“The IRS is increasingly alarmed about honest small business owners being scammed by unscrupulous actors,” he said in a press release. “The further we get from the pandemic, the further we see the good intentions of this important program abused. The continued aggressive marketing of these schemes is harming well-meaning businesses and delaying the payment of legitimate claims, which makes it harder to run the rest of the tax system. This harms all taxpayers, not just ERC applicants.”

The refundable tax credit, which was authorized by the $2.2 trillion coronavirus package known as the Cares Act, aimed to motivate employers to keep workers on staff during the early days of the pandemic as unemployment rates surged. The IRS has received more than 3.5 million employee retention credit claims since the program was enacted.

But a good chunk of those ERC claims have been fraudulent, forcing the IRS in May to alert business owners about ERC scams from marketing ne’er-do-wells. Calling it a “barrage of aggressive broadcast advertising, direct mail solicitations, and online promotions,” the IRS said ETC promoters are “wildly misrepresenting and exaggerating who can qualify for the credits.”

On July 26, the agency announced it was increasingly shifting its focus to review these claims for compliance concerns, including intensifying audit work and criminal investigations on promoters and businesses filing dubious claims. The IRS said on Thursday that the agency is working on hundreds of criminal cases, and thousands of ERC claims have been referred for audit.

As part of the wider compliance effort, the IRS said it is working with the Justice Department to address fraud in the ERC program, as well as promoters who have been ignoring the rules and pushing businesses to apply for the tax credit. Promoters are able to take advantage of “There’s still time” and “See if you qualify” promotions to lure small business owners into filing ERC claims. 

The IRS said it has auditors who were trained to examine ERC claims that pose the greatest risk, and the agency’s Criminal Investigation (IRS-CI) division is actively working to identify promoters of fraudulent claims for potential referral for prosecution to the Justice Department.

Former IRS Commissioner Mark Everson, currently vice chairman of tax consulting firm Alliantgroup, said he fully supports Werfel’s decision to temporarily suspend the ERC program.

“[Alliantgroup has] helped thousands of taxpayers claim this important benefit. That said, we have also screened out thousands of potential claimants who don’t qualify for the employee retention credit. In too many instances other so-called experts have then stepped in and assisted them in securing monies from the government under the flimsiest of justifications. This dynamic is damaging the tax community,” he said in a statement.

In the meantime, the IRS is still working on previously filed ERC claims received prior to the moratorium and payouts will continue—but at a slower pace due to the more in-depth compliance reviews, the agency noted.

“With the stricter compliance reviews in place during this period, existing ERC claims will go from a standard processing goal of 90 days to 180 days—and much longer if the claim faces further review or audit,” said the IRS, which added it may also seek additional documentation from businesses to ensure their claims are legit.

This enhanced compliance review of existing claims submitted before the moratorium is critical to protect against fraud but also to protect the businesses from facing penalties or interest payments stemming from bad claims pushed by promoters, Werfel said on Thursday.

“For those people being pressured by promoters to apply for the employee retention credit, I urge them to immediately pause and review their situation while we look to add new protections and safeguards to stop bad claims from ever coming in,” he said. “Businesses should seek out a trusted tax professional who actually understands the complex ERC rules, not a promoter or marketer hustling to get a hefty contingency fee. Businesses that receive ERC payments improperly face the daunting prospect of paying those back, so we urge the utmost caution. The moratorium will help protect taxpayers by adding a new safety net onto this program to focus on fraudulent claims and scammers taking advantage of honest taxpayers.”

Plans to help victimized businesses

The IRS said it is developing new initiatives to help businesses who found themselves victims of aggressive promoters. This includes a settlement program for repayments for those that received an improper ERC payment. More information about the settlement program will be released this fall.

In addition, the IRS said it is finalizing details that will be available soon for a special withdrawal option for those businesses that have filed an ERC claim but the claim has not been processed. This option—which can be used by businesses whose claim has not yet been paid—will allow small business owners who were misled by promoters to avoid possible repayment issues and paying promoters contingency fees. Filers of these more than 600,000 claims awaiting processing will have this option available, according to the IRS. The agency also noted that those who have willfully filed fraudulent claims or conspired to do so should know that withdrawing a fraudulent claim will not exempt them from potential criminal investigation and prosecution.

To date, IRS-CI has uncovered suspected pandemic fraud totaling more than $8 billion. As of July 31, IRS-CI has initiated 252 investigations involving more than $2.8 billion of potentially fraudulent ERC claims. Of those, 15 of the 252 investigations have resulted in federal charges. Of the 15 federally charged cases, six have resulted in convictions and four of those cases have reached the sentencing phase with the average sentence being 21 months, according to the IRS.

The Innovation Awards were first presented in 2004, as a means to honor new or recently enhanced technologies that benefit tax and accounting professionals and their clients through improved workflow and efficiencies, increased accessibility, enhanced collaboration, greater accuracy, or other means. Nominated products or technologies must be less than two years old or have had new, significant features or enhancements during that time.

“The Tax & Accounting Technology Innovation Awards get more exciting every year as new solutions and features are developed. Our software vendors are working non-stop to create the tools we need to do our jobs more effectively,” said CPA Practice Advisor Editor-in-Chief Gail Perry, CPA. “We hope you’ll take the time to examine each of our featured products this year as you optimize your potential for achieving success in your business.” Perry also manages a tax practice and is the author of more than 30 books, including Mint.com for Dummies, Surviving Financial Downsizing, and Idiot’s Guide to Introductory Accounting.

