Skip to main content

valuation, M&A diligence

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.







Comments

Anonymous said…
I spent a few months in M&A at a Big 4 as an intern. I enjoyed the atmosphere and there was always a lot going on. It's deal based work, so you basically come into work every day not knowing when I would go home. I couldn't make any plans ever because I wouldn't know if I had to work. One day it was 4:59 and I was packing up and a senior approached me saying he needed help for a few hours and I ended up staying until midnight. It's that unpredictable.

There is a ton of traveling as well. Depending on what industry you focus on, you can be traveling at least every month.

Overall, the work itself was good, and it's a lot more interesting than audit, but the unpredictability and hours put in just don't justify the payscale. Unless you plan on going to private equity after, it just isn't worth doing.
John said…
yep, definitely not worth it. you can enjoy your business trips and unpredictable work hours.

you need to say goodbye to your personal life though.

this job is for loners
Why not try valuation - it's more predictable, there's more job security, the pay is good, work-life is not bad.
Mary Gooven said…
I use Ideals virtual data room for due diligence. Using of this system gives a possibility to work even at home. In this way you know hot to plan your day. And it really reduce operation time.

Popular posts from this blog

career progression

"What can you tell me about the different possible tracks a person would take at the Big 4 in regards to tax vs. audit? Is there a difference in career progression among the two specialties? How about career potential? Workload?"

Loaded question. In terms of career potential, they're both pretty potent. Audit leads you to controller/accounting manager/ VP - accounting positions at companies if you choose to quit. Tax can lead to tax manager positions at various companies/firms..to help them minimize taxes and exploit tax loopholes. It's a pretty important position in many companies...I'm not an expert on tax careers though, so you might want to ask somebody in a tax related position.
In terms of career progression, it's the same as audit...start off as a staff associate...move to senior..manager..snr mgr..partner.
In terms of workload, my friends in the tax department seem to work two busy seasons...in the fall and in the spring. So I think they work more than i…

Boomerangs

As a big four employee, lately, I've been hearing a lot about "boomerang" employees. Those who, for some reason or another, decide that leaving work when the sun is still out is not for them and alas, return back to the firm. Yes, the grass is not always greener on the other side, however, is this trending upward or about the same as it always has been? I think, also, that the firms really do a good job in highlighting those that do choose to return to make it appear more common than reality. Can you please speak about how you've seen the trend of "boomerangs" amongst the big 4? 

Good question. A boomerang, as the commenter pointed, is one who quits a big 4 Firm and then decides to return (or boomerang) back to the Firm after getting a taste of work life in the non-public accounting world.
I have seen a few return this past summer, but didn't really notice a trend until you mentioned it. It's definitely been higher than past years, but not enough to s…

auditing vs consulting

I was wondering if you could break down the career opportunities in auditing and consulting (in a big 4). I know that consulting pays more in a big 4 and has more interesting work, but it seems that auditing has extremely good exit opportunities (Financial controller, CFO etc). Any thoughts on which is better in the long run?

Well there's different consulting services offered by public accounting companies - the most popular being IT consulting and risk consulting. There are also other consulting services offered, but these two hire the most. Do they pay more? Yes, but not by much. Not enough for you to say: Shoot, the $$ is a huge reason for me to move over. Is the work more interesting than audit? Yes. You're actually looking over a company's processes and telling them what to do instead of what not to do (audit). Everyone I know who's made the switch likes it waay better than audit.
In the long run though, choosing audit vs consulting really depends on what you want t…