June 2008 - Posts
I'm not at all surprised that you'll find my site if you Google big four Canada overtime - I already pointed out that three of the big four are paying out overtime to their non-CA staff and seniors. n.b. provincial laws treat CA, CGA, CMA and CPA and students registered to study for those designations as "professionals" ineligible for overtime pay, regardless of rank.
Well now it turns out that all of the big four are doing it - Deloitte & Touche has joined the party.
A kind reader who worked for Deloitte pointed this out to me - Deloitte's non-CA staff's overtime hours are
about to stop being "unpaid".
The news isn't that fresh, but this isn't the sort of thing you see on the front page of the newspaper - unless you Googled "deloitte Canada overtime" you might not be aware of it.
All the facts for Deloitte are available at the website they setup otplan.ca - a URL which redirects straight to a deloitte.com page.
The general details are the same as with the other Big Four firms. After KPMG got smacked by the courts who pointed out that if you weren't registered as a CA, CGA, CMA - full members or student - everyone realized they better pay up or face lawsuits.
It's a shame it took the threat of massive lawsuits to straighten things out, but hey, no one's complaining once they have cash to look forward to, eh?
Deloitte reports it'll pay within 30 days of receipt of your acceptance of their offer to settle things up.
Letters started going out at the start of June and should all be sent out by August 1, 2008 - if you don't get one - contact the "OT Administrator" through the appropriate channels. such as the official website or 1-866-669-6615. Remember that number is only valid until August 1, 2008.
Interestingly enough, that 866 number belongs to legal firm Koskie Minsky LLP and is used to settle other legal issues like class action lawsuits.
Deloitte's short term savings, long term pain
Another intriguing fact is that Deloitte's practice has been to NOT pay for their summer interns' CA student fees.
The interns, not surprisingly, generally don't end up signing up as CA students, reasoning - correctly - that the firm would pay their fees when they return as full-time employees. The Ontario CA institute - the ICAO - will even let you pick up 8 months of time you spent before becoming legally registered as a CA student, so the interns had all the incentives in the world to take this approach.
All the incentives plus one: by not being legally registered CA students, their work was all subject to overtime labour laws.
Does A Counting School believe Deloitte is going insist on having all their interns getting registered as soon as they show up for work?
There's not a rhetorical device strong enough to emphasize how obviously they're going to do just that moving forward.
As usual employees in Quebec need not apply - Quebec, ironically for being such a leftist jursidiction, has one of the worst rules from the employee's point of view. Unless your effective hourly wage dips below the legal minimum wage times 50% (i.e., less than $12 an hour for last year), you get nothing.
Something I don't recall seeing on the other OT plan sites is the offer to cover up to 50% of legal fees ($250 of $500) to have an independent lawyer review their offer.
Can I get a lawyer to review my Assessment Letter before accepting?
Yes, you are welcome to have external counsel review the Assessment
Letter before you accept it. Should you wish to retain legal counsel at
any point in this process, Deloitte will pay fifty percent of the legal
fees you incur, up to a maximum contribution of $250 from Deloitte.
I was planning on writing about the nature of being an accountant and
more observations on exam prep, but that'll wait, as this is pretty time sensitive - not to mention a popular topic I find. Writing up something decent that isn't "news" takes more time if you want to get your point across completely and concisely.
I guess the only questions left after this are how the "mid-tier" firms that have non-CA staff will handle matters, and how this'll affect our friends to the south. American labour laws are quite different - I mean, minimum wage alone is about $3 lower in many jurisdictions! - so our precedents may not carry much weight on a purely legal level.
But on a cultural level, seeing the way we're treated will no doubt cause some consternation or interest if word spreads far enough.
So I suppose this is just the sort of story you'll expect to see supressed or "conveniently ignored" by those who have the power to do so. At the same time, I imagine the class action lawsuit squads from California and other more "labour-friendly-ish" states will be all over this like the proverbial seagull on a table of leftovers.
If you're not familiar with CA firms, you may be a little surprised to know that there's such a thing as "recruiting season."
Employers will come around university and college campuses during set times of the year - both in Canada and the US - to interview potential employees en masse.
The phenomenon of ‘campus visits’ is especially pronounced in the US where there’s a plethora of colleges to visit - smaller campuses often miss out on visits from the Big Four and students who want to get noticed with an in-person interview end up having to travel to a campus visit taking place at another larger school.
A reader asks what to do if you had the misfortune to miss out on recruiting season - or were simply unsuccessful in the hunt for a position.
