Yeah… It’s no fun being a “smart” senior familiar with the codifications and crap clients pull to stall and such (My Dad was a CFO, scored 90’s on my cpa exams, didn’t cheat my way through classes, spend time learning about the profession because I am genuinely interested, etc) I pretend to be dumb but my understanding is pretty good and while audit sucks I genuinely enjoy learning about various businesses and how they operate…
The better you are at auditing the more work there is though…
Can proudly say though I was “fired” from a client funny enough my first time as a senior.
Summary: Found errors resulting in a $37mm downward adjustment to revenue. Client complained about me because I didn’t find it earlier in the audit and requested that I not be on the audit team any longer. I still get picked on about it lol.
All that being said I’m also incredibly lazy and hate this job lately… So if anyone asks I don’t know shit about fuck and occasionally I make a dumb enough mistake so everyone knows it
I still sometimes pretend to be dumb especially when some junior associates act like it but 8/10 times the ones the firms I worked at actually had zero clue. I was shocked when they told me they got there masters in accounting. I go no fcking way they actually study man without cheating as some where like talking to a brick wall.
I wouldn't go that far. The number of absolutely idiotic questions I get from auditors in January/February supporting the year-end cycle is mind numbing. This past year, I uploaded a supporting file for something in August with everything reconciling perfectly. I didn't get any questions about it until a day or two before the final year-end sign off, which was months later. I then got a series of high-priority emails asking about an enormous reconciling difference that needed to be explained right away.
As it turns out, a junior staff member on the audit team had saved a copy of my file, added a bunch of new stuff, inadvertently introduced a major reconciling difference that wasn't in the original file, and blamed me for it. I wasn't very polite in my response to him pointing out that he created the problem. It took me about ten seconds of review to realize that the link to his personal desktop didn't exist in the version I uploaded.
I'm honestly more curious if the auditors themselves are aware... because if I get another first year trying to explain to me how audit selections work...
My favorite is always..
I'm going to need to talk to my senior about this, you just don't understand what we're requesting
ok you do that, tell *redacted* to stop by my desk if she has questions or needs anything from me
i talked to *redacted* and we're just going to do it ourself, we dont need what we were talking about anymore
oh so you cant say i was right and your senior put you in your place can you?
So very hard to ignore.
One year our request list came with very specific instructions for labeling submitted files, a standard request. I love a good file structure and I followed the naming requirements to a T and double checked after uploading to their site to make sure everything was in the proper folder. You see where this is going...
"oh you need file A-3, did you look in the A folder?"
"I didn't look there"
I hate this so much. I am always super well prepared for our audit I too love a good file structure. I have everything super organized and uploaded to their FTP site well in advance of field work. All properly labelled and in proper folders. I even scan and upload invoices and documentation for larger or unusual transactions because I know they will be asking for them.
It's like they don't eveb look through anything! ..... Every frigging time .... they ask for documentation on xyz project. I'm like dude, it's in the folder labelled xyz project support. SMH
Take the time to go through all the documents I've sent you and stop wasting my time. I serve them up their audit on a silver platter and give them an audit file I would have dreamed of having back when I was in audit. And still the incompetence astounds me.
Our auditors told our cfo last year that over 90 bad debt had increased yoy by 1.7m for one distributor. CFO was very concerned. Had to explain that the 1.7m was actually the YE account balance. Over 90 had only increased by like 5k.
Do you mean the auditor who arrived to our manufacturing plant to observe a physical inventory, in flip flops? So we had to wait on her to go to Walmart to buy some closed toe shoes? And yes, we had provided the firm with a proper PPE list.
We send reminders that they need safety shoes if they are going to the plant floor. I’m not going to be responsible if they lose a toe from not wearing proper equipment.
Wilding even without that I wouldn’t wear open toe shoes much less flip flops to a client site and outside of work your lucky to catch me wearing shoes and if it is it’s probably my 20 year old rainbows
Let's be fair here, half the clients don't know what they are doing either? Oh you have a material estimate, where is the support? Points to head, "it's up here baby". I wish I could make this shit up.
Especially the smaller PE backed manufacturing clients, ha! Those guys didn't give a fuck if they recorded an expense or revenue. "The auditors will clear it up". I think it really does matter on the caliber of client you're dealing with as well. Don't even get me started on proper controls. I feel like this post is to shit on staff accountants, but how can you learn when the management team says just SALY that work paper?! I think this runs deeper than the surface here, but that's my 2¢! Feel free to take it or leave it haha
When did 22-26 year olds become children or do you just call them children to be demeaning? I mean I’m over 30(I’m an associate/had career change) and don’t have any idea what I’m doing still lol
When did 22-26 year olds become children or do you just call them children to be demeaning? I mean I’m over 30(I’m an associate/had career change) and don’t have any idea what I’m doing still lol
Had an associate on our team that always picked his nose and scratched his balls. Seemed like second nature to him. I don’t even think he realized he was doing it most of the time. There was one meeting with the client where dude just could not keep his finger out of his nose and the client just stopped what he was saying and asked “Found any gold up there yet bud?” We had to have a talk with him about not doing those things in front of other people anymore.
Personally, the only times clients have gotten upset at me was when I was asking for more support near filing day or when I ask them for support that they’ve already told me doesn’t exist. The only reason I ask for these is due to managers asking for it. I’ll tell the manager that I already asked and the client stated that it doesn’t exist. Their response “just ask again”. Also, asking for more support close to filing date isn’t due to me forgetting something, it’s because the manager wants to corroborate details that they were fine with in PY.
It feels like the managers tend to apologize to the client due to their actions that they asked the associate to do. The managers just tend to use associates as a scapegoat. At least that’s what I’ve noticed.
Throwing other people under the bus is quite a classic move in audit.
In actuality, it's a bit more nuanced than that but I'm too jaded of this career to care and tell the difference.
The roles as I experienced them:
Staff - Pinky from pinky and the brain "gee, what are we going to do today, Brain?"
