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Musk’s federal worker order divides Trump administration

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Elon Musk’s demand that more than 2 million federal employees defend their work is facing pushback from other powerful figures in the Trump administration, in a sign that the billionaire’s brash approach to overhauling the government is creating division.

On Saturday evening, federal workers received an email telling them to submit five bullet points accounting for their past week, due Monday at midnight Washington time. Musk had previewed the demand in a post on X, the social-media platform he controls.

Yet it didn’t take long for some of President Donald Trump’s hand-picked top officials to rebuff the effort. 

FBI Director Kash Patel, in his first full day on the job, told employees in a memo that he was in charge of reviewing bureau personnel and would coordinate any information needed.

“For now, please pause any responses,” said Patel, who was a stern critic of the agency he now leads and one of Trump’s most ardent defenders. 

In the early days of the Trump administration, when workers from the Department of Government Efficiency began arriving at federal offices, temporary leadership was running much of the day-to-day business of the government.

Now, most departments have a Senate-confirmed cabinet secretary in place, counterbalancing Musk’s proximity to the president and giving many agencies more powerful advocates who can provide a bulwark against DOGE’s directives.

The Department of Defense, run by vocal Trump defender Secretary Pete Hegseth, told its workers in a tweet to “pause” any response to the email and that the Pentagon would “coordinate” any responses “when and if required.”

Officials overseeing all or parts of the State Department and NASA were also told to refrain from replying to the email. 

Employees at the Department of Homeland Security, which includes the Secret Service and Immigration and Customs Enforcement, received an email late on Sunday saying management would respond on behalf of all workers, according to a message seen by Bloomberg News. 

Musk defended the move in a post on X early Monday, calling it a “check to see if the employee had a pulse and was capable of replying to an email.” A CNN poll from last week found that a slight majority of Americans — 54% — say it’s a bad thing that Trump gave Musk such a prominent role in his administration.

“This mess will get sorted out this week,” Musk said in the tweet. “Lot of people in for a rude awakening and strong dose of reality. They don’t get it yet, but they will.”

Since Trump took office last month, Musk’s DOGE team has been dispatched to access sensitive data, organized a buyout program to push employees into “higher productivity” private-sector jobs and fired thousands of probationary employees. 

Despite the resistance by Patel and others, employees of other parts of the government were told to respond to the bullet-point prompt, which was sent from the Office of Personnel Management. 

The Social Security Administration’s human-resources department told staffers in an email that OPM’s request was a “legitimate assignment,” according to a copy of the email viewed by Bloomberg News. 

At the Justice Department, a senior official emailed other agency leaders around the country, telling them to be ready to respond but cautioning care in what they and their staff share. 

“This is an official OPM email address and employees should be prepared to follow the instructions on Monday as requested but be advised that you should not respond with sensitive, confidential, or classified information,” Jolene Ann Lauria, assistant attorney general for administration, wrote on Saturday evening, according to an email seen by Bloomberg News. 

Judicial review

The OPM email was sent out so widely that it even went to some federal judges and their staffs, who under the Constitution work for a separate branch of government and don’t report to the president. 

Federal judges are presiding over the dozens of lawsuits challenging Trump’s executive actions, including Musk’s role in the administration.

The Administrative Office of the U.S. Courts, which coordinates personnel policy for the judicial branch, sent its employees a message late Saturday suggesting that they not respond to any similar communication from the executive branch, according to an email seen by Bloomberg News. 

“Most of what we do is protected by the Privacy Act as we deal with very sensitive personal information of claimants,” said Judge Som Ramrup, the president of Association of Administrative Law Judges, a union representing Social Security Administration judges. “We cannot discuss or release any information related to any case that we work on. I don’t think there’s any way to realistically provide ‘five bullet points’ about the work we performed last week.”

Employees have received confusing and contradictory instructions on how to handle the email. National Weather Service employees were first told to hold off replying to the email, and then late Sunday instructed workers to answer the request, coordinating the response with their supervisors, according to an email seen by Bloomberg News. 

Workers at the Federal Emergency Management Agency on Sunday morning received instructions to reply to email using “action verbs,” such as “planned, initiated, coordinated.” After the Department of Homeland Security, which oversees FEMA, said it would reply on behalf of the entire department, workers were told to stand down.

