How is accounting used iin I-banking
I'm taking intermediate accounting and intro finance right now, and we just got done doing some DCF/NPV analysis. People keep telling me to major in accounting because it's useful in banking, but so far, I don't understand why. I understand that to do the DCF you need to understand a balance sheet/other 10-Ks but I don't understand why I need even intermediate accounting to be able go find a number and plus it into my excel model, forget about advanced accounting/tax classes. Clearly, I must be naive and or missing something, so can somebody please enlighten me?
Thanks
It's all accounting. You need to be able to build out I/S, B/S, & CF. All accounting, especially as an analyst.
if you understand all the statements and what each line item is and where to find certain things and what to do when one increases/decreases than your fine. 2-3 accounting classes is fine. i'd major in finance/econ
You have to build those statements?! Why? Isn't that an accountant's job? I know that my class doesn't equal real life, but even in class, all we have to do is grab the numbers off of the already formed 10-Ks. Why would you need to recreate them as a banker?
You don't seem to understand what it is we do all day. A lot of the analysis I do is rooted in modeling various financial and transaction scenarios which means projecting financials into the future - i.e. building detailed three-statement models which will then flow into transaction scenarios, be it financing, M&A, LBO, etc.
That being said, this job sucks balls. This business is incredibly unfulfilling, believe me. Every morning is the worst day of my life.
PM sent
Well, I'm an accounting major. But, aside from auditing the investment banks, I wouldn't necessarily recommend it if you want to go into investment banking. I've taken most of the accounting classes now, and if you want to work on Wall Street a major in Finance gives you a better background.
Stop bitching and quit then.
I love when college kids make comments like these. You can't understand unless you've actually experienced it. And yes, I would love to be able to quit, but I am of the opinion that I got myself into this position so I have to deal with it.
Do as much Financial Accounting as you can. It will help in the long-term and if you're looking to get into IB you'll probably enjoy most of the stuff you learn. Stay far away from Management Accounting. It's the devil's creation.
haha why do you hate on management accounting? i took it and thought it was interesting, albeit worthless for ibanking. it's better for consulting and F500 jobs
^I never hated on managerial accounting, I just personally dislike how all you do is reconcile and adjust journal entries and whatnot all day. Your post actually makes me wonder about another thing though, please tell me if this is an accurate statement, and this is only based on what other people have told me:
For F500s and Management Consulting: Accounting > Finance major
For I-Banking, Commercial Banking, Corporate Development: Finance > Accounting major
True or false?
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