Recruitment season is creeping up, and with that, you may have some questions in regards to what exactly are the differences between an international accounting firm, and a smaller accounting firm. My hope is to answer your questions, and provide you with what I believe are the main differences. Although I have never worked at a smaller firm, I will try my best to make this as unbiased as possible! I do have friends at smaller firms, and from hearing their experiences, if I had to pick the 3 most important differences, they would be the size of audits, the type of clients, and the availability of future job opportunities.
Size of Audits / Types of Clients:
In 2010, it was noted that 88% of public companies were being audited by one of the big 4 accounting companies. (PriceWaterhouseCoopers, Ernst & Young, Deloitte, or KPMG). That leaves a measly 12% to the smaller firms. In comparison, big 4 firms only had 36% of the private companies, while the smaller firms took the majority at 64%. These numbers help to shed some light on the difference in clientele you’re going to observe with big 4 firms compared to the smaller firms. It also makes it clear that you are going to have some significantly large audits when working at a big 4 firm. As public companies need quarterly reviews done, plus the year-end audit, if booked on all the audit work for that client, it could mean 3+ months of work to do.
The issue is that the bigger the audit, the less accounts you will most likely see. For example, for one of our public company clients, it was a 6 week job for their year-end audit, but I only touched 4 different financial statement line items for that whole time. Sometimes smaller firms use this against big firms, and state that they allow their employees to see the whole side of an audit rather than just a few sections of an audit, which can be a fair point.... kind of.
This may be a fair point if you work at a big 4 firm, and only work on public companies, which is never the case at PwC. We aren’t divided between private company and public company clients. All employees get a nice mix of public and private companies. I could be performing the whole audit for a client 1 week, and then move to a 8 week job at a public company.
But to back-up the smaller firms, they do give their employees more responsibility of other audit procedures earlier in their career than bigger firms. This would include writing up the engagement letter, the management representation letters, and actually managing the client. Smaller firms also tend to have the employees who audited the client to do the client’s tax return. For the bigger firms, you are generally separated between audit and tax. If you are performing an audit for a client, you will get people from tax to do the tax work for that client, to determine the tax payable.
Future Job Opportunities:
When it comes to job opportunities for when you want to go to industry, or if you are looking for something new, those who have worked at any big 4 firm are going to have a leg-up on the competition. The main reason is that having a big 4 name on a resume is a sign of professionalism, and quality that is accepted worldwide. Not to say that the smaller firms don’t breed the quality accountants that big 4 firms do, but brands matter, and familiar names are going to resonate better when they look at your resume, rather than the small regional firm that they have never heard of.
Another reason for more job opportunities at the bigger firms traces back to our clientele. A great deal of the employee’s at these big firms go on to work with companies that are client’s that they once audited, and with the big client’s that have thousands of employees, and offices across the globe, they provide a lot of opportunities that employees at smaller firms may not be able to get.
Lastly, if your future job plans are to work abroad, big 4 firms have offices all across the world. PwC has offices in 771 cities across 158 countries. you can’t beat that kind of opportunity. Secondments are encouraged here at PwC, and we always have people coming in, and leaving from places like Australia, Paris, Vancouver, New Zealand, Russia, etc.
I hope this has helped resolve some of the questions you had regarding the differences of the smaller firms, and bigger firms. These differences are just based on my experiences, and the experiences of my peers. If you have any comments, or questions, please feel free to leave them down below. You can also reach me at JeremyUA12@Yahoo.com. Lastly, don’t forget to follow me on Twitter @JeremyUA12.
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