is auditing really that bad as they say in this site?

Not in IB or Big4 audit but have good friends in both. At the analyst level, I wouldn't say the actual work in either is inherently more interesting. However, the total compensation in IB is substantially more. But probably the most important factor is that there is a much larger array of more interesting opportunities you can pursue after two years in IB than in audit. Perhaps someone in either industry can confirm this.

I used to work in Big 4 audit. The reason so many people hate audit is because it is extremely boring after the first 3-4 months because you do the same exact procedures over and over for different clients, and these tasks don't even require the use of accounting knowledge most of the time. You essentially spend a lot of your time reconciling numbers to each other. On the other hand, the work is organized very poorly and there is a considerable amount of it. Therefore the hours are pretty bad, albeit not IB bad. The end result is you do a boring job with a bad work-life balance for fairly mediocre compensation. The career advancement also stalls after year 3 when you make senior auditor. You will get insignificant payraises for the next 3-5 years with exponentially larger workloads.

The exit opps also aren't great. Gigs like chief accountant roles and controller positions usually come with a marginal bump in pay and better hours, and if you like accounting (even after 2-3 years of audit) then the work can be fairly interesting. However, you will not be moving up as quickly as in audit and unless you plan to work in a similar capacity for 10-15 years and make it to senior management you will get insanely bored. With that said, audit was a great learning experience as you can see how a company operates from the inside, but doing it long-term isn't for most people. In fact, most of my buddies who are still in audit hate the work but they are too afraid to leave. As you can tell, this is somewhat of a biased view, but these are my main reasons for not liking audit overall, and it was the culmination of these factors which led me to leave.

I am currently in Big 4 audit so can give you the insider perspective on this.

As CorpFinHopeful said, it is a great learning opportunity but it does get a bit boring. In my experience, there are three types of people in audit; those who don't know what they want to do, those who know what they want to do and think the chartered accountancy qualification will get them to where they want to be, and those who genuinely enjoy accounting.

Personally, I'd like to think I fall into the second category as I am hoping to go down the ER --> HF route after my time in audit. For now, I am learning as much as I can about the fundamentals of companies and build my base knowledge to help in an ER role. Sounds like you fall into a mix of the second and third categories so you might not find it as boring as others do. In addition to the qualification, there are actually a lot of opportunities within your firm or within specific engagements, to increase your accounting knowledge and put to use what you've learned so far. It just a matter of finding those opportunities and pushing yourself to get involved.

If you're aiming for an FC role in the future, then audit is definitely the right way to go. Just keep in mind, as with any job, there will be boring parts but it is what you make of it.

Here is a brief summary of audit:

(1) Does this number match that number? Yes! Cool. (2) Repeat 500,000 times. (3) Write a brief memo that says all 500,000 numbers match. (4) Stick said page somewhere in the middle of a financial document where no one will read it. (5) Repeat. (6) Don't profit.

Part of it is how boring the work is. The other part is the crushing realization that 99% of the time your work kind of just...doesn't matter.

I spent a brief amount of time in audit. That's how I felt.

vasilist:

i live in europe
and i study accounting, which i like
and i am planning to go big4 audit, what i wanted to ask, why people bash so much auditing and accounting as something extremely bad, while glorifying jobs like IB?
i mean, is it so bad if you like accounting?
i was thinking to go big4 for some years and then in financial controlling

In addition to the posts above: 1. The people on this site are mostly finance geared people, so their opinions are all biased simply because this is Wall Street Oasis. Compared to their current jobs, or their ideal jobs, Big 4 audit doesn't pay as much, and isn't as rewarding in their eyes, because that is not what they are looking for. 2. You need to know accounting, but auditing is not completely tied to accounting. The first few years, most of what you do will not be related to any accounting decisions. You simply follow what was done last year and perform similar things in the current year. This allows you to learn a lot as you move through documents and materials quickly, but does not actually involved or require a deep understanding or utilization of accounting knowledge.

If you like it do it!