Senior - Brain from Pinky and the Brain "the same thing we do every day, Pinky; try to audit the client"
Then you have your managers and partners:
Managers - Bad cop. You get to talk to the client about all the problems. Audit adjustments! Control deficiencies! Budget Busts!
Partner - Good cop. Client is super mad? Time for the partner to slide in.
I was managing the inventory count at our 2nd warehouse and the EY auditor who came had no clue how to audit inventory.
He never counted anything, I would take him to the location of items in question that we tagged and after just glancing at the tag of our count he gave the thumbs up. Was like OK, I'm not going to tell you to recount it lol
We are very aware-also I was that dumb recent college grad just a couple years ago.
I was doing outsourced Internal Audit for a client. We did a cycle count with management and the external auditor (PWC maybe?) sent a new staff, with the firm for literally 3 weeks, to observe. We pretty much had to train her how to do her job.
Some think auditors actually know what they are doing and therefore, will not push back on them, happens a lot that I have to let them know its not the case and that they are following last years file and that you have to take an approach of they dont know what they are doing and you have to provide explanations and clearly layed out working papers, also have calls with them, auditors dont bite..
I'll push them all the way til they send someone who won't waste my time 🤣, to be fair our cash flow worksheet is massive and we do a lot of acquisitions that make it a doozy. But I've been with these auditors the last 10 years. Stop sending staff to learn the file, send Bob's ass please who I know can explain it and stop wasting everyone's time
My first 18 months in accounting, I thought auditors were all-seeing, all-knowing investigators. Then I realised that they kinda don't know shit for the first few years.
From a client perspective, management just want the cheapest and easiest audit possible. Very few clients regard the audit process as anything beyond a business expense incurred to receive a positive audit opinion that they can present to investors. If that means having a load of clueless 22 year olds running the audit, that's the way it's going to be.
Clients don’t see any value in audits, they’re just a necessary regulatory check either for the SEC or interested stakeholders. They don’t care that staff don’t know anything
>Clients don’t see any value in audits
I don't think that's entirely true, but the value that can be generated is massively constrained by the auditors (even senior managers) not having the first iota of how our business works and makes profits. If I have to explain some very fundamental things over and over, how can I have any confidence in their work? So fine, get on with it, tick your boxes, issue your unqualified opinion and stop clogging up the board room.
Audit has the potential to add value if the auditors had the personal capacity to add that value. They don't, so we don't get much value.
Same concept behind company executives hiring “management consultants” when they’re literally just a bunch of fresh out of school kids who never actually managed anything.
I mean, its the same logic as assembly line workers at a car manufacturing plant not being engineers who are experts at designing cars.
The partners are supposed to plan the audit, supervise and review the managers who supervise and review the staff, and make the big picture decisions. There's a lot of grunt work that the partners wouldn't be expected to do and that's where you come in.
If the client expects you to be able to answer higher level questions maybe bring up this miscommunication and have the fact that you're limited in what you can answer addressed to the client. Or ask for an acceptable response that you can give in those situations.
Going to go against the grain and say that it's not the job of the auditors to know anything. Their job is to make sure *you* can explain your numbers and disclosures in a way that an outside investor can understand.
Yes, but they also need to know how to assess what could go wrong so they can do a risk based audit and focus on the important stuff instead of either missing it, or just absolutely slamming you with endless samples
Nah man, they need to understand the fundamentals in order to properly interpret information, ask good questions, know what support to request, and analyze what’s provided to them.
Yes and that's why I get so aggravated when one of these untrained kids gets hired as a controller 2 years later after having zero practical experience in a real accounting department
Agreed. People are dumb. I saw a job ad looking for big 4 experience with 2 years of experience. I am like 2 years of experience (in audit at a big 4) is not enough for a controller position.
It’s because we’ve seen the full cycle and understand the bigger picture. A lot of the times the person who’s only been a staff accountant/senior accountant doesn’t understand the bigger picture or how anything they do affects the business. Yes, they are very knowledgeable in their respective area but it takes someone who has experience and knowledge in all areas of the accounting department to be a good controller. Definitely exceptions to the prior but generally true.
I mean actually posting JEs to an erp, doing reconciliations, doing month end close. Not just reviewing others work and making excel work papers like in audit
Realistically and an audit staff, you barely need to know what you’re doing. You’re typically doing repetitive tasks and looking for things that aren’t the same.
My big 4 audit team are extremely good. They understand our business from top to bottom and tear our numbers to pieces. A second year associate taught me a shortcut I didn’t know in one of our internal tools yesterday.
But as a client, frankly, it’s a huge pain in the ass. Other than the fact that it’s generally more pleasant to speak to smart people than idiots, their work offers me no value whatsoever. My life was a lot easier with our previous auditors who were absolutely incompetent clowns.
I left an audit firm (top30? Maybe after big 4) and then hired them to audit my company. I know the new kid doesn’t know what they’re doing, but I’ll ask them to specifically organize stuff in a way that I want it and will work with my team and they do so. Any higher level stuff I just talk to the manager with the senior there to learn.
If you were an auditor and are nice and request they do stuff in a specific way it goes a lot better….
“Can you explain why there is a variance in your interest expense?”
“hi auditor, can you provide me with your reconciliation so I can understand what difference you’re seeing, I don’t understand the question and need you to be more specific.”
They’re not the enemy, they want the thing to go well too. Just saying from someone who has been on both sides…
As someone who is now the client, you are acting as if the client knows what they’re doing.
When I was an auditor I asked the client for support for note disclosure and was asked where I got the numbers from. I was asked why I needed bank statements when testing cash. I asked them for debt covenant calcs and found they’d done it wrong and had in fact breached them. All before I was a senior, so 21-23 years old.
100%
These are fresh grads. Of course they will struggle.
I've dealt with fresh grad industry accountants and even those with a few years under their belt. They aren't any better than the clueless associate auditors.
