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EY gets banned from new audit business in Germany

economist.com

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Re: EY gets banned from new audit business in Germany

#221

Post by mlyle »

wongarsu wrote: post #103
AbrahamParangi wrote: post #58

Earlier quoted context omitted.

The counterpoint is what's the point of reducing losses on bankruptcy if it makes the entire business climate worse? By trying to protect creditors you just make everyone poorer.

Does it? You could equally well argue that punishing CEOs for bankruptcy makes banks more willing to lend money, improving the business climate. And of course for startups in the early years it's not that relevant anyways, since nobody will lend you anything until you have revenue. VCs invest instead of lending and aren't owed anything if you shut the company down.

> You could equally well argue that punishing CEOs for bankruptcy makes banks more willing to lend money, improving the business climate.

Banks can take into account the borrowing history of the executive teams already.

> And of course for startups in the early years it's not that relevant anyways, since nobody will lend you anything until you have revenue.

Being unable to make payments on leases, etc, is pretty likely for startups that fail.

Re: EY gets banned from new audit business in Germany

#222

Post by [deleted] »

andrewmutz wrote: post #219
23B1 wrote: post #179

I worked at Accenture as an MD for several years, primarily on innovation and transformation programs. I have plenty to say about them, but I think the key driving factor for all of the grift and awful performance has a lot to do with how they operate, which is to sell in a big program, then pull a switcheroo and try and pack a project with as many low-paid MBAs as possible – kids straight out of college tasked with…

Does outsourcing major strategic initiatives even work? Seems like the definition of the sort of things you shouldn't outsource

[deleted]

Re: EY gets banned from new audit business in Germany

#223

Post by benatkin »

andrewmutz wrote: post #219
23B1 wrote: post #179

I worked at Accenture as an MD for several years, primarily on innovation and transformation programs. I have plenty to say about them, but I think the key driving factor for all of the grift and awful performance has a lot to do with how they operate, which is to sell in a big program, then pull a switcheroo and try and pack a project with as many low-paid MBAs as possible – kids straight out of college tasked with…

Does outsourcing major strategic initiatives even work? Seems like the definition of the sort of things you shouldn't outsource

I think the answer is "it depends".

Re: EY gets banned from new audit business in Germany

#224

Post by robocat »

bitL wrote: post #104
tom-from-july wrote: post #72

Earlier quoted context omitted.

This is terrible advice and you or actually your Estonian company will be fined for tax fraud. In Germany income is taxed where it is generated, which includes the head of the person running the business. So if you run your foreign company from Germany - which is expect to be the case if you have no physical permanent office in Estonia, where you also have to be regularly present - you home is considered to be an bus…

That's why one should just move to Dubai and escape Germany and its crazy taxes and health insurance costs.

Dubai? Extremely bad advice unless you deeply understand the sometimes “crazy” implications of their Sharia based laws e.g. debts:

  The UAE has no bankruptcy laws, so there is no protection for those who fail to meet their car repayments, pay off their credit cards or default on their mortgage, even accidentally.

  Anyone who fails to make their payments faces imprisonment in the notoriously tough prisons of the United Arab Emirates, and the Sharia-influenced debt offences have even led Interpol to circulate red alerts to capture indebted Europeans attempting to flee the UAE.

  There have been previously recorded cases of foreign workers being prevented from leaving the Emirates after being blacklisted for simply missing one credit card payment or bouncing a cheque. As a result, many expats are forced to abandon their lives to avoid jail time, often with their car keys still in the ignition.
I would bet they fixed their information systems, and you couldn’t now leave if you happen to screw up.

https://www.carkeys.co.uk/news/the-story-behind-dubais-aband...

Re: EY gets banned from new audit business in Germany

#225

Post by [deleted] »

hef19898 wrote: post #220
krn wrote: post #188

Earlier quoted context omitted.

> Well ok, but was EY less competent than McKinsey or did they just get unlucky that they're the poor bastards who stepped on the landmine? I have asked myself the same question, before I noticed that EY is basically the Credit Suisse and the SoftBank of the audit world[1]: > EY has been involved in many accounting scandals: Bank of Credit and Commerce International (1991), Informix Corporation (1996), Sybase (1997),…

Well, EY started as part of Andressen (?) and was as such part of the Enron scandal. We shouldn't ignore the scandal of the century. EY so is a very reputable accounting firm. Unreputable would be the Metaverse headquartered shop FTX used.

