Recommeded Reading For CPAs: Spam Nation

While small CPA firms are often vulnerable in terms of protecting their clients' personally identifiable information, the Big four firms aren't particularly breach proof either in terms of safeguarding personally identifiable information.  Despite the firm policies and all the CPEs on this topic that the Big 4 Firms use to increase awareness of the firms' employees to the theft and misuse of personally identifiable information (PII), it's all up to the employees who have access to the personally identifiable information to follow the rules and be cautious.  The mere size of the Big 4 firms makes it almost impossible to ensure that everybody who handles or who has access to the personally identifiable information is going to be very cautious and is following the information security rules.  It's because there are just too many people in the big four firms who handle clients' PII, many of them are new college grads who just got hired, more of them are offshore employees and outsourced contractors in India. PII just passes too many hands in the Big 4 due to the size of the firms and the high employees turnover.  Many new college hires don't even know or care about the significance of PII because they are so young and inexperienced.  They received some training on this but their mentality just doesn't take this seriously.  The more experienced managers and senior managers are also young and naive about the seriousness of identity thefts and the consequence of a breach of PII security to the firms and their clients.

In the small firms, many professionals there don't even know what PII is all about, or do they have a clue as to how to safeguard it.  I recommend all the CPAs to do yourselves and the public a favor and read this book, so you don't smirk and just brush it off casually next time when someone talks to you about safeguarding PII.

Do You Need A Master Degree in Auditing To Serve As A Maid???

Obviously you do, according to one of the Big 4 that brags about being the best big 4 accounting firm to work for.... or to wait on???

This is one of the most rotten and wasteful practice in any accounting firm. The smallest accounting firms don't make any associate drive around town to buy the managers and partners coffee.  They don't make the associates work as take-out delivery boys and girls either. Even the smallest of the small 4 accounting firms know that it's cheaper just to give a few dollars' tips for delivery service than sending college grads and associates who passed the CPA exams to go buy lunches, dinners, snacks, coffees,  do post-office runs and other errands.  I sincerely hope no CPA candidate is cleaning toilets in any of the big 4.

From one of my cousins who has been working with this so-called very women-friendly Big 4 firm since her passage of her CPA exam and her graduation of her Master Degree in Accounting, most of her work experience in her 6 months of employment  in this "prestigious" firm has been stuffing many many envelopes, making many copies, filing long expense reimbursement reports because she was made to buy so many dinners,  lunches, coffees and had to run many non-audit related errands that her firm sponsored credit card bills are  flying through the roof.  She has been spending a lot of time talking to the internal audit department to respond to questions from the T&E auditors. I don't blame the T&E auditors either, the parking expenses charged on my cousin's credit card in any one day is outrageous.  The numerous parking tickets from the same expensive parking lot in the same day do look suspicious to any T&E auditors who don't know her story. I guess this answers her question as to why the managers and partners in her firm rarely volunteer their firm sponsored credit cards to pay for some of those so-called engagement related business expenses.  Getting the reimbursement from the firm can be a pain and a hassle.  Managers and partners often don't want even to charge their own meals on their own credit cards probably because they don't want to spend time to do their expense reports and explain the charges to the internal auditors.  To me, running most of the expenses through the young associates' credit cards are so unethical.  I was so appalled when my cousin told me this.  In my entire life working in public accounting, I had never worked in a firm that has this practice... I am shocked this is the accepted culture in the big 4 firm.

Instead of dragging the audit into a 12 + hours day, why can't the audit team make good use of the intellectual power within the team and delegate more audit work to the highly educated associates???  What benefits do the audits get when the engagement teams are sending off the CPA candidates  to work as maids and servants on duties that are not really related to the engagements?  In one way or another, the audit clients are paying for these unproductive hours that my cousin and her peers spent on that had nothing to do with the audits, regardless of how the firm can explain its way into saying such meals and coffee breaks are indeed vital to the audit engagements that they can't possibly let anyone who don't have an accounting degree to do them....

Review question on this blog post:  How can any accounting firm that can't effectively make good use of its human resource be trusted to produce an effective audit that the public can rely upon???  Please feel free to leave your answers in the comment area below.

Big 4 Equals Big Scam

One of my friends had joined one of the Big 4 a month ago. But until now, he had not been paid. Since his start date, everything had been bumpy, from attending the B.S. mandatory new-hires training to navigating  the firm's software to activate the firm sponsored credit card to book travel for audit field work. Of course. why should he even expect to get paid punctually after every mul-functions of the firm he had been through in just one week?