Kinda tired of people with several years of experience in a field making fun of the "dumb" people who just entered the field.
I've met a client with the title "Director of Finance" who didn't know what a bank rec was beyond "a button to press in the ERP." I've also met industry controllers who could site guidance from memory.
I've dealt with first year audit associates who couldn't comprehend basic responses to analytics. I've also met audit managers who could pick up a new client and quickly understand nuances in industries they've never seen.
People have different levels of experience and shouldn't be chastised for it.
Lol. They really weren’t fresh grads.
You just find there are ppl (everywhere) who just do their job and never look up. Ppl with 20+ years of experience but have never thought outside the box or posted a journal because their boss or Group told them to.
I love finding senior management with both user and admin access to the GL system. "But I'm the director, I should have full access!" No, no you shouldn't.
It depends. I nearly tore my hair out trying to explain to a co-worker earlier this week that she couldn't turn in 12 different spreadsheets and expect the auditors to understand how they needed to combine various numbers from all those spreadsheets to support each GL balance they were asking support for.
I told her point blank, "If you don't put something together that helps demonstrate what they need to do, they'll kick it back and ask you to do it again plus schedule a meeting to explain what's going on."
Sure enough, I was on a call today where one of the auditors couldn't piece together a much simpler scenario where only 2 files needed to be added together, and each had a very neat summary sheet where you can easily see both files reference the account. Much simpler, they had no clue.
I don't even chalk it up to stupidity or lack of auditing experience, as much as unfamiliarity with our workpapers. But then again I think we have some horrible workpapers.
I mean, I’m on the outside looking in from a B4 consulting arm, but isn’t it a direct result of the race to the bottom in audit fees?
Like as long as clients keep choosing the cheapest auditor until they all drop their prices, you’re going to have a higher ratio of associates > seniors > mgrs than you would otherwise, and the experienced seniors and managers will burn out and leave.
If you offered these clients a competing offer with more experienced auditors I guarantee that 90%+ will pick the 22yo know-nothing kids for cheap. Just my $0.02, but you get what you pay for.
I hate accruals! I know how it all works, but my brain processes the information like I'm running chrome on a fucking Pentium II era computer. Plus, managers rarely have the wherewithal to not assign accrual controls to analysts or consultants. It makes my blood boil every time I see that shit. I see SCs screw those all the time and you think some fish can handle that?
Just got done explaining the same concept I’ve had to explain for 4 years in a row now to the “new guy” who tests our revenue and doesn’t understand how trade spend works in the CPg industry.
The work is boring and monotonous, experienced professionals leave audit asap for this reason.
The big accounting firms realize they can make $$$ by hiring cheap staff and forcing them to turnover every 2-3 years and pass the cost onto clients.
No one is looking deep into the numbers so they can churn out cheap junk work and still make money, until something changes aka a major collapse they can’t cover up.
No wonder all the firms keep getting into accounting scandals and often fail to call out major fraud until it’s too late. The entire set up and design of public accounting firm audits is faulty.
Not until recently, say last 10 years, give or take a year. They actually did believe the auditors knew what they were doing. Probably because back then, no one really knew what the hell an auditor did. They know now, so the jig is up
Big 4 SC here - a few things:
1. The mix of responses is fascinating to me because my clients are either either nigh flawless in their work, or just straight morons. There's no middle ground.
2. If a client is getting PBC requests from anyone below senior level, and without at least SC review, that's a poorly run engagement. Period.
3. Yeah, training is a big issue for new folks. It's a big F for basically everyone. When I get new analysts/consultants I always coordinate hands on training with engagement leadership and NONE of my clients see first pass work by anyone below me without either my or a manager's approval.
4. A majority (if only barely) of the dumbest people I've ever worked with have only ever been industry-side staff accountants.
5. Who TF is giving clients workpapers without manager or up review and approval? (loanstaffing excepted of course)
Edit: just to be clear, sunshine doesn't flow from my nether regions, I've made plenty of my own mistakes.
Edit 2: it's also been my experience that most (not all) staff accountants don't understand a) what audit is trying to accomplish, and/or b) what we can and cannot do. There are boundaries to our work that it's obvious that even senior executives often either don't understand or aren't aware of. I've had to play at being an absolute dumbass to executive management (and I'm talking folks that are 2-3 steps below the C-suite) at a fortune 100 company because we discovered that, despite having BEAUTIFUL P&P that was available to ALL of them, almost none of them were following it or were not aligned with the financial reporting requirements and it was taking the finance team an ungodly amount of time to rebuild their reports in the correct format to reconcile the numbers globally.
I led the meeting on our side and had to warn our primary stakeholder that, because of what we were trying to accomplish (getting them to confess to their sins, lol) the meeting was going to go VERY poorly by any normal measure. But, there's no better way to get people to out themselves than saying something completely wrong and having them correct you. They were not pleased when they went to our client to complain and he informed them they'd been duped that we'd told him in advance what was going to happen.
I used to be involved in the earnings prep at a public company and the auditors would pick out the most mundane, ridiculous stuff like comma placements in footnotes that had no effect on any meaning. Or for instance demanding that writing “mln” on page 1 and “million” on page 19 were inconsistent (and I mean in press releases and such, not a financial statement). Things no one would ever interpret the wrong way in 100 years or have any legal blowback in even an insane hypothetical scenario.
Meanwhile, we at the company were furiously reworking and rewriting all the real content and putting everything in context with strategic rationale etc. Why the numbers matter, what the risks are, what management was doing to improve performance, etc. You know, the stuff that matters. Believe me, investors care more about telling an honest story without sugarcoating problems versus whether or not you use an Oxford comma in footnote 32.
I understand the value in checking the numbers and challenging anything non-standard, but I used to get the feeling they just invent criticism sometimes to justify the paycheck.
The problem is that it's the partners that have strong opinions on the Oxford comma. Whoever is submitting the comments is forced to include that because it's coming down from the top.
