This Is The Reason Why You Shouldn't Major in Accounting Anymore

To all American college students, and to all of you out there who think you can make more money by getting an accounting degree or a CPA license, please do yourself a big favor and don't  waste your precious life on earth like my niece is currently doing at one of the Big 4 because there are just too many CPAs in America and many more are being imported from the U.K., India, China, Japan, Malaysia etc, etc..  If foreign accountants aren't imported through the use of H1-B visas, then the accounting jobs are out-sourced to other countries.  So either way, America is not lacking of  CPAs!!  But American CPAs are lacking of decent paying jobs or even a job.

The following hiring ads is quite typical these days even the USA current unemployment is supposed to be at the lowest for 7 years.  Anyway, who is so retarded to actually listen to the idiot in the government who calculated the unemployment rate?

According to this ads, the compensation is $1000  for 40 hours per month.  So a licensed CPA with 4 to 5 years' accounting experience  is only worth $25 per hour for doing all those high level work from tax research, partnership and corporate tax filing, accounting, and forensic auditing?  Now my niece's big 4 job does look a lot better.  Because most of her job duties, aside from the occasional vouching of bank statements with a tick mark, is just coffee runs, meals runs, postal service runs and yes, scanning!!  She doesn't have to put her name on anything that is subject to huge legal risks.   I don't understand, does the firm which writes this ads really think there will be any CPA who is going to let the firm use his / her license for only $25 per hour?  After gas and mileage and health insurance, any experienced CPA who is going to be so lucky to score this job will be making less than $20???  Is there any experienced CPA out there who is this desperate to want to make this kind of supplemental income.  If there is, why don't you just go baby sit or dog sit?

This is so sad.  The CPA profession in America  has become really really sad for the last few years.  

Are CPAs and Accountants Properly Informed On Competitive Billing Rates??

As a CPA, I am often in awe to see a lot of my peers are reading articles or advice provided by others without questioning, be they from the peers in our profession or even others who aren't in any kind of profession at all.  An example is this article on billing rates for solo accounting practice and small firms (click to read). The article cited average billing rates for various services provided by small firms or solo practice, and yet it didn't say how many small firms were surveyed and what the sampling methodology was regarding to variances on geographic, years in practice, revenue range and client sizes.  All it said was the data was obtained from a "new survey"?  But it didn't say conducted by who and where?

According to the article, the average billing rate for tax prep is $110 per hour and $513 fixed flat fee.  Throughout my years of hanging around in small firms, I have seen many fixed rate tax returns at $75, and also $150.  As for per hour rate, many are charging under $50 and under $75.  May be many of these low billing firms are totally eliminated in the survey?  Recently, I have been having a hard time trying to get new clients from scratch, because many of them are telling me that they are paying only $125 for their tax returns with their CPAs.  And I truly resent these low billing CPAs who are degrading the profession to those tax prep services inside the hair salons. But who can blame them when literally any doofus are allowed to practice tax, bookkeeping and even accounting.  Auditing and attestation is the only service that requires a CPA license.

Now back to the topic, am I the only CPA out there who reads articles like this unknown survey and always feel this kind of data reporting should be left to be done by us, the CPAs???  And yet, many CPAs in America are very weak in Mathematics, logic or even basic arithmetic so many of us are totally incapable of writing even an article like that one which I consider it to be very inadequate and unprofessional.  Lots and lots of us can't even write an email to begin with.  In America, and particularly in California, everybody is providing accounting, tax and bookkeeping services.  One of my former tax clients is actually doing it and she is telling me she is studying to become a CPA and she is now having her own bookkeeping practice serving a few law firms already.  Her original degree is early childhood education but she couldn't pass the certification test to get a job at the kindergartens. Now she is taking evening accounting classes in some community college while providing book-keeping services.  God bless her clients.  I took a brief look on a few tax returns she did and they were full of outrageous mistakes.  Her clients are unaware of these mistakes and seem to be happy with her  because she charges only $30 an hour for her full charge bookkeeping service.  Meanwhile, I am having a hard time trying to get anybody to switch to me when I am asking $150 per hour, even though I am a CPA with many years of hardcore tax and audit experiences.

It's really frightening and disheartening to see the billing pressure in the profession, and it actually feels  much worse than  the article reported.

Tick Tock My Public Accounting Clock

I had thrown in my towel last Friday and gave my two weeks' notice.  My original plan was to hang on there until I had a new job offer.  After one year's interviewing and the exhaustion of all my paid vacation days on attending interviews,  I decide that it has got to a point where I feel so bad about waking up to go to work that I feel that I can no longer hang in there anymore.  (I have to say most of my paid vacation days were wasted on worthless headhunting firms, which I have learnt my lesson now to be more skeptical of them.)

