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What does it take to make the jump from senior manager to partner?
Good question. Let's break it down, in order--
1) People Skills - You have to have really good people skills, you cannot be awkward. You have to come across as genial and amicable, and exhibit the personality of someone that others want to do business with.
2) Perception that you can network and pull in clients - At the end of the day, the Firms were created to make money, and the partners need to keep adding more money in the pool. If the partners think you can go in, network at charity events, golf events, etc, and pull in new clients, you're in, it goes a loooong way. Develop a personality that will make people want to ask you to join them for a drink
3) Perception that you understand audit and that you are good at what you do - You do not have to be an audit superstar, but as long as you have a good reputation, and the client likes you, that's what matters.
4) Reflect your demographic - If you want to be a partner in a place like say Minnesota, odds are being white will help you. If you want to be a partner in Miami, being hispanic will help. Look like your clients and your potential clients out there, and that helps give them a sense of comfort. Hey, I'm not advocating this one bit, but don't blame the messenger, blame the message.
5) Concentrate on 1-2 industries where you can become really knowledgeable in the technical guidance related to that industry, and ideally where there's not a glut of partners already in that industry - Manufacturing and software are notorious for having a ton of partners, so it's tough in cities where there so many partners dedicated to this area
6) Take over certain jobs completely, to such an extent that all the partner needs to do is sign off. This takes a huge burden off his/her shoulder
7) Develop a strong relationship with the CFOs of your current clients, strong enough that they come to you for everything instead of the partner
8) Take a lead role in an IPO
9) Schmooze the partners, they're the ones who can promote you, so try your best to get them to like you
10) Dream..there's a 10% chance of becoming partner, so you better know you're good enough to be partner and be prepared to stick it out as senior manager until you make it (6-10 years as snr mgr).
Remember..it's not the quality of your audit, but your ability to bring in money...
I wish to pursue a career in audit or transaction advisory services. Wanted to know if you can give an insight into both departments with regards to the career prospects, work life balance and monetary factors.
Transaction advisory services can be a pretty broad term, depending on the Firm. Assuming you mean m&a commercial due diligence work and valuation related work.
M&A commercial diligence- To get into m&a diligence, you'd need to put in 3-4 years in audit, because they usually like people with audit experiences and CPA certifications. People who usually do a stint in commercial due diligence go onto some rather interesting jobs - joining the acquisitions group of different companies, private equity analysts, other specialized valuation companies (duff & phelps, etc). W/ regards to work life balance, it is really unpredictable. You can be in your office doing nothing for weeks but still have to stay in the office in case a deal is in the works and your Firm has been hired. Then when you are on the deal, it can initially be 8:30-5 days crunching numbers, and then when the deal is in full swing (talking to the target, writing reports, deeper analyses), you can end up working as late as 2-3 am for 2 weeks straight, yes, I said 2-3 AM. And the schedule is really unpredictable. You never know when you have to travel, at times just knowing about it a day before or day of. Monetarily, it's 15-20% higher than audit. Another big problem is the lack of job security. If there's a slow down in m&a deals, the Firms will be looking to cut people in that group. Back in '08-'09, when there was zero m&a activity, the m&a group was absolutely massacred, a visceral bloodbath. If you like unpredictability, traveling, meeting the heads of top targets, and working under pressure, you'll like the rush this group offers you.
Valuation - This is more predictable, there's more job security, the pay is good, work-life is not bad. It's tough to get into though, you'd need finance/economics masters degrees/CFAs from top 40 schools to get in usually. Audit clients usually require valuation of different tangible and intangible assets every year - investments, goodwill, companies, real estate, recent financings (stocks and debt, etc), so the group gets some steady business every year. This is in addition to some new deals that the group gets to work on. Given the expertise you gain/ have looking at financial models, your pay is a solid 15-20% above your respective peers in the audit practice.
Is there any particular industry you recommend for an associate to being with?
I wouldn't recommend any one industry, it all depends on your interest. The core sectors are - Technology/Software, Manufacturing, Hedge Funds and Mutual Funds, Insurance, Banks, Retail, Government, Real Estate, Entertainment, Biotechnology, Energy, Alternative Energy and Non-Profits. I'm sure there's more. I started breaking down why you'd want to join each industry, but then realized it all came down to one more thing - your interest in that particular industry. If you see yourself in that industry long-term (after your stint in auditing), choose that industry. Simple as that. One thing you'd want to take into consideration is specialization. For example, if you go into the financial service industry, it will be hard to transition to manufacturing, retail and technology. Consider the similarities between the industries if you don't know what you want to do and want to keep your options open. Hope this helps.
How often do big 4 auditors compare how their situations are with others working in Fortune 500s, Investment Banking, Consulting, etc jobs?
