Merry Christmas to Peter Wilson. When it was suggested that Peter Wilson should be independent of the old board so that we can have a fresh start Peter responded with "That's your issue". Summary of the meeting here: viewtopic.php?f=23&t=594
A good summary of where we are up to by Joe Aston of the AFR, linked to from here: viewtopic.php?f=5&p=4137#p4137
If you are new to this website read the story so far: viewtopic.php?t=321#p1793
Check out some of the AFR articles, too many to list and check out some of the ABC reports: http://www.afr.com/business/accounting/ ... 215-h055ej http://www.afr.com/business/accounting/ ... 211-h02x1d http://www.abc.net.au/news/programs/the ... s,/8626662
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CEO terminated effective today!

A weekly round up of the issues and progress
bottomline
Posts: 1
Joined: Mon Jun 26, 2017 12:45 pm

Re: CEO terminated effective today!

Post by bottomline » Mon Jun 26, 2017 1:45 pm

As a retired Fellow of the Society, with 25 years plus membership, I truly feel sorry for all the present members who are now paying a probably fairly hefty yearly fee to be a member of this now laughable organisation. I thought some of you may be interested to know what is happening at a grassroots level from the perspective of young graduates who will be future members of the Society. My niece came to me 6 months ago for some career advice after graduating from UNSW with a B Com. and Deans award for excellence. I explained to her how the Society worked and what it could offer compared to the other guys i.e. ICA. So she is now a junior CPA member doing her studies to gain full membership. However she has spent the last week trying to register for her latest study module and couldn't due to "systems issues". To say she is now a little bit disillusioned and wondering if she made the right decision to with CPA Aust. is an understatement. I have other young relatives studying Commerce or Economics at UNSW and Sydney Uni. I will be steering them firmly towards the ICA as a membership choice from now on. I say to Brett Stevenson and your supporters go for the jugular and get rid of these pathetic Directors of CPA Australia. To allow a Members Society to pay someone what the Chief Executive of a major public company would earn, is the greatest joke since Bernie Madoff managed to hoodwink half the investors in New York city!!!

Dave
Posts: 26
Joined: Wed Jun 21, 2017 1:33 pm

Re: CEO terminated effective today!

Post by Dave » Mon Jun 26, 2017 1:55 pm

Hi Bottomline,

Cannot agree more with your comments.

This is not counting what we have not been aware of over the last 7 + years of various expenditure and sponsorships etc.

Interesting comparison with Madoff.

The irony is that this has occurred with accountants while in the Madoff case some investors were not financially savvy.

It is a sad state of affairs.

Steve Hamilton
Posts: 34
Joined: Mon Jun 19, 2017 11:49 am

Re: CEO terminated effective today!

Post by Steve Hamilton » Mon Jun 26, 2017 2:33 pm

I get the level of anger at the size of Mr Malley's payout and am in total agreement that it is manifestly excessive.

Not sure what we as members can do about it, other than potentially waste a lot of time and money in the courts fighting it and probably not winning the argument. Mr Malley's credibility has been further damaged by him receiving this payout. No one in their right mind will employ him in a senior capacity ever again.

In my opinion the focus of the legal fight should be the replacement of the board. It seems the overwhelming opinions of the members, that the CEO needed to be replaced, still required a very long board meeting on Friday for the directors to finally make the decision.

Was the fight about sacking him? Or the size of his termination payment? Either way the board has totally lost touch with their responsibilities to safeguard the interests of the brand and the members.

I also think the education side of the "business" has lost it's way. Again in my humble opinion CPA Australia need to change the CPA Programme(CPAP) so it is more like the Chartered Accountants PY. People should only be able to enrol in the CPAP if they are employed under the supervision of a CPA. There is no point taking kids money unless they have a job in the profession already, that's just wrong. The whole point of the CPAP when I did it 20+ years ago was that it was an extension of your degree with more practical elements in it requiring you to have some real world accounting experience. Maybe it still is and this is a reason for the higher failure rates? You still need the 3 years experience to progress to CPA status, I checked on the website. What about the kids that do the course and still can't find a job to get their experience? They have wasted their money. Coming from an academic background I'm sure Mr Malley was of the typical academic mindset of keep studying!!!!! At some point you are better off getting the first job, seeing if you like what you studied and doing further study later if required.

