Thoughts on Corporate Finance?
Fellow monkeys,
Would love to hear your thoughts on corporate finance.
I started my career early (19) with a BB working in small business underwriting. I worked full time through school, was allowed to set my work hours around classes, take vacation days to study, you get the picture.
My performance was always exceptional, and I built a good reputation for myself. While I did not go to a target school, and did not have pristine grades (largely due to working full time through school), I was able to network internally into a role as an analyst within my banks CFO division. I'm now only 23 years old but have ~4 years industry experience.
The new role was very exciting for me. It allowed me to relocate to a whole new city, a city where the COL is extremely low, but my bank has a large presence and a lot of room for me to grow. The work is interesting and engaging to me, I have a very "top of house" view of the entire bank now, as opposed to sitting in the business and generating loans, working with clients, ect...
The work life balance is a huge plus too. I usually get into the office around 730 am and am usually out the door by 6. Only a few times have I had to work until about 8. Usually all in 55ish hour weeks.
Comp is very reasonable too. All in, I can expect ~$80k (Base salary, bonus, 401k match). Where I grew up, $80k a year is considered a fortune. I'm from a decrepit rust belt city. This is honestly more money than I ever imagined making at age 23. I come from very blue collar, middle class roots, and live very well below my means.
My lingering question to you WSO, is what is the upside? Does anyone have any stories about significant career advancement within corporate finance? While I love the job, the work life balance, the pay...I feel as if I could be doing more. I have hustled and pushed myself all my life. I started working at age 14 and have earned some form of paycheck almost every single week since. Working full time through college, I was pulling 70-80 hrs a week between school and work. Whats my next move?
bump, anyone...
Your question still seems a little broad as corporate finance is quite a large umbrella of roles for one to pursue. I would say step back and thing about things you like to do in your spare time?
Then start to look in different roles in finance to see which roles align closer to your interest. Are you thinking about exploring a move to FO role like IB or working within a large corporation for either Corp Dev or Corporate Strategy to name a few?
Serious consideration given to some of the questions I posed can be helpful for guidance going forward.
Typical WSO bullshit. IB IS FOR EVERYONE!
Corporate Finance Careers - Question About Earnings Potential Based on Function (Originally Posted: 09/30/2017)
Hey all, I'm in a FLDP right now and I could honestly see myself being okay winding up in one of the accounting/reporting roles for a few years. However, I was talking to an alum from the program earlier this week and they mentioned something about comp for the other functions and that it was higher for non-accounting/reporting functions (we were discussing bonuses specifically but I think they meant salary was as well). So with that, is that a standard thing at most companies where more finance leaning functions e.g. FP&A, Treasury, Investor Relations, Corporate Development, etc. out earn their counterparts in accounting/reporting functions in both salary and year end bonuses? If that is the case, I would probably end up changing my mind about what kind of role upon completion of the program. Would love to hear everyone's thoughts and experiences on the subject. Thank you!
I'm in corp dev at a mid cap pharmaceutical company with a couple years on the job. Comp. is so-so compared to banking, but better than FP&A. Also for corp dev the hours are way better (like an actual 40 hour week). If I were in FP&A I'd be pulling 80 hours for the week of every quarter close.
How often does your FP&A team pull 80-hour weeks? I'm just curious because I don't think I've ever seen my company's FP&A team in the office past 6:00 PM, even when it's earnings season.
This could be the case, but will depend on the company. For example, if you're in our accounting or AR/AP department and you're a Manager, you might be leveled the same as an Analyst in a finance role. The Analyst could actually be leveled higher in some cases. Depending on your underlying level that you're it, it will impact your bonus % target payout. It likely evens out at the higher levels, for example, you may have someone who was a FP&A Director become the VP of Accounting. This person definitely isn't taking a step-back in terms of level, pay, or bonus. But, in your case, you should definitely look into whether your company has levels and how those levels correspond to titles & functions.
