Finished Busy Season in B4 Audit: AMA

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 an AMA, 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!

Comments (46)

Mar 17, 2015

what type of work did you do? What was your typical weekly schedule including hours worked? What region is your firm located in?

Best Response
Mar 17, 2015
cheesy:

what type of work did you do? What was your typical weekly schedule including hours worked? What region is your firm located in?

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

    • 6
Mar 17, 2015

That's great. Thanks!

Mar 17, 2015

Still got 4 more weeks on my busy season (tax)! Enjoy the downtime.

Mar 19, 2015

International tax here. You?

Mar 21, 2015
MTx_2012:

International tax here. You?

Federal/state partnership returns mainly, for investment management firms. It's kind of interesting as you get a back door view to fund structures, investment choices, etc.

  • Associate 2 in CorpFin
Mar 17, 2015

What are your strategies for hiding the fact that you are no longer working on anything when on site? Note, I am not asking this to catch out my own juniors...

Mar 17, 2015
moneytrail:

What are your strategies for hiding the fact that you are no longer working on anything when on site? Note, I am not asking this to catch out my own juniors...

The privacy screen is clutch. Otherwise, I always keep an excel file open, even if it's a financial model I'm working on or something. People assume that a first year will be dicking around on Facebook/Twitter, so an excel file makes it seem like I'm working. If all else fails, use the costanza method:

https://www.youtube.com/watch?v=yd9ma2UVLHM

    • 2
  • Associate 2 in CorpFin
Mar 17, 2015

lol the looking frustrated / angry / annoyed method is classic. I always used to do it / do it still. Only thing is, now when my juniors seem like they are frustrated / angry / annoyed - I ask them whats up and if I can help them with anything.

also, another thing to note, that to an experienced slacker, who has managed to get promoted, he will be able to notice that you are constantly ALT TABing when someone more senior goes up to you / goes past you (to e.g. go to the toilet).

Mar 17, 2015

So the general ledger matched the back up?

Mar 17, 2015

Is it as bad as you expected? What was your client like/what were your hours?

Mar 17, 2015
coreytrevor:

Is it as bad as you expected? What was your client like/what were your hours?

So my client is in a unique situation (I legally can't say more than that), and I'm technically staffed on quarter work for now, so mine have been fairly laid back after the first 3 weeks and the 2 months prior. Additionally, on the year-ends I did work on, the seniors were super efficient and so I only worked till 8 or so. This sounds bad, but when I compare myself to my friends who are on bigger jobs and are consistently working till 10, that ain't half bad.

One thing I will say is finish the CPA before you work. I did 3 over the summer and that was a big help. I got very lucky with my staffing and was able to knock out the last one while I was less busy, but even then, it's not fun having that thing hang over your head the entire time. I can't imagine people who go in without having passed any or just BEC, for example. That's asking for a miserable first year.

As far as the work goes, people on here said so much bad stuff about working at the Big 4 that I actually like it more than I thought I would. It's not super exciting, but at the higher levels, accounting is more interesting than people give it credit for. Even revenue, for example, isn't just taking the price and multiplying by quantity. There are certain requirements that have to be met (i.e. risk of loss transferred, price is fixed, etc.) before you can recognize it and that involves digging into contracts/the client's policies to make sure it's appropriate. If you work on even more complex cases, such as software bundles, that's a whole other can of worms (google VSOE for those interested).

All-in-all, it's not the worst gig. The basic tests you do kind of suck, but if you get on smaller jobs, you often get to cover a wide variety of line items and may even get thrown onto more complex tasks (i.e. I've done revenue testing and assessed the impairment of inventory, for example, as a first year). There are other trade-offs for sure on small jobs, but I think that it's nice to see multiple items instead of just doing bank reconciliations all day.

    • 2
Mar 17, 2015

I was told that must B4 firms (as well as law firms) are outsourcing jobs to countries like India. In my area, Deloitte used to recruit 70 kids per year. Now it's down to 35. And let's not talk about the constant pressure to lower audit fees.

'Not sure why anyone would want to work for a B4.

Mar 17, 2015

I can't not think about the movie "The Break-Up" where she goes on the date with the accountant and he talks about "The bizz".

Mar 17, 2015

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.

    • 4
  • Associate 2 in CorpFin
Mar 17, 2015
Asatar:

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.

if you get an exception - just pick a different sample & replace. save yourself the effort. the only thing material would be the amount of time you spend doing it.

Mar 28, 2015
Asatar:

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.

This is spot on, +1

Mar 17, 2015

Hey,

Thanks for doing this!

Could you touch on "eating hours"? How common is it in your firm/group? How much of your time have you eaten, if you have?