Anyway that's my 5c for the day......

FCA
Posts: 14
Joined: Wed May 03, 2017 2:27 pm

Re: CEO terminated effective today!

Post by FCA » Mon Jun 26, 2017 3:57 pm

Presumably Malley had to organise his outrageous termination payout using the remaining 5 Board members knowing he had a snowflakes chance in hell if getting approved once 7 Independant directors (who wouldnt be blindsided by his self professed 'brilliance') were appointed.

FCA
Posts: 14
Joined: Wed May 03, 2017 2:27 pm

Re: CEO terminated effective today!

Post by FCA » Mon Jun 26, 2017 5:14 pm

Maybe there is a silver lining to all of this.

Malley's payout ISN'T a genuine bona-fidi redundancy because the position of CPA's CEO will be replaced.

Therefore Malley should have his excessive $5m payout taxed at the top marginal rate - 47% + 2% Medicare levy. I'll be letting the ATO know - just in case there is any uncertainty on Malley or CPA's behalf.

Karena
Posts: 8
Joined: Sat Jun 24, 2017 10:28 pm

Re: CEO terminated effective today!

Post by Karena » Mon Jun 26, 2017 11:48 pm

theallseeingeye wrote:
Fri Jun 23, 2017 11:18 pm
If the Board of CPA think this puts and end to their troubles, they are in for a rude shock. A lot of unanswered questions still to be dealt with. Current board must go, and ASIC must investigate - not just issues of governance, but remuneration and spending decisions as well.
We need independent working groups to work through all these issues, and it's only fair if they also review all the fees they have been charging members since Malley took the office. If they never needed that much money then they should return part of it to the members. And I do not want to see the threatening $50 charge again if we do not pay our membership fee by the due date. CPA is a professional membership organisation, not the SDRO!!

Lyn CPA
Posts: 4
Joined: Tue Jun 27, 2017 8:27 am

Re: CEO terminated effective today!

Post by Lyn CPA » Tue Jun 27, 2017 8:32 am

I only want to say as a CPA member, no matter how hard we work with the highest professional standards and integrity, a lot of us won't be able to earn $4.9m for the whole of our working life. It is kind of sad and unfair for someone to rip off our hard earned money in this way!!!

Lyn CPA
Posts: 4
Joined: Tue Jun 27, 2017 8:27 am

Re: CEO terminated effective today!

Post by Lyn CPA » Tue Jun 27, 2017 8:37 am

FCA wrote:
Mon Jun 26, 2017 5:14 pm
Maybe there is a silver lining to all of this.

Malley's payout ISN'T a genuine bona-fidi redundancy because the position of CPA's CEO will be replaced.

Therefore Malley should have his excessive $5m payout taxed at the top marginal rate - 47% + 2% Medicare levy. I'll be letting the ATO know - just in case there is any uncertainty on Malley or CPA's behalf.
Please do so!!! If the money is not returned to us CPA members, at least should be returned to the tax payer!!!

theands
Posts: 5
Joined: Mon Jun 19, 2017 3:17 pm

Re: CEO terminated effective today!

Post by theands » Tue Jun 27, 2017 11:10 am

I saw someone doing a spill motion survey that was posted on the CPA facebook page. Is this going ahead ?

CPAwhatever
Posts: 25
Joined: Fri Jun 16, 2017 2:43 pm

Re: CEO terminated effective today!

Post by CPAwhatever » Tue Jun 27, 2017 11:12 am

Whoops
Last edited by CPAwhatever on Tue Jul 04, 2017 6:04 pm, edited 1 time in total.

cpacpa45years
Posts: 8
Joined: Thu Apr 20, 2017 4:02 pm

Re: CEO terminated effective today!

Post by cpacpa45years » Tue Jun 27, 2017 11:25 pm

May be we should form a new Accounting Body and get all the CPA members to join in. Without the membership fee of $720 per year per member, we will see the positive consequences. I have been a mentor for a number of men tees and you can guess how positive or negative will my opinion be.
Last edited by cpacpa45years on Tue Jul 04, 2017 11:37 pm, edited 1 time in total.

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Brett Stevenson
Posts: 450
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Re: CEO terminated effective today!

