Big Four Accounting To Investment Banking

afurgs's picture
Rank: Senior Chimp | 19

In discussion with an econ professor, he mentioned how working as an accountant at the big four can be a good in to the investment banking world. I found this to be an intersting opportunity, as I think some individuals could use this to their advantage. But is it possible or better yet, reasonable. If so I was going to take an off-cycle internship for a accounting firm, then use it to my advantage for next summers internships hopefully under an investment banker.

Can I Go from Big 4 to Investment Banking?

When considering the OP's original question about whether or not you can go from a Big 4 role into Investment Banking, it is important to note that it will almost always make more sense to start in IB if that is an option for you. That being said, our users have shared conflicting opinions about how difficult it can be to change between these career paths.
Some users believe that the transition would not be hard considering the fact that you are working for large relevant clients on transactions, which lends itself easily to the job of investment banking.

User @5000 Meters, a private equity analyst, shared that the transition wouldn't be too hard:

5000 meters - Private Equity Analyst:

It depends what you are doing at one of those firms. If you are doing transaction advisory, valuation or due diligence, that experience can be good for banking. Maybe even audit might be ok. I would stay away from the typical tax type jobs though.

Binders - Private Equity Associate:

Who will banks take: someone who has transaction experience with large clients having worked at a well-known, high quality financial services firm that had its own competitive recruiting process or a bunch of random applicants from a no name shop with no known standards and insignificant deals? Big 4 would probably be a much safer start to your career than a random 10-man boutique. Boutique is more relevant experience for sure, but Big 4 is a better indicator of quality in most cases.

However, User @Sil, a corporate development associate, shared that the accountant experience is not super relevant and therefore when it comes to taking lateral hires, it makes more sense for a bank to hire an applicant from another BB or from a middle market bank that wants to make the jump upwards.

Sil - Corporate Development Associate:

Think about it this way: when it comes time to lateral, who will banks take: the accountant or the hoards of applicants from tiny M&A boutiques? It's certainly possible, but you will be facing extremely tough odds. A better start to your career would be a boutique if you're not able to break into a BB, EB, or MM.

If you had the choice between Big Four (non-relevant experience) and a "no-name" boutique (relevant experience), I'd take the latter 100% of the time. The "transaction experience" you gain from audit/tax is not relevant to IB. Even if you sit around all day at a boutique and put together pitches, that is still more relevant.
No disrespect to Big Four employees meant, but hiring hoards of kids from just about any school is not exactly "quality", at least not in the IB sense of the word.

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Comments (43)

Jun 6, 2016

It depends what you are doing at one of those firms. If you are doing transaction advisory, valuation or due diligence, that experience can be good for banking. Maybe even audit might be ok. I would stay away from the typical tax type jobs though.Also most of the big 4 have some type of Investment Banking arm so you may be able to lateral into on of those groups if they have it at your location.

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Jun 7, 2016

What exactly would you say is wrong with tax? E.g private clients and high net worth individuals

Array

Jun 7, 2016

There's nothing wrong per se, but the skill set you would gain working in a tax group is in no way relevant to a career in IB. As @Sil mentionned above, when banks look to hire experienced analyst, they will go for those that already have the relevant background and training so working in a tax group would not get you any closer to an IBD job.

Jun 7, 2016

Its not really in any way related to what investment bankers do in terms of modeling and valuation.

Jun 6, 2016

Yes. I know someone who did that lateralled from Big 4 to a large American BB>

Jun 6, 2016

Terrible advice...Think about it this way: when it comes time to lateral, who will banks take: the accountant or the hoards of applicants from tiny M&A boutiques? It's certainly possible, but you will be facing extremely tough odds. A better start to your career would be a boutique if you're not able to break into a BB, EB, or MM.

Jun 7, 2016

Ehh you can also look at it as, who will banks take: someone who has transaction experience with large clients having worked at a well-known, high quality financial services firm that had its own competitive recruiting process or a bunch of random applicants from a no name shop with no known standards and insignificant deals? Big 4 would probably be a much safer start to your career than a random 10-man boutique. Boutique is more relevant experience for sure, but Big 4 is a better indicator of quality in most cases.

But if this is a question about what do for an internship while you're an underclassmen - then, yes, boutique bank >> accounting if you're looking for banking full-time. If we're talking for full-time jobs and then potential lateral, then I think there's an argument either way.

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Best Response
Jun 7, 2016

100% disagree. If you had the choice between Big Four (non-relevant experience) and a "no-name" boutique (relevant experience), I'd take the latter 100% of the time. The "transaction experience" you gain from audit/tax is not relevant to IB. Even if you sit around all day at a boutique and put together pitches, that is still more relevant. I wouldn't agree with your measure of quality either. No disrespect to Big Four employees meant, but hiring hoards of kids from just about any school is not exactly "quality", at least not in the IB sense of the word.