[deleted]

Re: EY gets banned from new audit business in Germany

#226

Post by lordnacho »

SilverBirch wrote: post #168

I don't know if I have just enough knowledge to be dangerous, but it seems to me that auditors don't really do what people think they do. Auditors seem mainly to just double check the numbers they're handed. This serves a purpose, it provides some level of guarantee that companies that are acting in good faith are generally reporting correct numbers. Auditors don't do what people seem to think they should do - invest…

What never made any sense to me was the incentives. Is the company supposed to hire people to write a public report saying the company committed fraud? It doesn't really seem like it makes sense for anyone. If anything, you'd just do some minimal performative work to say you had a good look in the company, and then you pick up more work next year. If you write a critical report, how many companies will want to hire you? I'll pick the easy going auditor who doesn't give me a hard time, thanks.

Contrast that with say an HMRC tax audit. They're not there to be your friend and it actually makes sense for them to investigate certain firms.

It would be interesting to read a history of the industry to see how we ended up here.

Re: EY gets banned from new audit business in Germany

#227

Post by Jolter »

23B1 wrote: post #179

I worked at Accenture as an MD for several years, primarily on innovation and transformation programs. I have plenty to say about them, but I think the key driving factor for all of the grift and awful performance has a lot to do with how they operate, which is to sell in a big program, then pull a switcheroo and try and pack a project with as many low-paid MBAs as possible – kids straight out of college tasked with…

Interesting, but how does your experience relate to the linked story? Is EY somehow related to Accenture? Are Accenture also doing auditing?

Re: EY gets banned from new audit business in Germany

#228

Post by tim-- »

hef19898 wrote: post #220
krn wrote: post #188

Earlier quoted context omitted.

> Well ok, but was EY less competent than McKinsey or did they just get unlucky that they're the poor bastards who stepped on the landmine? I have asked myself the same question, before I noticed that EY is basically the Credit Suisse and the SoftBank of the audit world[1]: > EY has been involved in many accounting scandals: Bank of Credit and Commerce International (1991), Informix Corporation (1996), Sybase (1997),…

Well, EY started as part of Andressen (?) and was as such part of the Enron scandal. We shouldn't ignore the scandal of the century. EY so is a very reputable accounting firm. Unreputable would be the Metaverse headquartered shop FTX used.

You might be thinking of Accenture, which was founded from the ashes of Andersen Consulting.

Andressen is one half of Andreessen Horowitz (a16z) which (I think?) doesn't have any connection to Enron.

Re: EY gets banned from new audit business in Germany

#229

Post by 23B1 »

Jolter wrote: post #227
23B1 wrote: post #179

I worked at Accenture as an MD for several years, primarily on innovation and transformation programs. I have plenty to say about them, but I think the key driving factor for all of the grift and awful performance has a lot to do with how they operate, which is to sell in a big program, then pull a switcheroo and try and pack a project with as many low-paid MBAs as possible – kids straight out of college tasked with…

Interesting, but how does your experience relate to the linked story? Is EY somehow related to Accenture? Are Accenture also doing auditing?

They're both global professional advisories with a ton of similar services and competing for similar clients. They ought to be thought of as basically body shops for management consulting.

Re: EY gets banned from new audit business in Germany

#230

Post by 23B1 »

chinabot wrote: post #185
23B1 wrote: post #179

I worked at Accenture as an MD for several years, primarily on innovation and transformation programs. I have plenty to say about them, but I think the key driving factor for all of the grift and awful performance has a lot to do with how they operate, which is to sell in a big program, then pull a switcheroo and try and pack a project with as many low-paid MBAs as possible – kids straight out of college tasked with…

Lets face it, the answer from chatGPT would be almost identical to what these consultants say, however the main reason for consultants is to CYA so if the decision is bad, you can blame someone else.

I won't deny that I've been using it as a research assistant to investigate a lot market forces and conditions, but as always I have to support it with quality data and citations if it's gonna play in the board room and with savvy institutional investors.
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