Above: Non-big-four recruiting poster in Buffalo's airport. Photo credit: Krupo (as usual)
I'm grouping both scenarios together because the methods of dealing with either scenario are ultimately the same.
Figure out what you're applying for
You've graduated from university with a shiny Bachelor's Degree in Commerce or Business Administration. Your tuition was two or three times more expensive than that of your friends with English degrees, but it's okay you tell yourself, you'll get a high paying job that'll pay off your debts quickly.
Except where will you work?
A BComm or BBA is a great degree to have, job-wise, but when planning your job search you have to keep in mind that the specializations you studied for will have a major influence your job search. Organizational Behaviour (HR), Finance, and Marketing people will be generally looking for positions that are pretty different from someone with an Accounting specialization.
Ultimately you will hopefully pick third and fourth year courses in areas you enjoy working in. Of course, some people end up finishing a four-year program with the sickening realization that they really didn't enjoy any of the materials they studied. The prospect of a double major to switch directions towards something they enjoy may be daunting, but if they disliked studying the topic, there's a high probability they may not enjoy working in that field either.
But let's put all those hypotheticals aside to simplify things - you studied Accounting because this DR/CR stuff sounds interesting and you're actually intrigued by the prospect of showing up on peoples' doorsteps and demanding, politely, that they show you all their secret files - you want to try your hand at audit!
You want to become a CA.
There's one catch - to become a CA, you need to become a CA student.
To become a CA student, you need to work for an Approved Training Office.
You don't necessarily have to love that a google search for that phrase automatically hits Canadian CA websites, but it helps.
Anyway, you tried your best, but you you didn't get hired.
What to do?
The single most important tactic is to keep yourself busy.
Find something to keep you occupied - and to pay off those mounting debts or at least keep you from mooching off your parents so much if you're so lucky to have their support.
If the job is at least tangentially related to accounting, that's excellent, but you don't have to be too picky.
Don't turn your nose up at a small family business that can't afford to pay you as much as a medium-sized company, but which will let you help them improve all aspects of their business. This can give you an extremely rich resume which will come in handy the second time you come calling on the doors of your favourite CA firms.
I know this is an excellent idea because it's exactly what I did, and more than a few of my colleagues did the same thing - both locally and down in the US. Speaking with one of them we marvelled at the fact that our experiences were similar. For various reasons, we passed up on the 'mainstream' recruiting season and ended up in our niche practice.
Before sneaking during an 'off-season' recruiting drive - yes, they do exist and I'll get back to that - we both worked as severely underpaid "jack of all trades" types, working wonders for our old bosses, helping transform, modernize and improve their businesses - and in the process realizing that, "wow, we really did learn something in school."
Note the precious mix of cynicism and positivity in that last sentiment.
The key, of course, was not to think "how can I do something at this business that'll look good on my resume," but to just do even the most menial tasks if everyone was busy and to then find a way to improve things to make the menial things automated or faster - that's probably the quickest basic summary of what "business process improvement" means and practising that skill will help you in life incredibly.
While working elsewhere, keep looking for that opening
If you're in Ontario, keep checking out Ontario's Approved Training Office list.
As of June 17, 2008, in addition to all the regular CA firms, there are now 9 offices approved to train CA students in "non-traditional career paths" including the Royal Bank of Canada, Manulife, Telus and others.
Every province except Alberta currently has approved this training option; it's very new, though, which is why the list of companies to pick from is so desperately short.
Watch this list grow significantly in coming years - even Alberta is expected to approve this change in the near future according to the ICAO's page. The reasoning behind this shift is relatively straightforward: Canada still has a shortage of CAs.
The traditional method of filling the ranks with new CAs - through hiring in the regular accounting and audit firms - is insufficient now because all the baby boomers are about to start retiring in droves. It would be uneconomical for the CA firms to hire people "just to train them", so the CAs collectively decided that the best way to keep the market well supplied with people that have their valuable designation is to find other companies that can offer the adequate supervision and guidance needed to help young CA students hone their fledgling Professional Judgement and prepare for the UFE.
"Alternately" trained CAs will be trained to the exact same standards as 'mainstream' trained CAs, and will have the same rights and privileges with one minor catch - they will have to gain some experience in 'proper' audit firms to get a license to audit - a "public accounting" license.
The ICAO explains that:
With the implementation of CA Practical Experience Requirements
2007, practical experience requirements for a Licence to Practise
Public Accounting are recognized separately from practical experience
requirements for CA Qualification.
This, of course, is just fine for someone who doesn't care for doing audit - they can stay inside companies where an 'independent audit' isn't something that they have to explicitly worry about or carry out. Considering the number of CAs who jump out of accounting firms quickly and never look back, it's a rather logical solution.