I recently started and see finishing files on budget as the biggest challenge. Would love any advice from someone who's been through busy season!

Mar 18, 2015

Not sure if this is serious or a troll but I'll bite...

You eat when you want to. Usually 6-8. Finishing on budget is definitely not the biggest challenge, the biggest challenge is getting through the tedious, mostly irrelevant, mind numbingly boring work without killing yourself.

Mar 18, 2015

It was a serious question my man.

Like I said, I work on the accounting side for private enterprises, so I do the statement preparation as well as tax prep. Working with smaller companies, the focus is much more on tax so learning tax rules for related companies, etc. is quite challenging for now and I'm having to underreport hours until I'm up to speed.

Mar 18, 2015

Hey, another audit rookie here.

I am still in the wrap-up part, and it will take at least two more weeks to get it done. Unlike you, I've been staffed with the worst team, in the worst client possible (from a work-life balance standpoint). For the last couple months, I can only recall one single day leaving on time. Everyone in the team is expected to stay longer - you need to have a very good excuse (either real or fictional, actually they don't care that much) if you intend to leave on time. The problem here is: it is a lot more about the image you project, than the actual work it is being done.

Some of the grunt work that juniors carry out is not essential regarding the final audit opinion. While this is a general fact for junior positions no matter the sector, sometimes it happens too often. There is a generalized feeling among junior staff of being disrespectful towards the client, given that we are offering a service (and expensively billing for it) that doesn't correspond with the real work that's being done. In addition, you can find a lot of mistakes in the work papers, and some of them are flagrant, which means that there is little or no supervision - after all, it is grunt work, who cares?

The situation described above, of course, only reflects a portion of the big picture. It can vary enormously, depending on the team and the client.

As you can see, I don't exactly love the job. When I got into audit, I knew in advance that it wouldn't be the job of my life. But the reality from the inside crushed my already low expectations. So far, I haven't been able to find a single person who enjoys it from the ones who got in at the same time. So what's left? You should consider staying and go up the ladder only, and ONLY if you like audit, and real audit, which is what managers and sr managers do (and some partners, the most technical ones - the rest are commercial agents). Not for the pay, not for the work-life balance.

Mar 18, 2015

Hi,

I'm sorry to hear about your situation. Does your firm assign a coach/mentor? If so, I would consider talking to them about your interests and let them know that you'd like to try out a different project if the firm tries to re-assign you to that same job.

Maybe your firm is different, but in my case, I find the opposite to be true. I find that, and maybe this is because I work in one of the largest offices nation-wide, people are WAY too nitpicky about every little detail. We too have the issue of people wanting to make appearances, but in our case, it has more to do with the fact that people try to ding you on every little thing so that the person above them thinks they're doing a good job. That part really bugs me. I can understand flagging me for things that are egregious, but at some point, you have to ask yourself if it's more efficient to leave me a note in the revision telling me to add a semicolon in cell B5 or if it's best to correct one of the workpapers on your own, pull me aside and tell me to be more careful about them moving forward.

If I may ask, how large is your market? I've done a job for a city that is much smaller than ours, since it's part of the metro, and from what I've seen, smaller markets are much more chill and tight-knit than mega offices.

    • 1
Mar 18, 2015

Hi,

Yes, you are assigned a counselor from day one at the firm. This might translate into different scenarios depending on how much effort you put in keeping in touch with your mentor, but from what I've seen so far, the mentorship role is perceived as an obligation resulting from firm policy, rather than as an opportunity to learn about their employees, gather and provide feedback, and offer guidance in order to enhance future performance. They might agree to meet you for a quick talk, but most likely you will only see your counselor on the mid and year end review dates.
However, these dynamics can vary a lot across offices - and this also applies to work oversight. I've spoken to employees from other offices and the situation is slightly different. I work in the firm's second largest office in Spain, which is established in Barcelona. Obviously, the larger the office, the more difficult it will be to generate strong bonds among employees (it is not the only cause, though). Another related issue arises when you take a general look at the office's client portfolio and you find substantial differences across clients depending on their size (or to be more precise, how much they can bill from them), in terms of quality of the job done. Yes, I agree that resources are limited and have to be allocated efficiently, but after all it is about the image you project and the service you sell. And this eventually has a negative effect on the prestige of the profession and the sector in general, since Big4 have the highest market share.

Correct me if I'm wrong, but I believe that audit professionals in other countries have a stronger feeling of being respected by their clients.

Mar 18, 2015

*crickets*

Yeah, like literally, man.

