Public Accounting: Audit or Tax?

College Majors Business Major
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<p>I am currently an accounting major who is looking to go into public accounting. The problem is I haven’t taken a tax or audit class yet. The classes I have taken are intro to financial and managerial accounting, and information systems. I want to start building my resume now towards one or the other. However, I don’t know what is a better fit for me.</p>

<p>If someone could share their experiences with one or the other that would be great.</p>

<p>The things I want to know is:</p>

<p>What does your daily work consist of?
How is the nature of work like?
What characteristics do you think you need to enjoy the work?
What are the pros and cons?
Where does each field lead you in the long-run?</p>

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<p>Well there are pros and cons to each. Moreover, the work varies with each.</p>

<p>Audit: pros:
You work in teams,which is more “fun.”
There are a LOT more audit positions than tax. Every government agency has an audit division.
Long term , you can make as much money with audit as with tax.</p>

<p>Neutral: You must have a thorough understanding of accounting standards and audit standards.</p>

<p>cons: Because there are audit programs, many firms have the thinking that an “educated guerrilla” can do an audit. If you are not , therefore, very efficient, you won’t last at a public accounting firm.</p>

<p>Tax: Pros: Usually takes a lot more specialized knowledge. Thus,job positions tend to be a bit more stable than audit.</p>

<p>They tend to pay a bit better for tax pros since firms don’t view the positions as “anything an educated gorilla” can do.</p>

<p>Neutral: You must have an understanding of the Internal Revenue Code, regulations and rulings and know how to do tax research.</p>

<p>Cons: There is little teamwork in tax preparation. You are on your own much more than with audits. Tax also can involve some very sophisticated analysis and research.
If they change the tax code to a flat tax or sale tax, tax positions can disappear. However, there will always be openings for auditors.</p>

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<p>@taxguy</p>

<p>You said:</p>

<p>

</p>

<p>Are you stating that job stability is “rocky” for an auditor at public accounting firms? Or at least, is it “rocky” at the entry level? If so, then where would one be more stable as an auditor?</p>

<p>Also,</p>

<p>

</p>

<p>That worries me. I was thinking about going into the tax program at Baruch (1 year Master’s in Taxation to sit for the CPA exam). Could you elaborate?</p>

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<p>Auditors get evaluated on the competance of the audit and the efficiency of the audit. I wouldn’t worry about the government changing the tax system.</p>

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<p>Nice response tax guy.</p>

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<p>

Is it harder to get into tax than auditing taxguy?</p>

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<p>Do the area of accounting that you enjoy. Without any background to the subject (no classes), you have no idea what the information is even like. </p>

<p>You can only plan so far and you are trying to hit a homerun in one swing before you even know if the pitch is hittable.</p>

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<p>Tax has fewer positions. Typically anywhere from 10-25% of their practice is tax while audit is 60-80%.</p>

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<p>What about advisory?</p>

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<p>Advisory is typically a pretty small venture at this point in time. 10-20% sometimes a little larger.</p>

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<p>Audit opens a lot more doors. You grasp strong financial analysis skills, which can lead to finance jobs (Corp finance). Or Audit -> MBA -> Other Finance jobs is much easier to transition than starting in Tax.</p>

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<p>So would most of you agree that going into tax is “more” for people who plan to further education, ie. tax law?</p>

<p>Edit: I’m not saying that’s the ONLY option. Just asking if it is the common one.</p>

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<p>ijamji, you don’t need a masters in tax to go into tax law;however, most tax professionals do have a masters in it or a law degree or a law degree and a masters in tax.</p>

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<p>"Tax has fewer positions. Typically anywhere from 10-25% of their practice is tax while audit is 60-80%. "</p>

<p>Barely correct. The revenue split is around 50/25/25 audit/tax/advisory in the Big 4.</p>

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<p>Revenue split and the amount of staff hired to produce that revenue are two completely different things.</p>

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<p>acaden, revenue does not mean job openings. Bad. But regardless of that statistic, tax jobs are less plentiful.</p>

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<p>Audit: Its a lot of work. In a public accounting firm you basically don’t have a designated work space because you are always on the road. Interaction with clients, working in teams, I don’t agree with Tax guy that an educated gorilla can do it, if that’s true so is Tax.
Tax is more like you go to work to the same place everyday, not really in groups, less client interaction, little or no travel. It pays a little bit more in the beginning since you are specialized but in the long run audit and tax balance out. Both tax and audit are a lot of fun. I experienced both. If you like law then tax is for you because its a lot like law. A lot of people get their law degrees and then can work in international tax.
Advisory has the best of both worlds. You don’t really need a CPA but if you have a MBA is better. Extremely hard to get in. Pays the most. But a lot of traveling, long hours and hard work.
My advice is pick what you really are passionate about because I feel like a lot of my peers at my university want to go to the big 4 just because its the big 4, they don’t really think that basically your job will be your life. You work extremely long hours in regular season and busy season is just crazy.
Audit and advisory gives you more opportunities to find a job if you ever decide to leave the firm. Again tax will pay the most if you leave the firm and become a tax manager or something else in a private firm or a company. But the jobs are harder to find. If you are going to tax I will recommend international tax. It’s fun and it open more doors for you.
And in my experience and what I heard from people I had the pleasure to worked with that are Tax managers, they agree ,even if you want to go to tax is extremely helpful to have the audit experience.If you can think like an auditor and also understand tax codes the sky is the limit ad I believe anyone can make it to partner, it,s not easy but its possible. Good Luck!! </p>

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<p>This is a 2011 thread.</p>

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<p>Keyblade18, “I never said that an educated gorilla can be an auditor nor do I believe it.” What I said was that the perception among companies is that an educated gorilla can be an auditor. </p>

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<p>Is there a way that an accounting professional can do both audit and tax? Would that be for private companies only? Thanks.</p>