The winners of the CPA Practice Advisor Tax and Accounting Technology Innovation Awards are selected from nominated products by an awards committee, which includes thought leaders and professionals engaged in various practice specialties across the accounting profession.

CPA Practice Advisor provides a variety of independent digital and print resources for accounting professionals, including practice resources, podcasts, reviews of practice technologies, interactive tools, and content that helps firms achieve greater productivity. Award winners are listed in alphabetical order.

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2023 Winners:

Avalara Property Tax
https://www.avalara.com/us/en/products/property-tax.html

Avalara Property Tax is a digital business solution for real and personal property tax management designed to improve tax compliance with automation. Property tax is one of the most challenging business compliance activities due to the complexities of preparing personal property returns and the downstream implications of assessments and tax bills for real and personal property.

All 50 U.S. states and the District of Columbia assess property taxes on real property (land, buildings, etc.). Additionally, 38 states and the District of Columbia levy a business personal property tax on tangible property—including supplies, equipment, etc. Further complications arise from many jurisdictions having different forms, due dates, terms, varying depreciation schedules, and transforming data from client systems.

Avalara’s new web solution enables accounting professionals to efficiently manage their clients’ entire property tax portfolio and compliance activities, from preparing business personal property renditions to handling and processing assessments, appeals, and tax bills. Pairing Avalara’s technology with its intelligent document management for property tax vastly increases practice accuracy and efficiency.

Accountants and professional service firms that manage property tax compliance for clients require solutions that maximize the client service experience and minimize the cost of compliance. Leveraging the automation of Avalara Property Tax, accounting professionals can simplify all elements of managing the property tax process and valuation to ensure clients only pay the necessary property tax while minimizing risk and maximizing ROI.

Avalara Property Tax is scalable and configurable to address business requirements while supporting large volumes of work to meet demanding workloads. Avalara Property Tax offers future-proof SaaS flexibility for all property tax compliance activities across real and personal property managed in one secure, central hub. And significantly, as part of the Avalara Platform, accounting firms can use Avalara Property Tax to automate clients’ property tax compliance alongside other tax compliance requirements.

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BILL
https://www.bill.com

BILL is the center of our customer’s day-to-day financial operations as a leader in financial automation software for accounting firms and the small and midsize businesses they support. Businesses rely on BILL to efficiently control their payables, receivables, spend and expense management. In the past two years, BILL has listened to customer feedback to create new features that bring greater control, efficiency and profitability to accounting professionals. BILL has launched three new features that help accountants provide their clients with improved cash flow visibility and more flexibility with payments. This included:

Invoice Financing: Invoice Financing allows customers to get paid early for outstanding invoices. Instead of waiting 30 days to get paid, customers can finance customer invoices and get money in as little as 5-10 minutes. For a 3% origination fee per invoice, they can receive advances on unpaid invoices. The process is fast and easy, and it doesn’t affect a customer’s credit score. Invoice Financing helps businesses have the money they need for their business to grow.

BILL balance: BILL balance is a financial account that can be used to hold funds and pay bills within one business day at no additional cost. Unlike wire transfers at a bank, customers can make these payments digitally anywhere, anytime, all while having the additional benefit of automatically reconciling with your existing accounting software.

Pay by Card (PBC): BILL subscribers can pay their vendors with a debit or credit card – even if the vendor does not accept cards. Paying a vendor by card can give your client more time to settle the debt on their credit card account, freeing up cash. As a bonus, customers still get to earn credit card rewards on all transactions.

Invoice Financing launched in January 2023, BILL balance launched in 2022, Pay by Card launched in July 2022.

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Botkeeper Operating System by Botkeeper
https://www.botkeeper.com/en/knowledge/botkeepers-new-operating-system

Experience more visibility into a centralized and consistent source of truth on transaction categorizations. With out-of-the-box powerful machine learning, firms can now expect more visibility and interactivity with Botkeeper’s technology as it uses historical client details in combination with algorithms trained on millions of data points to intuitively auto-categorize clients’ transactions and directly sync them back to the general ledger system. This will allow firms to be prompted for review when needed and ensure they’re equipped with information that is accurate, accessible, and always reliable when serving their clients.

Gain deeper visibility into firm-wide operations on client work. Firms can adopt a sophisticated approach to project management across their clients, keeping their bookkeeping processes working in harmony without the need for multiple third-party integration tools. Workflow improvements and upgraded file structures will ensure that customer data is always consistent and up to date, even as the firm adds more clients, which means firms can scale with confidence.

More control over user access and permissions. Our upgraded experience gives system admins even more control of their data by making it possible to better control permissions for selected users and teams. This change gives firms a higher level of assuredness that their clients’ information is only visible to the staff team members who should be seeing it. 

Use powerful reporting – purpose built for accounting firms: Firms need quick answers to their clients’ or even team members’ questions, which can be tricky to access when reporting begins and ends in spreadsheets.

Now, firms can bring multiple widgets and reports into a single picture to help teams focus on the metrics that matter most. See powerful business insights and even schedule reports to be delivered via email on a recurring basis. View the Janover case study for BOS impact across their firm: https://www.botkeeper.com/janover-case-study.