I just realize that life is too short for me to spend one extra day, dragging myself to my car and be miserable.  I don't see how my current position at my firm is going to lead me to anywhere less miserable.  Sure, a lot of recruiters advise me to not quit my job until I have another job lined up.  Too bad, I don't have one lined up yet even though I had spent the last year looking for one. I just want my way out now before the audit season kicks in full gear and I will become stuck for another 6 months without time to attend job interviews.

As more work comes my way and more crises tossed to my desk, created by my bosses and the incompetent Controllers of their clients, I feel that it will be harder for me to focus on finding my next public accounting job or to even think about what I need to do with my career.  I feel that one more day hanging on in this firm means only one more day of my life being wasted.  I feel that it's very important for me to surround myself with the right professionals, professionals who are competent, and not complacent.  I have been looking at the people around me in this firm and in this firm's clients, all I see are very incompetent and complacent people with the exception of one of my colleagues, who told me he had been feeling frustrated and was actively looking for a new job too. I just want to leave before he does.  

So I quit.  My days at my fancy and spacious office are now counting down.  I feel relief.  I guess the fear part hasn't kicked in yet.  What about you?  Do you enjoy what you are doing at your job?  Have you ever quit without having another job lined up?

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CPA Credentials and Experience Don't Increase Employment Opportunties

Today, my recruiter called me that this job that I applied and went interview twice for a total of 4 hours, selected another candidate who is more suitable.  If this is my first failure in a job application, I won't feel this defeated.  Since this is my 4th rejections after a series of job applications during the last month, I am beginning to worry that my years' experience as a CPA plus my other 3-letter credentials will never give me another job opportunity and I am forever stuck with this small firm that not only offers me no more upward opportunity, but pays me less than others who are less experienced, have no management responsibility, and even no CPA credential or any credential at all.

So for those of you who think that getting a CPA license will give you advantages in job search,  think twice because from my experience, I can tell you this is a myth.  No CPA license or any credentials can give you a better pay job if you don't compromise your professional standards, if you have your own opinion and if you are a real good auditor who can find accounting misstatements and identify significant weakness in internal controls.  This is because if you are a good auditor or if you are a really good tax accountant who really knows the tax laws, then you will see your clients are doing a gazillion things that are grossly wrong and unacceptable, and then you are creating problems for your boss in the firm and putting your firm in a very difficulty position with the clients.  In addition, clients don't want to hear from you that they have this weakness and that weakness. They also don't want to hear from you they can't take this deduction or they can't take that deduction.   The clients want you to give them approval of whatever they do.  My current bosses don't like me and they see my strength as something that costs the firm extra time and even a discount in fees when they resolve my findings with the clients.


They always told me if only I didn't bring the significant issues up, they wouldn't spend time to resolve with clients and they wouldn't have to cut the fees to soothe the upset clients for whatever honest opinions I present.  And this reflects in my annual salary review in lower than average annual raise compared to my co-workers and even the associates under me. The partners never appreciated the fact that I keep them out of potential trouble that can cost them licenses and legal fees.  I guess in the big 4 they can't  pay my position lower than the people who are less qualified, and experienced than me , particularly no less than those whom I supervise. But in small firms, there is no pay scale, the partners can pay whatever they like.  This is another reason that you shouldn't work for small firms at all.

So if you are really serious about accounting, and if you are serious about doing a good job, don't work in accounting. Unless you can bear to see your salary being lower than your colleagues who quietly and obligingly give the good news the accounting firm and the clients want to get.  Or, you have no problem working under partners who are incredibly incompetent and out-dated. This is just what I learn from my decade long practice as a CPA.

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My Job as an Auditor is Literally Making Me Sick!!!!!

Before I majored in Accounting years ago, I had no clue about the downside of public accounting, and the stress level I would experience.  When I studied for the CPA exam, I was told time after time again I would make good money when I became a CPA.  Those were all lies. Driven by a false sense of hope and optimism, I studied very hard and became a CPA.

Looking back, I wish I had spent my time doing something else, like getting a job as an office manager in a Doctor's office or even an office manager in my CPA firm.  May be I should have gotten a job in the kitchen or dining room at a restaurant.  I would be making a salary not too different from what I am making now, but I would have more time with my family, to pursue my hobbies, and to sleep more, etc, etc.

