For recent accounting graduates, life holds the mysterious, age-old question:  what is it like in the real world? In particular, what is it like to work daily as an accountant and what does it take to succeed in your accounting career? The answers to those questions come in part from knowing yourself and your own goals, then realizing that there are several types of accounting careers. Your success will depend partly on whether the accounting path you choose fits your goals and your lifestyle. Whether you advance depends upon the structure of the company you work for. If you choose to work as one of three accountants, you may have to wait until one of the two above you leave or retire before you can move up. Consider the areas of accounting.

Areas of Accounting

Early in your career, preferably while still in college, you will want to get an idea of what kind of accounting field you wish to enter. You may already know that there are three types of businesses, and accounting fits into each one:

Sole proprietor – a single, independent CPA practitioner with several reliable clients

Partnership – start a CPA firm with other CPAs and share clients, or join a firm already established. This provides advantages such as taking time off or reducing the workload or liability.

Corporation – joining a large company with several accountants. In this case, you have little liability but also not as much control.

In addition to these, you will want to decide whether to work in a for-profit firm in private industry or a not-for-profit organization such as a city, state or federal government agency. Private industry jobs normally pay more than government jobs, but there is also less job security. While all jobs have an "office politics" element, some jobs are clearly more political than others (e.g, handgun or tobacco manufacturers, or abortion clinics). Also, be aware that government jobs' salaries are generally publicized – and that means politicized. So, if any person or position makes too much money, the civil service commission may feel pressure from politicians, public interest groups or rival government agencies to modify the pay scale to reflect the public's priorities (e.g., police or public school teachers vs. accountants).

Finally, you will want to decide what branch of accounting you prefer to specialize in. Here are some examples:

General accounting – posting journal entries, posting and monitoring accounts receivable or accounts payable, reconciliations of accounts, keeping track of amortization schedules, monitoring investment income, etc.

Financial analysis – comparing actual income and expenses to budget or prior year, and reporting on the causes of variances. This also includes balance sheet analysis, where you ensure that a balance sheet account is reported at the proper level. These include extensive primary and secondary research.

Taxation – preparing and submitting tax forms for individuals or corporations. This may also include answering clients' questions or providing information to authorized parties.

Audit – testing client transactions and accounting policies and procedures to ensure management reports fairly represent the financial condition of the business, based on some standard such as Generally Accepted Accounting Procedures (GAAP). This includes internal audit (done with company employees) or external audit (done with independent CPAs).

Consulting – providing clients and business with ideas to improve their financial condition or profitability.

Major Accounting Firms

Many aspiring accountants start their careers with a major accounting firm. While those firms in fact do accounting, most of their business comes from consulting, auditing, and other attest engagements. In many cases, starting at an accounting firm allows you to become exposed to many facets of accounting and many types of businesses.

Most of the Fortune 500 companies and many public companies are audited by the "Big Four" accounting firms, that is, the ones ranking in the top four in the country in revenues and professional staff. They are:

• Deloitte Touche Tohmatsu
• Ernst & Young
• KPMG
• PricewaterhouseCoopers

However, over the past few years, the Big Four have been losing clients and other major national firms, such as the following, have been gaining them. Other major national firms:

• BDO Seidman
• Grant Thornton
• McGladrey & Pullen

While these companies are large and provide good compensation and some opportunity for advancement, they also pressure their employees to pass the CPA Exam. Also, only a few will make it to the level of "partner" or "managing partner," where the large salaries are made. More likely than not, you will stay at an accounting firm for two to three years, then move on to industry, as the compensation and opportunities for advancement are greater in a regular company. A firm that you may audit may seek your services as an employee.

Salaries: The salary for entry-level accountants ranges from 40 to 60 thousand.

Before you get into the Real World of Accounting

If you are a junior or senior accounting student, you are almost certainly contemplating your work options after graduation. Before interviewing with prospective employers, ask yourself the following questions:

(1) Do I want to work with a small, local firm or a large national firm? And more specifically, do I want a clear, fast path to advancement, or am I willing to wait awhile, until a path opens up?