Sadly, a good amount. Let's break it down -
Fortune 500 - I'm going to group in all public companies here. This is what most employees compare their jobs to. When you audit these companies, you get to say their payroll reports, and so you know exactly how much each individual makes. You get mad when you see people who are not as competent but make a ton more than you. Then while you're slaving away through 8-9 pm, you see these guys jet faster than Usain Bolt at 5:30 pm, so they can enjoy life, and work to live rather than live to work.
Ibanking: You know it's a miserable job but you get riled up when you see how much they make, be it 5x, 10x or 20x the amount you make. It hits you when you audit banking fees on certain transactions, and you look at the amount of money they make for each transaction. You barely ever see them outside of the occasional nights "at the printer" when they walk in in their armani and gucci suits, acting like everyone else around them (the non-ibankers) are peasants. It either turns you off (many of them are glorified douchebags) or makes you want to be them.
Consulting: This is one of those jobs that everyone thinks is ideal. People think you don't pore over the details, and that you're very high level, like Bob and Bob from Office Space.
It's a tough transition though, you'd probably need an mba to go from auditing to consulting. When people realize this, and that you're basically living in hotels 75% of the time, they cut back on their need to join the consulting world.
Basically, every time you compare your job to someone else's, there is a 75% chance you'll feel miserable. I try to avoid it, but fall into this trap a lot. Just shake your head, stop thinking about other jobs unless you really want to leave and can leave, and move on.
What's your advice for a soon to be college grad interested in the big 4 but dealing with the new 150 credit hour law? It seems like everyones advice is to go right for your masters after graduation. Is the Masters program worth it or would extra credits from a community college still look good?
At the end of the day, all that matters is your CPA. Your masters program's only help is getting you credits towards the 150 requirement. If the costs are much higher for a masters vs credits from a community college, then just do the credits from the comm college. I've seen many either do the masters or the credits from the comm college, but nobody really cares as long as you have your CPA. The two kinds of people who get their masters in accounting are - a) people who need the 150 and b) people who were non-accounting majors but now want to switch to an accounting career.
Still in the questions from September,backed up...
Was hoping you could help me out. Due to the staffing issues that I've heard are plaguing all of the Big 4 many teams are severely understaffed. What advice would you give to a first year who's starting on a team where there are no Seniors and has to work directly with the manager.
The Big 4 are just getting destroyed by staffing issues, it is really bad. I understand that the fat had to be trimmed in 2008, and I have no issues with that move. But they really need to do a better strategizing hiring. Given the amount of inactivity in the markets from 2008-early 2010, many knew the M&A,IPO activity was bound to shoot up. So they should have anticipated this and hired more. Now the Firms are trying their best to poach from other Firms, and offering all sorts of incentives and bonuses to jump ship, which was previously a no-no. Looks like all bets are off at this point. People who are sitting pretty at this point are the seniors and managers in the non big 4 Firms who want to jump to a Big 4 Firm. I've heard some absolute horror stories on staffing this year, with a lot of people taking on a lot of roles.
On to the actual question above, that's a tough situation. The manager will expect that you know more that you actually do, and since he or she is a little removed from teaching you the nuances of auditing (which is what a senior should do), you'll struggle a little to meet his or her expectations. I would do the following - a) Keep reminding the manager subtly that you're only a staff associate b) reach out to seniors on other teams, explain your situation, and call/email them whenever you encounter situations where you're not sure what the next step is, or if you want validation of your thoughts. c) If you have experienced staff associates on your team, treat them as if they were your senior. There's not much else you can do, but these three points will help you immensely while on this team.
Been a couple months,sorry for the delay.On to the questions...
I currently work for the a department of the US Government doing some auditing and analyzing of government-sponsored and government-assisted programs. I will be completing my master's degree in accounting next spring and have begun all of the big 4 interviews this fall. My question is, how common or "normal" is it for people to move from the public secotr to the private sector, or vice versa? I have been told that it would be a good idea to stick with the federal job for a few years and then attempt to move to a big firm, but not to stay for too long because I wouldn't want to get "stuck" working for the government due to its percieved laziness. And on the other hand, I have been told that it would make no sense to work in the private sector and then return to the government stuff later...Anyways, I am currently more in favor of taking an associate audit position at the big 4 if I was to be offered though I am still having feelings of uncertainty.
Most people from auditing firms go to the private sector once they've been through the painful training ground that is public accounting. I'd go as far as saying 80% of alumni head to the private sector after. KPMG has a chokehold on the US government and related agencies, so it'll be a great place to join if you see yourself joining the government later on. It's very rare that people come in from private to public, and if you do, you have to start at the bottom unfortunately. So I'd definitely recommend doing a 3-4 year stint in the big 4 if you're in your 20s.
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