Hi all, I'm about done wrapping up my busy season and as such, I'm open to answering any questions people may have about working in Big 4 audit as a first year. I know some senior associates have done a Q&A, but I haven't seen one for first years, so if anyone wants to learn more from this perspective, ask away. One disclaimer is that I'm not that experienced with regards to everyone's favorite topic on WSO: exit opps. I don't want to spread any misinformation, so I'll leave those questions to more experienced users in case they want to chime in. I hope to be able to contribute more on this front as I gain more experience.
Also, in case I don't respond right away, that probably means that something came up with my client, but I will try to get back to you when possible. Thanks!
So let me describe auditing from a high level perspective (this is going to be a long post):
The basic structure is that at the beginning of the engagement, the team is assigned different tasks (often grouped by a line item in a financial statement). For example, a first year will typically be assigned to low risk items, such as cash, inventory, PP&E, etc. The higher up you go, the more challenging the work becomes because you deal with more interesting (IMO) accounts that require a lot more judgment, such as revenue, goodwill, etc. Within each of those line items, there are various tests that the team performs in order to gain assurance over the assertions that management is making.
From there, it's very much a ladder-type format and the work flows up and down. I'll perform my testing, document the results and explain the procedures we took to perform it, send it up to the senior associate who (usually) sends back changes. I will fix those items and, once the senior signs off, it flows to the manager, senior manager, all the way up to partner who has the final call. Usually, by the time it reaches the manager, it should be pretty darn close to complete. Managers are expensive, so their time is better spent on the more challenging tests rather than verifying that cash receipts tie out.
Week to week will depend based on which item/test you have. Basically, a typical day will start off with the team having a brief meeting to discuss their open items, what files we need from the client, etc. After that, a lot of it is spent individually finishing up your work or asking the senior above you for help on items. The actual testing, which makes up the bulk of your time is spent sending out samples, receiving the support from the client, documenting the support, following up on any irregularities, documenting why the irregularities are OK (assuming it's not an exception), and then closing out the task by making sure it looks pretty. You can expect the last few weeks, aka when deadlines are coming up and clients still haven't sent you anything, to be the longest in terms of hours.
Sampling involves taking the population of all items for a line item (i.e. a fixed asset ledger for PP&E) and then selecting an appropriate number of transactions based on the total dollar amount, number of transactions, etc. to gain appropriate comfort over the balances (note, for my Big 4, and I'm assuming the others, this is automated so you can usually just plug and chug to get how many to select rather than hand-calculating it or having to research the guidance). Usually for something like cash, this is a straightforward and tedious process, but for more complex items, such as revenue, you have to use more judgment and assess which ones to pick.
Once the samples are selected, we send them out and ask for the appropriate documentation underlying the transactions. For example, when testing revenue, I asked for invoices, bill of lading, etc. and verified that the price, quantity, and total price was the same for all documents so that we can ensure that management isn't booking fictitious sales.
The most annoying part, honestly, is finding an exception or when you know things are right but aren't matching. Piggy backing off that revenue example, there were many times, for example, when the sales prices wouldn't match what the shipping company billed for because of differences in how they account for income taxes or sales discounts. It's these little things you have to ask which sometimes annoy our client but we are unfortunately required to do as part of our job. The real value is added more at the manager level when you are working with management on huge accounting decisions, whether or not it complies with GAAP, and assessing how this will impact the financial statements.
Exceptions are also a pain because it's often just a human error, but you will be forced to test a bunch more samples, which again means selecting samples, sending them out, waiting for the client, etc. Hopefully this helps answer your question
Former Big 4 employee here, did 1 audit busy season in my first year then moved. Can confirm the above is broadly accurate. Also - get the hell out of audit as soon as you can.
Tips to avoiding work / late hours:
1) Get staffed on medium sized clients (5-10 people teams) with reasonable managers 2) For your first 2-3 weeks turn in everything perfect and early, people will be a lot more lenient with you. 3) Tell your manager it will take at least twice as long as you expect, finish it early, take some downtime and then hand it in before you promised. For example, say something takes you a day. Tell them it takes 2 days, finish it, chill for a morning then hand it in at lunchtime, a full half day before expected. 4) NEVER mention you have availability after 4pm. Drag out whatever you're working on before that for the rest of the night. 5) Don't get in early, you won't leave any earlier. 6) Think of any excuse possible to work from the office rather than client site. Printing is always a good one. 7) If you don't understand something - ASK SOMEONE. You save both yourself and your reviewer time. 8) People don't care about small differences / exceptions. As a junior you won't be given anything materially risky anyway. Don't get hung up on anything. 9) Make prolific use of clever ROUND formulae to clear those pesky errors 10) If you don't complete / start something, delete that work paper / excel sheet. No evidence!
I used every single one of these and some more dubious / creative ones and still got rated in the top 10% of my class.