Ernst & Young announced last week it has formed a new, specialized tax practice to serve mutual funds, hedge funds and private equity firms.
The New York-based accounting and auditing giant's National Financial Services Asset Management Tax Practice has pooled all market-based and service decisions under one group of leadership, explained Michael Serota, market leader of the new practice.
"The hedge fund, private equity and mutual fund industries are incredibly complex and are getting more complex every day," he said, adding that the new practice came about as a result of a combination of the firm's hedge fund and mutual fund tax practices.
"We have had an extremely deep and talented tax practice in the United States," Serota continued.
Strength & Change'
"When we looked at the fact that the industry is changing as much as it is and we looked at the strength of our tax practice, we thought that this was a natural fit in terms of the needs of the marketplace," Serota said. Ernst & Young's management felt that the move would "bring efficiencies and effectiveness in a more robust way to fit the changing environment."
Serota, who joined E&Y last year from Deloitte & Touche, will oversee the practice along with E&Y veterans Howard Leventhal, Richard Barry, Ron Cohn and Robert Glassman.
The new national practice, which Serota said is one in only a handful, is based out of New York.
"With public accounting firms, the local offices generally serve local marketplaces. This [practice] is different," Serota added.
"This is a major commitment and major initiative by Ernst & Young. E&Y is the leader in the hedge fund industry in the U.S. and globally. Because of that commitment, both in the U.S. and globally, we are able to do this."
The E&Y Tax Team
Leventhal, who has 28 years of experience as a tax consultant, has focused primarily on hedge funds and investment advisors. He has served on the financial products committee of the New York Society of Certified Public Accountants and the investment company tax committee of the AICPA, among other associations. He is currently an active member of the Federal tax committee of the Wall Street Tax Association.
Barry, who has been with E&Y for the past 22 years, has primarily worked with private equity and investment partnerships. He is a member of the Wall Street Tax Association and the Managed Futures Association.
Cohn also has more than two decades worth of experience, focusing on tax issues surrounding various investment vehicles, including mutual funds, private equity funds, hedge funds, common trust funds and variable insurance products.
Along with market leader Serota, the fifth managing E&Y executive on the tax practice is, Glassman, who has been in the space for the past 18 years. Like his colleagues, he has also provided tax advice to a variety of investment advisors, and, in his case, he has served as chairman of the National Investment Company Service Association tax committee.
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