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Jun 8, 2016
Binders:

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p>Big 4 is a better indicator of quality in most cases.

lol no

The quality of employees at big 4 firms is pretty weak. You do get some intelligent kids from respectable schools who were conned into working in accounting, but this is the minority. Most of the smarter kids will leave the firm or switch into another group (val, TS) within 2 years. The majority of employees at big 4 firms are from lesser schools or from another country and only working to get a green card (i.e. indentured servants), a process that takes roughly 4-6 years and is only initiated after having been at the firm for 2 years.

OP, your professor is wrong. In order to break into IB from audit, you will either: 1) have to first switch into your firm's respective valuation or transaction services group (generally takes 2 years of working at the firm for transferring to be a possibility) or 2) have friends in IB that are willing to push your resume to their respective VP or whoever is in charge of hiring (you'll likely need a respectable GPA and to have gone to an above average school for this option to be viable). You could also do audit for 4ish years, get your MBA at a top school, then get a job in IB after graduating...but you could do the same with just about any background coming out of a top b school.

tl;dr don't go into audit at a big 4 firm thinking it's a stepping stone to IB. Only valuation and transaction services would qualify as such.

edit: interning at a big 4 firm is fine. it would be considered relatively good experience, so long as you can then intern at an investment bank the following summer. i have friends that followed this path.

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Jun 7, 2016

Big 4 is def a good starting point. Just master all the accounting interview questions, learn all the excel short-cuts and become proficient w/ everything excel (pivots, complex formulas, etc.) and take a BIWS course on the side to learn how the actual modeling works and you will be in a great position.

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Aug 14, 2016

Hey -Andrew-, I think you deserve a response...heck, everyone does. We're listening, sorry about the delay ...my best guess at places on WSO that could help:

  • Graduate Accounting--> Big 4---> IBD??? school for my MBA, which is a top-25 program). I would prefer not to do IBD right away. Big 4- ... Audit/Assurance Associate (currently interviewing, 2nd round) Big 4 (different)- TAS Associate (currently ... interviewing, 2nd round) Mid-Tier Accounting Firm- Valuation Analyst (hard) F500 CorpFin- Financial Analyst ...
  • Big 4 Audit vs Rotation Program (Not GE) Given my Goals (not PE/HF) Hi all, I have an offer with a big 4 audit firm in a major metro area and a Rotation program with ... goals, which differ from many on here.(+ = pro,- = con just to clarify) Big 4 Audit +Exposure to ... I'm not looking to become financial wizard of the universe and getting into PE / HFs. My long-term ...
  • Working In Big 4 Audit in London work in the Financial Services (investment banks, brokers, retail banks, corporate banks, spread ... they interact with the client and how they interact with me. cpa big 4 Banking associate audit Big ... investment banking internships. The market for hiring full time in banking just wasn&#039
  • Working in FIG (Financial Institutions Group)- An Overview. * Boutique investment banks or advisory firms * Exchanges * Execution Services Firms * Financial Technology ... "FIG", which includes: Banks, Insurance Companies, Asset Managers, Diversified Financial Companies ... (Custodial Banks, Exchanges, Brokers, Financial Technology, etc.) This post will lay out a framework for ...
  • The truth about GE's FMP (it's accounting; forget banking) accounting. Forget investment banking, capital markets, private equity, or anything even only remotely ... office role in the top investment banks, or people who moved from a GE industrial business to a financial ... Make no mistakes: CAS is about auditing and accounting, not about anything fancier. You'll be ...
  • The route to investment banking for an Accounting Major BIG 4's websites but I just wanted to get a take on which specific divisions inside each ... insights. Investment Banking ... For those of you who are accounting majors or accounting/finance and are looking to pursue an ...
  • Big Four Accounting To Investment Banking for next summers internships hopefully under an investment banker. accounting Big 4 ... In discussion with an econ professor, he mentioned how working as an accountant at the big four ... can be a good in to the investment banking world. I found this to be an intersting opportunity, as ...
  • Investment Banking Interview Questions- A Comprehensive Guide not listening carefully and not being in the moment. The "Why Investment Banking" Question? ... the midst of investment banking interview season. I was in your shoes about five or six years ago. ... I worked as an investment banking analyst at a Moelis/Houlihan/Evercore type firm in restructuring, got an ...
  • IBD">More suggestions...

No promises, but maybe one of our professional members will share their wisdom: @ttcalhoun @O&#039;Donovan @D_Ribeiro78

I hope those threads give you a bit more insight.