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Fieldguide AI
https://www.fieldguide.io/

Fieldguide AI is the industry’s first secure and private AI solution that helps firms future-proof their business. The new solution allows firms to securely leverage the latest AI innovations to significantly reduce the manual work associated with engagements, so that staff members can focus on more critical and higher margin work. With the latest Fieldguide AI features, firms can increase engagement quality, margins, and staff retention, while allowing practitioners to leverage their professional expertise in more productive ways.

Fieldguide AI provides a set of AI capabilities purpose-built for advisory firms. It is a practitioner-centric AI, designed to enhance and automate the services that firms offer to their clients. It brings the magic of AI to team members as they write test plans, analyze evidence, and review client documents. Fieldguide AI performs routine tasks, similar to a junior associate, in order to elevate and empower teams to engage more frequently with clients and think critically about client risks.

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Karbon AI
https://karbonhq.com/feature/ai/

Karbon AI is a GPT-powered artificial intelligence tool embedded within the award-winning accounting practice management software—Karbon.

Karbon AI’s first iteration focuses on making accountants more efficient with their email while improving the client experience they offer. Functionality includes the ability to summarize long email conversations and internal discussions, adjust the tone of email, assess the priority of inbox emails, and compose email drafts based on prompts and from within workflow tasks.

By embedding artificial intelligence into Karbon’s practice management system, users can now leverage the power of GPT in the context of their own data and workflow without relinquishing privacy or security. They will also enjoy a productivity boost as they spend less time sorting through long email threads or stressing over the best way to respond to angry client emails, freeing them up for more valuable work.

As a truly connected practice management solution, Karbon is home to more context than any other tool in an accounting firm’s workflow, and it is open to vast possibilities with AI.

And email efficiency is only the beginning. Karbon AI will continue to evolve and expand what it can do with data across the collaborative workflow to automate more tasks, save more time, and add more value to accounting firms and their clients.

Finalists:

Digits AI
https://digits.com/

Digits AI combines the strengths of generative natural language interaction with unparalleled data security and the accuracy of its proprietary financial modeling. From instant report generation to automated categorization and the ability to answer questions about a client’s books in real time, Digits AI makes the full accounting pipeline faster and smarter. Digits AI truly represents the future of business finance.

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HubSync Gateway
https://www.hubsync.com/gateway

HubSync Gateway levels the playing field for CPA firms, providing access to an end-to-end, customized audit and tax digital platform.

A centralized view provides‍: 360 visibility, real-time updates & status reporting, transparency, increased collaboration, and streamlined interactions‍. All while offering different views for internal teams, corporate and individual clients.

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NettTracker
https://www.nett-tracker.com/

nettTracker takes the pain out of recording fixed assets, prepaid expenses, deferred revenue, accruals. Creating all the journal entries you need. Hours of time saved, and month-end made easy.

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Once Accounting Technology
https://www.onceaccounting.com/

Once Accounting’s client integration platform revolutionizes accounting firm workflows. By offering real-time data, simplified processes, and automation, CPAs experience improved efficiency, productivity, and profitability. Clients benefit from proactive service, accurate financial insights, and timely tax planning. Once Accounting’s innovation drives success for professionals in the industry.

–

TaxPlanIQ
https://www.taxplaniq.com

TaxPlanIQ is a revolutionary way for accounting firm owners to organize their clients’ tax strategies quickly and easily so they can demonstrate expertise, communicate value, and price.

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Nominations for the 2024 Innovation Awards will open next spring.

Currently, finance teams spend a disproportionate amount of time reimbursing employees around the world for their out-of-pocket expenses. As business leaders continue to grapple with market fluctuations, a potential recession and other external factors, the need for automation and streamlined workflows has become more urgent. A recent Tipalti survey of CFOs found that 70% are currently making or using digital technology investments to pursue finance automation, and over two-thirds (67%) agree that expenses are a very important area to apply digital technology.

“As a global company, centralizing our expenses processes and policies is a major challenge,” said Rami Darouiche, Controller at T3 Micro, a creator of innovative styling tools. “Without proper oversight and checks and balances, employee spend can quickly become out of control and a huge pain point for any company, not to mention the challenges of ensuring employees are reimbursed quickly and in the currency they require. Tipalti Expenses checks all of those boxes. It provides an easy-to-use interface for employees and managers and the ability to submit, approve and reimburse globally at lightning speed.”

Tipalti customers have already been reaping the benefits of Tipalti Expenses, including:

• Fast Global Reimbursements: With support in over 196 countries, 120 currencies and up to six payment methods, finance teams can quickly and securely reimburse employees no matter where they are in the world and in the currency of their choice.
• Auto ERP Sync and Reconciliation: Expense-based transactions and reimbursements are automatically captured, processed and categorized by general ledger (GL) expense type for better visibility and are automatically reconciled at the entity GL level within the ERP system.
• Reduced Errors and Fraud: Automated expense policies and embedded compliance checks ensure expenses are being submitted and reimbursed in accordance with company policies, helping enforce spending limits while ensuring compliance, minimizing fraud and reducing manual employee steps and finance workloads.

