SARA HOPKINS / Special |
| Stacey
Johnson, who got a master's degree in accounting from Georgia Southern
University in May, was able to exceed her goal of landing a $50,000-a-year
job within two years. |
10-20-05
New accountants
cash in on demand
>>
HA&W News Archive
By ROBERT LUKE
The Atlanta Journal-Constitution
Stacey Johnson
is keen on problem solving.
That talent
has landed her a job that pays nearly $50,000 right out of Georgia Southern
University.
"My goal
coming out of school was to make $50,000 within the first two years of work,"
says Johnson, who graduated in May with a master's degree in accounting.
"And my offer from Habif, Arogeti & Wynne [Georgia's largest independent
accounting firm] exceeded my expectations and goal."
An acute shortage
of accountants, particularly for internal audit work, has prompted accounting
firms, and businesses such as BellSouth, to aggressively court both freshly
minted and experienced accountants.
The shortage
is compounded by a deluge of work driven in part by new government rules
to improve financial accountability.
As a result,
salaries are rising, with many receiving double-digit increases.
"It's
somewhere between 12 to 16 percent higher than it was a year ago,"
says Brian Swaney, a partner at the Atlanta-based FirstPRO search firm.
And firms are
offering other inducements, such as bonuses and flexible work schedules,
to retain top talent.
The shortage
has its seeds in the late '90s, when accounting fell out of favor with business
majors. They flocked instead to finance and information technology to participate
in the dot-com boom.
As a result,
the number of graduates with degrees in accounting fell to 44,695 in 2001-2002
from 61,220 in 1994-95, according to the American Institute of Certified
Public Accountants.
That trend
reversed course in the last two to three years. In 2003-2004, for example,
53,760 students received degrees in accounting. And indications are, many
more graduates are in the pipeline.
At Emory University,
for example, there are 36 accounting majors who are seniors this year, against
26 last year, according to spokeswoman Elaine Justice.
While enrollments
are climbing nationwide, some schools can't accommodate more.
"We are
basically at capacity," says University of Georgia accounting professor
Dennis Beresford, citing budgetary and other constraints. UGA admits about
175 new undergraduate accounting majors each year and roughly 100 master
of accounting degree candidates, he says.
"We could
probably produce twice as many, and they would still find jobs quite easily,"
says Beresford, a former chairman of the Financial Accounting Standards
Board. "I'd say for the foreseeable future, this is the golden age
for accounting students."
Tougher
standards
Some schools,
working with accounting firms and businesses that hire their graduates,
have tightened standards as well.
"We won't
let anybody into accounting unless they have at least a B average in their
accounting principles course, which is the course that everybody in the
College of Business has to take," says Jane Mutchler, associate dean
for academic planning and programs at Georgia State University's Robinson
College of Business. The change took place 18 months ago, says the former
director of the School of Accountancy.
The scarcity
of accountants comes at a time when accounting firms and publicly held companies
are scrambling to comply with federal law that requires management to assess
the effectiveness of its internal controls over financial reporting.
Congress passed
the Sarbanes-Oxley Act of 2002 in the wake of corporate scandals, such as
Enron. The law seeks to improve the quality of audits, enhance the financial
expertise of corporate directors and boost the accountability of managers
at public companies.
By some estimates,
audits are taking as much as 60 percent more time to complete, and at higher
cost.
"It's
a double whammy," says Dan Simms, referring to the increased workload
and dearth of professionals. Simms is managing partner of Habif, Arogeti
and Wynne, which has 141 professionals. The firm has increased its staff
by 32 professionals so far this year, compared with none last year and six
the year before.
"We currently
have openings for at least 10 individuals at the manager-and-above level,"
says Simms, referring to those with five or more years of experience.
Another reason
for the new hires: "We have picked up substantially more business,"
Simms adds, estimating a 15 percent increase in revenue for the firm this
year over last. "It's coming as a result of changes in the industry,
with the Big Four [accounting firms] increasing prices and the fallout of
the middle-market clients from the Big Four."
