Saturday, September 17, 2016

Promotion in Private

Working in private can be better although it can also be hard as a staff person. I'd wait for the manager title and 5 years of experience. That way you can have staff people under you. You don't want to be a staff in private because you'll be doing the work for a lot longer in your career. It's much harder to get a promotion in private.


 Agreed, a lot of individuals who switch from Public to Private (especially after 3-4 years) struggle with the idea of not getting promoted every year when they switch to Private. It's absolutely true that you will not get promoted every year, especially if you're average. It's not like a factory where people go in and out all the time, there just aren't enough slots. Stay until manager in Public, then switch to Private if you don't want to be partner. It's a common trope that the Big 4 put out there, but it's somewhat true. The way to succeed in Private is to quickly be good at whatever you're doing, and then speak up to say that you are ready for the next step. The Company will want you to stay, and then either work towards promoting you or giving you more responsibilities that will help you if/when you decide to jump between Companies in the future. 

Should I leave after 2 years as senior?

I'm currently working in KPMG Philippines, will about to start my fourth busy season and it'll be my second year as a supervisor/senior. I would like to know if it'll be a good idea to go work for a private company by this time. My only concern is that work outside audit may not be as enjoyable for me. However, I am starting to get tired of too much workload. 

At this point, stay until you get a year as manager under your belt and then leave. You could leave now and start as a senior accountant somewhere only if it's not a regular operational job where you'll do the same thing every time. Over the next few years, you'll pick up a lot of soft skills and technical skills that will be critical to your growth. If your only goal is a 9-5 workday and the money isn't all that important to you, then leave now, but if you can tolerate the workload for 3 more years, stay. It'll benefit you a lot long term.

Why is private better than public?

"Could you elaborate, why your life is better now?"

Here are some of the various differences between public and private-

a) The work itself - The work is significantly better. In public, you spend half your time on documentation and controls. That's all essentially Cover Your Ass work so the PCAOB or your internal reviews don't deem it to be a deficient audit. You're essentially trying to figure out ways to say that you are comfortable with your client's work. While you get a high level overview of the various processes, you don't really dig into it or have the power to change things. In private, you're actually making decisions - whether it comes to accounting conclusions or process improvements, and what you prepare or review actually makes it into our financials. Yes - we're not the revenue generators, but there is something more intangible in coming up with the financials than reviewing it once it's done.

b) On call - In audit, you're always on call. If a client calls you on a weekend, you answer. You're always checking your phones at night and making sure you have substantive responses in case your team or the client emails. And when there's offerings, forget about it. In private, unless it's during monthly close or whatever, you're generally in good shape in the evenings or weekends. You likely won't even be receiving emails (unless there's an imminent deal or offering), and even if you do, the expectation is that you will only respond on Monday or when you're back.

c) Vacations - In Private, vacations are vacations. People rarely bother you when you're out. In audit, at a certain point in your career, you don't really have work-free vacations. Goes back to b), in a sense, you're always on call.

d) Not being hated - Auditors are a necessary evil, and no group in the Company really likes dealing with the auditors. I was fine with it as an auditor, but there are always conflicts. Client service is a misnomer with the PCAOB breathing down the auditors' necks. It sucks when you're trying to push the Company to do something that you think is a waste but needs to be done so we can cover ourselves from a bad rating. 

d) Bonuses and pay - The bonuses in Public aren't much, it just isn't. The Firms make it up by increasing the base by 10-15% every year, but it's still an absolute pittance. In Private, the bonuses are where it's at. It's a great feeling when you find out about your annual bonuses (until you see the after-tax numbers, but that's a different conversation). Yea sure, the base pay usually doesn't increase that much in most companies, but I would argue that if you're good, it will increase since the Companies would want to keep you. It's not like a factory model where they can spit you out and hire another one to replace you immediately.

e) Stability - After a certain age, you'd probably not want to be placed on random engagements in the middle of nowhere, or have a small sense of uncertainty if there are open slots in your schedule for whatever reason - your existing client got bought out, the Company moves to another location to cut costs, etc. etc. In Private, you go to the same location essentially every day. While that gets boring when you're young, it's something you will appreciate as you get older.

Exceptions...
There are two things that I miss from Public - 

a) Back office - Accounting in Private is the back office unfortunately. So we're not the drivers of major decisions for the Company, and just have to deal with what the Company does from an accounting standpoint. In Public, the auditors are essentially the front office, although it doesn't really feel that way.

b) Flexibility - While you can get flexibility in Private, it's nothing like the flexibility you get after a certain level in Public. Once you have self-sufficient teams doing the day to day work on various engagements, you can basically work from home a good of time, or take days off here and there for various errands. You know you're going to working like a dog on random days anyway, so enjoy this flexibility.





Friday, August 26, 2016

Working in private

Can't believe that this is the first time I logged in this year. I guess I just didn't need this kind of therapy anymore. Anyone got any questions about the other side, i.e. the post-audit life? I can tell you one thing - it is significantly better.

Sunday, November 8, 2015

Internal audit

Can you give a more robust description of an internal auditor? What he/she primarily works with/for? 

IA essentially is in charge of ensuring that all operations across the company have set processes and controls for each process. They ensure that there is a solid segregation of duties for all these processes. They then are in charge of walking through these processes and testing our internal controls around these processes and ensuring that they are effective.

The auditors expect that IA's walkthroughs and control testing would be enough to rely on a sample of them. They also want IA to know all of our walkthroughs and controls inside-out, because that, in theory, is their job.

In the instances that I've been exposed to, both in audit and in private, it's really not feasible for IA to know these processes inside out. Most IA groups aren't really that big, so from a process perspective,for them to know all the nuts and bolts of a company would be hard (unless the IA group is really built out to handle or the company is really small).

If you ask someone in IA, their job is more than just reviewing processes, and testing controls. It's about various legal dealings, company structures, feasibility studies, etc.

One thing I can tell you - they don't work late, and there's decent travel involved if the company has various locations. Also, while they aren't despised like the external auditors, we're still not picking up the phone in a hurry every time they call.


Can't believe I was an auditor

My interactions with our current auditors always helps reinforce in me that my decision to leave was the right decision, but it actually takes it further - it makes me wonder - how the heck did I survive for so many years in audit. When I hear their questions, many of which are purely for PCAOB documentation purposes, I just want to walk away because I'd rather waste my time watching paint dry than answer such non-value added questions. 

I even frequently ask them why they continue to stay in audit. And from what I hear in my old firm, life's still the same. People constantly complaining, the Firms saying that things will change, but it isn't really. And life goes on. Factory model.

Look, auditors add value, don't get me wrong. But there's a lot of non-value add in what they do. I get it, it's not their fault, it's the system and the regulation board. But man - can't believe I used to do that.

Sunday, July 26, 2015

Was it worth getting the CPA?

Was it worth getting the CPA? 

If you want to stay in accounting, or even go into finance for that matter (after a stint in accounting), get the CPA. If anything, it's a must-have to be considered for hire in most places. Many companies tell the recruiters that it's a pre-requisite. 

At the same time, I've seen people in private move up the corporate ladder without their CPA - but these are the exceptions, they were really smart and could pick up accounting concepts pretty immediately. So am I glad I have it? Well, I guess because I haven't done a 180 career path wise, yes

So for those of you out there looking to leave public, get your CPA. If you can't, there's still companies willing to overlook based on your experience, but if you do, it's a pre-requisite you've met, meaning there's more opportunities. It's a hot market right now.