Jun 7, 2016

this user has some good posts on the topic http://www.wallstreetoasis.com/user/146980 @Big4Bound

WSO's COO (Chief Operating Orangutan) | My Linkedin

Aug 14, 2016

Try getting Boutique IB - Investment Banking Analyst (M&A). I am not sure what (hard) means. Audit roles use a different skill set than IB roles. Private banking it another story. Valuation analyst might be useful for M&A and Financial Analyst at F500 is good for freshman/sophomore internships. I suppose you are looking for a FT position so I would go with the Boutique IB. How big of a boutique is it?

Aug 14, 2016

You're probably better off doing a TAS/valuation gig, F500 corpfin, or boutique/private banking if the end goal is IBD. This experience will help you get more looks by better MBA programs and also position yourself to have relevant experience in the recruiting process. I have a lot of classmates that just went through the first year MBA IBD recruiting, and those that had transaction related or corporate finance experience got the best looks from big shops. Accounting background, while useful, just doesn't carry the same weight.

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Jun 7, 2016

This is solid advice, albeit you need to make sure that you sell the experience properly. I personally made the jump from Big4 Tax/M&A and was able to skip almost 18 months of being an analyst. My MAcc-Tax / CPA has been very helpful when it comes to financials, models, structuring, tax effected transactions, etc.

Jun 7, 2016

Definitely a possible route, but not the best. I can't imagine Big 4 experience even in TAS being a better experience than working at a smaller place doing relevant work. If your goal is IB, start in IB.

Big 4 typically do not hire interns 2 years from graduation though. Especially for more competitive groups like people have mentioned here.

Jun 8, 2016

Agree with what has been said. I did accounting undergrad and had a few audit internships. During my last one, I realized that it was going to be a VERY tough battle to lateral into banking. Therefore, I worked hard and got an offer from a TAS group. Then, I leveraged that into a val offer. The skills I gain in val / TAS (could get on some projects here) will be attractive to a bank. Better than a kid at a small bank? It'd be close but at least I have brand names on my resume.

I would take a step back and think about what banks want from a lateral hire and how to best set yourself up for what they want. Big 4 audit/tax is not a great way to do that.

Jun 8, 2016

Ok coming from someone at the Big 4 there's a difference between working in the advisory arm and being an accountant in the auditing arm of the firm. They are very different experiences with different people and culture and the only thing in common between audit/tax and advisory is the name on the building.

Working at Big 4 advisory is not a bad move if it's off cycle. You will get some deal experience and the firm has an amazing support system to ensure your personal development. The people are great and it's a recognizable name to put on the resume.

What you do not want to do is go into Big 4 auditing as an accountant. This is pretty far off from something like IB. Most people in audit lateral to the advisory part of the firm and then going into IB/PE/Consulting, sometimes via an MBA. I only know of one person that successfully switched directly from audit to IB but that may have been more due to his connections than qualifications.

Jun 8, 2016
TopChedder:

What you do not want to do is go into Big 4 auditing as an accountant.

...what else would you start as?

Jun 9, 2016

You would start right in the advisory arm.

Jun 8, 2016

Not sure why people are saying audit isn't helpful for IB. The work itself (doing cash recs, checking invoices against journal entries, inventories, blah blah) isn't particularly relevant, but the familiarity you gain with the financial statements, general exposure to a wide variety of industries, and interaction with clients is incredibly helpful. Especially considering you'd most likely lateral to a MM or lower MM firm where analysts have more client exposure, and the clients very likely won't have very sophisticated accounting / finance departments (or even audited financials). There's a very good chance you'll be forced to dig into their financials more than if you were working with large cap publicly traded companies (eg don't be shocked if the client sends you their trial balance and you have to put together an operating model and help answer questions for a quality of earnings report). Whether or not you can spin that into a story for ib interviews, that's on you...

All that said, if you're doing Big 4 for a sophomore internship, you're probably fine either way. If you're doing Big 4 full-time and hoping to lateral to IB off cycle, best of luck right now considering the hiring situation at banks.

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Jun 8, 2016

Not that I would ever recommend IB firms look to change their recruiting platforms to focus on people with an audit or accounting background, but I am shocked by the number of errors I find in banker models either a) because they don't understand how things go from operational processing to TB to FSLI or b) because they don't understand "conceptual" things which someone with an accounting background would. It would be a mind-numbing job but I almost wish the larger banks would hire staff with an accounting background just to tie out the models before sending since everyone else is usually relying on the banker model to do their work. Hell, they could contract with a Big 4 firm to outsource the tie-outs to their staff in India who are already familiar with tying out financials. It's hard to reconcile shit when the banker model goes out, has burned a number in everyone's head, and now you get to figure out where you have to plug or normalize things for all further analyses.

