Published on: 18 Apr 2017
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.
(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.
Published on: 18 Mar 2017
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.
Published on: 11 Mar 2017
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.
Published on: 04 Mar 2017
It’s an unfortunate fact of life that people get sick. In the winter months especially, there can be a lot of cold and flu bugs going around.
But what percentage of working hours do you think are lost to sickness?
The ONS (Office of National statistics) in the UK has just released details of the number of sick days in 2016. The number of hours lost to sickness as a percentage of working hours was 1.9% or to put it another way, about 137 million working days were lost due to illness in the UK last year.
This may sound a lot but of the number of sick days taken has fallen over the last few years. Last year the average number of sick days per worker was 4.3 whereas when records began in 1993 it was 7.2 days per worker.
It looks like the fall in sick days could be down to a number of factors.
The economic downturn in the late 2000’s arguably caused people to “struggle on” through an illness rather than risk losing their job. Companies are also more flexible nowadays when it comes to letting people work from home. If someone isn’t feeling 100%, a lot of employers will let them work from home and even if they are not up to full speed at least they will be doing some work.
The details also show that there’s a difference between the public sector and the private sector. The percentage absenteeism in the public sector is 2.9% compared to 1.7% in the private sector.
The most common reasons for missing work last year included minor illnesses such as colds (25%), musculoskeletal problems such as back ache (22%), mental health problems including stress and depression (11.5%), stomach upsets (6.6%) and headaches and migraines (3.4%).
Published on: 28 Feb 2017
It’s a busy time for new parents when a baby comes along. Lots of employers give maternity and paternity leave for the new mums and dads but what about when your “baby” has 4 legs and a waggy tail?
Artisan Brewers BrewDog are a Scottish beer company who are very successful and sell their craft beers around the world.
They are also pretty unusual. They have grown from having two staff and two investors in 2007 to a current global team of in excess of 500. It has broken crowdfunding records with more than 32,000 shareholders.
More recently though, they became the first major company to offer their employees a week off if they get a new puppy. This will enable the humans to bond with their new pets without worrying that their work will suffer.
Founders James Watt and Martin Dickie, who themselves founded the company with their dog Bracken, said in a company statement that ‘Yes, having dogs in our offices makes everyone else more chilled and relaxed – but we know only too well that having a new arrival – whether a mewling pup or unsettled rescue dog – can be stressful for human and hound both.
‘So we are becoming the first in our industry to give our staff help to settle a new furry family member into their home,’
If any employees are thinking of getting a new puppy, then they won’t be the first in the company with a dog.
As well as providing time off for new dog owners, BrewDog also allow their employees to take their pet dogs into the office and there are currently over 50 employees at their head office alone who take their dogs to the office every day.
Published on: 03 Feb 2017
Does your weight affect the amount of money you earn?
That’s an interesting question and researchers from the universities of Strathclyde in Glasgow and Potsdam in Germany have come up with a potential answer.
They analysed data from nearly 15,000 working men and found that men within that the recommended Body Mass Index (BMI) health range earnt more than those who were outside of the range.
Individuals who were underweight on the body mass index were found to earn 8% less than those who were in the top end of the healthy bracket. They found that the effect was more prominent in manual jobs where no doubt the extra strength of the guys in the healthy weight bracket helped increase their earnings.
What was perhaps surprising though was that there was also a difference in earnings in white-collar office jobs. They found that in the more middle-class occupations the rewards peaked at a BMI of around 21.
It wasn’t just men who were impacted though. The study also looked at the weight and earnings of 15,000 German women and found that the slimmest earnt the most and the obese the least.
Jonny Gifford, of the Chartered Institute of Personnel and Development was quoted in the press as saying “it is depressing that, in this day and age, looks are in any way a factor in how much people are paid”.
I have to agree with him as organisations should employ people on the basis of their abilities as opposed to how heavy they weigh.
Anyway, best dash as I’ve got a packet of biscuits to finish…
Published on: 21 Dec 2016
Anyone that has studied hard for their exams will almost certainly at one time or another utilised the services of a strong coffee.
Whilst desperately trying to cram that last bit of knowledge into your brain before the exams there is often a temptation to grab a strong coffee late in the night to keep your mind awake.
For years students around the world have been utilising the caffeine in coffee to help get that extra mark or two.
Coffee is said to originate from East Africa where legend has it that a 9th century Ethiopian goat herder by the name of
Starbucks Kaldi noticed that after his goats had ate some coffee beans they started bouncing around like teenagers at the local disco.
This started the journey of coffee and associated caffeine hits so loved by students around the world.
Over in Thailand though a new type of coffee has just been put on sale which has, how can I put it, but a pretty unusual processing method.
The key staff involved in the processing function are also unusual as they have massive heads and bodies, weigh on average 4,000 kg and are grey in colour.
Yes, that’s right. The key team members involved in processing coffee are 20 Thai elephants.
