Kula Consulting Blog

Working for one of the Big 4 CPA firms offers money, prestige and an upwardly mobile career path. Right? Not so fast. As it turns out, unless you are one of those rare chosen few who makes partner, staying too long at one of these powerhouses can actually harm your earning power and career choices over the long term.

Consider the preliminary results of our recent survey of accountants working with prior public accounting experience. More than half of the respondents worked less than four years in public accounting before moving to a corporate job.

There must be a reason. Let’s begin by entering into our Way Back Machine.

When I first joined one of the Big 4 it was common knowledge that you needed to progress toward partner every year or you’d be gently nudged out the door.

We called it Up or Out…

The first four or five years were focused on building technical accounting and financial reporting skills, passing the CPA exam, and learning how to effectively lead a team. If you did well, and could work the hours required to be a “star,” you’d be promoted, and keep your spot on the partner track. It was a competitive environment, but competition is good!

Once you made manager, business development and practice management skills began to be added to the list of talents required to become partner. You needed to be able to plan engagements, review the work of subordinates, exceed your profit goals, and interact with clients and the business community. The competition became more focused during this phase, and CPAs quickly realized that accounting is a business, as well as a profession.

Not much has changed over the years.

The good news is that if you enjoy developing new clients - and can still bill big hours - you have a shot at becoming partner. Keep in mind that the competition is even tougher at this level (10-15 years at a Big 4 firm).

Here’s the harsh reality. If you have determined, or the firm as determined, that making partner isn’t for you, it’s time to move on…

The $64,000 Question is at what point has a person stayed too long at a Big 4 firm?

My clients’ actions tell me that there is an optimal time frame to move to the corporate world. Two years of Big 4 work experience is still the minimum. Less than that raises questions about skill sets and work ethic.

However, more than 10 years of Big 4 experience may present issues when making a move (except for tax people, who get another two or three years). The “Sweet Spot” seems to be three to seven years of Big 4 experience.

Please post your thoughts about:

1) The Up and Out nature of Big 4 firms.

2) Is there an optimal time to make the transition from public accounting to private?

3) Is the competitive nature of public accounting a good thing, or not?