If you are interested in accounting, it is good to have a big 4 background. Put in 1-2 years, get that experience and then see where it leads you.

vasilist:

i live in europe
and i study accounting, which i like
and i am planning to go big4 audit, what i wanted to ask, why people bash so much auditing and accounting as something extremely bad, while glorifying jobs like IB?
i mean, is it so bad if you like accounting?
i was thinking to go big4 for some years and then in financial controlling

If you like accounting/auditing, then go for it. I'm currently a senior auditor for a Big 4 firm, only working in financial services. I have been pretty fulfilled at my firm, working on higher risk areas (valuation models, loan collectibility, for the entirety of my career and especially high profile clients. I've had a decent amount of exposure to C Suite and work closely with high profile partners in the firm. This is not the norm though, and is a result of heavy networking.

You also get good experience managing employees, as you are expected to begin managing someone after only two years of experience at the firm (sometimes sooner). This is great experience, and something you wouldn't get if you go work in most corporate jobs.

I would echo what others have said in that you will likely not be working on significant accounting issues, and will spend most of your time reconciling numbers, but I have been "lucky" in that I've gained pretty proficient understanding of accounting guidance (more so than many of my clients). Your experience at a Big4 firm is what you make it, and if you like it, then go for it.

That being said, there are exit opportunities that others haven't mentioned, namely attending business school. I'm leaving my firm after this week, primarily due to the frustration that my job as an auditor doesn't really impact much of anything. The compensation isn't great for the level of effort that I put in, and as a top-ranked auditor, you still don't get appreciated for your work.

Not an auditor and never have been but I've used them extensively many times, all of the Big 4 and tier-2 firms. I would think it would get boring because it's repetitious but the main thing is that no one looks forward to the auditors coming. You get thrown in some windowless room at best and just pound away for a few weeks then move on and do the same thing at the next company. All the more to you if that's your bag though.

I still don't understand why Big 4 emphasizes "exposure to the C suite". As if some CEO really remembers some auditor who's there for an engagement. When I worked 8 feet from a billionaire on a trading floor as an intern I never reveled in my handing him reports every morning.

Auditing indeed has exposure to the "C-suite" but the clerks instead of chief officers. AP Clerks, Revenue staff accountants, payroll clerks.

I'll play on the other side of the fence for a second and try and shed a positive light on us capital market servants.
I actually did series on banking vs big 4 audit http://www.wallstreetoasis.com/blog/accounting-vs-investment-banking-pa…

I would never tell anyone who has the opportunity to go to a legitimate IB to go Big 4 audit instead, but they aren't exactly apples to apples careers.

The short version of the series is that: In the short term and long term, accounting careers will pay less. Banking be more interesting work after you get out of pitchbook land Accounting will generally be less stressful, and a less intense atmosphere Accounting gives you more options to live in better cost of living areas, where as you're kind of locked into a major finance hub in banking (with exceptions obviously) The career progress in accounting is much more focused on big 4 short term (2-5 years) - then climb the corporate ladder with a solid foundation. Accounting doesn't need top MBA, but usually a MAcc (thought the ROI and general experience of such a program isn't something you would really feel "obligated" to do)

Hours in accounting are: 55 hours weekly average with 40-100 range weeks for 2-5 years, then you're looking at 40-50 average for pretty much the rest of your career. Hours in banking are really up in the air for the duration of your career, even after leaving the sell side. PE isn't immune to brutal hours at times, though some gigs like HFs may have some more normal and predictable hours.

Pay in accounting will be pennies in big 4 (~65k after 2 years, 80k or so after another 3), but those who leave for corporate gigs after 2 years (senior) are looking at ~70-80k, and those who leave after 5 (manager) are looking at 90-130k.

On this forum where most people either have pipe dreams or are actually able to pull in 500k under 30, yeah big 4 doesn't look so great. But if you're looking for something where you can live in suburbia and make 100k before you're 30 working 40 hours a week, it's not a bad gig.