(2) Do I prefer a regular, nine-to-five workday, or am I willing to work additional overtime and weekends on a normal basis?

(3) Do I prefer to do more mundane yet essential tasks, or do I want diverse and complicated assignments?

(4) Do I prefer an "easygoing" office environment or would I be able to handle an "intense" one?

(5) Do I prefer to work at the same office location all the time or am I willing to travel regularly?

Be honest with yourself when answering these questions. For instance, it's easy to say, "I'll do anything for the right amount of money," but it's very different to be paid well but to be unhappy with your job. Often you can't know how much you will enjoy your job until you are well into it. But you can certainly ask your interviewer specific questions about the firm they are representing and the position for which you are applying. Also, researching the company, visiting the job site and talking to current employees can provide valuable insights into what to expect if you were to choose that particular place to spend most of your waking hours.

So, what can you expect when you walk through the doors for your first day of work? For one thing, before you go directly to work, you will need information – and it doesn't just come from a book!  You will have to access the computer, acquire source documents, run reports, and do research in books, periodicals, journals, and other secondary sources. Beyond that, you will need to interview the people you work with: managers, co-workers, clients, and others with valuable information.

During my 15-year accounting career, I have worked for several different companies, all different and all presenting challenges and opportunities. Here are a few that I believe illustrate what you can expect on similar types of jobs.

Case 1: Civil Service:
The Tourist Mecca

I recommend that every new accountant take the civil service examinations for local, state, and federal positions. What is it like working for an organization that comes under civil service?

Early in my career, I acquired an accounting job at a local real estate management company in a major tourist destination. This was a small company, with about 60 employees, including 15 office staff. That company was a city agency that comes under civil service. To give you as real an impression of what you might have to do in the real world of accounting, I deliberately use the second person "you" where others would use the first person "I".

With only two accountants (a CPA supervisor an assistant), you had to manage a wide variety of responsibilities. They mostly consisted of handling accounts receivable, accounts payable, payroll and bank reconciliations. Also, you were expected to write up special management reports, attend board of directors' meetings, and conduct a daily audit of the flea market field office a block down the street. These functions provided valuable experience in various aspects of accounting and gave the most practical applications of what is learned in college.

The accounts receivable function consisted of recording tenants' rents due and payments received. From leases, you recorded the amounts due onto the computer (the general ledger) and then again onto a 20-year old tome (the subledger). Then you sent bills to each tenant. In most cases, tenants paid their bills timely with no problems. However, there were many occasions in which tenants did not pay regularly– some did not pay even after months of warnings and late fees. I recall a case where a well-known politician had to "assist" a tenant in paying his rent. And there was another where the tenant, a foreigner, could not read or write English well enough to even write a check – you had to assist him. In yet another case, one woman did not believe in checks, so she paid us thousands of dollars every month in cash. Unfortunately, I have also seen tenants get locked out of their stores and sued for default.

The accounts payable function consisted of entering the vendor billings onto the computer, acquiring proper approvals for payment, then cutting the checks, getting them signed, and distributing them to the vendors. Sounds easy enough, right? Well, complications can occur if a vendor-invoice exceeds a certain level: in that case, you needed two signatures on the check – one from the director who was on site, and another from a board member offsite. Some well-connected vendors, such as lawyers and artists, would want to be paid on the day they presented their bill so that they would not have to wait until the normal billing cycle. In other cases, some bills would go months without being paid, perhaps due to an ongoing dispute between our company and the vendor.

Employee payroll was done every Monday and employees were paid bi-weekly on Friday. On Mondays there was a rush to properly code and complete the hours on 60 payroll cards, check them against a control list, and send them to City Hall's payroll department for processing. Some of our employees worked overtime and required overtime pay. Others worked the "graveyard" shift and required shift pay. There was sick leave, vacation leave, back pay, leave without pay,  and severance pay. Many people in our company worked minimum wage jobs and lived paycheck-to-paycheck, so you did not want to make a mistake or deny anyone his or her check.