Robertsmit, part of what influences compensation at the corporate level is the abundance of the skillset needed for that role. Simply put, there are thousands of FP&A individuals and thousands more who posses the skillset needed for FP&A, while there are far less who posses the skillset needed for corporate development. This results in corporate development generally paying the most out of the corporate finance functions. In my experience, and I'm happy to be corrected if anyone has seen differently, the reporting roles will tend to pay the least whereas the roles that have no set schedules will tend to pay the most. That being said, regardless of where in corporate finance you work, you're not going to be eating beans every night, and you'll have a skillset that can be applied to pretty much every company in every industry.
Bonuses are a bit different. My company has a progressive bonus structure (for a lack of a better word) where those who started with a lower base salary receive a slightly higher bonus and those who started with a higher base salary receive a slightly lower bonus. It certainly does not make salary a wash as corp dev is still outearning FP&A by a material amount.
What skill sets do corporate dev people have that's so scarce?
Corporate Finance Question(s) (Originally Posted: 11/05/2015)
I may switch to a corporate financial analyst role. I'm just curious as to when they say planning/forecasting/reporting processes - are these basically financial modeling? If that's the case, I should be good to go, but I just wanted to be certain.
This can be a variety of things. Here is a high-level view of how I see it: 1. Planning/forecasting: this element can certainly involve financial modeling in that you can build out various scenarios in your financial model to understand the business impact of any number of inputs. However, this can also mean just collecting forecast data from everybody in the business and aggregating their thoughts into one place, which can be mind-numbing. There is a very wide spectrum and this will vary from company to company 2. Reporting: this is typically more straight-forward. building dashboards within the company's ERP system, slicing and dicing data dumps from the data warehouse, etc. This can be for senior management, the street, or investors. There is also SEC reporting, which is more of an accounting based function
Thanks for the response!
My guess is it's a typical FP&A role, which means you'll be working on putting together the forecasts, operating plan, and strategic plan. You'll also likely be responsible for putting together presentations for executives on monthly/quarterly/yearly results.
Thanks for the response! I may have some further questions; we'll see..
Typical FP&A role consists of budgeting, forecasting, variance analysis, monthly performance reports, and scenario analysis. Some are more accounting focused where you would be helping with month end close and some may even make you do journal entries. Although I would argue if you do are doing that your an accountant and not a financial analyst but some companies like to label accountants as financial analyst if they have any relevant finance exposure as it sounds better.
Is Corporate Finance for me? (Originally Posted: 06/08/2014)
I wanted to go into Equity Research, probably focusing on the Media industry, as that's where my WE has been so far and I was hoping an MBA to learn the finance side. However, I keep hearing it's tough to get into because it's a cost center and jobs are more likely to be cut. Also, I'm very intrigued by Wall Street, virtually every book I read is on the topic. That said, I'm not sure my personality fits it. I'm relatively stress and risk averse. I also feel like it's not that stable. I feel like corporate finance might be more my speed. The part that I was most interested in ER was analyzing financial statements, less so all of the other stuff. I feel like CF can give me more of that. I'm more of a numbers guy (I'm no math genius or anything, but I really enjoy numbers, analysis, and financial statements). Every time I read a book about analyzing financial statements I really get excited. Also, I think I might have a chance to get into McCombs off their waitlist. They seem to place well in corporate finance and have the #1 accounting program in the US. I would rather go back to NY though. Does CF sound based on this limited info, like something that could be a good career for me? Thanks!
Sorry guys, I accidentally posted this here instead of the corporate finance board.
But to introduce myself, basically I'm a 27 year Male that's coming from a media background and in the midst of "Waitlist hell" right now at 3 top 25 schools, but haven't gotten in anywhere, though McCombs seems promising. I'm thinking of going either the Equity Research route or corporate finance Route.
Corporate Finance - Please Explain (Originally Posted: 09/16/2007)
Please explain.
uh, pick up a corporate finance textbook. everything in there is corporate finance.
or look here, for example http://www.corporatefinance.db.com/home/
Thanks for asking, I've always wanted to know what corporate finance is.
Can someone please explain accounting and economics for me too?