Post by Brett Stevenson » Fri Jun 30, 2017 8:14 am

I tend to think the below quote from Lyn CPA perhaps encapsulates one of the aspects of this whole CPA fiasco that I, and I'm sure many other members, find most offensive. It touches on something that deals with the most fundamental wrong in all of his, which is really an ethical rather than just purely legal question, and I think it reflects something of the way in which the CPA leadership have abused and/or forgotten the high professional standards which we purport to uphold. Let me make just a quick comments on that.
Post by Lyn CPA » Tue Jun 27, 2017 8:32 am
I only want to say as a CPA member, no matter how hard we work with the highest professional standards and integrity, a lot of us won't be able to earn $4.9m for the whole of our working life. It is kind of sad and unfair for someone to rip off our hard earned money in this way!!!
1. I don't think we have a problem with people making money, but we do have a keen sense of needing to work and earn it. Be it based on time and expertise in service provision (as with most professionals) or be it something else (products etc). However with the CPA Australia leadership and management at various levels I think they lost sight of the link of remuneration with work and earning it, and rather thought in terms of the ability to pay (which is what they specifically said in their memos of 2nd March and 16th March) and with some of the absolutely crap benchmarks they used to justify Malleys Remuneration.
To express that more simply they saw CPA as a great big fat cow ready to be milked with no problem being able to pay whatever they wanted, and so they milked it.
They lost all sight of what was a fair and equitable remuneration for effort and work.
Here are some obvious examples of that (and why they refused to make full disclosure of remuneration evennfor board members until they were forced to - which in itself says something)
a. Alex Malleys salary of $1.8m in 2016 and termination payment of $4.9m in 2017. However you want to look at those levels they bear no bearing to work done, performance, market rates etc - disgraceful and greed sum it up pretty well.
b. Adam Awty and Jeff Hughes salaries of $900k + each in 2016, and going back how far who knows. Ditto to above, and they of all people should have known better. To think Adam Awty is now the interim CEO makes me want to puke at the arrogant disdain and one finger salute given by the board to we the members.
c. All the board remuneration levels are an exercise in 'let's pat ourselves on the back and not tell the members'. The opposite of even a semblance of responsible governance with all those fine sounding words like fiduciary duty, and openness and transparency. Jim Dickson reeled off the list of past directors over the last decade as if a hall of fame. To me it was just a listing of directors who really did lose their perspective and I tend more to the view that it was a hall of shame.
A bit hard.
I think not. People should not be directors if they are not prepared to make a stand against groupthink and stand firm against such wanton excess.
Is Mr Dickson going to pay himself at 60% of the auditor generals salary? I suggest the Board start to look at other member organisations and consider what do they pay their Chairman. I suggest they also look at the risk profile of their directors, including the chairman in terms of their statements and public support for many of the issues over which presumably the CEO Alex Malley was sacked, and perhaps of their complicity in that.
The resignation of seven directors including the Chairman, and the sacking of the CEO, with a significantly diminished ruling board in both reputationally and numerical terms, must give pause for thought about why that is the case. Just propping them up with a newly appointed director to make up a quorum is more a move Machiavelli would be proud of than what is expected of a professional membership organisation.
d. What about the seventeen or so middle management staff who are on salaries that would exceed the salaries of the top level staff in most membership organisations. Excess remuneration seems to have developed a life form of its own at CPA Australia.

So, is it any wonder that LynCPA finds it hard to take. I agree with her.

2. Just taking a very basic approach to Remuneration, it would seem that many of the board and staff members at CPA were paid far in excess of not only acceptable community standards but professional ones as well.
Let me take the CEO Alex Malleys salary in 2016. For an organisation with under 500 staff (even less if look at FTE), an annual revenue of $180 million, and a very low risk profile (very solid balance sheet, guaranteed revenue stream each year with membership fees and professional development/education revenue) it managed to pay him $1.8 million.
Let's compare to Ahmed Fahour as CEO of Australia Post with a staff of 32,000 plus, an annual revenue of $6 Billion plus, and a pretty risky company profile. He was paid a very handsome $5.6 million, and the community was outraged and he was terminated as CEO. His replacement is being hired on a salary of $1.3 million (Holgate) and people are saying that is too high.
I'll let you draw your own conclusions but however you want to look at it Alex Malley was being scandalously remunerated by a complicit Nominations and Remunerations Committee, and CPA board who thought they could get away with it as they had in the previous years.
Surely this reflects to a large degree on the calibre of the people who approved these remuneration levels, going who knows how far back. But we shall certainly be publishing a detailed overview of which board members oversaw each year so members can see for themselves that 2016 was not an unusually year and that the complicity of the directors goes back before the current directors.
Am I being too hard, or too personal?
I don't think so.
Too often the term board is used as a sort of scapegoat for the actual individuals who comprise the board. If they are to be remunerated individually and take their duties as individuals as per the law then so should we identify and name them.

