Exclusive Breaches: Prime Minister Boris Johnson pictured drinking at Downing Street party during lockdown

The man is alleged to have stripped the "classified" status from files relating to 500 departmental projects, before forwarding them to his personal email address to access at home.

A figure familiar with the "serious" breach of security protocols told the ABC the contractor removed the classification ratings from documents so his actions did not trigger an internal departmental alert system.

Hundreds of classified Home Affairs documents believed sent to unsecured address in 'serious' breach of security protocols

Kill off the AAT, it’s stacked with Morrison’s Liberal mates, no longer credible

Exclusive: Prime Minister Boris Johnson pictured drinking at Downing Street party during lockdown ITV News 

‘The haves and have-yachts’: on the trail of London’s super-rich Guardian

Vladimir Putin's rumoured girlfriend Alina Kabaeva was off-limits for Western sanctions. Until now

CRS Insight, Algorithmic Stablecoins and the TerraUSD Crash, May 16, 2022: “…TerraUSD (UST) stablecoinuses an arbitrage mechanism typical of some algorithmic stablecoin arrangements consisting of two coins or tokens: the stablecoin, in this case UST, meant to maintain a stable value or “peg,” and a balancer token, in this case,LUNA, the value of which can fluctuate. An algorithm manages the relationship between these two coins to attempt keeping the stablecoin pegged to the reference. 

GAO, Tax Compliance: IRS Audit Trends for Individual Taxpayers Vary by Income:

From tax years 2010 to 2019, audit rates of individual tax returns decreased for all income levels. On average, individual tax returns were audited over three times more often for tax year 2010 (about 0.9 percent) than for tax year 2019 (0.25 percent). Audit rates for taxpayers with incomes of $200,000 and above decreased the most, largely because higher-income audits tend to be more complicated and require auditors to manually review multiple issues, according to IRS officials. Because audit staffing has decreased, IRS cannot conduct as many of these audits, compared to lower-income audits, which are generally less complex and involve more automated processes. In addition, IRS officials stated that the number of returns filed by higher-income populations is growing, meaning more audits are needed to achieve the same audit rate.

A Half-Century with the Internal Revenue Code: The Memoirs of Stanley S. Surrey (Lawrence Zelenak (Duke) & Ajay Mehrotra (Northwestern; Google Scholar) eds. Carolina Academic Press 2022):

Stanley S. Surrey was the most prominent mid-twentieth-century American tax law academic, and the federal government official with the greatest influence on tax policy over that same period (aside from politicians). His professional life with the federal tax system spanned half a century, ending only with his death at the age of 73 in 1984. As Surrey writes in his memoirs, he had good reason to "doubt that any person alive today has had as close and as varied a relationship with the Internal Revenue Code as I have had."

They’re Worried About The Spread Of Information, Not Disinformation Caitlin Johnstone 

 

Pressure Mounts on Patel Over Assange Decision ConsortiumNews 

 

SEC prepares to crack down on misleading ESG investment claims Financial Times

New York City removes the last payphone from service CNBC

Terra Collapse Triggers $83 Billion Decentralized Finance Slump Bloomberg

Crypto links with banks pose threat to financial stability, says ECB Financial Times. This never should have been allowed to happen.

$28 for a beer? New York airports crack down on ‘exorbitant’ food and drink Guardian. Resilc: “$250 for baby formula.”

Why Is America Polarized? The Answer May Surprise You

America is divided against itself as never before. Some thoughts as to why. 

Orwell Prizes

Covering the froth of exiled life in all its forms: travel, booze, fashion, art & more…

The Louvre’s former boss charged in art trafficking case

• by Aurelien Breeden

Looking back at a horrific week

Coverage of the police response and how politicians have responded, urgent questions about showing images, powerful late-night monologues, and more.

  Orwell Prizes finalists 

       They've announced the finalists for this year's Orwell Prizes, which includes the Orwell Prize for Political Fiction, for which nine titles remain in the running (none of which I've seen). 
       There are also prizes for Political Writing and for Journalism, but of course the best-named of the lot is the Orwell Prize for Exposing Britain's Social Evils for which there are, surprisingly, only ten finalists ..... 
       The winners will be announced 14 July. 

       Publishing in ... Ukraine 

       At Deutsche Well Anastassia Boutsko reports that a Ukrainian publishing house makes books to survive -- Kharkiv-based Vivat 
       Ed Nawotka had a Q & A with CEO Yulia Orlova at Publishers Weekly two months ago, Ukraine's Vivat Publishing House Fights to Survive. 

       Dorothy Project profile 

       At Publishers Weekly John Maher profiles Dorothy, a (Successful, Experimental) Publishing Project -- the feminist independent press run by Danielle Dutton and Martin Riker, Dorothy, a Publishing Project. 