This is a serious question. For some of you, it's as fundamental as derivatives or supply and demand, but I have no idea. The only type of answer I seem to be getting when I mention Corporate is "I'm glad I don't work there," or "Corporate is terrible, why are you asking?" I guess a better question is (for those of you Corp Fin people): what is your experience with corporate finance?
my boss gave me a corporate finance textbook, and i have the option to take some online classes in finance through berkeley. (i already took a financial accounting class through this program)
should i take the time/effort to read through my boss' corporate finance textbook and take this berkeley class if im shooting for a corpfin job at an investment bank? or is it pretty much unnecessary? for a little background, im a sophomore economics major at a target.
Dude, the reason why people are making fun of you is because you are asking too broad of a question. It's like going to the math department and asking "what is math" or asking an athlete "what is sports". You have narrow it down a bit and give some context, otherwise you are just being an ignorant idiot.
Don't flame. I'd like the know the workings of corpfin as well. Generally speaking, what does that department entail?
I'm not flaming. I'm explaining why the original question is idiotic. Go read a textbook or look at the link posted.
This is usually referred to the actually investment banking side. As opposed to s/t or research, corporate finance employees work on the m/a deals and help raise capital through equity or debt.
http://www.stern.nyu.edu/%7Eadamodar/pptfiles/acf2E/cf2daypacket.ppt
The science of making decisions that regard maximizing shareholder value. This involves decisions with capital budgeting (which projects to take), cost of capital, and dividends.
Finance = Internal company finance
Corporate Finance = M&A Advisory, Raising Capital (connecting those who need it with those who have it)
if you're talking about internal corporate finance, then yes, that's a shitty back-office dept
I suppose you wouldn't want to be president because that job pays badly too?
i always though corp fin had two sides.
1) was on the corporate side (working in a corporation's finance group) 2) was a division in the i banking career field: M&A, Industry/product groups, ECM/DCM(diff banks structure it differently)...that link for DB that dan bush put up explains it really well.
also, about ur comment earlybird that ppl say corporate is terrible, i wouldn't say so. you would have to intern and find out for yourself, but it's definately a slower pace(LESS hours). You also start at the bottom of the ladder.
many i-bankers lateral into good jobs at corporations later on in life...
Thanks for the insight.
Corporate Finance differs at every firm, go on to individual websites to get summaries
"Corporate Finance" is an old, old wooden ship that was used in the Civil War era.
How to Advance in Corp Fin (Originally Posted: 07/01/2013)
I am sitting here at work and pondering this question. I'm interning at a F50 company and I believe I will be working here full-time come next year.
Right now, I am trying to impress and show dedication by being the first in the office everyday and taking on any task but I'm not sure it is being noticed. Perhaps this is simply the nature of my company, but people are very relaxed and generally only work 40 hour weeks. It seems odd when people work any more than that. It would be especially odd because there doesn't seem to be a lot of work going around.
Before anyone starts to jump on me for this, I know I am just an intern. This is a matter of curiosity and deciding if I may be capable of climbing the corporate ladder.
So, how have people been successful in advancing in corporate finance roles?
1) 50% is being a good/top performer. 2) 50% is having having someone higher up pull for you.
2 may be a function of #1, but not always. This is where office politics may come into play (i.e. if you're friends with the right people).
This goes for most industries, not just finance.
^Absolutely agree.
I'm assuming you have a manager, ask him/her what you can do to help regularly. Don't be a nuisance, but let it be known that you are ready to work. If your manager is busy, ask the full timers on your team if you can do anything for them to help with their workload. I'm sure everyone has grunt work that they'd rather pass off to an intern, but that's just the name of the game.
Also, do you have any networking opportunities available within the company? (friends of friends, alumni from school, etc.) If so, schedule a time to meet for coffee or lunch and discuss your desires and plan to advance in the company.
So yes, hard work can pay off. It is just important that the right people are seeing this hard work.