“Tipalti’s expense management solution is a timely response to the pressing needs of finance teams. As organizations increasingly prioritize automation and streamlined workflows in the face of market uncertainties, Tipalti Expenses offers a useful set of tools for all aspects of expense management,” said Kevin Permenter, Research Director, Financial Applications at IDC. “By addressing the pain point of manual reimbursement with its robust global payment infrastructure and providing an employee-friendly experience with its intuitive mobile and web interfaces, Tipalti’s offering will be a welcomed addition to the market with the potential to save users both time and resources.”

Tipalti also launched a physical U.S. card offering — the counterpart of its virtual Tipalti Card announced in September 2022 — to provide another method for managing travel and entertainment expenses. Existing Tipalti Card users, including FloSports, Achieving The Dream and Encoura, now easily create physical or virtual credit or debit cards on demand. Integrated with Tipalti’s comprehensive global finance automation platform, finance teams have full visibility on card spend with automatic reconciliation and robust controls.

Additional benefits of Tipalti Card include:

• Automatic Reconciliation: Card transactions are automatically captured and processed like other payment methods, eliminating the need to chase internal stakeholders for supporting documents or manually enter data into the ERP. Automatic receipt collection and cardholder transaction review also improve GL accuracy and reduce manual finance workloads.
• Centralized Spend and Improved Visibility: Finance teams can manage and consolidate all employee, supplier and payee spend in one place, whether it’s with Tipalti Card, ACH, wire transfer, PayPal or checks.
• Spend Control: Physical and virtual cards are issued with robust controls, including spending limits, vendor limits and approved categories. Finance teams can also pre-approve purchases with card request approval workflows tailored to companies’ processes and rules, suspend or cancel a card at any time and quickly identify and resolve unrecognized merchant payments in real time.

“In today’s climate, finance leaders require real-time data and full visibility to forecast future spending and scale accordingly,” said Roby Baruch, Chief Product Officer at Tipalti. “Tipalti provides the most innovative and easy-to-use solutions to make this happen all from one platform. The addition of Tipalti Expenses and the physical Tipalti Card are the final pieces of the most comprehensive global finance automation platform available.”

“Tax Analysts is proud to partner with NovaTax to support small and midsize CPA firms,” said Tax Analysts president and CEO Cara Griffith. “Expanding the reach of select content helps advance our vision of fostering an open and informed discussion about taxes.”

Key features:

1. Federal & State Tax Library: NovaTax provides access to a comprehensive federal and state tax library, ensuring practitioners have the most up-to-date information at their fingertips. It also includes enhanced primary law documents with expert summaries, and quick reference charts and state tax audit guides.

2. News from Tax Analysts: Select federal and state tax news on NovaTax is written by the experts at Tax Analysts. Receive daily updates and weekly newsletters that are customizable by tax topic and state/jurisdiction. (Includes all 50 states).

3. User-Friendly Interface: The company says that it’s modern and user-friendly interface enables even those new to the platform to become proficient in 10 minutes or less.

4. Affordable Pricing: Subscription levels start at $65 per month.

More information about NovaTax’s features and pricing plans is at www.NovaTaxIntelligence.com.

The new office is in LoDo Towers, an office building located in the heart of Denver’s LoDo (lower downtown) area. The Denver office will be led by William Delsa. Other CohnReznick leaders serving the office include George Klenovich, South/West Regional managing partner; Justin Wenzelman, partner; Al Lowry, director; and Richard Wu, director.

CohnReznick has approximately 20 employees living and working in the Denver area and is currently recruiting both experienced and entry-level talent, the firm said.

“CohnReznick has been serving Colorado businesses across a variety of industries for years and currently serves nearly 1,000 clients in the Denver area,” CohnReznick CEO David Kessler said in a press release. “This roster includes one of our largest clients in Mercy Housing, a national nonprofit and one of the nation’s largest affordable housing organizations. Establishing an office in Denver is an extension of our overarching growth strategy, which prioritizes our ability to meet the growing needs of our clients and create opportunities for our people. As with our additional recent expansions to Dallas and South Florida, we’re committed to delivering our full breadth of capabilities and building upon our national and local expertise.” 

Delsa added, “Denver is ripe with opportunities for our growth goals and for our people. This expansion will allow our teams to continue building upon the relationships and history that we’ve cultivated in the Denver market for many years but will also reveal new opportunities for us to explore with a physical presence. I’m honored to lead our Denver office and look forward to CohnReznick serving as a trusted advisor to many Denver-based businesses.”   

  

He had his $250 million bail revoked in August, after the judge in his case ruled he likely tried to tamper with two government witnesses. His lawyers asked the federal appeals court in Manhattan on Tuesday to release him so that he could properly prepare for his trial.

Bankman-Fried’s lawyer, Mark Cohen, said his client was merely exercising his First Amendment free-speech rights when he spoke to a New York Times reporter about the case. But the appeals court said Thursday there was “probable cause” that he had “engaged in witness tampering” by sharing the private writings of Caroline Ellison, his former girlfriend who served as the CEO of Alameda Research.

The decision came hours after the trial judge ruled that the former chief executive can’t call seven expert witnesses to testify on his behalf, which may narrow the scope of his defense.

U.S. District Judge Lewis A. Kaplan, who revoked Bankman-Fried’s bail in August, largely ruled Thursday that the witness testimony would have no bearing on issues in the case or could confuse the jury. However, he did leave the door open for Bankman-Fried’s legal team to call some witnesses—including two experts in data analytics and blockchain technology—to respond to the government’s witnesses.