Jhumpa Lahiri Q & A

       Jhumpa Lahiri Q & A 

       Jhumpa Lahiri's Translating Myself and Others recently came out, and at npr Mary Louise Kelly has a Q & A with her, Jhumpa Lahiri on how she fell in love with translating and how it shapes her writing. 

       NSW Premier's Literary Awards 

       They've announced the winners of this year's NSW Premier's Literary Awards; for a more convenient list of all the winners, see the Books + Publishing report. 
       The Christina Stead Prize for Fiction went to Dark as Last Night by Tony Birch -- see also the University of Queensland Press publicity page -- while Book of the Year (and the Multicultural NSW Award) went to Still Alive by Safdar Ahmed -- see also the Twelve Panels Press publicity page

       Expanded book coverage at The Atlantic 

       At The Atlantic Jane Yong Kim goes about Introducing an Expanded Books Section, promising:

Expect more book reviews and essays -- plus provocative arguments, reported stories, profiles, original fiction and poetry, and, of course, recommendations for your every reading need.

       That sounds ... good. But I recall New York magazine (well, New York Media) announcing New York Media to Triple Books Coverage Across Sites Including Vulture and the Cut less than three years ago and that fizzled spectacularly and pretty much immediately, lasting about a week. 

       Q & A: Daniel Mendelsohn 

       At The Oxonian Review Foteini Dimirouli has An Interview with Daniel Mendelsohn, the fifth in their: "series of interviews with contemporary critics about criticism". 
       Among his admissions:

I tend to write exactly the way I talk, which is why my punctuation is extremely idiosyncratic.

       And not surprising to hear that:

There was an absolute rule at The New York Review of Books that you could never use the word ‘compelling’ to describe a work. I thought this was really great advice because the language that's available to describe the effect of literature or art needs to be purged as much as possible of words that are placeholders, which stop us, as we write, from actually working out the problem. ‘Compelling’ really says nothing.

Engagement VR ❤️ RV: How to Stay Informed: No One Is Talking About This

The exciting news reached us tonight about your wonderful holidays and your engagement 😇

We are sending hearty congratulations on your wedding engagement. May your joining together bring you more joy than you can imagine. 

With much love ❤️ and we look forward to some spiritual gathering in a holy pub near you soon …🙏

Thailand proposals with diamond 💍 engagement ring ❤️ V R …

… May your love shine brighter and your companionship grow RICHER with each passing day. 

❤️

The cathedral was built between the 13th and 15th centuries in the Romanesque and Gothicstyles. It is one of the largest and most interesting Romanesque monuments in Slovakia. It contains many medieval carved altars and is the resting place of many lords of Spiš Castle; the 15th century carved marble tombstones of the Zápolya family are of exceptional quality.

Bells of St Martin's Cathedral (Spišská Kapitula - Andrej Imrich)

Coffee: How Many Cups Is Enough?

How to Stay Informed Without Getting Paralyzed by Bad News - Wired – “Every time we look at our phones, it seems something terrible has happened. Here’s how to monitor current events in a healthy way…Although technology can produce bad-news paralysis, online tools can also help you make productive contributions within your various roles. As an organization junkie who juggles four part-time jobs with college classes and a private life, here’s how I balance responsibilities…”

This 715-song playlist is scientifically verified to give you the chills, thanks to “frisson” Big Think Annoyed the list is monetized on Spotify, so I can’t even see it. But from the ones in the article proper, Metallica does not do it for me. Generally it takes vocals for me to get frisson, not instrumentals. This is why I like big bombastic choral pieces. Readers?

Neuroscientists Have Discovered a Phenomenon That They Can’t Explain The Atlantic

A history of punctuation aeon

Chimpanzees have their own language — and scientists just learned how they put “words” together Salon 

How to Write Software With Mathematical Perfection Quanta  Notice apparent original headline from URL: computing-expert-says-programmers-need-more-math

ABA Litigation Group – “Analyzing how best to preserve attorney-client privilege and work product protections over data breach investigatory reports in light of changing trends. In-house counsel faced with a data breach encounter a difficult balancing act. On one hand, it is critical to determine the cause of the breach and generate a plan to bolster security systems to reduce the likelihood of similar occurrences in the future. On the other hand, these same reports, usually performed by third-party consulting companies, can generate damning evidence for affected parties in ensuing litigation. 

EU will not find replacement for Russian oil in event of embargo – former Lukoil head Interfax 

German cars can’t run without Russian gas – BMW production chief RT 

Germany to Reactivate Coal, Oil Plants if Russia Cuts Off Gas Bloomberg. I thought it was the Greens that were the hawks?

