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Momma, Let Your Kids Grow Up to Be…Accountants!

Times are not tough everywhere. Indeed, The Big Four accounting firms: Deloitte & Touche, Ernst & Young, KPMG and PriceWaterhouseCoopers reported annual combined 2008 global earnings in excess of $102 (US) billion and a blended growth rate of almost 16%. $102,775,000,000. Shall we let that sink in whilst you catch your breath?


The 581,423 people employed directly by them have some of the best paid professional jobs in the world. The nice thing about this profession, even in receivership or bankruptcy, the accountants and the lawyers always get paid. Sitting quietly in the background during these processes is a very nice place to be indeed. Too, with the toughening of regulations that came with the passage of Sarbanes-Oxley, companies now must conduct much more thorough audits and one can here the ding, ding, ding of the hourly cash machines within these firms.

Accountants are also very good at controlling expenses and managing numbers since that is what they do for a living. So looking at the chart below and even assuming they let expenses for people, buildings, office supplies, computers and travel get so out of control they consume 75% of the above figure, the partners of these firms still put an average of $769,000(US) per partner into their pockets.

More realistically, they probably controlled expenses to somewhere between 50% and 67%. The effect was to raise that per partner earnings number to somewhere between $1 and $1.5 million dollars. So the competition for those partner slots (and one can be assured a junior partner earns far less than this average number) is fierce.

Inside Big Four firms are competitive cesspits where only the strong survive and prosper. Climbing to the top is done over the backs of others and the 12-15 years it takes to get there produces an interesting blend of people. It’s up or out so Momma, they need to be tough and strong, just like cowboys/cowgirls (diversity being a key buzzword although in practice few firms have yet to pass the 25% mark in terms of numbers of women and minority partners), to get there.


Now I have a unique insight as between 1986 and 1993 I worked for one of the Big 8 firms that was merged into another to create the Big Four. Arthur Andersen folded during the Enron scandal and the rest paired up or expanded globally (KPMG was Peat Marwick Mitchell that merged with second-tier firm Main Hurdman).

What I have always found most intriguing is that most Big Four partners could not make the money they do in any other field than an accounting firm. Many who leave the ranks or fail to make the partner cut go on to significant six-figure corporate CFO positions, but their main qualification is survival.

I found it intriguing to see the dearth of post-educational business degrees within the partner ranks because the almost fraternal system bred intense loyalty to firm and work product excellence over anything else, even expanding one’s educational horizon. Too, the lack of people and communication skills at the partner level is stunning.

I once had dinner with a young man in Houston who was a ‘lock’ for making partner. Everyone before the business development session I ran said the guy was a superstar and would be on the next partner list. When I told him this, he stared at his plate for a few moments. He finally said “thank you. It’s funny that I have to hear that from you, a stranger to this office, but never from those with whom I’ve worked side-by-side with for 11-years.”

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When you compare finance and accounting you’ll find that most firms heavily recruit from universities with top accounting programs and the competition for the best students is fierce, yet the entry requirements are onl an undergraduate degree after 4-5 years of university study in business and accounting.

While the incubator that is a Big Four firm encapsulates them in an intense cocoon environment of continuing education in their field and some of the top performers pursue firm-funded MBAs, the percentage of those who make it is miniscule and the longer one’s career last within a firm, the bigger the fall.

So one is heavily wooed at 21 or 22, paid a very handsome salary and benefits, given amazing global experiences with large companies, moved up through the ranks towards the brass ring of partnership and then falls short in their 11th or 12th year. They are then 34, their entire life has been this insular world and pursuit so in the words of the fish bobbing in plastic bags on the surface of Sydney Harbour after making an escape they planned throughout the entire film, Pixar’s Finding Nemo, “Now, what?”

Yes top financial positions are always available but what of the human side, the feelings of rejection and true pain for them. They are quite real and mostly… glossed over. To add salt to the wound, the partners then add the recent failure to their “alumni list” and expect to retain their loyalty after such a public snubbing, then scratch their heads in true wonderment when payback hits them equally as hard in the loss of a big client.

Alas, even those are probably factored into the equation as a mere $5.5 billion in earnings separate number 1 (PWC) from 4 (KPMG). It is indeed almost back to the old days of the 1970s where if a CFO of a company I knew you audited approached me about doing their work, I felt a moral obligation to let you know they were dissatisfied.


Hey, I said almost. Shhh. They all know they have a very good thing going. It’s good to be king!

Denis Campbell

Denis Campbell is a US journalist based in the United Kingdom. He contributes to newspapers and magazines, is a BBC Radio election commentator and publishes the daily e-magazine The Vadimus Post from the Latin Quo Vadimus – where are we headed and do we know why?

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