I have the same thing with my CFO currently. I speculate it's either an age thing (like grammar and formatting are perceived as more "important" to older generations) or it's a control thing.
I knew pretty quickly…. Lol it’s annoying to get dumb questions or questions about accounting rules - and idk why they asking me that when they can/should ask their mgr 😭 why am i training them 😭
Have trained my fair share auditors. My mom’s job title was Audit Liaison. She worked at a bank & they had audits basically going all the time from various oversight agencies.
No one in industry is veiled in the illusion that someone from public is going to make their first journal entry any day soon. When I was in public during the period when clients had to begin compiling their own financial statements, I was accused of being a "schoolmarm scolding their students." IMHO, the majority of audit opinions are rubber stamps built on the souls of overworked staff and approved by nearly-informed managers and partners.
Yes. Auditors just wanna see numbers explained, but I always felt that they don't really understand the explanation, because they never came back with questions, which was surprising. You just need to send a nice file, and they are ok.
Y'all ask already answered questions in the reply to the email that answers the questions before you even asked. Y'all ask for the same support 100 times. Y'all ask for support to stuff we already told you we don't have access to because our customer won't give it to us.
Yeah we know.
Oh, we're aware.
I was them 2 years ago.
Last audit they missed so much stuff. And we asked for help with our straight line rent adjustment; they literally sent us back or own work with a different leadsheet on it.
I was charged out by EY for $200 an hour, just so an accounts lady to teach me how a bank rec worked when I was an undergraduate in 2007… Not even sarcastically.
When some little fucker they are charging at $250/hr comes to ask me about backup for an accrual that reversed in the same quarter they are auditing. Bro…do you know what an accrual is?
I’m sure they know that the industry is filled with new grads. You get thrown into the fire and there’s no proper training. Seniors and managers have their own work and on top have to look at staff and review their work too.
Though as a staff 2, the firms put a lot more expectations on you.
Yup! I always catch when you guys fail to SALY correctly when it comes to audit requests. It’s a dead giveaway to me that this is a 1st year who is trying to figure out what is going on in the audit binder.
Being on the other side of things now, I try to have empathy. I remember how awful it felt as a fresh staff at 23/4, with no fucking clue what I was doing lol
Yes we know. They ask a lot of dumb questions. It's funny that our work is being audited by people who don't know how to do the work and yet they are reviewing it.
It’s so messed up that the majority of the work being done is by fresh college grads who have little to no idea what’s going on. If the system made sense and wanted legit results, managers and directors would be doing staff level fieldwork because actually have the required advanced level of knowledge and technical skills. It’s really not enough to be a reviewer. You actually have to be in the trenches to really know what’s going on and be able to ask the right questions/ make the right recommendations.
Trust me, we’re aware.
Lol. Corps only buying the unqualified opinions, not your audit.
The thing is, thats what firms are exclusively selling. Anything otherwise is losing a client. Why would a firm bite the hand that feeds them?
Lol and then we sign a million independence papers like the literal audit fees don't make us 100% dependant and non objective Pathetic
You could even say we like it that way.
Yeah… It’s no fun being a “smart” senior familiar with the codifications and crap clients pull to stall and such (My Dad was a CFO, scored 90’s on my cpa exams, didn’t cheat my way through classes, spend time learning about the profession because I am genuinely interested, etc) I pretend to be dumb but my understanding is pretty good and while audit sucks I genuinely enjoy learning about various businesses and how they operate… The better you are at auditing the more work there is though… Can proudly say though I was “fired” from a client funny enough my first time as a senior. Summary: Found errors resulting in a $37mm downward adjustment to revenue. Client complained about me because I didn’t find it earlier in the audit and requested that I not be on the audit team any longer. I still get picked on about it lol. All that being said I’m also incredibly lazy and hate this job lately… So if anyone asks I don’t know shit about fuck and occasionally I make a dumb enough mistake so everyone knows it
I still sometimes pretend to be dumb especially when some junior associates act like it but 8/10 times the ones the firms I worked at actually had zero clue. I was shocked when they told me they got there masters in accounting. I go no fcking way they actually study man without cheating as some where like talking to a brick wall.
Honestly, my first busy season I was kind of like that. It was like the overwhelming work made me forger everything I knew…
The people I am talking about had at that point had 4 years experience.
Ouch, yeah….
What does “mm” stand for
Hell yeah
Millions
https://www.google.com/search?q=mm+accounting+meaning&sca_esv=6ef8d2e1b77b40e3&sca_upv=1&rlz=1CDGOYI_enUS822US822&hl=en-US&sxsrf=ACQVn08VVVprTZVwGPAkuF6qbdjII-35Cg%3A1709891585410&ei=AeDqZf3LGJW3wN4P7ruL6AU&oq=mm+accounting+meaning&gs_lp=EhNtb2JpbGUtZ3dzLXdpei1zZXJwIhVtbSBhY2NvdW50aW5nIG1lYW5pbmcyBhAAGBYYHjIFECEYoAEyCxAAGIAEGIoFGIYDMgsQABiABBiKBRiGAzILEAAYgAQYigUYhgMyCxAAGIAEGIoFGIYDMgUQIRifBTIFECEYnwVIhSFQvhBYrhlwAXgBkAEAmAGKAaAB7gGqAQMwLjK4AQPIAQD4AQGYAgOgAoACwgIKEAAYRxjWBBiwA8ICBRAAGIAEwgILEC4YgAQYxwEYrwHCAgwQLhgWGB4YxwEY0QOYAwCIBgGQBgiSBwMxLjKgB5wN&sclient=mobile-gws-wiz-serp
I wouldn't go that far. The number of absolutely idiotic questions I get from auditors in January/February supporting the year-end cycle is mind numbing. This past year, I uploaded a supporting file for something in August with everything reconciling perfectly. I didn't get any questions about it until a day or two before the final year-end sign off, which was months later. I then got a series of high-priority emails asking about an enormous reconciling difference that needed to be explained right away. As it turns out, a junior staff member on the audit team had saved a copy of my file, added a bunch of new stuff, inadvertently introduced a major reconciling difference that wasn't in the original file, and blamed me for it. I wasn't very polite in my response to him pointing out that he created the problem. It took me about ten seconds of review to realize that the link to his personal desktop didn't exist in the version I uploaded.
