Ask any of my friends and they'll say my major is totally misaligned with my interests. My unconventionality does not dissuade me from engaging with my courses however, so I will demonstrate these four years have not been a waste by doing some business writing. I will also write occasionally about legal news to exercise my legal analysis as I prepare writing supplements for applications and publish in the Rutgers Law Review. I will conclude with life updates.
KPMG & Regional Banks
A Senate report released 17 September claims KPMG issued clean audits to multiple failing banks in the lead-up to their collapses. Silicon Valley Bank, Signature Bank, and First Republic Bank were the focus of the report.
Even though the report states KPMG did not play a role in any of the bank failures, I find this story absurd– a Big Four accounting firm issuing clean bills of health to firms that shutter soon after. Of the numerous grievances listed, the report states KPMG failed to include standard interest rate risk models assessing Silicon Valley, overlooked whistleblower allegations of mortgage fraud at Signature, and did not disclose meaningful indicators of First Republic's financial condition.
Absurd as it may be, this is nonetheless troubling. Market-wide stability depends not only on capital and regulation but also on honest reporting and early risk detection: you know, the reasons audits exist. When audits fail, vulnerability is under-reported, risk is misallocated, and regulatory oversight diminishes. Ultimately, risk is obfuscated and people lose confidence.
I have no doubt that there is some misalignment of incentives with third-party accounting firms as well. Pressures to retain clients and not rock the boat could encourage accountants to overlook clear risks. Likewise, auditing is something public companies need. It is an expense and there are tons of firms to provide it. It would not be unreasonable for a buyer of accounting services to believe their exposure is minimized, much the same way a Bar license can guarantee some standard of service. But why pay the premium KPMG would ask if there are so many accountants?
It is probably more likely, such as in the instance of Silicon Valley Bank, Signature, and First Republic, an issue of "too little, too late" from auditors and a presumption that prestige could cover up rushed work. We must remember that, unlike a license, an audit does not guarantee safety, only compliance. What is to become of this cycle? Clients get their rubber stamp, markets get complacency, and the public is left holding the bag when things fall apart.
Senior Year
As the doomsday timer counting down to my graduation date looms, my lack of internship– or really any interest from prospective employers– seems to suggest that the business world is not ready for this former sunglasses salesman, and I cannot say I know how to take it. I do not feel rejection, there will always be more I can do or could have done. Perhaps I could have given more face-time to recruiters, joined resumé-friendly clubs, or made more LinkedIn connections. I am more surprised I never even landed an interview. Life moves on, I am still applying, only I have pivoted to looking for a full-time job as I simultaneously study for the LSAT, apply to law schools, work my part-time job, juggle my coursework, and work on my art.