Bank reconciliations consisted of acquiring bank statements, canceled checks, prior reconciliations and other documents and reporting differences in the bank balances versus the "booked" balances (those on the general ledger). This was a tedious job with no real frills or personalities to deal with.

 The flea market field audit consisted of counting the cash and checks in the flea market office and comparing the balance to the registered sales reports for the day. Afterward, the accountant would have to observe the courier and security guard deposit the money in the bank, and get the receipt. Again, this was a minor task with no major issues to deal with.

This company was not a regular company. While it operated for a profit, it was a municipal operation wholly owned by the city. Inasmuch, you were bound by city civil service rules and paid a municipal salary. You rarely received raises, and those were often less than the yearly cost of living increases. Also, because the firm made a lot of money and was located in a popular tourist destination, it was highly sought after by local politicians and interest groups. A large number of our expenses were contributions to various charities, community causes, and event sponsorships, not to mention a generous quarterly contribution to the city's general fund.

Due to the structure of the company – only a chief accountant CPA and an assistant –the opportunities for advancement were limited. If you wanted to stay at the local office, you would have to wait for the chief accountant to retire. Otherwise, you would have to transfer to City Hall or some other remote city agency.

On the positive side, this office usually had an easygoing, pleasant environment, not to mention being situated in a gloriously beautiful and exciting tourist destination. The company employees and customers were from all walks of life, some young and single, others married with children. After several years there, I came to view many of my coworkers as friends and even like family.

Case 2:
The Utility Company

After I passed the CPA exam, I was lured away from the tourist mecca by the big money and glamour of a national public utility company. This company boasted of $1.4 billion in annual sales, 36 operations in several states including Hawaii, and thousands of employees.

Instead of handling several functions, you were a reporting accountant, charged with compiling and analyzing financial and statistical reports on the company's many gas, electric, water and wastewater treatment utilities. This entailed running computerized reports, poring through hundreds of documents and putting together detailed income statements (called "results of operations"). You and the other reporting accountants had to transfer the information from original documents to Excel spreadsheets, reclassify data to their correct accounts, then print original 700-page reports. You would then take your originals and send them to a professional copy service to be duplicated into 30 books. Hopefully the copy service would deliver them to you in time for you to meet your deadline – you had 3 days after the month-end close to distribute the books to board members and division controllers across the country.

After that fire drill came financial analysis of the reports. For every utility, you compared the actual income statement line items to budget and to prior year, for current month and year-to-date figures. You had to explain every variance that was material or not normal. To do so, you conducted research. This research included reviewing journal entries, subsystem reports, and other source documents as well as interviewing people in the building or in the field (i.e., at the various locations around the nation). The most frustrating parts of this job would be occasions when there was a lack of information on an entry or no one who knew why a large variance occurred. Another problem was "tying" the analyzed reports to the books sent to company officials. Sometimes it would take hours to "tie-in" to the dollar with no fudging. If someone from a distant location in the company came up with a source document or report that differed from yours, you were in trouble.

The money and opportunities for advancement were ideal. If you had the ability and aggressiveness, you could advance from a staff accountant to a supervisor or even a director, easily commanding a salary close to six figures. On the other hand, the daily office life was extremely stressful. A normal workday was 10 hours plus, and you were working feverishly the entire time to meet tough deadlines. Often you worked all weekend to get reports out by early the next week. Supervisors were micro-managers and taskmasters, constantly looking over your shoulder and having no tolerance for mistakes or deviance from procedures. On top of that, the controller ruled with an iron hand: he could call you minutes before closing time for a meeting, then "grill" you on your reports late into the night.

Whereas the company was hiring many people the first year I got there, by the second year the board of directors decided to go in a different direction. The company eventually sold all of its public utilities operations and invested in telecommunications in another state. This resulted in the closing down of its local accounting operations and hiring an outside accounting firm from New York to perform accounting functions.