The new brew of coffee is “processed” by getting the elephants to eat some coffee beans and then stepping back (in fact stepping way back) and letting the natural digestive juices in their stomachs do the job of “processing” the beans before they are deposited naturally on the ground a day later.
The beans are then handpicked out of the elephant dung by people who probably don’t bite their nails before being dried and then ground into coffee.
The finished coffee is said to have a
slight pooey taste smooth flavour without the bitterness of normal coffee and is some of the most expensive coffee in the world selling for nearly £150 per kilo.
It’s certainly an unusual production technique but it’s also for a good cause as 8% of the sales revenue goes towards the Golden Triangle Asian Elephant Foundation, a refuge for rescued elephants in Thailand.
We’re now heading off on our Christmas holidays and will be back blogging in January.
Thank you to all of you that have read our blog during 2016 and have a great holiday season!
Published on: 01 Nov 2016
What do you wear to work?
If I had asked that question 10 years ago the chances are that a large proportion of answers would have been “a suit”.
Things are different now though. Tastes are changing and so are a number of office dress codes. As a result, fewer people are now wearing suits to the office.
A number of major companies revised their dress codes this year. JP Morgan for example decided to allow their employees to wear business-casual attire on most occasions. PwC also switched to a more casual dress code where employees were allowed to wear jeans as long as there were no client meetings.
Whilst this relaxing of business wear rules can have benefits for individuals who prefer to work in more casual clothing, there are some organisations who will suffer.
Fashion brands focussing on tailored men’s suits are an obvious example of a business which could suffer due to the decline in demand for men’s suits.
Brioni, the Italian menswear fashion house owned by French holding company Kering was founded in Rome in 1945 and is renowned for its high-quality suits. It has had numerous famous faces as its customers including James Bond in the Bond films from Goldeneye to Casino Royale and more recently it was reported that Donald Trump has been wearing Brioni suits during his US presidential campaign.
But things aren’t going well for Brioni.
Earlier this year Bloomberg reported 400 job losses due to a fall in demand and recently Justin O’Shea, the creative director of Brioni who was brought in to modernise the luxury Italian brand, left abruptly after just six months in the job.
Mr O’Shea is well respected in the fashion industry and has a reputation for being a very straight talking person. He told Vogue that “First of all, I would change the shitty logo. I would change the campaign. I would change the clothes. In fact, I would change pretty much everything.”
When it comes to change though, one thing seems certain and that is that the fall in demand for men’s suits is unlikely to change given the relaxing of more and more office dress codes.
Published on: 16 Oct 2016
Sometimes it’s not what you do that counts but what your competitor does.
Apple are without doubt a great company and one of the most successful organisations that has ever existed.
They released their iPhone 7 the other week and whilst the die hard Apple fans will say that it is a big step forward for the iPhone, a number of commentators were not overly impressed with it.
But, and it’s a big but – their share price has been performing phenomenally well over recent weeks.
Just over 3 months ago at the end of June the price of an Apple Share was $92.04.
Since then the share price has increased by nearly 28%. This increase is partly due to the introduction of the new iPhone but the problems of their biggest competitor have also played a major part in their share price increase.
Samsung’s Note 7 has been a disaster for the South Korean company. Reports of the newly introduced Note 7 catching fire and the subsequent withdrawal of the phone from the market have caused big problems for Samsung.
Not so for Apple though as the 28% increase in their share price driven by the new iPhone and the problems at Samsung has resulted in the company increasing its value by $138 billion in the 109 days from 27 June to 14 October. Yes, the market value of Apple increased by $138,000,000,000 in just over 100 days.
$138 billion in 109 days is equal to
$1.27 billion per day, or
$52.75 million per hour, or
$879,205 per minute, or
$14,653 per second.
That’s not too bad an increase is it?
Published on: 22 Sep 2016
Should you employ good-looking people or not so good-looking people?
Whilst the obvious answer would appear to be that it doesn’t matter what a person looks like as long as they can do their job properly, researchers in Japan have found out that the attractiveness of an employee can have an impact on the sales of a business.
Interestingly though, it’s probably not the correlation most people would think applies.
Researchers at the Chinese University of Hong Kong studied retail sales in shops and found that the more attractive the shop assistants of the opposite sex were, the lower the sales were. The researchers found that male shoppers were less likely to go into the shop if the more attractive woman in the research study was serving.
Even if they entered the shop with the attractive shop assistant in it, only 40% of them bought something. This compared to 56% who purchased something when a less attractive assistant was serving.
Lisa Wan of the University said “attractive service providers can lead consumers to become self-conscious or embarrassed. This is especially true when the provider is of the opposite sex. Even when the attractive salesperson is the same sex, consumers may feel a sense of inadequacy through self-comparison.
In either case, the shopper may avoid interacting with physically attractive providers, rendering the salespeople ineffective”.
It’s worth mentioning though that the scientists undertaking the research were monitoring a shop selling figures from Japanese comics and the male shoppers were obsessed with computers.
“Male shoppers obsessed with computers” – surely they would only notice the female shop assistant if she was holding a computer?