3. Methinks that the remuneration levels, contrary to oft quoted ' if you pay peanuts you get monkeys saying, turns that on its head. Especially in an organisation where a small group have held a tight grip on power through various governance strategems.
I think the continued presence, after 11 plus years, of Graeme Wade and Richard Petty on the board, and Adam Awty and Jeff Hughes in senior management plus who knows who else in middle management, indicates a red flag waving vigorously. Yet for the remaining board members (Portelli, Dickson, and Dolin - that latter one surprising given her experiences in WA in 2011) and the new one (Youngberry) it is just business as normal. What is all the fuss?
In such a protected almost monopolistic environment all the normal rules of fair reward for fair days work just fly out the door, and the milking rules start to apply. These start with the 'we pay what the organisation can afford'
then move to 'let's just double it' to
the 'we must never disclose this to the members' to
the 'let's make sure we control the Nominations and Remunerations Committee' to
the 'let's give ourselves a great big pat in the back eh.

So yes LynCPA you have nailed it in a much simpler statement, and I think we all agree with you.
Last edited by Brett Stevenson on Fri Jun 30, 2017 1:05 pm, edited 2 times in total.

User avatar
Stomper
Posts: 206
Joined: Tue May 02, 2017 9:55 am
Location: Sydney, NSW, Australia

Re: CEO terminated effective today!

Post by Stomper » Fri Jun 30, 2017 9:38 am

@BrettStevenson

The icing (or turd) on the cake for me was, not only were they paying themselves obscene amounts totally unrepresentative of their roles, but then to have the sheer audacity to top that up with an ADDITIONAL $1m payment for CPA Advice "work" beggars belief.

CPA pigs.png
CPA pigs.png (56.99 KiB) Viewed 5151 times

kburn
Posts: 7
Joined: Fri Jun 09, 2017 11:51 am

Re: CEO terminated effective today!

Post by kburn » Fri Jun 30, 2017 4:21 pm

sent them an angry email. Not sure if it'll work.

Dear board,

How on earth do you justify paying Alex $4.9million given the damage he has done to our brand?

Since I've joined the CPA, all that has happened is the cheapening of our brand.

This is to the extent that I was rejected from several roles at the big4/ASX200 solely because I was a CPA and not a CA.

Our reputation is in shambles, and its no thanks to Alex. Fat lot his TV shows has done for the careers of its members.

My CPA status has become more of a liability than an advantage in getting a job.

Also, great job on losing our limited liability status, well done, really expected that from you guys, give yourselves a pat on the back, maybe help yourself to a couple of million.

Most of us will not see 4.9 million in our lifetime, and paying it to someone who has screwed the pooch is DISGRACEFUL

All of you should be ashamed! To think that I'm paying for such crap!

You clutch your millions and sleep soundly at night while your members lay awake and think about how worthless their CPA is, especially now without its limited liability status.

If you truly go ahead with the 4.9 million golden parachute, I will cancel my membership, and proceed to take exams for the CA. At the very least, I know their board members are not thieves.

Absolutely disgusted,
******
Member No: *******

Karena
Posts: 8
Joined: Sat Jun 24, 2017 10:28 pm

Re: CEO terminated effective today!

Post by Karena » Mon Jul 03, 2017 11:34 pm

kburn wrote:
Fri Jun 30, 2017 4:21 pm
sent them an angry email. Not sure if it'll work.

Dear board,

How on earth do you justify paying Alex $4.9million given the damage he has done to our brand?

Since I've joined the CPA, all that has happened is the cheapening of our brand.

This is to the extent that I was rejected from several roles at the big4/ASX200 solely because I was a CPA and not a CA.

Our reputation is in shambles, and its no thanks to Alex. Fat lot his TV shows has done for the careers of its members.

My CPA status has become more of a liability than an advantage in getting a job.