If you ever change your mind, you'll probably have several years of experience under your belt - any mature audit firm will be more than happy to hire you to leverage all that you've learned in the intervening years in private industry and provide you with the training necessary to get your public accounting license. The ICAO FAQ goes into more detail if you need to know about this option. If the small business or alternate industry option isn't appealing, all is not lost.
If you're persistent, though, you may find an office or department that needs to hire people outside the regular recruiting seasons. Keep the following tactics in mind to help find a place that will look at your application:
- Check the Approved Training Offices pages to find small and mid-sized companies that might not follow the regular recruiting season.
- Check the websites of larger companies to see if any positions are being advertised.
- Check the job posting boards for any positions not advertised on the companies' own sites.
- Stay in touch with your old university's career centre - they might get notice of positions that aren't being advertised to the general public.
- Stay in touch with your friends in case they hear of other positions being posted internally, or to get a recommendation for publicly known positions.
- Look for positions outside your home city.
If you've been keeping busy at a small or medium sized non-accounting firm, keep in mind that you will likely still be treated as a 'raw recruit' hired at the entry level, unless your current/previous job is tightly related to audit - say, an internal audit position in a larger firm or a related accounting position. Basically, any job that doesn't involve teaching you the things you'll pick up as a first or second year 'junior' won't count towards your 'experience level' when they hire you - you'll be treated like any raw recruit whether you're 22 or 38. More experience will still help, however, in helping you stand out against some kids fresh out of university, though.
And don't forget those alternative options might be just as attractive if not moreso. Lots of companies lack skilled internal auditors, so keep an eye out for such postings, even at the entry level your academic background might be enough to get your foot in the door even if you don't have fancy experience. And the government has its own audit offices - don't forget to look into those options too.
Keep it up - before you know it, you'll be studying for the UFE and getting swag for writing about it.
One reader asked a clever question to one of my recent posts about the market's job situation:
Just out of curiosity, how much lay offs are there in the accounting
firms? What is causing all these lay offs? I thought the CA firms had a
shortage of workers and they were hiring like crazy? I’m not really in
the accounting field, so I guess I’m behind on the new…
Layoffs are caused by an excess supply of employees, and an insufficient demand for their work - same as in any company.
How many layoffs are there and what's causing them? The short answer to both is, "it depends."
If you live in a region where there's lots of work, layoffs aren't happening.
If you're in a region where some or all audit firms lost business, you'll be looking at 2 to 20 people in a given city's office.
Yes, I can't give you a hard number, just some ballpark estimates, and that's because it's all spread around.
So much so that when someone hazards a firm number, hecklers also shout them down, in disbelief that any firm number is possible - check out the long line of angry messages that challenged the number of PWC layoffs at around 1000 in one of Francine's posts. She's a bit of an authority on this topic if for no other reason because of the number of people who flock to her blog to find out news on this front.
Aside from blogs on the profession, though, you won't find newspaper headline-grabbing events publicized like 400 or 4000 people who unfortunately lose their jobs at steel mills or automobile factories.
One of the reasons a newspaper wouldn't cover the news - even if they knew about it, though - is that while someone's losing, someone else is often winning. As a result, usually at least one company will be hiring because it won business while the competitor who lost business ends up shedding people. It's one of at least two little paradoxes you'll encounter in this article.
As usual, there are tons of specific exceptions to the rule which make it hard to make a generalization. The company you're interested in might have decided it's going to specialize in a given area, so it's going to shift people from, say, fraud to tax. If you're happy with the move, you win. If you'd rather die than switch, you'll end up leaving.
When you read about layoffs dragging out over a year-long period, that's usually because one firm recognizes trouble ahead and 'invites' people to leave early, and other firms either don't see the trouble, or believe they can 'ride through it'. Unless they're very good at finding new business, they'll typically have to show people to the door as well.
What's really interesting is to see how flexible things are - your perception that CA firms are hiring like crazy is correct. In general, the firms always need more fresh faced kids. I saw tours passing through my office recently - always fun to see them wandering the halls, somewhat dazed, somewhat in awe. But you will, however, find that in the midst of hiring booms some specialized groups or individual offices will nevertheless cut back from time to time.
So that's the other even bigger paradox - while one part of a given company is letting people go, they'll still be hiring hundreds of new staff straight out of school.
If you're familiar with the apprenticeship system of accounting firms, this will not be a surprise - skip to the next section.
If this is all foreign to you, I'll shed a little light on the process.