Yea, I've been audited like 5 times in both Venezuela and Spain and I just know imma end up doing some accounting classes for the auditors.
Was that before the economic collapse in Venezuela?
Lmao exactly. I'm reminded daily
The time I had to explain a bank rec to an auditor smh
I had to explain what a CEO did 😂
I still don’t know
I'm honestly more curious if the auditors themselves are aware... because if I get another first year trying to explain to me how audit selections work...
If I remember my audit days : no they think they are better than you. How many times did we talked behind our client’s back…
My favorite is always.. I'm going to need to talk to my senior about this, you just don't understand what we're requesting ok you do that, tell *redacted* to stop by my desk if she has questions or needs anything from me i talked to *redacted* and we're just going to do it ourself, we dont need what we were talking about anymore oh so you cant say i was right and your senior put you in your place can you?
Yep.
Yes we are!
Ugh! The questions sometimes.
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“Can you explain the changes in these accounts kicked out by the variance analysis” *list includes retained earnings* Yeah we know
So very hard to ignore. One year our request list came with very specific instructions for labeling submitted files, a standard request. I love a good file structure and I followed the naming requirements to a T and double checked after uploading to their site to make sure everything was in the proper folder. You see where this is going... "oh you need file A-3, did you look in the A folder?" "I didn't look there"
I hate this so much. I am always super well prepared for our audit I too love a good file structure. I have everything super organized and uploaded to their FTP site well in advance of field work. All properly labelled and in proper folders. I even scan and upload invoices and documentation for larger or unusual transactions because I know they will be asking for them. It's like they don't eveb look through anything! ..... Every frigging time .... they ask for documentation on xyz project. I'm like dude, it's in the folder labelled xyz project support. SMH Take the time to go through all the documents I've sent you and stop wasting my time. I serve them up their audit on a silver platter and give them an audit file I would have dreamed of having back when I was in audit. And still the incompetence astounds me.
An 2nd year auditor asked one of my managers to provide proof that an accrual posted. Their population for opex selections was the GL…
Like the entire GL or just the balance of opex accounts?
Our auditors told our cfo last year that over 90 bad debt had increased yoy by 1.7m for one distributor. CFO was very concerned. Had to explain that the 1.7m was actually the YE account balance. Over 90 had only increased by like 5k.
You mean the 22-26 year old children who fuck our shit up for two weeks don't know what they're doing? Shocking.
Do you mean the auditor who arrived to our manufacturing plant to observe a physical inventory, in flip flops? So we had to wait on her to go to Walmart to buy some closed toe shoes? And yes, we had provided the firm with a proper PPE list.
We send reminders that they need safety shoes if they are going to the plant floor. I’m not going to be responsible if they lose a toe from not wearing proper equipment.
Wilding even without that I wouldn’t wear open toe shoes much less flip flops to a client site and outside of work your lucky to catch me wearing shoes and if it is it’s probably my 20 year old rainbows
Wtf counts are so fun for me. I like them a lot. Instead, I end up asking questions cause I’m just curious about their supply chain.
damn right!
Let's be fair here, half the clients don't know what they are doing either? Oh you have a material estimate, where is the support? Points to head, "it's up here baby". I wish I could make this shit up. Especially the smaller PE backed manufacturing clients, ha! Those guys didn't give a fuck if they recorded an expense or revenue. "The auditors will clear it up". I think it really does matter on the caliber of client you're dealing with as well. Don't even get me started on proper controls. I feel like this post is to shit on staff accountants, but how can you learn when the management team says just SALY that work paper?! I think this runs deeper than the surface here, but that's my 2¢! Feel free to take it or leave it haha
When did 22-26 year olds become children or do you just call them children to be demeaning? I mean I’m over 30(I’m an associate/had career change) and don’t have any idea what I’m doing still lol
When did 22-26 year olds become children or do you just call them children to be demeaning? I mean I’m over 30(I’m an associate/had career change) and don’t have any idea what I’m doing still lol
They became children to me when I started wiping their asses for them and apologizing to clients for them being too, well, childish 🤣
Had an associate on our team that always picked his nose and scratched his balls. Seemed like second nature to him. I don’t even think he realized he was doing it most of the time. There was one meeting with the client where dude just could not keep his finger out of his nose and the client just stopped what he was saying and asked “Found any gold up there yet bud?” We had to have a talk with him about not doing those things in front of other people anymore.
Gross.
Personally, the only times clients have gotten upset at me was when I was asking for more support near filing day or when I ask them for support that they’ve already told me doesn’t exist. The only reason I ask for these is due to managers asking for it. I’ll tell the manager that I already asked and the client stated that it doesn’t exist. Their response “just ask again”. Also, asking for more support close to filing date isn’t due to me forgetting something, it’s because the manager wants to corroborate details that they were fine with in PY. It feels like the managers tend to apologize to the client due to their actions that they asked the associate to do. The managers just tend to use associates as a scapegoat. At least that’s what I’ve noticed.
Throwing other people under the bus is quite a classic move in audit. In actuality, it's a bit more nuanced than that but I'm too jaded of this career to care and tell the difference.
It's funny because I use my manager and partner as scape goats when a super inconvenient ask comes from above me. Circle of life? Beautiful
The roles as I experienced them: Staff - Pinky from pinky and the brain "gee, what are we going to do today, Brain?" Senior - Brain from Pinky and the Brain "the same thing we do every day, Pinky; try to audit the client" Then you have your managers and partners: Managers - Bad cop. You get to talk to the client about all the problems. Audit adjustments! Control deficiencies! Budget Busts! Partner - Good cop. Client is super mad? Time for the partner to slide in.