Best of luck
it also comes down to time and leadership potential. you can do all the right things. make sure you work is done properly and is delivered on time. speak up and present well in meetings. establish a strong reputation. even find ways to improve internal processes and implement time savings. thing is, it's corporate finance. no company is going to be chomping at the bit to rapidly promote a financial analyst, senior financial analyst, or even a manager. some people are definitely better than others, but in my opinion, there is a ceiling to just how well you can do your job. it's crunching numbers, analyzing data, keeping things organized. it's not as if you are bringing in business, or finding ways to make the company more money, or doing things that would differentiate yourself from all the other corporate finance professionals (note all of this is based on my experience at a f100 company). that's not to say corporate finance people are not valuable and don't contribute to the business, but at the end of the day, you really aren't doing anything to warrant anything but a standard promotion timeline. even though it's frustrating for someone who really wants to get ahead and move up, you are going to have to be patient in almost all cases. 2-3 years at each level. maybe faster if you get lucky and a spot opens up. granted, this is for someone who has the potential to be a leader in a business setting. having the people skills and emotional intelligence to deal with people, give orders, prioritize, and effectively communicate and present to executive level stakeholders. most people do not have these skills and abilities. so my advice, do your job well, learn as much as you can, do everything you can to make sure you are recognized as a leader, and keep things in perspective.
Keep doing what you're doing regardless of whether it's noticed or not. If you are coming in for an hour longer every day than your counterparts and they're all working 40 hour weeks straight up, you're getting 12.5% more experience than they are. If you do an extra 5 hours every week for 8 weeks, you've gotten a full extra week of experience.
I know that's a simplistic way to look at it, but what you're doing is great. bird's advice is great. Just be on the lookout for opportunities to show that you can take it to the next level.
Wow thanks for all of this great advice so far. I happen to have a very good connection that is high up in the company so I am hoping that this will help me.
Gonna keep these tips in mind when I jump over from Big 4 audit after a couple of years, thanks to those who replied and to the OP for asking.
Develop skills that will make you stand out from others (advanced excel/VB, etc), learn to make people like you, and do more than what is asked (when someone asks you for project A by end of day tomorrow, finish it today and go above what they asked).
Invest your free time in your career also - while your coworkers are watching TV for 4 hrs every night after work, go get your MBA part time or take the CPA/CMA. You dont need to know someone to get promoted. Those higher up will naturally notice you and pull for you if you're a top performer.
Absolutely this.
If it's a company with a large international presence, learning another language or two is another thing you can do in your free time that can make you more valuable and marketable.
Used to work for a big company (f50 equivalent) in the treasury financial markets division.
Just my opinion:
im out.
WHEN YOU SEE THE CFO IN THE ELEVATOR DON'T AWKWARDLY ASK HIM FOR A COFFEE TO DISCUSS ABOUT YOUR FUTURE CAREER.
talk about football or fishing.
I don't know why but this right here seems like the most simplistic, great advice every given.
corp. finance (Originally Posted: 07/17/2013)
.
As someone who's done it, I can say that It really depends on your boss. I worked in FP&A at a F100 and the Analysts usually took advantage of tuition reimbursement to get part time MBAs, CPAs, or MSFs, and depending on workflow either found the bosses accommodating or reluctant. Of course at the F100 level, if you're certain your career is in FP&A/Corp Fin. you'll likely be guaranteed promotions w/ an MBA from anywhere, so prob won't want to leave the company since it's already an industry leader and willing to foot the bill. I imagine it's different the further down the F500-1000 you go. Also, if you go into an FLDP program they half expect you to leave for B-school, so they will be very supportive. They like to brag about all the veterans of their programs going on to great grad schools.
Those who have left to go to MBA programs usually had no problems getting recommendation letters if they're strong performers, but depending on the timing, would seriously disrupt our schedule taking multiple days off for interviews, pre-mba events, networking events, etc. so just be mindful. But I've never seen a case where a Manager just made life miserable for anyone who wanted to improve themselves. I brokered a deal with mine to stay on and train my replacement before submitting my resignation. I found that people typically started looking at grad programs after around 2-3 yrs, once they've established a comfortable tempo at work.
I prob. didn't answer your question clearly so any follow ups are welcome.
thanks for the input, that actually gave me a lot of info/insight about what going from a corp fin role --> mba might be like. for those that did leave after 2-3 years to get an mba, did you find those employees coming back to your company or did they network their way to another company?
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