To audit, or not to audit, that is the question

As soon as we passed the Board, most of us dive into the profession by starting out in public accounting firms. Most of us have this belief that it’s a good training ground for new CPAs.  But all of us at that time doesn’t really have a glimpse to the bigger picture of the public accounting profession. 

Based on my few years of experience in public accounting profession, here are my observations and insights on what public accounting is and is not.

1.Starting out in public practiceis more on investment. I guess this is the major disadvantage of starting out as public practitioner. The monetary rewards are not so high as compared to those in private accounting. You will experience living payday-by-payday on your initial years. But that’s OK. The returns will be huge as years go by. When you become a partner, you will receive multi-million profit share (depending on what kind of partner are you) plus plus other perks. Yun eh kung tatagal ka hanggang maka 10 – 15 years ka hehe.

2.Exposure to different industries and companies. You will be assigned to different client companies and industries and will have the chance of knowing the ins and outs of that industry. You will also be exposed to deep secrets and confidential issues that are not known by the public or even the employees of the companies themselves. More importantly, the lessons learned in school and during review will come into reality. 

3.Public practice is not for the faint-hearted. One must be bold and courageous enough to face the everyday struggle. Good health is a must. You know... the daily hustle and bustle of fieldwork, out-of-town orout-of-the-country fieldworks, meeting client demands which may sometimes looks like impossible, ability to finish the audit work papers on time for the boss’ review and partners sign-off, and of course, working until midnight/overnight without extra pay hahaha (this is true especially kung maliit lang ang audit fee ng client mo).

4.Deep bonding with your batchmates. This is one of the best part. Your batchmates will be your confidante, friends and companion as you surf the tides of audit. The load becomes lighter when you work and play together. Your relationship with them will be treasured even the years go by. You know, the accountancy profession is just a small world. Some of them will be CFOs, CEOs, Presidents of various companies, Partners, consultants etc. Sabi nga ng batch ko noon, “Kita-kits nalang sa finals”. So, start building relationships as early as your Day 1.

5.A High IQ is not so useful. A High EQ is. I’ve seen many CPA Board topnotchers, magna cum laudes, and summa cum laudes that did not last long in the profession (some quit so early andsome were counselled out). They may have high IQs and robust technical competence in accounting, audit and taxation but in the actual practice, your knowledge and skills is of only secondary importance. A good attitude,fortitude, leadership and ability to build relationships with your co-workers and clients are more important than having memorized all PFRS and PSA. Let go of your past laurels. Pantay-pantay na lang tayo pagtapak natin sa propesyon. 

6.Do not expect that you will learn everything you need to be a CFO or CEO someday in an audit firm. I think this is the common misconception – public practice will only give you the best knowledge and tools in accounting, audit and taxation but not necessarily on the operations and management side of the business. So I will say that the belief na “tataas ang value kapag nag-start sa audit” is relative. It depends on what position or industry you will jump into after you’re done with your public practice career. So choose wisely.

7.You’ll work on extremes. Kapag busy, super busy talaga lalo na kapag busy season. Pero kapag di busy season,as in wala kang gagawin kundi mag-mall o manood ng sine habang naka time-in ka,mag internet maghapon, at kung anu-ano pa. Well based on my experience, mas busy talaga sa private kasi every month-end busy compared sa audit na ilang months lang tapos lamyerda na ulit J

8.In the long-run, staying in public practice generally has higher return up to retirement. Most of the time, the retired partners usually becomes the independent directors and board members of various companies because of the trust and confidence they built in the business community (just like Wash SyCip). Ika nga, bigatin talaga!


(This is a repost from my thread in a CPA forum site)

Keep the best and brightest

(Busy season has just ended. Everybody's on the archiving mode now. Then, RL mode?! haha! Kidding aside, I am very much affected everytime I see young and promising CPAs resign due to burnout, low morale and a lot more factors. As I relax today after my series of performance evaluation discussions with each of my staff, I checked out AICPA journals's website and found out this article. It explains everything we need to know on how to maintain and retain the best and the brightest in today's audit firms.) 

Keep the best and brightest

BY YASMINE EL-RAMLY, CPA/CITP

APRIL 2012

The AICPA’s Private Companies Practice Section (PCPS) recently completed a national survey about the attitudes and aspirations of the most promising young accounting professionals. The 2011 PCPS Top Talent Study (available at tinyurl.com/6tygubv) suggests how firms of all sizes can hang on to top talent.

• Foster a culture of trust and open access to management. The survey reported decreased trust in firm leadership among 40% of high-potential CPAs. This might indicate that firm leaders did not communicate well during the recession and failed to adequately explain key decisions. To foster better communication, firm leaders should maintain a true opendoor policy for employees. That’s easier at small firms, where the hierarchy is more informal, allowing for continual interaction between staff and firm leaders. At firms with more than 10 employees, management should hold face-to-face meetings with high potentials at least once a year.

• Make work/life balance a firm priority. The brightest young CPAs are much more focused on successfully integrating their professional and personal lives than their predecessors were. High-potential CPAs rank flexible work schedules (77.5%) and telecommuting (63.1%) as the top priorities in maintaining work/life balance. Firms also should monitor work hours and travel time to make sure future leaders aren’t burning out. Regardless of size, firms should encourage staff to take vacations and address family matters when needed.

• Provide a competitive compensation package. Salary is the top factor in retaining high-potential CPAs and the second most important factor in attracting them, the survey found. That’s to the advantage of large firms (those with at least 21 employees), which usually can pay higher wages than smaller firms. Young talent also highly values retirement plans.

• Transform each engagement into a training opportunity. Involve top young talent from start to finish, ensuring they grasp the breadth and complexity of each engagement. Smaller firms can assign only limited resources to each engagement, allowing high potentials greater access to key individuals. However, larger firms can offer unique training opportunities by exposing most promising young talent to a broader portfolio of clients in multiple industries. This is important because career development ranks as the top attraction factor and No. 2 retention factor for high potentials.

• Implement diversity initiatives for women and minorities. Such programs can have a substantial effect on attracting and retaining women and minorities by enhancing their sense of belonging and recognition. The survey found that nonwhite respondents are particularly interested in tuition reimbursement, sabbatical leave, firmwide diversity initiatives, equity incentives and a mentoring program, formal or informal. Nonwhites are 97% more likely than whites to stay at an employer with a firmwide diversity program and are 102% more likely to stay with a firm that offers tuition reimbursement.

• Identify emerging partners as early as possible. With career growth high on the high potentials’ priority list, it is important to establish a career road map with top talent. This can help them enhance leadership and business development skills. Emerging partners should be exposed to client retention and client development meetings. They also should participate in networking activities, speaking engagements and business proposals involving the acquisition of new clients. This can be best achieved by pairing an emerging partner with an experienced partner.

—By Yasmine El-Ramly, CPA/CITP, (yelramly@aicpa.org), a project manager with the AICPA’s Private Companies Practice Section in Durham, N.C.

source: http://www.journalofaccountancy.com/Issues/2012/Apr/20124970.htm