Prosecutors in Manhattan had asked the judge to exclude the expert witnesses, who were prepared to testify about the crypto industry, political donations, Alameda’s balance sheets and the use of customer funds. Former Federal Election Commission chairperson Bradley Smith was also poised to charge $1,200 an hour to provide insight into U.S. campaign finance laws.

The case is US v. Bankman-Fried, 22-cr-673, US District Court, Southern District of New York (Manhattan).

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©2023 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency LLC.

The same poll asked workers if they felt recognized at work. Of the respondents, only 37% said they feel “very recognized” at work, while 46% feel only “somewhat” recognized and 8% said they don’t feel recognized at all.  

When workers were asked about their current workplace concerns, they specified salary cuts as their biggest fear, followed by wage gaps and worker strikes. Gen Z workers were most concerned about nationwide strikes, while millennials cared more about cuts to their salary. Concerns about job security and wage gaps topped the list by Generation X and baby boomers. 

Pay gaps

The majority of workers, or 73% of all working adults, agree the gender wage gap is still very real. Nearly six in 10 working men believe their current salary is influenced by their gender (58%), compared to 54% of female employees.

Making changes

When it comes to making changes in the workplace, half of those surveyed believe speaking directly to management is the most effective way to pressure companies and bosses to improve work conditions and pay (51%). 

Beyond that, many believe that labor/union strikes (49%), filing a complaint with the human resources department (40%), or posting on social media (36%) could positively change workplace conditions.

When employees were asked if they belonged to a labor union, half said yes (43%), and half said no (43%). Of those who belong to a union, 93% said joining one was the best work-related decision they’d ever made.

In relation to worker strikes, 41% of respondents said they participated in a labor strike, while 47% said they had never done so. Of those who did, the reasons varied, from better work conditions and higher pay to better health insurance and benefits. 

When asked whether they would be in the same job at this time next year, only 26% said that scenario was “very likely.”

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All contents copyright 2023 The Kiplinger Washington Editors Inc. Distributed by Tribune Content Agency LLC.

• Few employees are flourishing: Only 27% of knowledge workers say they have a healthy relationship with work. India leads with 50% of employees saying they have a healthy relationship with work, while only 28% of employees say the same in the United States, and Japan lags far behind with only 5% of employees saying their work relationship is healthy.
• What unhealthy looks like: 55% of employees say they struggle with self-worth, mental health, and report feeling like a failure. More than 60% say they struggle with their physical health—poor sleep, exercise, and eating habits.
• This impacts the quality of work: 76% of people with an unhealthy relationship with their work consider leaving the company, 39% say they are disengaged, and a third are less productive.
• Employees are willing to take a pay cut for happiness: 83% of employees said they’d be willing to earn less to be happier. Specifically, they’d give up 11% of their salary to work somewhere where employees are engaged and leadership is emotionally intelligent, and they’d give up 13% of their salary to work where or when they want.

“There is a huge opportunity to strengthen the world’s relationship with work in ways that are both good for people and good for business,” said Enrique Lores, president and CEO, HP Inc., in a statement. “As leaders, we must always reject the false choice between productivity and happiness. The most successful companies are built on cultures that enable employees to excel in their careers while thriving outside of work.”

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Fast Company © 2023 Mansueto Ventures LLC. Distributed by Tribune Content Agency LLC.

Signing on the dotted line before reading a contract has cost many Gen Zers, too. Adobe Acrobat says that 20% of the respondents have agreed to something they were not aware of, and 10% have admitted to losing money because they signed a contract without reading it.

Yet Gen Z makes an effort to fully read some types of contracts over others. The Adobe Acrobat poll found that:

• 85% of Gen Z do not read a pet adoption contract in full.
• 83% do not read the contract for subscription services in full.
• 68% do not read renting or leasing contracts in full.
• 67% do not read employment contracts in full.

The employment contract stat is one of the most concerning for Gen Z professionals just getting started in the workplace. By not reading an employment contract in full, the person may not fully understand their compensation package or the terms required to get the annual bonus they were told of when the company made the offer.

Yet even after times when not reading the fine print had negative repercussions, 61% of Gen Zers said they still do not read contracts fully.

Of course, Gen Z isn’t the only group to be reprimanded when it comes to not reading contracts fully. The Adobe Acrobat poll found that other generations are also guilty of signing before reading fully: 24% of Gen Xers admitted to never reading contracts fully, while 33% of baby boomers admitted doing so as well.

For its poll, Adobe Acrobat surveyed 506 Americans and 505 freelancers, small businesses, and “solopreneurs.”

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Fast Company © 2023 Mansueto Ventures LLC. Distributed by Tribune Content Agency LLC.