Mar 27, 2015
Scott Irish:

*crickets*

Yeah, like literally, man.

test quote comment

Aug 9, 2015

x

Mar 18, 2015

As far as I'm concerned, anyone can start at a Big 4 just by showing interest and proactivity in the interviews and being able to discern a BS from a PL. In fact, by the time I was doing the accounting test in the first round of interviews, I had forgotten most of the accounting basics I had learned at school (just did a quick conceptual catch-up the night before), and anyway made it to the next round.

Once on the job, you can learn quickly regardless of what you learned in school, or how hard you studied - although those with more accounting knowledge will likely adapt easier, but only because of being more familiar with accounting terminology, since the tests and procedures to be performed will be something new for almost everyone.

So don't let this feeling bother you in excess. After all, it's accounting, not rocket science, and you can access tons of information on any accounting issue that you might encounter during your adaptation period.

    • 1
Mar 18, 2015

Wouldn't worry about it tbh. Nobody knows what they're doing as a first year. Hell, I'm convinced even some of the seniors don't really know what's going on. You'll learn a lot on the job and slowly, you'll understand the audit process, what the firm wants in it's workpapers, etc. On my first 2 jobs, I was pretty god awful at this (mind you, I didn't do great in my audit courses either), but by the third one, I started to understand why the testing was done, how to make things better, etc.

At the end of the day, a lot of auditing can be simplified by asking the following question: "can we trust the number that management has listed". From that question, you have to break things down to their simpler components by understanding the process they used to come up with it, thinking about areas of weakness, and then selecting transactions that are higher risk. From there, and once you work on more complex line items, you can then think about GAAP, it's application, if there is a better way to account for something, etc.

This comes with practice, but if I had understood that overall question coming in, I think it would have helped me a lot on my first couple engagements. It sounds simple, but when you see 100 tasks in your queue and you worry about the deadline, missing the big picture becomes easy. You'll understand when you get to your first busy season.

    • 1
Mar 18, 2015

I SB'd you both. Thanks for the responses!

That eases up my anxiety levels. I'm now kind of focused on just relaxing and enjoying my time before I begin work. I look forward to working the long hours you guys have mentioned, so thats not a concern for me. It's more so the application of what we study.

Mar 18, 2015

Third year Big Four auditor here from London checking in, hopefully just a few months left and then its on to corporate finance. For us in the UK being an auditor is a 3 year process during which you do your ACA exams (British CPA) and then generally move on.

I must say that compared to some of the other stories I've heard about "busy season", mine has never really been that bad. After 2.5 years of auditing, I think I've worked past 8PM perhaps 10 times at most. Generally I'm finishing at around 6PM in January through March. Then again it also depends on the client and what part of the client you're on. The best bits to do (at least in my opinion) are the not so big subsidiaries of larger groups and only corporate clients, not financial services ones. In financial services audit you work banking hours but for audit pay. Pointless. Also if you're on the Group team of a company with lots of overseas subsidiaries you'll be working longer hours. Then again sometimes you can't really tell and the hours you'll be working can be hard to predict.

They say that audit is 5% work and 95% documentation and it is true. And documentation is dull, really really dull. That is one of the main reasons I hate audit.
Every year you generally go up a level in what work you're doing and as such some of the more mindnumbing tasks can be given to juniors and you take on more complex pieces of work (though that doesn't necessarily make it more interesting, at the end of the day you're still just ticking through a trial balance). One trick to learn is to document the work you didn't do, hence giving yourself an easier way of getting by. You'll pick up the skills to do this over the years. Make your working papers look good (remove gridlines!), stick lots of documents on them, and you're on your way.

The main thing that keeps me going is the knowledge that soon this will be over and I'll be off to corporate finance and a better life. This knowledge also makes life in audit easier as I just don't care about putting in a ridiculous amount of effort as I don't need to be a star performer since this isn't where my future lies.

Privacy screens are lifesavers. When I'm not too busy at work I'm browsing Linkedin, Wallstreetoasis, the Financial Times and company careers websites. Make good use of your downtime as you won't always be furiously ticking away.

Happy to answer any questions should anyone have any.

    • 1
Mar 19, 2015
NotaTrollExtraordinaire:

how easy it is to get the ACA if you have a CPA from North America?

Why would you want to do something like that? Be a double chartered accountant? It serves no purpose.

Though strictly answering your question: I don't know. But it's completely pointless.

Mar 20, 2015

any interest to do your own AMA? send me a pm

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

Mar 20, 2015

Lucky you, finishing your busy season now. Mine goes till june....

Mar 21, 2015

Not sure if you're going to answer this but I'll try anyway. How are non-drinkers perceived at the Big 4? As self-righteous social retards who don't know how to loosen up with 1 beer? Anyone go to happy hours and not drink?

Mar 22, 2015
Comment