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Would you do this for a bit of chocolate?

What’s one way of increasing the chances of getting hold of someone’s password?

Does it involve the use of the very latest supercomputer? Does it involve some clever IT geeks hacking into a computer for you?

Or does it involve chocolate?

A bit of research published in the journal Computers in Human Behaviour attempted to find out how people are obligated by the kindness of others. Or in other words, if someone does something nice for a person, how likely is it that the person will be nice back to them?

The researchers in Luxembourg conducted a survey of random people in the street asking them about internet security including questions about passwords.

Some of the people interviewed were given chocolate and some weren’t.

30% of those that were not given chocolate revealed their passwords which to me is a surprisingly high percentage and just goes to show that quite often human stupidity is the weakest link in internet security.

For the people who were given chocolate at the beginning of the interview the figure rose to 44% and if the chocolate was given just before the question on passwords was asked an incredible 48% gave their passwords! Yes, nearly half of the people asked their passwords as part of a survey told a complete stranger their password if they had been given chocolate.

Andre Melzer, the author of the study said that “when someone does something nice for us we automatically feel obliged to return the favour”.

So, in conclusion, if someone walks up to you in the office and offers you a piece of chocolate be careful what you say…

Are you better looking than your boss?

So who’s better looking – you or your boss?

Well, if you are male and your boss is also male there could be some disappointing career news for you if you think you are better looking than your boss.

A study has suggested that male bosses are less likely to promote good-looking men who work for them.

The study by University College London’s School of Management concluded that good-looking men were considered competent by their male bosses but as a result were also seen as a threat to them and their own personal career aspirations.

This raises an interesting point. Organisations no doubt want to employ the most competent people but if a male boss is reluctant to recruit or promote good-looking men because they take the view they are a threat to them personally then it means that good-looking men could be discriminated against whether or not they are competent.

Dr Sun Young Lee, the lead researcher on the study was quoted as saying “organisations want to hire competent candidates but individuals have their own agenda. When employing someone, they do not want the newcomer to do better than them and show them up”.

“What about good-looking females” I hear you say?

The study concluded that the same prejudice did not apply to women. Being a good looking lady was not associated with competence according to the study.

The study was published in the Organisational Behaviour and Human Decision Processes journal and Dr Lee felt her results suggested that organisations should consider appointing external recruitment consultants to avoid personal preferences impacting on recruitment decisions.

One additional point though is that if you yourself are male and have recently been overlooked for a promotion by your male boss then surely the only reason you didn’t get the promotion was because you are better looking than him…

Would a good liar make a good accountant?

Do you have children? Have they ever told you a lie? Even a small teeny weeny lie?

Well, if they have then although you may not be particularly pleased with them, it may actually mean that they have good memories and excellent thinking skills.

Psychologists at the University of Sheffield tested 135 children and found that those children that lied performed much better than the honest children in the group.

The children in the study were aged between 6 and 7 years old and during the study they were given a trivia game. The answers to the trivia game were on the back of the card which they had been given. Initially, each child was in a room accompanied by one of the researchers but the researcher then left the child alone with the card with the answer on the back.

Before leaving the room the researcher told the children not to look at the answer but what the children didn’t know was that when they were alone in the room there were hidden cameras which were monitoring whether they would look at the answers on the back.

25% of the group subsequently cheated and looked at the answers on the back of their cards but claimed that they hadn’t cheated when the researcher returned to the room.

At a later stage, all of the children had to perform a separate memory test and the research found that the children who had lied performed significantly better than those children who didn’t lie.

Dr Tracy Alloway, project lead from the University of North Florida was also involved in the research and said that “this research shows that thought processes, specifically verbal working memory, are important to complex social interactions like lying because the children needed to juggle multiple pieces of information while keeping the researcher’s perspective in mind”.

This has got me thinking as a lot of the readers of this blog are accountants or studying to be accountants.

“Thought processes”, “verbal working memory”, “juggling multiple pieces of information” and “keeping other people’s perspective in mind” are all skills which many accountants need.

Does this mean that you would make a good accountant if you were a good liar when you were a child?

Whatever your answer is, I’m not sure I would believe you…

The Captain was sober, the First Mate was drunk. Was that true? Was that fair?

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I’ve been a qualified accountant for a fair few years now.

I had the pleasure of bumping into my first auditing lecturer last week. It was at a business mixer event and even though it was a long time since we last saw each other he really hadn’t changed that much.

We got talking and I reminded him of something that he told me that I’ve remembered ever since and to me is a great way of explaining what is meant by “True and Fair”. Those of you that have studied financial reporting papers will be aware of the importance of “True and Fair” in connection with financial statements.

In summary, financial statements should provide what is generally understood as a true and fair view of the reporting entity’s financial position, performance and changes in financial position.

