. “Because there are a lot of those, where people are just basically playing games. I want to do everything I can to support goods and real services and take a good look at what is now being done in the trading world.”
Recent AccountingWEB Articles That You Can’t Afford to Miss:
April Showers Bring More Criminal Prosecutions by the IRS
An analysis of government data shows that many IRS prosecutions are timed to coincide with tax-filing season.
Study: Finance Chiefs Are Not Satisfied with Annual Budgeting Process
Many organizations lack the resources to shift toward higher-value budget planning and analysis, report finds.
California and Colorado Are the Worst States for IRS Audits: Study
Report by TaxAudit.com reveals where taxpayers are most likely to be audited by either the IRS or by their state.
Clarified Auditing Standards: Audit Documentation (Redrafted)
It's all about knowing what the auditor did, what the auditor found and what the auditor did about what was found.