It was a classic career path, but with a twist: after spending six years at a midsize CPA firm, John Doherty left to become the controller of a regional bank. From there, he moved on to a division of John Hancock, where he was director of financial reporting. That positioned him to advance in corporate finance to, well, almost anywhere. Yet after a mere six months at Hancock, he leapt at an opportunity to go back to his old CPA firm.
A significant jump in salary was one factor. So was the chance to enjoy more-flexible work hours, a greater diversity of work, and the satisfaction of contributing to revenue rather than overhead. “Working at a company, you’re constantly watching the bottom line. The stresses of working at a CPA firm relate to client satisfaction, which is easier to manage for me,” says Doherty.
All over the country similar scenes are playing out as accounting firms large and small sweeten the pot in order to lure or retain employees. The Big Four have doubled their assurance staffs in the past five years and are expected to nearly double them again in the next five, thanks largely to Section 404 of Sarbanes-Oxley. Smaller accounting firms, their client rosters expanding thanks to new rules on auditor independence, are also upping the ante. Add to that a precipitous plunge in the number of accounting degrees granted in the late 1990s and disaffection with corporate finance jobs, and suddenly the labor pool is roiled by a perfect storm, one that CFOs readily admit is difficult to navigate.
Nearly half of the CFOs surveyed in late 2005 (see “How CFOs Confront the War for Accounting Talent” at the end of this article) say that it is somewhat or very difficult to hire qualified finance staff. “It’s an extremely competitive hiring environment today,” says Craig Nickerson, CFO of Dynetech Corp., a privately held business-process outsourcer based in Orlando. After a five-month search, he recently hired a senior staff accountant away from Deloitte & Touche but is still looking for an accounting manager for his 33-person finance team, a position the company expected to fill this spring.
Nickerson says competition has not only driven up CPA salaries by as much as 25 percent in the past several years, but now he must contend with public accounting firms that “provide signing bonuses and a lot of fluff benefits that they’ve never offered before.” And there is competition as well from other corporate finance departments. Dynetech had a 10 percent turnover rate among finance staff in 2005, about double its historic average, largely because people had better offers from other companies.
Even though enrollment in accounting programs has risen over the past few years, the demand for CPAs currently outstrips supply by as much as 20 percent, and relief appears to be a long way off. “We’ll have an incredible shortage of accountants for the next 10 to 15 years,” predicts Allan D. Koltin, president and CEO of PDI Global Inc., a Chicago-based consultancy for accounting and other professional firms.