Musk said in a tweet on Saturday that “failure to respond will be taken as a resignation.” The Office of Personnel Management said “agencies will determine any next steps.”

OPM doesn’t have the authority, except through regulation, to order another agency’s employees to do anything, said Jim Eisenmann, a partner at Alden Law Group PLLC who advises federal and private-sector employees on employment issues.

“In any legal sense, failing to respond cannot be considered a resignation,” he said of the email.

Musk’s momentum

Trump gave Musk cover to pursue more brazen actions, posting on his Truth Social platform on Saturday that his government efficiency czar was doing a good job, “BUT I WOULD LIKE TO SEE HIM GET MORE AGGRESSIVE.”

A few hours later, Musk put federal employees on notice.

“Consistent with President @realDonaldTrump’s instructions, all federal employees will shortly receive an email requesting to understand what they got done last week,” he wrote on X.

The email that followed came from an address familiar to more than two million federal workers. It was the same [email protected] address that tried to coax them into voluntarily resigning 25 days earlier. That email, with the subject line “Fork in the Road,” promised workers they would get paid through September if they left in February. 

Only 75,000 federal workers took the offer — fewer than the 240,000 the White House had hoped. 

Like the “Fork in the Road” missive, Saturday’s email recalled past communications from Musk. The subject line — “What did you do last week?” — echoed the text he sent Twitter CEO Parag Agrawal before he bought the company and fired him. 

Some officials within the Interior Department are concerned that the administration could use their responses to Saturday’s email to justify reneging on the terms of the “Fork in the Road” retirement deal — effectively declaring their accomplishments didn’t justify continuing to pay them through September, one official said, on the condition of anonymity to discuss a private matter. 

A State Department employee who had submitted their resignation via the buyout program still received the email asking for bullet points, according to the employee and emails reviewed by Bloomberg News.

The person replied on Saturday with five bullet points referencing their support of the Trump administration’s goals — including one that noted they had already agreed to leave their job.

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Accounting

IAASB tweaks standards on working with outside experts

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The International Auditing and Assurance Standards Board is proposing to tailor some of its standards to align with recent additions to the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants when it comes to using the work of an external expert.

The proposed narrow-scope amendments involve minor changes to several IAASB standards:

  • ISA 620, Using the Work of an Auditor’s Expert;
  • ISRE 2400 (Revised), Engagements to Review Historical Financial Statements;
  • ISAE 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information;
  • ISRS 4400 (Revised), Agreed-upon Procedures Engagements.

The IAASB is asking for comments via a digital response template that can be found on the IAASB website by July 24, 2025.

In December 2023, the IESBA approved an exposure draft for proposed revisions to the IESBA’s Code of Ethics related to using the work of an external expert. The proposals included three new sections to the Code of Ethics, including provisions for professional accountants in public practice; professional accountants in business and sustainability assurance practitioners. The IESBA approved the provisions on using the work of an external expert at its December 2024 meeting, establishing an ethical framework to guide accountants and sustainability assurance practitioners in evaluating whether an external expert has the necessary competence, capabilities and objectivity to use their work, as well as provisions on applying the Ethics Code’s conceptual framework when using the work of an outside expert.  

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Tariffs will hit low-income Americans harder than richest, report says

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President Donald Trump’s tariffs would effectively cause a tax increase for low-income families that is more than three times higher than what wealthier Americans would pay, according to an analysis from the Institute on Taxation and Economic Policy.

The report from the progressive think tank outlined the outcomes for Americans of all backgrounds if the tariffs currently in effect remain in place next year. Those making $28,600 or less would have to spend 6.2% more of their income due to higher prices, while the richest Americans with income of at least $914,900 are expected to spend 1.7% more. Middle-income families making between $55,100 and $94,100 would pay 5% more of their earnings. 

Trump has imposed the steepest U.S. duties in more than a century, including a 145% tariff on many products from China, a 25% rate on most imports from Canada and Mexico, duties on some sectors such as steel and aluminum and a baseline 10% tariff on the rest of the country’s trading partners. He suspended higher, customized tariffs on most countries for 90 days.

Economists have warned that costs from tariff increases would ultimately be passed on to U.S. consumers. And while prices will rise for everyone, lower-income families are expected to lose a larger portion of their budgets because they tend to spend more of their earnings on goods, including food and other necessities, compared to wealthier individuals.