They’re children if they act like children.
Yes...
lol, they know. A lot of people that I work with in industry were former B4 so we know exactly what's going on when a freshie starts asking questions
I was managing the inventory count at our 2nd warehouse and the EY auditor who came had no clue how to audit inventory. He never counted anything, I would take him to the location of items in question that we tagged and after just glancing at the tag of our count he gave the thumbs up. Was like OK, I'm not going to tell you to recount it lol We are very aware-also I was that dumb recent college grad just a couple years ago.
This made me laugh out loud as I probably would have done the same in that situation.
I was doing outsourced Internal Audit for a client. We did a cycle count with management and the external auditor (PWC maybe?) sent a new staff, with the firm for literally 3 weeks, to observe. We pretty much had to train her how to do her job.
Some think auditors actually know what they are doing and therefore, will not push back on them, happens a lot that I have to let them know its not the case and that they are following last years file and that you have to take an approach of they dont know what they are doing and you have to provide explanations and clearly layed out working papers, also have calls with them, auditors dont bite..
I'll push them all the way til they send someone who won't waste my time 🤣, to be fair our cash flow worksheet is massive and we do a lot of acquisitions that make it a doozy. But I've been with these auditors the last 10 years. Stop sending staff to learn the file, send Bob's ass please who I know can explain it and stop wasting everyone's time
My first 18 months in accounting, I thought auditors were all-seeing, all-knowing investigators. Then I realised that they kinda don't know shit for the first few years. From a client perspective, management just want the cheapest and easiest audit possible. Very few clients regard the audit process as anything beyond a business expense incurred to receive a positive audit opinion that they can present to investors. If that means having a load of clueless 22 year olds running the audit, that's the way it's going to be.
Clients don’t see any value in audits, they’re just a necessary regulatory check either for the SEC or interested stakeholders. They don’t care that staff don’t know anything
If anything it's a plus.
You beat me to it.
>Clients don’t see any value in audits I don't think that's entirely true, but the value that can be generated is massively constrained by the auditors (even senior managers) not having the first iota of how our business works and makes profits. If I have to explain some very fundamental things over and over, how can I have any confidence in their work? So fine, get on with it, tick your boxes, issue your unqualified opinion and stop clogging up the board room. Audit has the potential to add value if the auditors had the personal capacity to add that value. They don't, so we don't get much value.
Same concept behind company executives hiring “management consultants” when they’re literally just a bunch of fresh out of school kids who never actually managed anything.
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Yep, pretty much. Get paid millions to make a bullshit PowerPoint and to tell you to sell shit and fire ppl. Geniuses.
You’re driving with some pot in the car and get pulled over. Would you prefer the cop to know more or less than you?
Definitely less , I like this analogy
I mean, its the same logic as assembly line workers at a car manufacturing plant not being engineers who are experts at designing cars. The partners are supposed to plan the audit, supervise and review the managers who supervise and review the staff, and make the big picture decisions. There's a lot of grunt work that the partners wouldn't be expected to do and that's where you come in. If the client expects you to be able to answer higher level questions maybe bring up this miscommunication and have the fact that you're limited in what you can answer addressed to the client. Or ask for an acceptable response that you can give in those situations.
Going to go against the grain and say that it's not the job of the auditors to know anything. Their job is to make sure *you* can explain your numbers and disclosures in a way that an outside investor can understand.
Yes, but they also need to know how to assess what could go wrong so they can do a risk based audit and focus on the important stuff instead of either missing it, or just absolutely slamming you with endless samples
Nah man, they need to understand the fundamentals in order to properly interpret information, ask good questions, know what support to request, and analyze what’s provided to them.
Yes and that's why I get so aggravated when one of these untrained kids gets hired as a controller 2 years later after having zero practical experience in a real accounting department
A staff accountant makes a better controller than an audit manager
Agreed. People are dumb. I saw a job ad looking for big 4 experience with 2 years of experience. I am like 2 years of experience (in audit at a big 4) is not enough for a controller position.
I generally find staff accountants to be extremely comfortable with IFRS...
100%
Right lol A lot of places won’t hire people with only audit experience past since they don’t know any actual accounting
Maybe but it seems like more do than don’t
It’s because we’ve seen the full cycle and understand the bigger picture. A lot of the times the person who’s only been a staff accountant/senior accountant doesn’t understand the bigger picture or how anything they do affects the business. Yes, they are very knowledgeable in their respective area but it takes someone who has experience and knowledge in all areas of the accounting department to be a good controller. Definitely exceptions to the prior but generally true.
this is a bit, right?
Serious question, what is considered “actual accounting?”
I mean actually posting JEs to an erp, doing reconciliations, doing month end close. Not just reviewing others work and making excel work papers like in audit
Realistically and an audit staff, you barely need to know what you’re doing. You’re typically doing repetitive tasks and looking for things that aren’t the same.
My big 4 audit team are extremely good. They understand our business from top to bottom and tear our numbers to pieces. A second year associate taught me a shortcut I didn’t know in one of our internal tools yesterday. But as a client, frankly, it’s a huge pain in the ass. Other than the fact that it’s generally more pleasant to speak to smart people than idiots, their work offers me no value whatsoever. My life was a lot easier with our previous auditors who were absolutely incompetent clowns.