Those admitted to the partnership include:

• Fiorella Belardi, Tax and Business Services, Miami
• Marilea Campomizzi, Assurance Services, Mayfield Village, OH
• Kyle Connors, Assurance Services, Providence, RI
• Blerina Demiri, Tax and Business Services, New York
• Philip DiBartolomeo, Quality Control, New York
• Jennifer Freitas, Assurance Services, Providence, RI
• Matthew Giovine, Tax and Business Services, New York
• Jeremy Handlon, Assurance Services, Portland, ME
• Giuseppe Ienopoli, Assurance Services, Melville, NY
• Jeffrey Jackson, Tax and Business Services, Nashville
• Karla Jimenez, Client Accounting and Advisory Services, Washington
• Andrew Kantor, Business Enterprise Services – Tax, New York
• Mileny Kondorosi, Tax and Business Services, Miami
• Christopher Manzo, Tax and Business Services, New York
• Marina Margarucci, Tax and Business Services, East Hanover, NJ
• Nicholas Marazza, Tax and Business Services, Fairlawn, OH
• Jessica McCauley, Transaction Advisory Services, New Haven, CT
• Joseph Mecagni, Business Enterprise Services – Tax, Boston
• Shivanni Narain, Assurance Services, Fort Lauderdale, FL
• Derek Parks, Risk Advisory Services, Tampa, FL
• Rashi Ray, Quality Control, Melville, NY
• Samuel Scherr, Tax and Business Services, Rockville, MD
• Robert Schumin, Tax and Business Services, Marlton, NJ
• Husnain Siraj, Assurance Services, Houston
• Gary Smith, Assurance Services, New Haven, CT
• Rosanne Smith, Tax and Business Services, Costa Mesa, CA
• Benjamin Tenenbaum, Assurance Services, Melville, NY
• Nicholas Thomas, Tax and Business Services, Philadelphia
• Brian Trombley, AIG Assurance Services, Melville, NY
• Marissa Turrell, Valuation, Forensics and Litigation Services, Hartford, CT
• Matthew Weiler, Assurance Services, Philadelphia

“These new partners embody the essence of Marcum’s dedication to excellence, bringing together unique experience, unrivaled proficiency, and a drive to innovate,” Marcum Chairman and CEO Jeffrey Weiner said. “The pace of change in our industry is swift, and these individuals have risen to the occasion, blending technical expertise with a deep understanding of our client’s needs. My sincere congratulations to them on behalf of the executive committee and the entire firm.”

“We’ve seen that the most magical and empowering moments people have experienced with AI is when it’s informed with the context that extends way beyond what’s in front of them,” Nadella said. “This requires that what we think of today as separate categories — search, productivity, operating systems devices—all come together and evolve.”

For the past year, the Redmond, Washington-based software maker has been retooling its biggest products around AI technology that can generate new content from massive datasets. That list now includes Windows, Office, Bing search, security software and customer and finance products. The work heavily leverages the GPT-4 technology from OpenAI, in which Microsoft has invested $13 billion.

Microsoft rivals including Alphabet Inc. and Salesforce Inc. are working on their own products to help customers make use of the latest AI technology aimed at speeding up and automating some tasks.

The Office product, unveiled in March, has been in testing with about 600 customers and will cost $30 per user a month on top of what most business customers already pay. The product lets workers uses data from the web as well as a company’s internal information, to do things like analyze spreadsheets, generate slide shows and predict future business issues.

Microsoft announced the Windows product in May, saying it would be accessible from a PC screen taskbar button that opens a side panel customers can use as an assistant. The tool lets one copy and paste text, as well as rewrite, summarize and explain content, among other tasks. Windows users can also ask the Copilot questions as they can with the Bing AI chat.

The company also showed how a user can copy an email with information on things to do nearby, and the Copilot seamlessly provided locations for each. The software can automatically show the distance in time rather than miles if the user says they prefer to walk. Microsoft said it’s also testing the Office AI tools with a group of consumers and small businesses.

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©2023 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency LLC.

Founded in 1992, Raimondo Pettit is a full-service public accounting, audit, tax, business management, and financial consulting services firm with three Southern California locations: Torrance, Irvine, and Long Beach.

“Right from the start, it was clear that our companies shared a strong cultural connection,” said RPG Managing Partner Timothy Pettit. “Knowing about Eide Bailly’s solid culture, dedicated staff, and ample resources made joining forces appealing to RPG.”

Eide Bailly currently has 43 offices in 15 states. Eight of those 43 offices are in California.

Results have been buoyed by an international growth spree, including efforts to improve the company’s presence in Africa in recent years, Vorsatz said. The company now has offices in almost four dozen countries across the continent.

“Up until four years ago, we were just in Nigeria and Kenya,” Vorsatz said. “We’ve built a very significant platform in a relatively short time.”

The Andersen moniker was sullied in 2002 by charges of document shredding and obstructing a Justice Department investigation into Enron’s accounting, which prompted hundreds of clients and partners to defect. The effects of the scandal can still be seen today: U.S. lawmakers passed the landmark law known as the Sarbanes-Oxley Act, which tightened regulations for auditing companies.

In the aftermath of the scandal, Vorsatz was one of 23 former Arthur Andersen partners that set up a firm of U.S. tax consultants known as Wealth & Tax Advisory Services LLP. In 2014, the firm bought the rights to use the Andersen name.

Vorsatz has long taken issue with those who say the Arthur Andersen name is symbolic of accounting fraud. The firm’s conviction, he notes, was overturned by the U.S. Supreme Court in 2005.

“The Andersen brand has had an extraordinary impact on our growth, our ability to attract quality clients and to recruit people,” Vorsatz said.

Africa Opportunity

These days, Andersen Global is an association of legally separate firms from all over the world that employ tax and legal professionals alike. Initially, these independent companies start out as “collaborating” firms before they become full members that can take part in the company’s profit-sharing system.

