Art of Accounting: More on CPAs Who Leave Public Accounting
IMGCAP(1)]Last month I posted three columns covering CPAs who leave public accounting. They generated widespread interest, but there is a lot more to say.
There were many comments posted online, and I also received many emails raising questions on related issues (see Art of Accounting: CPAs Who Go to Work for a Client, CPAs Who Leave Public Accounting and Why CPAs Leave Public Accounting). Today I’ll address many of those questions.
Generally speaking, many bosses do not listen to staff concerns. At many firms, there is a lack of serious mentoring and little help for staff people in managing their careers. In many practices, there is an appearance of a lack of growth, or if there is growth, then staff people are often left behind. In most instances, these problems are exacerbated by staff people not being clear about what they want. They are hesitant to speak up, share their concerns with their bosses or venture beyond their comfort zone. Both are culpable, but I place greater blame on the bosses, who should know better.
The main focus of my three earlier columns was accountants who leave public accounting firms and go to work for private companies. However, many also leave for not-for-profit organizations and government agencies, including the IRS. While I primarily concentrated on businesses, what I wrote also applies to these other organizations.
Some Just Do Not Like Public Accounting
I gave many illustrations and believe they are representative of what is happening out there. I also know of many exceptions to what I wrote and suggested, but unfortunately the views I expressed represent a preponderance of the experiences of the people I know. I wish everyone, whatever they do or wherever they go, all the happiness they desire for themselves. Also, I am fully aware that public accounting is not for everyone and those who leave because of this are not being addressed. They have every reason to leave and to try something else.
My comments are directed at those who really want to work in public accounting and have bad experiences that likely could have been avoided by a more sensible personnel policy where they worked. This is a complicated issue and I am trying to identify some problems and offer solutions.
Many CPAs Leave Because of Us
Many people leave public accounting because of the unreasonable time demands made by the firms where they work. This is curable. Just reduce some of the long hours and allow some weekend time off during tax season. Don’t demand overtime presence in the office if there is only busy work, rather than real tax season work. Establish an overtime pay policy that removes the doubt of fair compensation.
I know many accounting firms that create bad conditions as “payback” for the way their leaders were once treated. Pretty stupid and narrow minded. It can be fixed.
I question those who lay out a career path that I do not think is realistic or designed to get them to where they say they want to go. One reader used a few comments to present his entire career objective. His first comments that I responded to were not as clear or decisive as what he eventually said. He has a plan and a way to achieve it. Good for him. Too many do not and my comments are addressed those people.
For those who plan on using their CPA experience to get their license and then follow a different career path that is OK by me as long as it is part of their deliberate plan. However, I believe they sell themselves short by not giving everything they have, and they miss out on savoring the benefits and joys our profession offers.
I believe public accounting is great training for those who want to become entrepreneurs. Where else can you get inside a business and see how it works? My path led me to being an entrepreneurial accountant, and my experiences have continued to feed that ambition. I am one of the fortunate ones.
My Opinion on Why the Big Four are Destroying the Profession
This is my opinion, as is everything else I write in these columns. I believe the Big Four hire about 70 percent of the accounting major graduates, but 90 percent of them leave the profession within three years. That means 63 percent of the college graduates who want to go into accounting leave public accounting pretty quickly. To me that destroys the profession.
Of course, working in private accounting is working in the profession. But I am referring to public accounting because that is where they start out and expect to remain (except for those career-oriented people with a plan charting a path outside of accounting). On the contrary, many people who leave their first job with a non-Big Four firm usually get jobs with another public accounting firm. This indicates that the atmosphere within the Big Four is not conducive to remaining in public accounting. That’s why I feel they are destroying the profession.
CPA Exam is Not Too Hard
I received many comments about the declining percentage of graduates who do not sit for the “onerous” CPA exam. I do not know why this is so, but it does represent a challenge for the profession, and concerted efforts are needed to reverse this trend.
I reject the proposition that the exam is too hard. I do not think that is so, as measured by the higher passing percentages and the increasing ease of taking the exam. Regardless of a later career path, having the CPA designation definitely adds value and prestige.
Related to this series, I received a few emails from unhappy partners. I am not suggesting that everyone in public accounting is happy or does not have reservations about their career choice. I cannot help them, but thankfully they are in the minority.
As partners they have different interactions and levels of control than employees. Some firms have a managing partner/CEO or committee that runs the practice. Not everyone likes that person or the decisions they make. This is a different issue than what I have been discussing, but they can still make choices (subject to their partnership agreement) that can permit them to leave, go to another firm or go into private industry. Some of these issues were addressed by me in postings at www.CPATrendlines.com. You can go there and search my name for those articles.
John Milton wrote in Paradise Lost, “The mind is its own place, and in itself, can make a Heaven of Hell or a Hell of Heaven.” Unfortunately some people are never happy. No matter the situation, they will find something bad and unpleasant. I am one of those people who always find what’s good and the benefits of what I am doing. I also am sure enough of myself to recognize when I should extricate myself from really unpleasant activities and people. I believe I am happier having this bent. To each their own!
Thank you for reading my columns and especially thank you for your emails and comments.
I believe the above addresses many of the questions and comments that have been posted or sent to me. If you still have comments, you are welcome to post them.
Edward Mendlowitz, CPA, is partner at WithumSmith+Brown, PC, CPAs. He is on the Accounting Today Top 100 Influential People List. He is the author of 24 books, including “How to Review Tax Returns,” co-written with Andrew D. Mendlowitz, published by www.CPATrendlines.com and “Managing Your Tax Season, Third Edition,” published by the AICPA. Ed also writes a twice-a-week blog addressing issues that clients have at www.partners-network.com. Art of Accounting is a continuing series where Ed shares autobiographical experiences with tips that he hopes can be adopted by his colleagues. Ed welcomes practice management questions and can be reached at (732) 964-9329 or firstname.lastname@example.org.