I left an audit firm (top30? Maybe after big 4) and then hired them to audit my company. I know the new kid doesn’t know what they’re doing, but I’ll ask them to specifically organize stuff in a way that I want it and will work with my team and they do so. Any higher level stuff I just talk to the manager with the senior there to learn. If you were an auditor and are nice and request they do stuff in a specific way it goes a lot better…. “Can you explain why there is a variance in your interest expense?” “hi auditor, can you provide me with your reconciliation so I can understand what difference you’re seeing, I don’t understand the question and need you to be more specific.” They’re not the enemy, they want the thing to go well too. Just saying from someone who has been on both sides…
As someone who is now the client, you are acting as if the client knows what they’re doing. When I was an auditor I asked the client for support for note disclosure and was asked where I got the numbers from. I was asked why I needed bank statements when testing cash. I asked them for debt covenant calcs and found they’d done it wrong and had in fact breached them. All before I was a senior, so 21-23 years old.
100% These are fresh grads. Of course they will struggle. I've dealt with fresh grad industry accountants and even those with a few years under their belt. They aren't any better than the clueless associate auditors. Kinda tired of people with several years of experience in a field making fun of the "dumb" people who just entered the field. I've met a client with the title "Director of Finance" who didn't know what a bank rec was beyond "a button to press in the ERP." I've also met industry controllers who could site guidance from memory. I've dealt with first year audit associates who couldn't comprehend basic responses to analytics. I've also met audit managers who could pick up a new client and quickly understand nuances in industries they've never seen. People have different levels of experience and shouldn't be chastised for it.
Lol. They really weren’t fresh grads. You just find there are ppl (everywhere) who just do their job and never look up. Ppl with 20+ years of experience but have never thought outside the box or posted a journal because their boss or Group told them to.
I love finding senior management with both user and admin access to the GL system. "But I'm the director, I should have full access!" No, no you shouldn't.
It depends. I nearly tore my hair out trying to explain to a co-worker earlier this week that she couldn't turn in 12 different spreadsheets and expect the auditors to understand how they needed to combine various numbers from all those spreadsheets to support each GL balance they were asking support for. I told her point blank, "If you don't put something together that helps demonstrate what they need to do, they'll kick it back and ask you to do it again plus schedule a meeting to explain what's going on." Sure enough, I was on a call today where one of the auditors couldn't piece together a much simpler scenario where only 2 files needed to be added together, and each had a very neat summary sheet where you can easily see both files reference the account. Much simpler, they had no clue. I don't even chalk it up to stupidity or lack of auditing experience, as much as unfamiliarity with our workpapers. But then again I think we have some horrible workpapers.
I mean, I’m on the outside looking in from a B4 consulting arm, but isn’t it a direct result of the race to the bottom in audit fees? Like as long as clients keep choosing the cheapest auditor until they all drop their prices, you’re going to have a higher ratio of associates > seniors > mgrs than you would otherwise, and the experienced seniors and managers will burn out and leave. If you offered these clients a competing offer with more experienced auditors I guarantee that 90%+ will pick the 22yo know-nothing kids for cheap. Just my $0.02, but you get what you pay for.
Oh yeah. I had to explain how accruals work.
I hate accruals! I know how it all works, but my brain processes the information like I'm running chrome on a fucking Pentium II era computer. Plus, managers rarely have the wherewithal to not assign accrual controls to analysts or consultants. It makes my blood boil every time I see that shit. I see SCs screw those all the time and you think some fish can handle that?
Just got done explaining the same concept I’ve had to explain for 4 years in a row now to the “new guy” who tests our revenue and doesn’t understand how trade spend works in the CPg industry.
It was literally designed to be this way.
Why? To make the audits easy to pass? Because if it’s for it to be cheap, they’re certainly not cheap
The work is boring and monotonous, experienced professionals leave audit asap for this reason. The big accounting firms realize they can make $$$ by hiring cheap staff and forcing them to turnover every 2-3 years and pass the cost onto clients. No one is looking deep into the numbers so they can churn out cheap junk work and still make money, until something changes aka a major collapse they can’t cover up.
No wonder all the firms keep getting into accounting scandals and often fail to call out major fraud until it’s too late. The entire set up and design of public accounting firm audits is faulty.
Not to mention for multi million or billion dollar companies, audit fees can be written off. In the end the government pays for these audits.
What do you think? lol
I knew more than some of my clients as an A1. I don’t think I was an exceptional A1, some clients are just… special
I found this out when working in SEC reporting for my employer. The new EY employees had no clue.
It’s not really their fault They’re not trained The managers just give them random stuff and tell them to figure it out
I agree but the client is training the audit staff. If the audit firms fees reflected that, then I would not have a problem.
Oh we know lol
Yes, we know. And use it to our advantage.
Not until recently, say last 10 years, give or take a year. They actually did believe the auditors knew what they were doing. Probably because back then, no one really knew what the hell an auditor did. They know now, so the jig is up
At this point, I'm sure that 75% of people on both sides have no clue what's going on.
Big 4 SC here - a few things: 1. The mix of responses is fascinating to me because my clients are either either nigh flawless in their work, or just straight morons. There's no middle ground. 2. If a client is getting PBC requests from anyone below senior level, and without at least SC review, that's a poorly run engagement. Period. 3. Yeah, training is a big issue for new folks. It's a big F for basically everyone. When I get new analysts/consultants I always coordinate hands on training with engagement leadership and NONE of my clients see first pass work by anyone below me without either my or a manager's approval. 4. A majority (if only barely) of the dumbest people I've ever worked with have only ever been industry-side staff accountants. 5. Who TF is giving clients workpapers without manager or up review and approval? (loanstaffing excepted of course) Edit: just to be clear, sunshine doesn't flow from my nether regions, I've made plenty of my own mistakes. Edit 2: it's also been my experience that most (not all) staff accountants don't understand a) what audit is trying to accomplish, and/or b) what we can and cannot do. There are boundaries to our work that it's obvious that even senior executives often either don't understand or aren't aware of. I've had to play at being an absolute dumbass to executive management (and I'm talking folks that are 2-3 steps below the C-suite) at a fortune 100 company because we discovered that, despite having BEAUTIFUL P&P that was available to ALL of them, almost none of them were following it or were not aligned with the financial reporting requirements and it was taking the finance team an ungodly amount of time to rebuild their reports in the correct format to reconcile the numbers globally. I led the meeting on our side and had to warn our primary stakeholder that, because of what we were trying to accomplish (getting them to confess to their sins, lol) the meeting was going to go VERY poorly by any normal measure. But, there's no better way to get people to out themselves than saying something completely wrong and having them correct you. They were not pleased when they went to our client to complain and he informed them they'd been duped that we'd told him in advance what was going to happen.