Also, great job on losing our limited liability status, well done, really expected that from you guys, give yourselves a pat on the back, maybe help yourself to a couple of million.

Most of us will not see 4.9 million in our lifetime, and paying it to someone who has screwed the pooch is DISGRACEFUL

All of you should be ashamed! To think that I'm paying for such crap!

You clutch your millions and sleep soundly at night while your members lay awake and think about how worthless their CPA is, especially now without its limited liability status.

If you truly go ahead with the 4.9 million golden parachute, I will cancel my membership, and proceed to take exams for the CA. At the very least, I know their board members are not thieves.

Absolutely disgusted,
******
Member No: *******
Does anyone knows if there are pathways for CPA to become CA?

CPAwhatever
Posts: 25
Joined: Fri Jun 16, 2017 2:43 pm

Re: CEO terminated effective today!

Post by CPAwhatever » Tue Jul 04, 2017 9:55 am

Karena wrote:
Mon Jul 03, 2017 11:34 pm
kburn wrote:
Fri Jun 30, 2017 4:21 pm
sent them an angry email. Not sure if it'll work.

Dear board,

How on earth do you justify paying Alex $4.9million given the damage he has done to our brand?

Since I've joined the CPA, all that has happened is the cheapening of our brand.

This is to the extent that I was rejected from several roles at the big4/ASX200 solely because I was a CPA and not a CA.

Our reputation is in shambles, and its no thanks to Alex. Fat lot his TV shows has done for the careers of its members.

My CPA status has become more of a liability than an advantage in getting a job.

Also, great job on losing our limited liability status, well done, really expected that from you guys, give yourselves a pat on the back, maybe help yourself to a couple of million.

Most of us will not see 4.9 million in our lifetime, and paying it to someone who has screwed the pooch is DISGRACEFUL

All of you should be ashamed! To think that I'm paying for such crap!

You clutch your millions and sleep soundly at night while your members lay awake and think about how worthless their CPA is, especially now without its limited liability status.

If you truly go ahead with the 4.9 million golden parachute, I will cancel my membership, and proceed to take exams for the CA. At the very least, I know their board members are not thieves.

Absolutely disgusted,
******
Member No: *******
Does anyone knows if there are pathways for CPA to become CA?

There are no pathways, they are competing organisations. Only option is to get CPA back to where it was! :P

deaneus
Posts: 189
Joined: Mon Apr 03, 2017 9:09 pm

Re: CEO terminated effective today!

Post by deaneus » Tue Jul 04, 2017 1:00 pm

kburn wrote:
Fri Jun 30, 2017 4:21 pm
If you truly go ahead with the 4.9 million golden parachute, I will cancel my membership, and proceed to take exams for the CA. At the very least, I know their board members are not thieves.
Sorry to break it to you but it's been reported the payment was made that night after the meeting, i.e., straight away

...making sure he had the cash before anyone could complain

deaneus
Posts: 189
Joined: Mon Apr 03, 2017 9:09 pm

Re: CEO terminated effective today!

Post by deaneus » Tue Jul 04, 2017 1:01 pm

Karena wrote:
Mon Jul 03, 2017 11:34 pm
Does anyone knows if there are pathways for CPA to become CA?
Yes there is: something about being nominated by two CAs and getting a letter of good standing from CPA Australia

User avatar
Stomper
Posts: 206
Joined: Tue May 02, 2017 9:55 am
Location: Sydney, NSW, Australia

Re: CEO terminated effective today!

Post by Stomper » Tue Jul 04, 2017 1:23 pm

deaneus wrote:
Tue Jul 04, 2017 1:00 pm
kburn wrote:
Fri Jun 30, 2017 4:21 pm
If you truly go ahead with the 4.9 million golden parachute, I will cancel my membership, and proceed to take exams for the CA. At the very least, I know their board members are not thieves.
Sorry to break it to you but it's been reported the payment was made that night after the meeting, i.e., straight away

...making sure he had the cash before anyone could complain
Hush money moves fast!!!!!!!!!

passedfc
Posts: 113
Joined: Mon May 29, 2017 3:14 pm

Re: CEO terminated effective today!

Post by passedfc » Tue Jul 04, 2017 1:45 pm

If that money has been already paid to Mallee it is a criminal disgrace.

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