I always remember my lecturer telling me the story of the ship’s captain that was having a problem with his first mate who was always drunk. In the end the captain wrote an official entry in the captains log saying “Today, the first mate was drunk.”

The first mate was upset about this and the next time he took charge of the ship when the captain was asleep, he wrote in the log that “Today, the captain was sober”. This of course implied that on other days the captain wasn’t sober as he was drunk.

Now, the statement “today, the captain was sober” was clearly true but I’ll leave it up to you to decide whether or not it was fair!

Nicely said Mr Musk

We’ve all been there haven’t we? Long boring meetings that don’t seem to be going anywhere.

Maybe you’ve tried to give the impression of being interested in what was being said but in reality the meeting wasn’t relevant for you and your mind was wandering to other more interesting things.

Well, if you’re not a great lover of excessive meetings then you are not alone. In fact, you share the thoughts of an incredibly successful and admired business person. Namely, Elon Musk.

Mr Musk’s current business interests include Tesla and SpaceX.

In the past he founded x.com which later became PayPal. Paypal was subsequently bought by eBay for $1.5 billion.

He currently has a net worth in excess of $20 billion.

But what does he think about meetings?

In an email to his staff that was leaked to the electrek website there were a few productivity recommendations:

In the words of Mr Musk, these include:

– Excessive meetings are the blight of big companies and almost always get worse over time. Please get of all large meetings, unless you’re certain they are providing value to the whole audience, in which case keep them very short.

– Also get rid of frequent meetings, unless you are dealing with an extremely urgent matter. Meeting frequency should drop rapidly once the urgent matter is resolved.

– Walk out of a meeting or drop off a call as soon as it is obvious you aren’t adding value. It is not rude to leave, it is rude to make someone stay and waste their time.

– Don’t use acronyms or nonsense words for objects, software or processes at Tesla. In general, anything that requires an explanation inhibits communication. We don’t want people to have to memorize a glossary just to function at Tesla.

– Communication should travel via the shortest path necessary to get the job done, not through the “chain of command”. Any manager who attempts to enforce chain of command communication will soon find themselves working elsewhere.

– A major source of issues is poor communication between depts. The way to solve this is allow free flow of information between all levels. If, in order to get something done between depts, an individual contributor has to talk to their manager, who talks to a director, who talks to a VP, who talks to another VP, who talks to a director, who talks to a manager, who talks to someone doing the actual work, then super dumb things will happen. It must be ok for people to talk directly and just make the right thing happen.

– In general, always pick common sense as your guide. If following a “company rule” is obviously ridiculous in a particular situation, such that it would make for a great Dilbert cartoon, then the rule should change.

Nicely said Mr Musk.

How much do Big 4 partners get paid?

KPMG UK released their results last month for their most recent accounting period and they showed a fall of 10% in pay for the KPMG partners when compared to the previous year.

Although the firm’s revenue rose by 5% to £2.2 billion, it’s profit fell to £301 million.

The firm wrote off a number of technology investments.

KPMG, like the rest of the Big 4, have invested heavily in technology companies in an attempt to stay at the forefront of technology.

Unfortunately for KPMG, not all of their investments were successful. Bill Michael, the Chairman of KPMG, highlighted one investment that hadn’t done so well – KPMG had committed £3 million to Flexeye, a tech company that analyses large amounts of data and it hadn’t proved to be the wisest investment.

Whilst profits fell, it hasn’t all been bad news for KPMG as their audit practice grew by 10%.

Back to the average pay of the KPMG partners though and although their average pay fell by 10% I’m sure that the partners will still be able to afford to buy a sandwich for lunch.

The average pay for the KPMG partners was £519,000 each.

That’s not too bad is it?

But how does it compare with the average pay from the partners of the remaining Big 4.

The most recent reported results show the following average pay per partner:

Deloitte – £865,000

EY – £677,000

pwc – £652,000

It looks like Deloitte partners will be having the more expensive sandwiches for lunch.

I never emailed you…

Sometimes it’s the simple scams that can cause the most damage.

We hear all the time about ignoring scam phishing emails where fraudsters are pretending to be banks to get online bank account log in details but there’s a new scam involving email which is costing some people a lot of money.

The Art Newspaper has reported that at least nine art galleries and art dealers have been caught up by the fraud. The amounts lost to the fraudsters have been significant with amounts ranging from £10,000 to £1 million.

The fraud itself is fairly simple.

The fraudsters hack into an organisation’s email system and look out for emails sending invoices to clients.

For example, if an art dealer has made a sale of a piece of art and then emails the invoice through to the customer for payment, the fraudsters send another email straight after the original email.

This second email looks like it’s come from the art dealer and includes an identical invoice with the only exception being it has a different bank account on it for payment of the invoice. Yes, you’ve guessed it but the bank details on the second invoice are not those of the art dealer but instead are details of a bank account in the name of the fraudsters.

