ferryboat10

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taxguy

As I have been reading this thread several things popped out at me that I felt needs clarification.

First, although working for a big 4 accounting firms has its benefits ( especially national prestige), you can make a lot of money and, in my opinion, get better experience working for a strong, midsize, local firm. Large firms tend to pigeon hole kids for a while. Moreover, these firms focus on large and international firms. Local firms do a lot of varied work and could provide even better experience to new graduates.

Moreover, if you specialize in an area, such as tax exempts, litigation support, forensics etc., you will be very well needed by the local firms. Large firms might have a number of specialists in each area. No one person becomes crucial.
This point becomes crucial if you want to make partner. No one makes a student a partner unless they have talents or skills that the firm deems ESSENTIAL. Having a specialty is a great way to be needed!

Also, with smaller firms the best way to get ahead is to market. You should start focusing on acquiring new clients around the second or third year. Your first two years should be focused on passing the CPA and developing skills needed by your firm. I can tell you that a good rainmaking accountant ( one who can bring in clients) is LOVED by everyone. Join clubs, do volunteer work, take up golf. The key is to meet people and get the "word out" about the firm.If you have the skills, notify the various TV and radio talk show hosts that you will serve as an expert. You might even send them points of discussion about new issues that are arising today. I do that all the time and became a "Fox Business News expert." It really isn't that hard to do.

In addition, you can make plenty of money plus have a more stable life working for a mid size accounting firm. Believe me , a successful mid size firm can make a lot of money for the partners. Don't think that only large firms have a monopoly on big bucks.

Finally, accounting is an ever-changing discipline. This took me a while to really understand since I don't like change. However, people are paying you,and paying well, for your constant, up-to-date expertise. There are always new pronouncements by the AICPA , courts, IRS , auditing standard boards etc. You must, must , must always keep up with the changes. Did I say that you need to keep up with the changes?

Your goal as a professional should be "constant and never ending improvement" (CANI). It is a pain sometimes to do this and to digest all of the complicated changes. However, that is why competant accountants can earn the big bucks.

kmzizzle

Would you like to elaborate?

taxguy

Nope, my post speaks for itself. Yes, a partner at the Big 4 will generally make more ( which could be a couple of hundred thousand) than a partner in a large, midsized firm. However, once you are making $400,000+, it doesn't affect your life as much as you would think to make an extra $100,000 -$200,000

Dawgie

First of all, if you are ever going to make partner it's not going to take 20 years. It would probably be a range of 10-15. I wouldn't exactly be calling 100k+ at the manager level (5 years in) very "average" salary, since the annual raises are generally large at Big 4. Also the reason why many people don't make partner is because generally people don't stay at Big 4 that long, not because they can't make it (Although that is a factor as well).

kmzizzle

Taxguy, my post was directed at Dawgie.
But you also seem to keep overlooking the fact that I am not asking about partners' salaries...

Dawgie, btw you need ~$150k to support a family comfortably here in the silicon valley. So you're saying if you work at a Big 4 for 10-15 years you have a HIGH PERCENTAGE of being a partner? If this were the case, everybody would be staying at the Big 4 and making bank. Is it really THAT easy as you guys seem to talk about it to make it to partner? You guys are making it seem like it's an automatic thing if you've been there for xx years.

Dawgie

I don't care what you need to support a family, point is 5 years out at around 100k is not average salary, it's definitely slightly above. You are wrong as hell, it's not easy to stay at Big 4 long at all even for 5 years. That's why there is such as high turnover. Many leave even before being eligible to become a partner, that's why you don't see everyone becoming partners and making bank. They leave for many reasons: maybe they don't feel like it's the right career path for them (MBA?), theres better offers out there, hours way too long, or too much travel. Big 4 is not for everyone that's pretty obvious, now hopefully that answers your question as to why people don't just work at Big 4 for 10 years. You seem like a college kid that's never worked a busy season at Big 4 or Regional firm or any demanding job, talking like its a piece of cake to work 65 hours a week. Some people can handle it, and most go nuts.

kmzizzle

I never said its easy, I inferring people would be going towards staying in Big 4.
I never said its a piece of cake to work 65 hours a week, I said quite the contrary.
Your points strengthen my argument... if it is so hard to become a partner (which I was trying to get across), why are we discussing and arguing salaries vs other partner salaries if almost none of us will ever make it there.
Thanks

taxguy

It is NOT easy to make partner. You have to be very competant, be very liked by the partners, work like a dog etc. It isn't easy or automatic.

kmzizzle

I know it's not even close to easy, my posts say you the way you guys phrased and crafted your arguments and claims made it seem like it was an easy task, which I was just trying to bring forward, that it surely isn't. I hope all is understood now

Dawgie

What is understood is that you are wrong, and that's why I responded in the first place.

Post:
"they've already been working for ~20 years on an average salary"

Response:
First of all, if you are ever going to make partner it's not going to take 20 years. It would probably be a range of 10-15. I wouldn't exactly be calling 100k+ at the manager level (5 years in) very "average" salary, since the annual raises are generally large at Big 4. Also the reason why many people don't make partner is because generally people don't stay at Big 4 that long, not because they can't make it (Although that is a factor as well).

I don't give a crap about your point or whatever you were claiming, all I know is your reasoning was wrong. I took the effort to clarify this for any even interested in going this route. No it doesn't take 20 years, and no it's not "average salary" the whole way through.

But okay if you want to talk about your original point of why we are bringing it up is because it's out there and its possible to obtain but its not for everyone. It may be difficult but so is getting into IBanking and Consulting and also this is not for everyone. But, yet we see jackasses discussing it all the time.

taxguy

one other thought just occurred to me: Partners of Big 4 companies might make more than other partners BUT they have HUGE liability exposure due to audits. Partners and smaller local firms usually don't have audits , and if they do, it is for much smaller, less risky entities.

Frankly, if I had a choice between making $300,000-$600,000 and having relatively little liability exposure vs. making $700,000-$1,000,000 and having a huge amount of liability exposure, I would take the former position. If you work for a big 4, you really need to understand this. In fact, this applies to any very large firm that audits public companies.

Dawgie

"With Great Salary, Comes Great Responsibility"

aj16

tell that to Bush......

barrons

Ask all the old AA partners. Many lost everything including their retirement.