It would be impossible to tell this story without also adding that the company controller was indicted for stealing millions from the firm. Essentially, he colluded with a board member to set up a false vendor and diverted company funds to his own bank account. Of course, he was terminated and had to repay the money, not to mention he now has to worry about probable prison time.   It was a textbook case of the cocky, shrewd executive who put himself before his company. Now that executive will lose his CPA privileges and not be able to work in accounting anymore. In the real world, there are real, unethical people out there. Don't get caught up with that because it will really destroy your accounting career – and at a time that you least expect.

Case 3:
The Funeral and Cemetery Provider

Today I work for a 95-year old company based in Louisiana that provides funeral services and cemetery products to some 110,000 customers in 27 states and Puerto Rico. It offers the best of all worlds: interesting work, good pay, ample opportunities for advancement, a normal work schedule, decent people and a pleasant work environment.

As a Balance Sheet Accountant, you analyze and research the activity and balances in general ledger accounts and prepare reports for management. My work can be divided into three main parts: (1) trust accounts reconciliation, (2) other balance sheet accounts reconciliation, and (3) other projects.

In trust account reconciliation, you are expected to compare special bank account statements called trusts with the company's books, then research, analyze and resolve differences. These trust accounts can range from a few thousand dollars to many millions of dollars. Because of the sheer volume of work (over 370 locations and 200 bank accounts), poring through every single bank statement is impractical — you have to download the bank and general ledger information using the computer into sub-reports. Then you can review those reports, research and resolve problem items, reconcile the bank accounts, then finally complete and distribute your final reports.

Along with the normal trust accounts to reconcile, there are many other accounts to handle, both on the asset side of the balance sheet and on the liabilities and equity side. These can range from accounts receivable, inventory, deferred charges, fixed assets, accounts payable and others. Unlike the income statement, where you are comparing an account to a budget or prior period, on the balance sheet your goal is to compare the account to a subledger and determine the proper level of the account. In real life, subledgers do not always exist or cannot be easily compared to the general ledger. Also, some accounts have balances that go back for years and no one knows about them, or those who know no longer work for the company. Getting information is always half the battle in accounting.

Other projects may include year-end account analysis for the auditors, acquisition of customer contracts for management reports, research of difficult problem accounts, documentation of an accounting procedure or an account's functions, or just answering a request for information. These cases test your flexibility, ability to learn new things, communication and writing skills, understanding of the company business and personnel structure, and just plain willingness to think through and solve problems sensibly.

Advantages of having a CPA

In the accounting world, there are real and tangible advantages being a certified public accountant. The rewards for passing the exam include: a substantial increase in employment marketability and thus compensation, eligibility to join national and state CPA societies, the ability to practice public accounting as an independent CPA practitioner, and generally the prestige and satisfaction of becoming a full member of a well-respected professional community. No matter how well or poorly you did in college, once you pass the CPA exam you immediately bolster yourself into the top 20 percentile of all accountants. After I passed the exam in 1998, I was able to increase immediately my earnings by almost 30%.

However, be mindful that becoming a CPA is not easy: You need 150 credit hours, or the equivalent of a Master's degree, just to sit for the exam. It costs money to apply for the exam and hundreds of dollars to take a review course. The exam itself only has about a 20-30% first-time passing rate. Even if you overcome all those obstacles, it costs over $100 plus 40 continuing professional education (CPE) credits per year to maintain.

Final Considerations

The most enduring philosophy that I've run across is that most of the obstacles in the real world come not from the work, but from people. It just makes sense to be on good terms with the decision-makers and to always be professional, friendly, patient, and well-informed. I have noticed that the degreed, salaried workers doing high-level duties like financial analysis often get more money and respect than non-degreed wage employees doing menial tasks like collecting receipts. I have also noticed that companies are constantly changing and it pays to be flexible and up-to-date in your skill sets and knowledge.

In summary, the road to accounting success is a self-paved road, where you have done your homework, selected your career based on your personal definition of success, and been patient and flexible enough to move on if the current situation changes. Most of all, you should go into a career where you're doing what you love to do. A successful day in the real world of work is probably best measured by how you talk about your job when you return home.

Addison Carey III is an MBA accountant with Stewart Enterprises.