I had recently found out that the office manager of my firm is paid $77K a year.  She is not a CPA, she only has an associate degree.  She is therefore incapable of providing any support at all, and if the professional staff aren't watchful, she will mess up their health insurance,  401K contributions,  paid vacation and sick days and underpay them, not intentionally but because of errors.  The worst part is she has such strong conviction of being correct that she doesn't address the mistake immediately, because she believes the professional staff are wrong!  We are all CPAs and she is an uneducated community college grad with no special skills. She can't even write an email that is more than 2 sentences long.  Yet, when there is a dispute in any calculation of benefits, she is so confident that she knows the math better than the CPAs. Unbelievable.

I am very resentful, because as an audit manager, I don't make any much more than her.  Because of her incompetence, I have to spend extra time fixing complaints from my audit staff about their time, their pay, their software problems and other administrative support issue.   Yet she gets to go home sharply at 5:30pm everyday.  When she goes home, she literally goes home.  When I go home at 7pm or 8pm, I literally am bringing work home to continue to work till midnight.  I have to do that because I have so many different engagements on hand and I am short of audit staff and also administrative support.  Many people said working in a small firm is less stressful than working in Big 4.  I had never worked in a Big 4, I foolishly turned down a senior associate position 3 years ago from one of them because they offered me a salary that was way less than what the office manager is making in my firm.  But I believe if I were a senior associate in a Big 4, I would not have to waste time dealing with administrative issues or correcting paid time off for the 1st year associates and I don't have to do anything about the quality control and ARs for the firm like I am doing now.

I can handle huge volume of audit and accounting work fine, but I can't handle  administrative work, billing, the firm's AR, computer support and also audit, all at the same time.  So before you join a small firm, think twice!!!

Meanwhile, I have been feeling shortness of breath, exhaustion, mood swings with my family, headaches etc... due to the fact that I have a lot of imminent deadlines I have to meet for my clients, and I also have no administrative support. Sometimes I woke up and I literally suffered panic attacks right before I left home for work. Like this memorial day long weekend, my firm's office manager gets to take a trip to San Diego, and I will be working at home because I have a deadline on Tuesday!! I rather take the job of an office manger in my firm because all she does is well, I really don't know what she is doing.  But the partners seem to like her.  As professional CPAs come and go, she has become the employee with the longest tenure in the firm.  No, she is not related to any of the partners. As to why she gets such a well paid position and is able to get away with her little contribution to the firm, I have been too busy to try to figure out.

Yes, I know what you are saying now, why don't I quit?  I have been so busy I have no time to even sleep, forget about finding another job.  I did manage to send several resumes out for corporate accounting positions, but have not heard anything back.  I am very eager to leave my firm and leave public accounting for good.   Until then, I can only wish myself to get well soon, physically and mentally:

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My First Attempt in Getting My First Tax Client

A while back I met a lawyer at  my first and last happy hour for 2012.  He recently referred to me someone who needs a CPA to back file several years of tax returns.  I was so very excited and I started to dream about quitting my current job and having my own tax practice.  Well, such a dream turned out to be very short-lived.  This person whom the lawyer referred to me turned out to be a total flake.

After wasting my time emailing with this person and talking to him on the phone, I was so excited that he agreed to come into my office with his accounting records.  I was so looking forward to the appointment.  But he never showed.  He totally stood me up. I called his office several times and he just dodged my phone calls.  I left messages with his employees but he never called back.  I emailed him few times also trying to re-schedule his "missed" tax appointment.  He never emailed me back.

This flake wasted my time talking to him on the phone, answering his tax questions only to later pull a no-show on a scheduled tax appointment.  He didn't have the courtesy to call or email to cancel.  He didn't have the decency to even return my phone call or email to apologize for his no-show.

I am going to black list this guy's company and him and I swear to never give his company any business or pay my visit at any business that he is affiliated with.  I will warn my clients about this guy if any of them have the misfortune to be solicited by this guy's company.  A flake like this can't be fit for any one to do business with or to even work with.  This explains why he and his company haven't filed taxes for the last few years.

Now that I realize how hard it is to get a client, I have more respect for my current and former bosses for getting enough clients to pay for my salary and benefits.  Building a small accounting firm is definitely no easier task than getting a job from a Big 4.......Why is it so hard to get tax clients?  How can I get my own tax clients? Until I can answer these questions, I guess I better be back to job hunting instead of client hunting....

