Common independence topics
Financial, business and employer relationships
The lists below include situations that may raise independence questions involving financial interests or other relationships with restricted entities. While this is only a partial list, it can serve as a starting point for your independence considerations and guide you in determining whether to discuss your specific situation with an independence advisor. Ask yourself if you, your spouse, spousal equivalent, or your dependent(s) have any of the following financial relationships or are involved in any of the following situations. If you answer yes to any of the items below, you may want to contact National Office Independence by email (email@example.com) or +1 888 269 1068 to discuss whether, based on your assigned legal entity, position, role, or office location, you will need to make changes to maintain independence if you choose to accept employment with the Deloitte US Firms.
- Severance or any other payments (bonus, 401(k) contribution, etc.,) being received from previous employer
- Vested pension with a previous employer
- Former employer 401(k) plans or any other employee benefit plan, including stock options, profit sharing, and stock purchase plans (required divestiture of prior employer benefit plans for client service managers and above within 60 days of hire)
- Investments — stocks, bonds, mutual funds, unit investment trusts, hedge funds, warrants (including retirement funds, trusts, etc.)
- Broker-dealer accounts (including margin, cash management (sweep), active asset, retirement (IRA), and other similar accounts)
- Spouse’s or spousal equivalent’s former and/or current 401(k) plans or any other employee benefit plan (including pension, stock options, profit sharing, and stock purchase plans) (required divestiture of prior employer benefit plans for client service managers and above within 60 days of hire)
- College savings plan (529 Plans), established by you, your spouse, spousal equivalent or dependent
- Insurance products, including whole, universal, and variable life
- Trusts in which you, your spouse, spousal equivalent or dependent is named as a trustee or beneficiary
- Checking or savings accounts with a financial institution with balances over the FDIC insurance limit or its equivalent
- Credit cards with balances over $5,000
- Other unsecured loans, such as student loans
- Securitized loans, such as mortgages and lines of credit
- Partnership interests
- Brokerage accounts with a financial manager who has discretionary authority to execute transactions on your behalf (i.e., managed account)
- Named or acting as power of attorney or executor, administrator, or trustee of a trust or estate
- Uniform gifts to minors
- Joint investment (e.g., partnership interest, vacation home, boat, airplane, etc.)
- Leasing space to/from restricted entity client (i.e., rent)
- Buying at a discount
- Ownership of a franchise or a personal business
- Member of an investment club
- A spouse, spousal equivalent or dependent who is employed in an accounting, financial reporting or other significant role at a company
- Your current or previous employer is a restricted entity
- You or your spouse, spousal equivalent, or dependent is an officer or member of a board of directors or audit committee (whether for pay or not)
- Community activities/community leadership positions
- Non-Deloitte employment or independent consulting services, including but not limited to professor/instructor roles, part-time employment (e.g., retail store, self-employment, family business, professional service, any other type of paid position), and providing independent contractor services (e.g., sales- or commissions-based activities)
Also consider certain relationships that you are aware of pertaining to your Close Relatives. “Close Relatives” includes your parents, step-parents, non-dependent children and siblings. Note that unlike your spouse, spousal equivalent and dependents, when it comes to Close Relatives, if you are not aware of these situations, you are not required to ask.
Consider contacting National Office Independence if you are aware of a Close Relative who has one of the following situations: a financial interest in a company that is material to his/her net worth; Employment in an accounting, financial reporting or other significant role at a company.
- Deloitte US Firms – Includes the following: Deloitte LLP, Deloitte & Touche LLP, Deloitte Tax LLP, Deloitte Financial Advisory Services LLP, Deloitte Consulting LLP, Deloitte Services LP, and their affiliates
- Independence – Integrity, professional skepticism, intellectual honesty, objectivity, freedom from conflicts of interest both in fact and appearance
- Restricted entity – Any attest (audit) client and its affiliates including non–client affiliates of the attest client
- Spousal equivalent
A Spousal Equivalent relationship is deemed to exist in any of the following cases:
- A civil union in which the applicable law does not define the parties as spouses.
- A domestic partnership registered with a governmental body.
- A domestic partnership has been declared by the parties for joint coverage under an employer health and welfare benefit plan.
- The parties hold themselves out as married.
Absent the specific relationships above, a Spousal Equivalent relationship may still exist based on individual facts and circumstances. Professionals are required to use professional judgment in determining whether a Spousal Equivalent relationship is deemed to exist. Although no one factor will necessarily indicate the existence of a Spousal Equivalent relationship, factors to be considered in making such determinations include the following:
- Providing or receiving coverage or benefits under each other’s medical insurance or other employee benefit plans
- Having co–ownership of real property in which both parties continually reside
- Being co–debtors on a mortgage on the real property in which both parties continually reside
- Continuing to reside together in the same residence and having either natural or adopted children
- Having financial dependency on each other, including commingling of investment and financial resources
- Having joint responsibility for each other’s welfare and financial obligations
- Cohabitating and being engaged to be married with a marriage scheduled in the foreseeable future
- Having a committed relationship that is ongoing and expected to continue indefinitely similar to that of a married couple, but having either chosen not to marry or cannot legally marry
Resources upon joining the Deloitte US Firms
Deloitte Entity Search and Compliance (DESC) System – An internal system that, among other things, contains information regarding entities that are “restricted” for independence purposes. This information will assist you in determining whether or not acquiring or having certain financial relationships would create a potential independence issue.
Tracking & Trading System – An internal tool to help you monitor your compliance with independence requirements related to certain personal investments and financial relationships. You report the names of entities with which you, your spouse or spousal equivalent, and dependents have a financial relationship. The system then monitors these entities against the restricted entity list and informs you if there is a potential exception or conflict.
Broker Data Import Program (BDIP) – A feature of the Tracking & Trading System that allows the professional to receive automatic downloads of their financial holdings from their authorized brokerage accounts. This minimizes much of the administrative nature of maintaining Tracking & Trading and ensures brokerage account transactions are recorded timely and completely.
- Enrollment in BDIP, using only the approved, participating brokers, is mandatory for those required to maintain a Tracking & Trading System portfolio.
- For more information about this requirement, candidates should discuss the Broker Data Import Program with their recruiter.
Representation on Independence, Ethics and Compliance – A personal declaration or statement regarding the facts and circumstances associated with the various financial or other relationships you, your spouse or spousal equivalent, and certain family members may have that directly impact the ability of the Deloitte US Firms to conduct business.