Public Accounting

[Berns31]

I'm a college student about to start my senior year with an accounting major. My current plan for the future is to get a job in the public accounting field, work my ass off to try and pass the CPA exam, and eventually go back to school to get my MBA.

My question is how do those who currently work in the field or have worked in PA in the past feel about their jobs? Someone told me the other day that something like 80% of public accountants get burned out within their first 3 years and make a career change to either the private sector or into a new field all together. This seems like a ridiculously high number to me and I was wondering what the reason is for it. I know that the hours can be extreme during the busy seasons but don't they offset during the less busy times of the year? Are there other reasons for this huge turnover?

I decided on this field because it was something that I am good at and enjoy along with their being a ton of opportunity right now. The demand for accountants is huge right now. It if my understanding that even the big four are having trouble finding enough employees which I don't think has ever been the case in the past.

I guess I was just wondering what makes the public accounting field so unappealing to so many people and whether or not I am making a big mistake with the career path that I have chosen. Any input in appreciated.

[thing85]

IMO, the large turnover is largely due to work/life balance issues. PA is stressful at times (most times) and most people get sick of it after a few years. The 2nd reason for large turnover is the jump in pay you'll find when you leave PA. The raises are relatively small in PA, and someone making ~70-80k after 4-5 years in PA can probably find around $100k outside of PA. Obviously, the later you leave PA, the better salary you will find elsewhere. The only way you'll make the big bucks in PA is if you stay until you make partner (12-15 years, I think). I think few individuals can tolerate the amount of time and effort necessary to get that far, but I've heard it does pay off in the end (I'm not recommending it at all, however). FWIW, I've worked a year in PA, so much of this is based on what I've gathered from co-workers and my own observations.

PA with a Big Four accounting firm is a great start to your career as an accounting student not because of your entry-level career, but because of the doors it opens later on. I think the skills you gain by working through several busy seasons and getting to know the industries of the clients you work on are invaluable. You won't find anything like that in a private/corporate role.

[spd123]

Actually the number is high because people go into other high paying fields that they are qualified for because of their background in accounting.

[broiler]

thing pretty much nailed all of the big points on why people leave public accounting. The only point that I would add is that money outside of public accounting is very good and the opportunities can be substantially better. Once you decide that you don't want to make partner, you need to leave because the grind isn't worth it because of the money and quality of life on the outside.

The big four are having trouble finding employees because they are just not desirable positions for a new staff person. Locally, they only pay $2k more to start, but no overtime pay really hurts when smaller firms are willing to pay overtime. The big four work 65+ hours during busy season and 55+ in the off season here. The travel novelty wears thin if you end up getting scheduled to be home 2 days a week or less.

A big factor in people leaving public accounting is that college does a terrible job preparing students for public accounting. One auditing class just doesn't cover what you will actually see when you get into the field. Many new staff that I have worked with get shellshocked by the difference between textbooks and real life. The learning curve can be large and quite daunting to new staff.

My graduating class was about 50 people and the are only 5 of us left in public accounting after 9 years. Only 2 or 3 of us are in situations with a realistic chance to become a partner in the next 5-10 years.

I do have a question about your current plan. You say that you want to pass the CPA exam after your senior year of college. Are you in a state that allows you to sit for the exam without having 150 credit hours? I know that NY goes to 150 hours in 2009, but most states have aready switched their requirements. You will need to look into the requirements in your state soon. I have no idea what will happen to people that make that mistake here in NY, but I imagine that it will lead to a mass exodus of staff.

[blackasthma]

[ QUOTE ]
I guess I was just wondering what makes the public accounting field so unappealing to so many people and whether or not I am making a big mistake with the career path that I have chosen. Any input in appreciated.

[/ QUOTE ]

You're not making a mistake, nor should you concern yourself with that at this point in your life. I have a Ph.D. in Electrical Engineering and used to wonder if I made a mistake while in college (I spent a few more years in school than you did, I'll bet). After hopping around different companies for several years, meeting many people, and dating several accountants, I hung it up to become a professional gambler in Las Vegas. Two years later I began teaching college and started a real estate investing career. Now some of my former colleagues are actually funding my real estate deals.

My advice is to keep rolling with it, no matter what it is. The only mistake is quitting. Work hard, meet lots of people, and watch your options grow. This might be even more true if you enter private sector. Everyone can get a little burned out, so you just take a break. Your skills are in demand, so you've already got options. Regardless of what you end up doing 10 years from now, I think you're making an intelligent decision right now...

[Berns31]

I live in Minnesota which does require 150 hours to sit for the exam. I decided a couple of years ago that this was the path I wanted to take, and through some hard work I will be able to graduate this spring, having taken over 150 hours worth of classes in 4 years.

At first I hated the 150 hour rule (and I still find it useless and think it hurts the accounting profession as a whole) but now it has turned into an opportunity for me more than anything. I think that it keeps many people from becoming CPAs because no one wants to take 4.5 to 5 years to get a degree that is essentially worth the same as a 4 year degree. I'm hoping, for me personally, that this will create more job opportunities the next few years.

This thread has helped solidify how I have felt all along. It is currently not one of my goals to make partner. I am working a summer internship at a CPA firm right now and the work that the partners do has little appeal to me. I have always thought that public accounting would be a stepping stone to bigger and better things for me in the future.

To be honest, I have never doubted wanting to be an accountant (which most people cannot understand). More than anything, the purpose of this thread was to hear the opinion of others about the field in which I am planning my future around.