* * *

Starbucks Exits Russia, Shuts Down 130 Coffee Shops Gizmodo 

The impact of Western sanctions on Russian musical life Gilbert Doctorow

3 surprising ways to cope with climate change

 UVALDE: Where the Hell Were the Police? “Parents were pleading, ‘Give me the vest, I’ll go in there!’ but some ended up in handcuffs instead of vests.”

More coverage and reaction from the mass shooting in Buffalo

What else could have happened, where this hate thrives, the media’s use of the word ‘manifesto,’ and more.

Xiaomi and Leica to launch a co-branded phone in July

Trial, Triumph, and the Art of the Possible: The Remarkable Story Behind Beethoven’s “Ode to Joy”

A hymn of rage, a hymn of redemption, and a timeless love letter to the possible.

Mashable: “…In the U.S., one survey conducted by the American Psychiatric Association found that more than two-thirds of Americans are somewhat or extremely anxious about climate change. Last year, the Lancet polled 10,000 youth between the ages of 16 and 25 from around the world and found that more than half reported feeling sad, anxious, angry, powerless, helpless, and guilty.

 The trouble with eco-anxiety, a blanket term typically used to describe distress associated with climate change, is that there’s no easy fix. As Wray points out, anguish is a normal responses to the circumstances, and yet that despair can be so debilitating that someone experiencing it might need professional mental health help. 

If high-quality treatment is even available, it still doesn’t change the reality that the planet continues to tilt toward ecological chaos as politicians and corporations fail to meaningfully act. In her new book, Generation Dread: Finding Purpose in an Age of Climate Crisis, Britt Wray attempts to chart a path forward for those who feel uneasy or even stuck when it comes to eco-anxiety. Wray’s approach is holistic, weaving together various strands of thought from psychology and public health to help readers cultivate the resilience and emotional intelligence they’ll need to fight for the planet — and to survive the calamities that might come…”

3 surprising ways to cope with climate change - Mashable

Brussels is growing fruit and vegetables on the roofs of supermarket

euronews.green: “Over 60 species of plants are being cultivated on the rooftop garden of a Brussels supermarket, as part of a project financed by the European Union. The Lagum Project is experimenting with the idea of an urban garden and wants to determine whether they are sustainable or not. Since March, more than 2 tonnes of fruit and vegetables have been harvested. “We look into the agronomic part of the research, but also we look about the multi-functionality of these kinds of projects. So there is production, yes, but there is also training, and awareness, and cohesion of the social neighbourhood,” Francisco Davila, a researcher at the agroecology lab of Vrije Universiteit, told Euronews…”

Brave Antipodean Gaelic: EY considers spinning off audit arm

PATRICK IMRICH AND ALBO ASKING THE IMPORTANT QUESTIONS - WHY ARE IRISH ANTIPODEANS SO FEARLESS 

Michael O’Neill: A selfless Aussie dad who was awarded for his bravery and humanitarian aid in Ukraine has died while fighting Russian forces

(Mike, Mick) Michael Charles O’Neill, 47, died this week after heading to Ukraine to help in the fight against Vladimir Putin’s forces.

Australian man killed in Ukraine had a 'heart of gold'

An Australian man who died this week amid fighting in Ukraine has been remembered as “a larrikin [and] always a battler”.

Vladimir Putin was always more evil than we could ever even imagine - a former KGB agent who used criminals and stolen money from Tax Haven to grab the power after Iron Curtain Fell

How Gogol* Explains the Post-Soviet World

Can EY really split off its audit division if no one else does? I doubt it

Those who follow accountancy will have noticed the news that emerged at the end of last week that EY (or Ernst & Young, as it
Read the full article…

EY considers spinning off audit arm

Edmund TadrosProfessional services editor

Updated May 27, 2022 – 10.05am,first published at 8.25am

Global consulting powerhouse EY is considering splitting off its audit arm, amid increasing regulatory concerns about the conflict that has risen from the firm and its big four rivals providing non-audit work to auditing clients.

A string of audit-related failures across the world have triggered the regulatory crackdown, including the collapse of EY clients Wirecard and Luckin Coffee and KPMG UK audit client Carillion.

The firms have previously resisted the idea of splitting off their audit arm.  Will Willitts 

In Australia, regulators have repeatedly complained that the firms have compromised their “appearance of independence” by providing non-audit work for audit clients and the poor quality of corporate auditing.

“We routinely evaluate strategic options that may further strengthen EY businesses over the long term. Any significant changes would only happen in consultation with regulators and after votes by EY partners. We are in the early stages of this evaluation, and no decisions have been made,” EY said in a statement.

The EY plan, which has been in the works for months and would involve spinning out the auditing division into a separate company, was first reported by Michael West Media.

EY is legally structured as a network of independent national firms that pay to use the common brand and systems, and employs about 312,000 staff across more than 150 countries.