Dealing With People Is Much Harder Than Dealing With Numbers

Today is another day that is filled with aggravation. When I was a college student,  I chose to major in accounting thinking that I could make a  living doing what I was better at, which is, working with numbers and rationality. I avoided majors like marketing or law because jobs in those fields involves too much human interaction than I can handle.

The reality is, dealing with people, particularly annoying and aggravating people accounts for most of my working hours as  a CPA in public accounting.  All the emails, phone calls, in-person meetings, video conferencing with people  have taken up most of my working hours each day.

Working with numbers is easy, but dealing with people is way too stressful and aggravating.  There are so many aggravating people that I have to deal with everyday that it's sickening.  There are people who have too much ego.  There are people who are too dumb.  There are people who are too lazy. There are people who are too incompetent.  There are people who are too sensitive. There are people who are too rude and self-absorbed.  Then there are people who are too demanding.

The people that a CPA  in a small firm has to deal with are at very different levels than the people that an associate at a Big 4 firm has to deal with. I have a feeling that the people that I am dealing with everyday have to be much less educated, or literate (in accounting, business, or taxes)   The is one of the cons that I find from my years working with small CPA firms.

Tax Returns Assembly Factory

Today, I have finished 15 tax returns, several of them are corporate tax returns that have a filing deadline on September 15, 2012.  Most of them are individual tax returns that were put on extension from April 2012.  I don't know why many CPAs like to do tax returns.  Most of the time it's really data entries, particularly for the individuals' tax returns.  I guess one thrill of doing tax returns is the quick turnover.  With professional tax software's powerful diagnostics, it really doesn't take that much thinking to do tax returns anymore.

With the occasional special issues of tax free exchanges for real estate partnerships, enterprise zone and other industry specific manufacturing credits, and the occasional debt forgiveness, the 15 tax returns that I did today presented no time consuming challenge to me.  At times, I was feeling not like an accountant but a bored  data entry clerk.

The main difference between working in small CPA firms vs Big 4 is that you get to do the boring tax returns during times like this, after you are done with your financial audits and you missed out the tax season back in April.  You will get to do tax returns and plenty of them now.  It's as if there is a second tax season.  I never liked doing tax returns because I hate data entry and I get bored by the process easily.  But I am pulled into this tax filing fun because of these September 15 and October 15 deadlines.

A lot of the tax codes are only applicable to very few people and situations.  The ones that apply to majority of the people are always the same old same old....  This is why even a hair dresser and a travel agent can do tax returns and they put tax returns filing signs outside their barber shop and travel agency.  Pretty soon, I believe I will see car mechanics putting their tax sign up saying "Have your tax return filed while having your car's oil changed."

As a CPA, I often feel like doing tax returns is like doing something that even my high school grad grandpa  can do on Turbo Tax (yes, he never let me do his returns, he loves doing his own on Turbo Tax ... ). I feel kind of being degraded.  After all, one doesn't have to be a CPA to do taxes.   I wonder what it's like to do taxes in the Big 4, may be their tax clients' situations are so complicated that doing taxes can actually be fun and challenging?

Anyway, I'm looking forward to have this Sept and Oct 15th deadlines over, so I can go back to work on attestations and other advisory projects.

Many Small Privately Held Companies Have Very Shady Accounting

Most clients in small CPA firms are small privately held companies.  From what I had seen throughout my years in small CPA firms, these clients often have very shady and questionable accounting practice. It's always up to the small firms' partners to correct their clients' questionable financial statements.

Today, I was fired by a small privately held company and was removed from the review engagement.  I am actually happy that the client requested my firm to remove me from the engagement.  It's so hard for me to get satisfactory answers during my inquiry that, I can  no longer perform the review.

If this is my client and this is my firm, I will withdraw the review engagement, or at least step it down to compilation only. The reason that this client needs a review is their need to renew their millions of dollars line of credit from the bank. They had already violated  a few loan covenants in 2010 and also in 2011.  They got a waiver from the bank in 2010 and also 2011.  Their only cash inflow is really from this line of credit, which they use to finance their operating and also investing activities. They have been in business for many years.  The bank is waiting for the reviewed financial statements from us for consideration of further extension of the line of credit.

So, during my inquiry, I asked some questions, but the very first question I asked got a very angry response from the client and they refused to even answer. The client's CFO and controller just snapped.  The subsequent questions only got them  more upset and I got nothing back from them either.  So they called in the firm's partner and demanded him to remove me from the engagement in front of everybody.

Have you ever been fired by a client when you were working for a small CPA firm or a big 4?  If so, please let me know I'm not the only CPA who experienced this......