A few disagreements on the posts above:

The work is not always boring, and can be challenging at times. There truly isn't a lot of development in actually performing the testing, other than understanding how the journal entries work and the audit methodology. Once you get a year or two in, you can start to design the procedures and it can be very complex depending on the industry and client. Project/staff management is probably 50% of the battle at the senior (2nd to 5th year) level.

Depending on the size of the company, you can have direct interaction with top management very early in your career. I was talking frequently with the CFO of a small-mid public company my first year on the job. At the senior level you're mainly communicating with those who are giving you your support (ie payroll/ap manager ect), but also meet with the CFO and VP Fin/acct in meetings with the managers and partners, even of pretty large companies. The CFO/CEO will really never be around in F100 companies, maybe just for some fraud inquiries and signing the rep letter.

The repetition aspect I will say is very dependent on your office and your schedule. I've never worked on the same client or done the same procedures (except for basic things like PPE, cash,ect, which the first years typically do anyway). If you're on a large client and you work on it year round, every year, yeah that would be boring as shit.

And CorpFinanceGuy, if the support your provided would tie to the damn trial balance, we wouldn't be such dicks: )

I've been told the accounting vs banking difference is similar to the web/com tour vs the pga tour very similar but pay difference is astronomical

Yes, it is as bad as everyone says. You are providing reasonable assurance that the financial statements are free from material misstatements. (E.G., there is $1,000,000 in inventory, can we prove that 95% of it is there by going to a warehouse and counting boxes?)

That's all you do, for every account.

Thinking you will like audit because you like accounting, is like thinking you would like working in an apple factory in China because you like to use a MAC.

Here to support the the Big 4 >> CPA >> T10 MBA route. In all honesty, cracking the MBA business schools">M7 out of audit is damn near impossible unless you're an URM.

There are few things worse than 60 hour weeks, mediocre pay in expensive cities, and repetitive work where the client has zero interest in responding to your requests and follow-ups. And I got to work on heavy valuation aspects of our audit too..

When I was talking to a few firms last month about getting a QofE done for an asset we were looking to purchase they all sounded so incredibly dead inside and about 4 moderately strong drinks away from suicide. It takes a special kind of person to want to get into auditing IMO...

Most IBers on WSO talk exit ops so lets talk exit ops. Not in the business but know MANY who started out that way. A few examples are:

1. College roommate started in Big 8 (way back). Stayed for 5 yrs. Hired by client (f500). Finance area. They paid for his Wharton MBA. Worked his way up to a CFO spot of one of their businesses. Left for other opportunities. Is currently the CFO and head of global strategy for a F 200 company (makes about 3M per yr). Yes this is rare - but only because there are only 500 cos in the F500.

2. 2 Golf buddies each started in Big 8. Left after 5 yrs to start their own firm which has grown to a pretty good size regional. Although they started in audit, they are the founders and managing partners of a great firm that does all the Big 4 things (audit, tax, advisory, m&A guidance, etc.). Think of them as senior partners of a Big 4 but they influence ALL the practices, not just their specialty. Do a lot of strategic planning for small to midsize cos 20M-400M. Even provide CFO duties and CFO search for clients. Great lifestyle. Known n the community. Income north of 500k forever. Equity in the firm which was recently purchased by a larger firm in another major city. (They liked it better when it was a bit smaller and local)

3. Lots of friends who have moved from Big 8 to various corporate jobs.

Most of these guys were IDed for leadership and employee management very early. They are all very smart, "blue chip" types who were comfortable in front of clients right out of the gate. Their firms had them recruiting candidates and managing recruits in yr 2, so the work got more interesting as they were leading a small team, reporting to client and back to firm very early in their careers. They all say it was a great foundation.

Don't worry about the money. Other than owning your own business, few things will compare to the money in banking. However, most of those kids will burn out and leave (not necessarily to the buy side - just on to other things).

I'd rather enjoy what I do and build a solid foundation where I can make several hundred K per yr for a very long time. At some point, you'll become the face of the organization, entertaining clients, building opportunities, etc. while your staff does the day to day operational work. It's pretty much like that in most businesses.