The customer innocently pays the invoice as it looks genuine and as soon as the money is received the fraudsters withdraw the money, close the bank account and are never heard of again.

As far as the art dealer is concerned they are waiting for the payment to be made but the customer has already paid the money but to the fraudster. By the time the fraud is discovered it is too late.

There’s a fairly simple solution to this and ensuring that anti-virus programmes are up to date and email passwords are changed regularly will go a long way in preventing this sort of fraud.

KPMG fires unethical partners

Picture the scene – you’re the senior auditing partner of KPMG in America with more than 30 years of experience serving some of KPMG’s most prestigious clients. There are over 9,000 KPMG people in the US who look up to you as the boss.

You receive some leaked information about which of your audits the US audit watchdog is going to examine as part of their annual inspection of how well KPMG perform audits.

Do you:

(a) Disclose this unethical breach immediately, or

(b) Try to keep things quiet and make sure that the audit files of the audits selected are perfect?

Unfortunately for Scott Marcello, the (now ex) head of KPMG’s audit practice in America, he didn’t choose option (a).

The background to the issue is that every year the US audit regulator, the Public Company Accounting Oversight Board (PCAOB) selects a sample of audits to inspect and ensure they have been performed properly.

A former employee of the PCAOB had joined KPMG. A friend of his who was still working at the PCAOB tipped him off about which audits would be selected for inspection this year.

The confidential information was then passed up the KPMG hierarchy until it reached Mr Marcello.

We can only guess what Mr Marcello and 4 other KPMG partners were planning on doing with the leaked information but one thing was for sure and that was they didn’t disclose the leak.

Whilst the 5 partners clearly weren’t very ethical, KPMG as an organisation acted quickly once they found out about it.

The 5 partners were fired and Lynne Doughtie, the chairwoman and chief executive of KPMG was quoted as saying “KPMG has zero tolerance for such unethical behaviour. Quality and integrity are the cornerstone of all we do and that includes operating with the utmost respect and regard for the regulatory process. We are taking additional steps to ensure that such a situation should not happen again”.

The PCOAB publish the results of their inspections and the previous results of the KPMG inspections perhaps give a reason for why Mr Marcello was keen for any help, whether it was ethical or unethical.

In 2014 and 2015, KPMG had more deficiencies in their audits than any of the other Big 4 in America.

38% of their inspected audits in 2015 were found to be deficient whilst in 2014, 54% were found to be deficient.

Should you employ good-looking men?

That’s an interesting question and unless you’re a modelling agency then the answer for most jobs should be that looks aren’t important and it’s the ability to do the job that counts.

Research from Aarhus University in Denmark though has raised some interesting observations which could have an impact on fast food restaurants.

The study found that women were more likely to order healthy options such as salad instead of unhealthy options such as chips when they were in the company of a good-looking man. The research found that a woman was more likely to go for low calorie items when they were with a handsome man.

This healthy eating wasn’t present though when a women was eating with a good-looking woman.

Men on the other hand, tended to spend more on expensive food and drink when they were with an attractive woman.

Whilst we can probably guess that a woman doesn’t want to be seen as somebody who could eat a whole restaurant on a date and a man wants to be seen as wealthy and able to afford expensive food, Tobias Otterbring, the author of the study puts it nicely when he says “this research reveals how, why, and when appearance induced mate attraction leads to sex-specific consumption preferences for various food and beverages.”

He went on to say that “the most valued characteristics men seek in a female mate are beauty and health, whereas status and wealth are the top priorities for women.”

He also said that the study findings suggested that fast food chains should consider whether to employ good-looking men in case it encouraged women to look elsewhere for healthy options.

Somehow though, I can’t see many fast food restaurants saying that “good-looking men should not apply” in their job adverts.

A bit of a tpyo

We’ve all done it. Pressed the wrong key on the keyboard and before you know it you’ve sent an email or report with a typo in it.

Most of the time these are fairly harmless. This, together with spellcheck facilities means that normally it’s not a major problem if there’s the odd typo.

Unfortunately though, if you’re a software coder then a typo can have a major impact.

Cloud services are where companies store their data on remote servers held by companies such as Amazon, Google and Microsoft.

Last week, numerous websites which use Amazon’s cloud servers went down. These were major websites such as quora.com and soundcloud.com. Amazon subsequently revealed the problems were down to an employee who was trying to fix a software bug in a billing system but typed in the wrong string of characters.

Amazon said that “the command was intended to remove a small number of servers. Unfortunately, one of the inputs was entered incorrectly and a larger set of servers was removed than intended.”

Amazon quickly resolved the issue though and stated that they had “added safeguards to prevent capacity from being removed when it will take any subsystem below its minimum required capacity level. This will prevent an incorrect input from triggering a similar event in the future.”

There are lots of advantages of using cloud servers but as this illustration highlights there are also disadvantages.