Shell Companies Seeking IPOs are Small CPA Firms' New Best Friends

Recently, our firm had received quite a lot of leads from shell companies seeking accounting services for their IPOs.  Traditionally, IPOs engagements mostly belong to the Big 4s. But with the JOBS Act that makes it easier for small companies to go public, we are suddenly seeing shell companies coming out of the woods to inquire us about potential IPOs related engagements.

I'm not sure if my firm will take in these potential new clients. I only know that they are interested in my firm because we are small and we charge a lot cheaper than the bigger CPA firms.

Useless Workpapers

Auditing for small CPA firms can sometimes be so frustrating. The kind of clients small firms usually have are  privately held companies.  It's unlikely for private companies to have an internal audit department and the kind of internal controls that are often found in publicly traded companies.  It's either because they are too small, or they have grown to too big that its huge business volume has outgrown its existing internal controls.

Although I have  been doing audits for years, I am still frustrated when taking on a new client because the accounting staff always gave me worthless reports and useless information  that I couldn't audit on. It's either because the predecessor auditor always asked for the same worthless reports and never cared if they were useful or not, or the new client's accounting staff think auditing is really a joke and just give me whatever papers that are convenient for them to get.

After spending time testing and finding too many exceptions, I often realize that I am testing on the wrong report that is totally irrelevant or report that doesn't include all the activities because it was printed a couple hours too early.  It's a huge waste of my time when the clients' accounting staff give me incomplete reports or pieces of information here and there that don't tie to the whole picture.

I bet this is never the problem with the big 4 firms, since they have more knowledgeable clients and they have much better documentation of prior year's workpapers?

The challenge for auditing for small CPA firms is to get the clients' staff to provide useful and relevant information to be audited upon..

I'm really frustrated because I had just wasted an entire day of work to find out that I was working on bad reports....  So, tomorrow I have to request the client's accounting staff to give me the right reports and to show them why the ones they gave me are no good and are useless.  Then I will have to start the testing all over again.  

Recording Time Sheets is One Miserable Task in Public Accounting

One of the many stressful things I hate about working in public accounting is the recording of my own time.  In a CPA firm, an accountant is required to account for the time he / she spends everyday.  Every hour during the day can either be billed to a client, or be recorded as non-billable administration of the CPA firm.

It sucks because clients don't want the accountant to bill too many hours and will sure complain about it when they are billed too many hours.  At the same time, the CPA firm doesn't want the accountant to incur too many administrative hours either.  When non-billable administrative hours show up often, the CPA firm's managing partner will roll his or her eyes and  will reprimand the accountant.  That means, accountants in public accounting are expected to record less time for more work they do. (e.g,spending 14 hours everyday to work for 5 clients and only bill 8 hours.).  I'm sure this doesn't happen to the accountants working in a corporation.  I never saw my clients' accounting staff stressing out and scrambling to get more work done.  They all seemed to take their time and were never in a hurry like I am....

When I spend 4 hours working on one client, which is not unusual, I better find 1 to 2 more clients to work for so I can bill my 4 hours to not just one client but to 2 to 3 clients.  The problem is, I still have to bill 4 more hours and it's already 6pm in the evening when I am done with client #3.

Am  I the only CPA who hates tracking and watching my time? Can anyone tell me if this is the issue with only shallow pocket small CPA firms?

Small CPA Firm Has Overtime Too!!!

I'm now taking a break from working.  Yes, today is a Sunday but I am working on an audit engagement. Many people think that only Big 4 firms put their employees at work during weekends.  But small firms also have deadlines they need to meet and therefore working on weekends is not unusual at all in small firms. When I first worked in a small firm, I was shocked to be required to work overtime during weekends.  But now I am used to it....And, just like the Big 4, I don't get paid for working overtime in small firms either.  I don't like it, but until I can find a job outside public accounting, I will just have to suck it up.  Oh well, my break is over, it's time to get back to work.

My First Month at My New Job in a Small Firm

This is not my first job as a Certified Public Accountant, this is also not my first job as a Certified Public Accountant in a small firm. This is however my first job at yet another small CPA firm.

Just one month into my new job, I'm beginning to feel restless and unmotivated again.  I am beginning to feel that jumping from one small firm to another is not going to help me feel more settled and satisfied about my job.

So am I doomed to only be able to work in small firms?  I tried to apply for the Big 4s, but all I got was robotic rejections from their computer the minute I submitted my application to their websites....

Am I the only CPA who keeps receiving such kind of rejection emails from the Big 4?  These robotic email rejections are beating up my psyche....