The Apprenticeship System
To get your CA you must work at least 30 months and accumulate 2500 hours of time spent on various parts of audit jobs and other such work. Most people get the 2500 quickly and have to wait it out for the 30 months to pass. Some leave as soon as their 30 months are up and they receive their CA certificate in the mail, others hang around - either because they haven't found a job they're more interested in, or similarily, because they're happy where they are.
Just like in the military - where one seargent looks after a group of junior warriors - you usually expect to see more juniors than seniors. While it's wonderful to have a surplus of highly experienced on hand, they're expensive - earning roughly half as much as the new kids. Now clients are charged a higher fee for those 30-month-experienced
"senior" staff than they are for the fresh out of school "junior" staff
who are trained on the job by seniors and managers. And there's always going to be work to be done which doesn't require years of experience, but rather supervision by seniors and managers to get the job done properly.
As long as a steady stream of seniors leaves for other companies or other departments the triangular/pyramid shape of the accounting firm hums along smoothly. Get too many people who enjoy their jobs too much - or just hire too many seniors away from other companies expecting sudden growth which doesn't come through - and you witness Trouble
Of course, sometimes even juniors get let go, but it makes less economic sense and is saved for only those situations where a company's in truly bad shape.
If this sounds cruel, it can be, but at good companies it isn't. Any decent Commerce program will tell you that a layoff is the worst thing you should consider - one of my good profs, who used to work for my company, even went so far as to say she would give us failing grades if we simply suggested laying off people when writing our assignments and exams instead of considering more creative and humane options to fix up poorly performing companies.
Of course, sometimes despite your best efforts everything fails - the good companies distinguish themselves by either offering transfers to other offices, or using the management team's network of contacts to find you a home at another company. Just because you had bad luck at an accounting firm doesn't mean you're lost forever - you may even end up enjoying the new job more - the pay or hours could ultimately end up being superior depending on where you end up. And good managers will introduce you to the right people to help you land on your feet.
Of course, there's more than just altruism at work - if they hired you in the first place, you're no doubt a Smart Person with very good qualities - and if you leave on good terms, you may remember your former employer fondly. They may invite you back at a more senior managerial rank down the road, or maybe you'll invite your old company to come in to propose work that you would otherwise withhold if you were going to stay angry at them for treating you poorly.
I'm not disclosing any secrets here, mind you - this entire section was taught to us in our third year university Auditing class by a professor who used to work for one of the Big Four; I've also witnessed much of this in action at various companies, so this wasn't just some dry theory you just ingested - it's reality.
Currently, as far as I can tell, the situation has stabilized lately - in the parts of Canada I'm familiar with - and hiring continues 'as usual' at all the major firms. Francine can fill you in on where things persist in being ugly though, and offer her additional explanations as to why it happens the way it does.
Music geeks, note the not subtle nod to Junior Senior - Move Your Feet in the title. Of course the song refers to moving your feet for purposes of dancing rather than switching jobs, but I think I've beat the point to death with the obvious-hammer enough now.
It's been quiet on my end lately because I've been splitting my time
between being busy with work, life, and studying for my exam next
Unlike with UFE prep, I've been basically burrowing into a single book and then doing practice questions.
This is just a multiple choice exam so sharing my brilliant insights seems like a less-than-effective way of learning at the moment. Doing old questions and figuring out the logic behind right and wrong answers is the way to go here.
Once in a while there are interesting little tidbits I'd like to share, but the amount of time it would take to discuss them does not in any way correspond to the value associated with sitting down to write about them, so I'll do it for just one to prove my point, then I'll dive back into my book. I really wanted to say books, but there's really only just one book.
When tracking security logs, the exam manual suggests using programs which search for patterns. A user who typically logs in to a corporate computer network at 9 a.m. should have a red flag raised when a log-in at 4:30 in the morning is detected.
My insight? This system really wouldn't work well with me. Aside from the fact that anyone doing audit is usually equipped with a laptop that doesn't necessarily "phone home" to a corporate logging system to report this kind of data, even if it did, my log-ins tend to be so random that trying to pick out a pattern would be an exercise in futility.
Speaking of tracking things - I'm not even going to try for an elegant segue today - on the spam count front, I'm still keeping my humble little log of how much junk mail is hitting me. And it's down to 801 this month.
Have the spammers realized the error of their ways, or is filtering software killing more of this junk at the source? I'm curious.
But not especially. Still have a couple years worth of questions to burn through this week. At least the lead-up to this multiple choice exam is less eventful than the fiasco associated with preparing for the CKE with a surprisingly upset appendix.