"If we are always arriving and departing, it is also true that we are eternally anchored. One's destination is never a place but rather a new way of looking at things." Henry Miller
Some of the most difficult emails I get (and heartbreaking comments to my blog, re: The Auditors) come from professionals at the beginning of their career in public accounting who have lost their jobs after less than two years of experience. The largest accounting firms have a very efficient recruiting machine that gets fired up at least two years prior to graduation and starts with internships. The recruiting initiatives are organized geographically because that's how the firms are run and partners are rewarded. The geographic element can throw a monkey wrench into any plan you have to interview for a position in another part of the country. It can even affect your ability to transfer your placement if things change.
Organization by geography also makes mobility very difficult for currently employed professionals. When one office suffers a loss of clients or a more severe economic environment, firms won't pay to move lower paid, lower billing rate professionals to a busier part of the country. Nor will they incur significant travel expense that clients won't pay for. It's easier to bring in new, cheaper staff locally. The big firms continued to flood the cubicle farms with new recruits as a result of this pipeline effect, even as they started to cut in mid-2007.
It's never easy to lose your job involuntarily. Notice, I am not using the term, "layoff' because I think it's not only a euphemism but entirely inaccurate. The term "lay off" originated in the blue-collar world and connotes a temporary reduction of production staff - a seasonal reduction in the numbers to address temporary low product demand. When the time passes, workers are recalled back to their jobs. That doesn't happen anymore.
The largest audit firms are cutting professionals at all levels but it's especially hard when it happens during your first two years. Some may say that's the easiest time. No responsibilities, no family, no house, typically. Just loans. It's easy to pick yourself up, dust yourself off, and find a new job, wherever that has to be. But in this economic environment, it takes more than a good haircut and a big smile to get the next job.
That's because the overall market for accounting/audit professionals depends, in large part, on the accounting firms taking responsibility and paying for the training necessary to turn a textbook accountant into a practical accountant or auditor. Most corporations and government agencies are not set up to initiate new graduates into the accounting profession in quite the same way. They count on the firms to deliver the burnt-out, family-track, and otherwise "not cut out for partnership" refugees from public accounting, training wheels removed, ready to ride the two-wheeler in the world of internal audit, finance, and accounting.
Losing your Big Firm job before you've gained 3-5 years of experience puts you in a "limbo" of sorts. You're no longer a new graduate and, yet, you're not qualified for an "outside" job, at least according to the traditional criteria. Many ask me, "Will I ever have a chance to go back to Big 4? Do I have a black mark on my permanent record?" I won't assume that everyone is meant to return to the Big Firm or even wants or needs to. You can move forward, develop your career, gain experience, and maybe even find yourself outside of the Big Firm.
Here are some options to consider.
- Study for and pass the CPA exam Whether you intend to return to public accounting or not, passing the CPA exam is an accomplishment that will enhance your resume for the rest of your career. It's also the best time to do it well, when you're not also working 80 hours a week.
Don't let your firm take back any money they gave you for passed exams or study materials or days off. Tell them you'll file a claim with your state's Labor Department: Wage and Hour Compliance Enforcement. If you were let go for anything other than "cause" (which means you seriously breached policies or did something illegal,) you deserve every penny you have already been paid or promised even if cut for "performance."
If you have the interest and aptitude, the Certified Internal Auditor (CIA) , Certified Information Systems Auditor (CISA), and Certified Fraud Examiner (CFE) certifications are also highly interesting and marketable. All, like the CPA exam, require a certain amount of experience before becoming fully certified, but getting the exam out of the way is a big first step.
And, of course, if you have the money and haven't done so already, going back for your Masters in Accountancy or Masters in Taxation is always a good idea. The biggest immediate benefit is the opportunity to take advantage of the new recruiting process. More importantly, a graduate degree enhances your intellectual life (and your resume) for the rest of your days.
- Consider the smaller, regional firms From Rick Telberg's CPA Trendlines Blog, October 2008:
"INSIDE Public Accounting namedthe 2008 Best of the Best firms [They] range in size from $6 million to $275 million in revenue; represent nine states; have practice mixes ranging from audit specialists to tax specialists and everything in betweenWith revenue growth of the group at 24.2 percent and income growth at 27.8 percent, Best of the Best firms turn in a scorecard that is the envy of their peers Not only are their growth rates strong, but they are able to pay partners on average 75 percent more than their peers with average partner compensation crossing the $700,000 threshold for the first time in IPA history."
Many of the regional firms also audit public companies and are, therefore, registered and regulated by the PCAOB. Check out their track record as part of your due diligence. They often have strong, nationally recognized specialties based on their geography or history. That bodes well for future moves either back to a larger firm or to industry.
- Demand support from your university placement office - Put your group of recently terminated graduates together and organize a meeting with your university placement office. Demand renewed job search support for their graduates. Your school took credit when you were placed with the firm that threw you to the wind. They also continue to allow those firms to come to campus and hire interns and graduates under rosy, unrealistic pretenses. Call them on it. They owe you.
- Consider serving your country No, I don't mean serving in the military unless, of course, you are already in the reserves and would like to step up that participation while there's no civilian job to interfere.
What I meant is perhaps you should look at the new jobs created to manage all of the US taxpayer's investments in public companies. The federal government is teeming with opportunity at all levels and I know people who have found jobs quickly. Search on www.usajobs.gov for "audit" and 717 results show up, all over the country, some quite interesting and exciting. More than 20 of the listings had salaries over $100,000 per year. And once you "report for duty" with the Federal government, you're "in like Flynn" for the duration.
- Take some time off Back in October of 2008 I wrote a post about things you can do if you have some extra time to relax. I think the suggestions are still valid, assuming you don't have to find a job immediately and can enjoy the break.
- Rethink your choices, in general In my first post for the blog, Going Concern, I wrote:
"Sarbanes-Oxley pushed you to accounting. When you started college, the professors and the media said accounting was booming, tons of accountants needed. Do four years and get a job no prob, rather than an MBA right away. Might as well put a couple of years in as an excel jockey, easy schmeezy, and then head to Stanford. Anyway, an art history degree is not what it used to be. And a 3.9 wasn't so tough once you remembered debits to the left, credits to the right. Or was it the other way around? Do you know what you've gotten yourself into?"
Some of you may not, to borrow unfortunately a line from your firms' HR people, be "cut out" for Big Audit Firm life. It takes a certain interest and aptitude and it's not "just a job," especially when you audit public companies. The post was written tongue in-cheek, but like everything I tell you, there's a more than a hint of bitter truth to it.
Don't stay in the profession for the money (?), fame (?), or easy life of the partner (??) that they promise. None of it was entirely true and certainly not true at all anymore. Make sure you're committed to this vocation or take the golden opportunity, at a fairly early stage of your career, to reinvent yourself.
Francine McKenna (@retheauditors) has more than twenty years of experience in consulting and professional services environment including tenure both in the US and abroad at PwC, KPMG/BearingPoint, JP Morgan and Jefferson Wells/Manpower. She is a freelance writer and a frequent speaker in and out of the accounting/audit world.