Food prices could rise by 2.6% in the short run due to tariffs, according to an estimate from the Yale Budget Lab. Among all goods impacted, consumers are expected to face the steepest price hikes for clothing at 64%, the report showed. 

The Yale Budget Lab projected that the tariffs would result in a loss of $4,700 a year on average for American households.

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At Schellman, AI reshapes a firm’s staffing needs

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Artificial intelligence is just getting started in the accounting world, but it is already helping firms like technology specialist Schellman do more things with fewer people, allowing the firm to scale back hiring and reduce headcount in certain areas through natural attrition. 

Schellman CEO Avani Desai said there have definitely been some shifts in headcount at the Top 100 Firm, though she stressed it was nothing dramatic, as it mostly reflects natural attrition combined with being more selective with hiring. She said the firm has already made an internal decision to not reduce headcount in force, as that just indicates they didn’t hire properly the first time. 

“It hasn’t been about reducing roles but evolving how we do work, so there wasn’t one specific date where we ‘started’ the reduction. It’s been more case by case. We’ve held back on refilling certain roles when we saw opportunities to streamline, especially with the use of new technologies like AI,” she said. 

One area where the firm has found such opportunities has been in the testing of certain cybersecurity controls, particularly within the SOC framework. The firm examined all the controls it tests on the service side and asked which ones require human judgment or deep expertise. The answer was a lot of them. But for the ones that don’t, AI algorithms have been able to significantly lighten the load. 

“[If] we don’t refill a role, it’s because the need actually has changed, or the process has improved so significantly [that] the workload is lighter or shared across the smarter system. So that’s what’s happening,” said Desai. 

Outside of client services like SOC control testing and reporting, the firm has found efficiencies in administrative functions as well as certain internal operational processes. On the latter point, Desai noted that Schellman’s engineers, including the chief information officer, have been using AI to help develop code, which means they’re not relying as much on outside expertise on the internal service delivery side of things. There are still people in the development process, but their roles are changing: They’re writing less code, and doing more reviewing of code before it gets pushed into production, saving time and creating efficiencies. 

“The best way for me to say this is, to us, this has been intentional. We paused hiring in a few areas where we saw overlaps, where technology was really working,” said Desai.

However, even in an age awash with AI, Schellman acknowledges there are certain jobs that need a human, at least for now. For example, the firm does assessments for the FedRAMP program, which is needed for cloud service providers to contract with certain government agencies. These assessments, even in the most stable of times, can be long and complex engagements, to say nothing of the less predictable nature of the current government. As such, it does not make as much sense to reduce human staff in this area. 

“The way it is right now for us to do FedRAMP engagements, it’s a very manual process. There’s a lot of back and forth between us and a third party, the government, and we don’t see a lot of overall application or technology help… We’re in the federal space and you can imagine, [with] what’s going on right now, there’s a big changing market condition for clients and their pricing pressure,” said Desai. 

As Schellman reduces staff levels in some places, it is increasing them in others. Desai said the firm is actively hiring in certain areas. In particular, it’s adding staff in technical cybersecurity (e.g., penetration testers), the aforementioned FedRAMP engagements, AI assessment (in line with recently becoming an ISO 42001 certification body) and in some client-facing roles like marketing and sales. 

“So, to me, this isn’t about doing more with less … It’s about doing more of the right things with the right people,” said Desai. 

While these moves have resulted in savings, she said that was never really the point, so whatever the firm has saved from staffing efficiencies it has reinvested in its tech stack to build its service line further. When asked for an example, she said the firm would like to focus more on penetration testing by building a SaaS tool for it. While Schellman has a proof of concept developed, she noted it would take a lot of money and time to deploy a full solution — both of which the firm now has more of because of its efficiency moves. 

“What is the ‘why’ behind these decisions? The ‘why’ for us isn’t what I think you traditionally see, which is ‘We need to get profitability high. We need to have less people do more things.’ That’s not what it is like,” said Desai. “I want to be able to focus on quality. And the only way I think I can focus on quality is if my people are not focusing on things that don’t matter … I feel like I’m in a much better place because the smart people that I’ve hired are working on the riskiest and most complicated things.”

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