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Showing posts from 2014

9-5?

Sorry for the delay, losing the energy for this blog, I may give in soon.


Hey I'm curious what are the hours typically like during non busy season. Obviously busy season is brutal but do you ever get to work a mon-friday 9-5?


9-5 in the big 4 is dead for the foreseeable future. Under the PCAOB era and the  shift in focus to be more on the regulators that the clients, the amount of work we do is borderline insane. The current model as it stands is definitely being stress tested. The attrition level is back to high rates. But I digress...in the past (before I started, the summer hours were true summer hours). Now it's the time to bolster walkthroughs and control testing for 404 purposes, since the PCAOB is now focusing on 404 just as much as the financial statement audits.





insider trading

Reading an article on insider trading now made me think of the unfettered access that we as auditors have to financial information before the press release is out. And it's not just us, it's the clients we audit too. Outside of certain companies, most public companies don't exactly have the best control over their financial reporting; so individuals can get access prior to the public release if they wanted. While the audit firms do a great job of stressing independence, can't help but think of the bad apples who are getting away w/ leveraging such information for personal use. Yes, the Firms can audit your stock accounts but you can always give it a friend of yours who invests in stocks. Feel like that environment is way too lax, and I can see it changing once an auditor gets caught in a high-profile case.

bad performance rating

I work at a big 4 and i got a rating of 4! I am pissed off and want to leave the firm! I worked really hard during the busy season and i feel like my work wasnt recognised and appreciated at all. I am on my way of completing the ACCA ( 1 more exam left) and i have 2 years of work experience. I am only thinking to stay there one more year in order to qualify and then leave. Even if I stay will I have any progression there with my career? Or the rate 4 will always be there like a ghost in my performance review background to hunt me? 


You can always bounce back, and get a better rating the next year. Reputation will unfortunately spread throughout the Firm, and people will politic to get you on their teams or get you off their teams. Before people add you to their teams, they will ask around to get your rating. It sucks because the only time you come in there with a blank slate is your first day there. So work hard, and get a better rating the next year, or if your rating still stays the…

blackout list big 4

I would like to understand whether auditors can actually make investments of their own? especially index investing, would it compromise on their independence or ethical issue (if any)? 


We can; but every Firm has a blackout list - of pubic companies that you can't invest in. These are companies they either audit or are looking to pursue. As a big 4 auditor, you are essentially precluded from investing in about 25% of public companies in the US. There are still about 75% you can invest in, that's a pretty big %. This blackout list can be accessed using your respective intranets. As a partner, you get audited a lot, but if you are below that, you may not get audited but you can. I would play it safe, only invest in stocks you are allowed to, find out whether you can invest before you invest in it. It's not worth losing your license over it, even if you don't have any inside information.

Hiatus

Apologies for the lack of posts; I had a lot of worked-up energy when I first started this blog years ago, but that energy is no longer there. Back then, I wanted to vent, but now, I've just accepted the way of life in this industry. Granted, the changes in our industry caused by fear of the PCAOB has shifted the dynamics in a way that hasn't been done in years, but there's only so much I can say about this significant change.
At the same time, I still see questions coming in once in a while, and I really appreciate that; so I will do my best to answer some of them a little more frequently.

Career options big 4

I'm a junior accounting major with a big 4 internship lined up for the summer. I know I want to start in public accounting (audit, as of now) but I don't know what I want to do after. I shadowed an internal auditor, and frankly the job seemed boring as hell. What are some viable options outside of internal audit and reporting? Do you see many people going into more finance-oriented positions? 


Let's go down the list of available options:
a) Internal audit - Internal audit groups love getting ex-public acctg individuals; and thus there are plenty of opportunities here. If you love to travel, you don't like to prepare documents but would much rather examine it, and if you would like a work-life balance, this job is for you.

b) Financial reporting - Also plenty of opportunities here. It gets busy during quarter ends and year ends but only for specific periods, and you likely will not be making any journal entries. It provides you with even more exposure to SEC reporting requ…

Ratings

What's the disparity of someone who is 2-rated versus someone that is 3-rated at a manager level (5-6 years in) at a Big 4? I understand that it'll probably be different across regions, across firms, and across markets, but typically, is there a huge gap in salary between someone who is average and someone who is performing at a rating 1 level above? 

 The bands get wider the higher up you go, so at the manager level in above, there is a gap in salary that's a few thousand dollars, plus the higher rated ones will get bonuses. Always try and aim to get an above average rating. Partners and senior managers are aware of your ratings and this affects the clients you get put on, and your visibility amongst the higher ups too.

SOC1 audits

Back after a long hiatus, this is what busy season does to you; you barely want to look at your computer when you are back home. Onto the questions...

I've been working on several large public companies that deal with SOC 1 work and have less experience in other types of audits (such as financial statement audits). What is your point of view on SOC 1 audits? Any thoughts on which type of audits to gain experience in? 

It's good getting that SOC1 work experience under your belt for a few months, but try and get out after that. It'll help you get a better understanding of why we can rely on service organizations, but take that knowledge and move on. There is really no value on this outside of the audit sphere unless you want to go into internal audit. Do your best to get into financial statement audits, you'll have a much better understanding of financial statements there.