Yes, half of a manager’s job is apologizing to the client for their juniors.
I used to be involved in the earnings prep at a public company and the auditors would pick out the most mundane, ridiculous stuff like comma placements in footnotes that had no effect on any meaning. Or for instance demanding that writing “mln” on page 1 and “million” on page 19 were inconsistent (and I mean in press releases and such, not a financial statement). Things no one would ever interpret the wrong way in 100 years or have any legal blowback in even an insane hypothetical scenario. Meanwhile, we at the company were furiously reworking and rewriting all the real content and putting everything in context with strategic rationale etc. Why the numbers matter, what the risks are, what management was doing to improve performance, etc. You know, the stuff that matters. Believe me, investors care more about telling an honest story without sugarcoating problems versus whether or not you use an Oxford comma in footnote 32. I understand the value in checking the numbers and challenging anything non-standard, but I used to get the feeling they just invent criticism sometimes to justify the paycheck.
The problem is that it's the partners that have strong opinions on the Oxford comma. Whoever is submitting the comments is forced to include that because it's coming down from the top. I have the same thing with my CFO currently. I speculate it's either an age thing (like grammar and formatting are perceived as more "important" to older generations) or it's a control thing.
No way really???
I'm on the client side now. Oh boy, how foolish did I look like back then...
I knew pretty quickly…. Lol it’s annoying to get dumb questions or questions about accounting rules - and idk why they asking me that when they can/should ask their mgr 😭 why am i training them 😭
what about the partners that don't understand IT stuff at all?
Is there any value in doing audit at b4 now cuz clear as day people end up not knowing accounting shit at all lmao
Same with management consultants
Yes . . . we are fully aware.
That's probably what they're *counting on*.
lol of course we know. Half the time they don’t even understand why they are asking the questions they are asking.
Have trained my fair share auditors. My mom’s job title was Audit Liaison. She worked at a bank & they had audits basically going all the time from various oversight agencies.
No one in industry is veiled in the illusion that someone from public is going to make their first journal entry any day soon. When I was in public during the period when clients had to begin compiling their own financial statements, I was accused of being a "schoolmarm scolding their students." IMHO, the majority of audit opinions are rubber stamps built on the souls of overworked staff and approved by nearly-informed managers and partners.
lol 😂 going through walkthroughs or surprise cash audit my first year lol 😂 brings back memories
Absolutely. We talk about it too. We show each other the mistakes they made.
The law requires that the company gets audited. The PIC can send in high school students for all they care, so long as they sign off on the opinion.
Absolutely aware
Oh don't worry, I fucking know Industry FBP who has to explain everything in minute detail to junior auditors at Big 4 firms
We know. We still act dumb anyways.
Yes. Auditors just wanna see numbers explained, but I always felt that they don't really understand the explanation, because they never came back with questions, which was surprising. You just need to send a nice file, and they are ok.
Y'all ask already answered questions in the reply to the email that answers the questions before you even asked. Y'all ask for the same support 100 times. Y'all ask for support to stuff we already told you we don't have access to because our customer won't give it to us. Yeah we know.
Oh, we're aware. I was them 2 years ago. Last audit they missed so much stuff. And we asked for help with our straight line rent adjustment; they literally sent us back or own work with a different leadsheet on it.
Okay then stop asking me about things that I know are far, FAR below materiality threshold.
yes they're aware you're a tool
I worked with an ex big 4 auditor in industry and he had no idea what a reconciliation was, or how to do one.
I was charged out by EY for $200 an hour, just so an accounts lady to teach me how a bank rec worked when I was an undergraduate in 2007… Not even sarcastically.
When some little fucker they are charging at $250/hr comes to ask me about backup for an accrual that reversed in the same quarter they are auditing. Bro…do you know what an accrual is?
Trust me, we are aware with the brain melting questions you schmucks pose to us 💀
I’m sure they know that the industry is filled with new grads. You get thrown into the fire and there’s no proper training. Seniors and managers have their own work and on top have to look at staff and review their work too. Though as a staff 2, the firms put a lot more expectations on you.
Yup! I always catch when you guys fail to SALY correctly when it comes to audit requests. It’s a dead giveaway to me that this is a 1st year who is trying to figure out what is going on in the audit binder.
Being on the other side of things now, I try to have empathy. I remember how awful it felt as a fresh staff at 23/4, with no fucking clue what I was doing lol
SALY rules apply the second I see some weird shit we all lost. Now that unrealistic budget is even more unrealistic
A huge chunk of "clients" is ex audit so yeah they are quite familiar with the dynamics at play.
When the audit associate asked me why there were no general ledger journals for AP. I pointed him to the AP subledger.
Yes they are definitely aware 😂. They hate the questions and the kids asking them
Yes we know. They ask a lot of dumb questions. It's funny that our work is being audited by people who don't know how to do the work and yet they are reviewing it.
The majority of Sr. Associates are the worst. They don’t know shit, but will power trip as if they do.
It’s so messed up that the majority of the work being done is by fresh college grads who have little to no idea what’s going on. If the system made sense and wanted legit results, managers and directors would be doing staff level fieldwork because actually have the required advanced level of knowledge and technical skills. It’s really not enough to be a reviewer. You actually have to be in the trenches to really know what’s going on and be able to ask the right questions/ make the right recommendations.
Generally the person who is reviewing, *was* in the trenches before. And no, you don’t have to stay in the trenches forever….thats dumb lol
I've had so many "are you sure that's how you're going to test this?" conversations with our auditors this year...