The company now has 14,000 of these professionals worldwide. About 11% of them work in firms across Africa.

The company sees an opportunity to help government officials attract private capital and form new public-private partnerships, Vorsatz said. These tie-ups allow governments to tap consortiums of private companies that, in turn, raise money and design, build and operate infrastructure projects.

The company has a presence in Guinea, which is China’s biggest bauxite supplier, as well as Nigeria and South Africa, the continent’s biggest economies. It also works with firms in Chad, a minor oil producer and Gabon, the second-smallest member of the Organization of the Petroleum Exporting Countries.

“We’ve gone into big countries, we’ve gone into small countries,” Vorsatz said. “Africa affords us that opportunity.”

— With assistance by Michael Kapoor

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The British business has over 26,000 people on its payroll, including 992 partners last year.

PwC U.K.’s profit declined to £1.3 billion in the year to June 2023 from £1.5 billion in 2022, the company’s financial results showed. Results for the previous year included a £139 million boost from the sale of its global mobility practice.

Revenue of the U.K. group, which includes its Middle Eastern businesses, increased 18% to £5.8 billion, when excluding the mobility unit sale. The gains were driven by 30% growth in its consulting business which benefited from Middle Eastern firms looking to diversify beyond oil, the company said.

PwC U.K.’s audit revenues grew 19% as it was reappointed by HSBC Holdings Plc and was appointed to audit NatWest Group Plc from 2026.

“Against a backdrop of political and economic upheaval, our multidisciplinary business has charted a strong course,” said Kevin Ellis, PwC’s U.K. chair and senior partner. “Considering the sizeable investments we’ve made in our people and technology, partner profits beat our forecasts.”

PwC also said it handed around half its U.K. staff as much as £1,500 spread over five months to help them cope with higher energy bills.

The firm is also growing its presence outside London. Over half of its 1,600-strong graduate class were hired in other locations, and the number of people working in PwC’s Cardiff office grew by 25%.

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He is fighting to restore confidence in PwC Australia following revelations that a former senior partner obtained confidential tax policy information while advising the government. The firm then used it to advise global clients. PwC stands to lose millions of dollars in revenue due to its breach as clients review their relationship.

“Past leadership failed to meet the standards our people, our clients, the community and the Australian government rightly expect, and for that I apologize,” said Burrowes.

Seymour made A$4 million ($2.6 million) in 2023 even after the scandal, the firm said in its results published Sept. 1.

Despite growing revenue 11% to A$3.4 billion, profit was flat in the year to June 2023, because of the reputational damage caused by the leak, the company said.

Results for this year don’t include the sale of its government advisory business to Allegro funds for A$1. Government advisory work accounted for 20% of PwC Australia’s revenue in the 2023 financial year.

Together with the reputational fallout, the divestment is set to hit 2024 revenues, the firm said, meaning partner pay will be cut by as much as 30% in 2024. PwC’s Australia partners saw their average pay decline by 12% in 2023, with the lowest paid partner earning A$374,000.

In July, PwC named eight partners who had left the firm or would leave soon following an internal investigation into the leak of confidential tax documents by a former partner advising the government.

The firm is awaiting the results of an independent review of its governance, accountability and culture in late September. PwC will publish its own transparency report in response to that document, the company said.

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“We are honing-in on areas where we believe noncompliance among our wealthiest filers has proliferated over the last decade of IRS budget cuts, and pass-throughs are high on our list of concerns,” IRS Commissioner Danny Werfel said in a statement on Sept. 20. “This new unit will leverage Inflation Reduction Act funding to disrupt efforts by certain large partnerships to use pass-throughs to intentionally shield income to avoid paying the taxes they owe. These efforts are consistent with our broader commitment to use Inflation Reduction Act dollars to end the era of historically low error rates for wealthy and large entities, while making sure middle- and low-income filers continue to see no change in audit rates for years to come.”

The Inflation Reduction Act, which was enacted in 2022, set aside nearly $80 billion for the IRS over a 10-year period to bolster its enforcement of wealthy tax cheats. 

The announcement of the new pass-through unit comes nearly two weeks after the IRS said it would open examinations of 75 of the largest partnerships in the U.S. that on average have over $10 billion in assets by the end of September. The agency said it will be using improved technology, including artificial intelligence, to better detect tax cheating by large partnerships and wealthy earners, identify emerging compliance threats, and improve audit case selection tools.

Pass-through organizations, including large partnerships and S corporations, will be the focus of the new work unit within LB&I. The IRS noted that these groups are not subject to the corporate income tax, but instead income is “passed through” onto the income tax returns of the individual or corporate owners and taxed at their income tax rates. Pass-throughs are frequently used by higher-income groups and can be complex tax arrangements.

LB&I Commissioner Holly Paz announced the creation of the new pass-through unit during a speech at a Tax Executives Institute meeting in New York on Wednesday.

“This is an important change we will be making, and we will be working in the months ahead to efficiently and effectively transition to this new group,” Paz said. “This effort will include working inside the IRS, as well as working with external partners, to ensure this is a smooth transition period for everyone involved.”

The IRS said it will be coordinating with the National Treasury Employees Union on the effort. The work group will formally “stand up” late next year, Paz said, but work involving pass-through areas will continue to increase before that time. The group will eventually expand to include employees from both the LB&I and the IRS Small Business/Self-Employed division, according to the IRS. 