Jun 9, 2016

You are forgetting C) They don't care because it's insignificant to the overall deal.

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Jun 8, 2016

EDIT: I've realised that in the US, corporate finance basically means back-office finance whereas in the UK it's essentially investment banking (i.e. if you work in M&A IBD you're a corporate financier). Throughout my post, corporate finance refers to IBD work.

To directly answer your post - an internship at Big4 won't really show anything at all, they take anyone as interns (source - I work at a Big4).

Now, if you're talking a job post-graduation then it's a different matter. I started in audit and the exit opportunities are pretty much as follows:

1 - Investment Banking (BB, EB or smaller boutique)
2 - Internal transfer to corporate finance / Valuations / TAS (this is what I did)
3 - Go to work in back office finance (don't do this).

Starting a grad job there, I would say definitely go for TAS or CF if you can, audit is an awful 3 years but not the end of the work. Avoid Tax. You can definitely move to a BB or EB - friends of mine have gone to BarCap, Lazard and Rothschild. Moving out to a smaller mid-market place is also fairly straightforward as they love trained accountants.

TAS is a due diligence job but you will get exposure to a LOT of deals, especially PE-backed deals. You won't learn the modelling aspect but you will develop a good understanding of deal structures, timelines and all the associated aspects.

corporate finance is the best place to go. You basically do all the same work (including modelling) as you'd do at a bank but you typically target private / smaller companies (PS100m - PS1,000m). A Big4 firm will usually do both ECM and M&A with sector, generalist and PE focussed areas. To expand a bit, I'm a generalist covering all sectors and work on the following areas:

  • Lead advisory on IPOs (obviously we help appoint book runners)
  • Lead advisory on public / private company M&A
  • Full experience of modelling, LBOs, DCFs, a LOT of comps
  • A hell of a lot of pitching

To give you an idea of the backgrounds of people who work in CF at a Big4 firm, these are the backgrounds of some of the individuals I work with

  • MD from Top 3 BB (JPM/MS)
  • MD from European BB (CS/DB)
  • Directors from mid-tier BBs and EBs (Lazard/Rothschild)

Most of the junior/mid level people have come up through the ranks internally but the senior staff certainly have stellar backgrounds.

You'll take a fairly material payout compared to a BB/EB, at least in your first few years, but your work life balance will be infinitely better.

Happy to answer any questions at all you may have on Big4 audit/TAS/corporate finance and exit opps from said departments.

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Jun 9, 2016

This is only good advice outside of the US. The situation here is drastically different as audit people are considered little more than lemmings.

Jun 10, 2016

If you want to do banking, do banking. I've said it on this site a few times but common sense dictates if you want a job, you need to have a job that has close to as relevant as a skillset as possible. It's kinda like how when you're recruiting for PE as an MBA, they tend to pick candidates who have done PE before. Shocker right? If you want IB, learn the accounting and take a boutique gig and don't look back. You can always lateral after a year or 2 anyway.

"Even if you're on the right track, you'll get run over if you just sit there" - Will Rogers

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Jun 10, 2016

You couldn't be farther from reality. An accounting internship even at a Big4 won't put you at a big advantage. I've been interning in a Big4 for a year now, and most banks didn't give much of a s*** when I applied for IBD summer internships about this internship.

Probably better than having a blank CV, but wasn't a key factor in securing my summer internship, neither helped me pass many BB screenings.

Furthermore, in my year at a Big4 I've not seen a single senior with his chartered accountancy exams moving into a FO role. They all move to internal audit, financial controlling, BOs at banks. Talking about people doing audit/assurance, NOT transactions advisory.

Apr 25, 2018

Hey everybody,

I did about four years in the KPMG (Big 4) Audit and Assurance Business., I was too dumb to leave sooner because I temporarily succumbed to the brain-washing regiment I was exposed to on a daily basis. You know the "If you leave before the 5 year mark it will be career suicide." I left for a corporate Accounting role and have been in the role for going on three years now.

I need a change, I can't make a 30 year career of this. Not only is the work boring, but there are so many people between me and the next level, and it is also very difficult to differentiate myself from the rest of the pack.

I am a licensed CPA, I am not sure if that helps or not, but I want to get out of Accounting and into high finance. I was thinking my two best options for opening doors into a high finance role were either going back to school for an MBA (expensive and time consuming), or going for the CFA (no guarantee I will be able to complete all three parts, but cheaper than an MBA).

I don't know if there is another option or if I need to choose from one of the two above. Has anybody been in a similar situation before and made a successful move? I am located in Houston, TX so I know the job market is a bit different than a financial hub like NYC. Thanks in advance!

Apr 25, 2018
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