Country-by-country vote

Any decision on the split would require a vote of the almost 4000 partners who are scattered across these independent national firms. This might result in some individual national firms keeping their auditing arms, while others are spun out from the auditing business into a separate entity, three people with knowledge of the matter told The Australian Financial Review.

EY partners would have to give up the benefit of sharing the earnings across audit, which is slower growing but steady regardless of the business cycle, and consulting, which tends to be more cyclical.

“The only way this can happen is if the audit partners are willing to give up consulting revenue and vice versa. Any move also raises questions about how the new audit entity would legally be structured and branded,” said Professor James Guthrie, of Macquarie University.

Auditors play a critical role in the function of markets, with investors relying on an auditor’s independent review of the financial statements of a company.

Regulators worry that the provision of non-audit services to audit clients compromises the ability of the firm’s auditors to form an independent view about whether the information presented in the financial report reflects the financial position of the company.

Firms deny this is the case and have been reluctant to stop providing non-audit services to audit clients, arguing they want them to provide these complementary services.

In Australia, the four firms made almost $600 million by doing non-audit work for audit clients in the 2021 financial year – about six per cent of their collective $9.3 billion income.

The EY insiders said the aim of the split was to enable a newly independent audit business and the existing non-audit business to access more capital and expand more quickly.

Any breakaway audit unit would also have a range of non-audit experts to ensure the quality of the service, and an independent large-scale audit firm would provide corporate clients an alternative external auditor.

In Australia, EY made about $550 million from its audit clients, of which about one-fifth, or $120 million, was for non-audit services.

Although the EY insiders acknowledged that the decision was partly caused by the global regulatory crackdown, they denied it had any link to the firm’s involvement in the collapse of Wirecard and Luckin Coffee.

‘Haunted’ by Wirecard

Wirecard, a German payment processor, filed for insolvency in 2020 after admitting that €1.9 billion ($3 billion) of cash on its books probably never existed. Luckin Coffee filed for bankruptcy this month amid allegations the company’s executives inflated income, costs and expenses for 2019.

The scandals have badly hurt EY’s ability to win work in Europe and China, according to rivals. In a partner briefing last year, Deloitte Global chief executive Punit Renjen said EY’s Wirecard issues would “haunt them, certainly in Europe” and that EY was “persona non grata in terms of audit in the Chinese market because of Luckin Coffee and Wirecard”.

Regulators around the world have moved to rein in the non-audit work the big four firms do for audit clients.

Britain’s accounting regulator, the Financial Reporting Council, has already ordered the firms to structurally separate their auditing operation by mid-2024.

In the US, the Securities and Exchange Commission is investigating conflict-of-interest concerns about the audit and consulting arms of the big four, according to a report in The Wall Street Journal.

A split of the big four auditing and non-auditing businesses was inevitable, said Johannes Dumay, an accounting academic from Macquarie University.

The writing has been on the wall for many years as far as splitting auditing and non-auditing work for the same client. For the big four, audit is part of the overall service that they offer all clients, so doing non-audit work goes hand-in-hand with being a one-stop-shop for their customers, and partner profits,” Dr Dumay said.

“While the regulator has yet to act in Australia, the lack of independence just does not pass the pub test and the UK regulator has seen fit to do something about it. Such a move puts pressure on Australian regulators to follow suit.”

“The recent Wirecard and Luckin Coffee scandals are also good reasons to separate audit from non-audit services ... we must also recognise that many of these collapses are perpetrated by management and boards hell-bent on covering up and doing the wrong thing.

Combine that with a lack of due diligence in the audit process for a big fee-paying client seems to be the most lethal cocktail for a corporate disaster.“

RELATED

EY reveals list of audit clients that collapsed

RELATED

EY to invest $2.7b on improving audit quality after scandals

RELATED

EY's dual roles at NAB raises concerns

ASIC’s most recent quality inspection reportsfound that one in five audits reviewed by the big four lacked the desired assurance that company financial statements were free from material error.

EY had by far the best results of the major auditing firms. ASIC found that the firm did not do enough on 7 per cent of the key areas of work it did on audits of risk-targeted companies in the 2020-21 financial year. In contrast, the findings ranged from 25 per cent for PwC through to 29 per cent for Deloitte and KPMG.

It is understood that about 18 months ago, KPMG’s partnership examined splitting off its audit arm but decided to stick with the multidisciplinary model.

A spokesman for PwC said the firm was not planning to split off its audit business and continues to believe that “access to a wide range of expertise and competencies is essential to serving our clients”. Deloitte declined to comment.

Find out the inside scoop about Accenture, Deloitte, EY, KPMG, PwC and McKinsey. Sign up to our weekly Professional Life newsletter.

Edmund Tadros leads our coverage of the professional services sector. He is based in our Sydney newsroom. Connect with Edmund on Twitter. Email Edmund at ed.tadros@afr.com