BellSouth,
too, has left the "help wanted" sign out, particularly for auditors
whose task is to make sure a company's accounting records are right.
"The main
reason we have increased the number of auditors is the additional work of
Sarbanes-Oxley," says Jeff Battcher, a BellSouth spokesman.
The Atlanta-based
company now has about 70 auditors. It hired eight earlier this year and
is looking to hire 12 more.
"We are
in a continuous hiring mode," Battcher says. "We continue to use
every means available to retain and attract auditors. For example, we have
increased our salary for new hires and our existing staff by approximately
16 percent this year."
BellSouth also
is awarding retention bonuses of thousands of dollars, depending on work
experience, to get auditors to stay at least another year, Battcher says.
"Even
so, we're losing a lot of good auditors to the public accounting firms,
to other corporations, even to the Public Company Accounting Oversight Board.
We lost a very good auditor to them last week." The PCAOB was created
by Sarbanes-Oxley to oversee auditors of public companies to protect the
interest of investors.
Deloitte &
Touche, which has hired between 50 and 100 new people in the audit, internal
control and data security field in each of the past two years, currently
pays a bonus to employees who refer somebody to the firm who is hired.
"Right
now the bonus we're paying for audit talent is $10,000 for a senior or a
manager," says Peter DeMartin, Southeast recruiting director.
A senior accountant
has three to five years' experience, while a manager has between five and
10, he says. Paying the referral bonuses has an additional benefit, DeMartin
says. It aids retention.
The larger
the accounting firm, the higher the professional staff turnover, according
to the AICPA. Last year, turnover at firms with more than 200 CPAs averaged
17 percent, against 12 percent for all firms.
"A lot
of students feel the public accounting firms are kind of a training ground,"
says Beresford of UGA. "They will eventually move into the corporate
world, usually with an increase in pay.
"It's
also a lifestyle change," Beresford adds. "The accounting firms
work their people very, very hard. In the corporate world, they still work
hard, but they don't have to kill themselves three or four months of the
year during the audit or tax season."
Likely
to continue
Bill Driscoll,
president of the Southeast district of the Robert Half International search
firm, says the bonuses and fatter paychecks are likely to continue next
year.
"What
we have seen in the last year is multiple job offers and a much shorter
window for candidates to find a new position," Driscoll adds.
That puts Stacey
Johnson and others like her in the catbird seat.
Johnson, 24,
gained firsthand experience in audit and tax work while interning last year
at an accounting firm in Warner Robins, her hometown. Among her tasks was
verifying that payments made by a sample of customers of an electric membership
co-op actually went into the utility's bank account.
"We do
this to ensure the accuracy of the financial statements," says Johnson,
who professes a love for her work.
"It's
challenging. It's ever-changing. There are always new rules and regulations
and changes in accounting standards. There's a lot of problem solving involved.
There's not always a quick and direct answer. Sometimes you have to do a
lot of research. It's not just cut and dried."
HIRING
TRENDS AT CPA FIRMS ('04):
• 19,705:
New accounting graduates hired
• 44:
Percentage of professionals who are women
• 53:
Percentage of women among new graduate hires
• 10:
Percentage of professionals who are minorities
• 23:
Percentage of minorities among new graduates hires
Source: AICPA
SELECTED
SALARIES ('05):
• Director
of audit & tax for a large accounting firm
$81,750-$125,000
(up 5.1% from '04)
• Internal
audit manager of a large company
$69,500-$90,000
(up 12.5% from '04)
• Senior
audit & tax accountant at a medium-sized accounting firm
$48,250-$62,000
(up 9.7% from '04)
• First-year
internal auditor at a small company
$34,000-$38,250
(up 14.7% from '04)
Note: *Add
10 percent for graduate degrees or professional certifications. Atlanta
salaries estimated to be 9.6 percent higher.
Source: Robert
Half 2005 salary guide
>>
HA&W News Archive
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