The average total fees paid by the S&P 500—which includes audit fees, audit-related fees (assurance and related services), tax fees, and other fees—grew 3% in 2022 to $13.5 million, the highest amount seen over the past 20 years, according to Audit Analytics. In 2021, the average total fees paid by the S&P 500 was nearly $13.2 million.

Overall, total fees reached $6.76 billion in 2022, a 4% increase from the previous year. Audit Analytics said:

In FY2022, total audit related fees increased 10% from FY2021, the largest growth of any fee category. Contrarily, both total tax fees and total other fees decreased 7% and 5%, respectively in FY2022. Total tax fees have continued to decline each year since FY2020 after consistent annual increases between FY2009 and FY2019. Meanwhile, total other fees have declined for a seventh consecutive year in FY2022. 

Six of the seven largest accounting firms in the U.S. audited the companies in the S&P 500 index in 2022: PwC, Deloitte, EY, KPMG, Grant Thornton, and BDO USA. Of those, PwC led the audit fee market share, receiving 35.7% of total audit fees paid by S&P 500 companies last year, according to Audit Analytics. PwC brought in $1.9 billion, followed by EY with $1.4 billion, Deloitte with $1.2 billion, and KPMG with $738.9 million.

Collectively, the Big Four took up 99.7% of the S&P 500 market share in 2022. Grant Thornton and BDO USA together audited only six companies in the index, comprising less than 1% of the audit fee market, Audit Analytics said.

In terms of average audit fees, PwC led with an average of $12.6 million received per S&P 500 client, followed by Deloitte, KPMG, and EY.

“The great resignation has turned into a mindset of staying put while the global economy sorts itself out,” said Francesca Lagerberg, CEO of Baker Tilly International Ltd.

She said MHA, Baker Tilly’s U.K. accountancy arm, was seeing fewer staff hand in their notices than normal.

She isn’t the only one spotting a change in attitude. A slowdown in dealmaking and concerns about the economy have put the brakes on consultants jumping ship, according to data from Consulting Point and conversations with consultancies and recruitment firms.

Fewer than 750 people left the UK divisions of the Big Four accountancies—Ernst & Young LLP, PricewaterhouseCoopers LLP, Deloitte LLP and KPMG LLP—last month, compared with more than 1,500 in August 2022, the data showed. It’s a similar situation at McKinsey & Co., Bain & Co. and Boston Consulting Group, which saw 87 leavers at the end of summer—around half the level of a year ago. 

There are also fewer open roles this year as accounting firms tighten their purses. The Big Four hired about 790 people in August, according to Consulting Point figures. Last year, that number was more than 1,500.

Attrition, or the number of people departing without being replaced, is now half the normal rate in the consulting world, several recruiters told Bloomberg News.

As well as having fewer deals to advise on and the economic uncertainty, consultants are seeing clients cut costs by shelving longer-term investments. 

“Strategy consulting is very, very quiet. Anything around M&A, growth strategy, those people are firing, not hiring,” said Matthew Bennett, director at Ascent Professional Services. “People getting made redundant is higher than normal, but people leaving their jobs is lower because they’re nervous about the market.”

The current situation is a U-turn for Big Four firms which hired hundreds of thousands of people in a bet on a post-COVID recovery, as well as making up for the wave of leavers between mid-2021 and 2022. Together, the four firms employ more than 80,000 people in the U.K., making the sector a key indicator of confidence among finance workers.

EY recently announced plans to cull about 5% of staff from its U.K. financial services consulting division amid a slowdown in demand, while rival PwC said it’s cutting pay increases and bonuses for some of its 25,000 U.K. employees. 

That’s without taking into account this year’s wave of voluntary redundancies affecting as much as 10% of certain departments, according to Richard Stewart, managing director at recruitment consultancy Mindbench.

The professional services industry is the U.K.’s biggest recruiter of graduates, hiring around 8,000 in 2022—almost double the number that went into the public sector, according to market research firm High Fliers. Most of these join in September, typically the industry’s busiest hiring period. Almost 6,000 people started roles at the U.K.’s top accounting firms that month in 2022.

KPMG is on track to hire around 1,400 graduates and apprentices this year in the U.K., said Chief People Officer Lisa Fernihough.

They join an industry with much less churn than they might expect.

EY’s attrition has slowed down over the last nine months across the whole of Europe, Middle East, India and Africa, EY’s managing partner for the region Julie Teigland said in an interview. The firm saw 20% of its employees in the region leave in June, down from about 24% in the same period last year. Meanwhile in the U.S., KPMG’s U.S. partners have been told they will be put on 50% pay during six months of gardening leave if they quit to join a rival, which would make moving jobs even less attractive.

Current job opportunities don’t come with a big enough pay jump to justify a move, especially when compared with the salary increases seen in the last two years, Ascent’s Bennett said. 

The trend might not last forever—but worryingly for the firms, it could be the most talented staff who end up leaving. In 12 months’ time, the best-performing employees could start looking for jobs elsewhere if they grow frustrated because more senior roles aren’t being vacated, Bennett said. 

“They’re not getting promoted and they’re not getting bigger pay increases,” he said. “They’ll feel their career is going stagnant and they’ll push on. We’ll see attrition go up.”

— With assistance from William Shaw

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