The poor guy had been working for more than 12 hours everyday for 7 days a week since he joined. But he hadn't been paid yet...I'm sure he will eventually get paid when the firm finally fixes whatever problem that caused this mess up... According to my friend, nothing is smooth or easy with the firm... He is already an experienced CPA and he joined because he got sucked into the marketing hype and the "Big 4 experience will enhance your future career" marketing pitch.  He got sucked in and so far he says this is the worst first month he had experienced with any jobs he ever had. Of course, this is the first accounting firm he had worked for that hadn't paid him after over one month's work....When there is even a tiny problem within the firm, it's very hard to fix because the firm is like a world that is governed by some kind of "being" whom nobody knows, and nobody ever met....If you think the CEO or the Managing Partner or any Partner is running the firm, you are wrong. They are controlled and dictated by some sort of authority too. Who and what it is????  Well, who knows... It's not like anyone can just simply  fix my friend's payroll problem there.... like the regular smaller accounting firms. He needs to go through layers and layers of platforms and be bounced around  and around..... So far, he is still not paid.  But why?  Who knows!!  

Well, may be he just joined in the wrong time when the firm is scrambling to issue the 10Ks for its clients?  But should busy season be the excuse for the firm to mess up the IT infrastructure,  pay information and miss the employee pay dates???

The quote "Bigger is not better" holds true to everything, including accounting firms.

What Losers Work For Big 4???

Every time when I was completing the independence checklist on my audit of non-public clients in the small firm I worked, or every time after I was forced to take the boring ethics CPE that nags me year after year about "Auditor's Independence", I couldn't help but wonder,  with such a wide net to restrict auditors and our family and possibly relatives from having "financial or other relationships" with the audited clients, how do the Big 4 manage to keep experienced  and top talents within the firms???  For my small firm and me, the independence compliance was extremely easy to follow.  But for people who work in the Big 4, the "Independence" compliance can be a huge pain in the bottom.

Most of the banks, mutual funds, publicly traded companies are all audited by one of the 4, and they are financially related to most of the Americans who ever held a job and had a 401K, or savings, or loans or credit cards of some sort.... I mean no wonder the Big 4 only seem to be interested in hiring 20 something year old children, who are fresh out of college, because they are broke and they have "zero" savings and no investment. They may still have a student loan they wasted on majoring in accounting though.  But that was easier for the firm to manage, compared to an experienced and talented CPA who had amassed a nice portfolio of stocks, credit cards, home loans, and other partnership interests everywhere.

One has to be really  a broke loser to work for the Big 4, or has to be really stupid about investing and money to have not much investments with the Big 4 clients in order to work for the Big 4. Neither of these is a desirable attribute for a competent accountant.  Either that, or they are so young and so fresh out of college that they have yet to establish any financial relationship with any entities.  Now this kind of projects the caliber of the people who are working in the Big 4 firms... Do you still think they are smarter than the rest of us like the firms claim they are???

If you are an experienced professional and you are looking for jobs with the big 4, be prepared to sell your investments and other financial interests in order to maintain your firm's independence and your independence  as an auditor or advisory professional, unless you are totally broke and you have nothing.

Don't Work For The Big 4 If You Want A Nice Office

Lack of work-life balance, comparatively low pay (sometimes even for the partners), long hours, office politics, are often listed by former Big 4 employees as "reasons why any talented CPAs or accountants shouldn't work for the Big 4".  To most former and current Big 4 employees, the most annoying negative of working for a Big 4 accounting firm is the lack of a decent office room for the professionals.  In smaller accounting firms, it's not unusual for even senior associates to have their own office rooms.  But for the Big 4, even the senior managers may just have only cubicles...and for certain partners, a closet size fish tank as an office room....

So if you are dreaming to be promoted to that dream management position in a Big 4 firm so you can command a corner office, dream on...and be ready for one day to be asked to bring your own folding chairs to go to work...  or be told to go use the public toilets in the neighborhood, since now some Big 4s are thinking that taking away everybody's permanent desks and make everyone drift around the office with their computer equipment and belongings like a vagabond are so chic... The day when the Big 4 get rids of the rest rooms may be nearer than you think...

Whatever The CGMA Exam Will Be Testing Is A Lot More Interesting Than The CPA Exam

The first exam for the Chartered Global Management Accountant designation will be held in May 2015.  While management accounting and public accounting are defined as two different disciplines, I think many accountants in public practice will benefit  if only they have a better understanding in the management accounting practice of their clients.  Based on my 10+ years of public accounting experience, a lot of the audit deficiencies are caused by the lack of their CPA's understanding of their clients's management accounting system and accounting estimates. One aspect I hate about being the auditor is the fact that the clients often don't see value in the public accounting firms they engage to do their audits because they only see them as the necessary evil to get that rubber stamping on their financials.

Bottom Line Advice Of The Day

"The strongest improvements in market performance come from businesses that go beyond lip service and actually treat their workforce as a strategic asset rather than a cost to be minimized." -  The Custom-Fit Workplace, pg 24.