Accountants by the nature of our profession want to follow rules. Therefore, we like it when we have guidelines such as an employee handbook that tell us how to respond in an accounting firm to a particular situation. However, new accountants soon find out that the firm grapevine provides unwritten rules to be followed as well.
One example is in the area of the billable hours (the time each person charges to the job for preparing and reviewing the tax return or audit) that a staff should put on his timesheet. If the staff person talks to people in the firm they will get one or more of the following answers:
- Charge all of your time. The logic is that the firm wants to know when you are struggling so they can train you and decide whether to charge the client for that time.
- Same as Last Year (SALY). Charge essentially the same time as the staff person did as last year so no one will give you any grief for the time you spent on the job.
- Eat Time. Charge less time on the job than was spent last year regardless of the time you spent on the job so that the manager and partner will be impressed by your skills.
As a result of the confusing and conflicting answers, most interns and new accounting staff fall into the following pattern:
- Step 1. New staff person is told to charge all of his time by human resources and his team.
- Step 2. Staff person follows Step 1 and goes way over budget on many occasions.
- Step 3. Staff person finally gets read the riot act by at least one manager (the others have stopped using him) because he is going over budget.
- Step 4. Staff person starts charging some of his billable time to administrative time to avoid going over budget on the job.
- Step 5. Staff person gets grief from a manager or partner for having too much administrative time on his timesheet. Gets told that he needs to work more hours to keep up with everyone else.
- Step 6. Staff person starts working late and eating lunch at his desk so he can complete his “eight hour” day in ten hours by removing his daily administrative time and any billable time he is going over budget from his timesheet.
- Step 7. Staff person gets burned out and tries one of the above options for a while and starts the process all over again.
Obviously, the above steps are a little simplistic and do not apply to every firm. But CPA firms have not been charging the full value for many tax returns and audits for a while due to the struggling economy. As a result, it puts more pressure on everyone working on the job to be as efficient as possible.
As someone who has worked in public accounting firms for over twenty years, I
understand the frustration of new staff trying to work their way through this problem. Therefore, let me give you a few pointers to avoid the problem of eating time or looking bad to your boss.
- Budget. It is your job as the staff member to make sure that I as the reviewer give you a budget. If you
don’t then I have the right to get mad at you (probably unfairly) for exceeding an arbitrary number of hours I had decided in my head that you should spend on the job.
- Talk to me. It is your job as the staff member to come to me when you get stuck or you determine that you will go over budget. To be blunt, I get an office and I am the manager on this job because:
- I know more accounting than you.
- I know how to solve more problems within the firms processes and procedures than you.
- I can make judgment calls on what items you can skip to speed up your job.
- I know what items the client and the partner do and do not consider important.
- I can decide if the budget I gave you is too small and give you a larger budget.
You coming to me early also lets me know if I need to start discussing (or arguing) with the client over increased fees this year for the job.
If you continue to show a pattern of providing quality work, learning from your mistakes and a willingness to work overtime when needed (no need to work crazy overtime – but at least flexible when needed) then managers will fight to have you do their work. Managers realize that most of the decisions on whether a job will stay on budget are out of your control. But we have no sympathy for your situation when you go over budget or eat time without asking us for help because you gave us no chance to try to solve the problem.
If you enjoyed reading about my article on eating time in a CPA firm then I hope you will like, comment, or share the article on Facebook or LinkedIn. You might be helping a fellow accountant to find their way through this tricky problem.
If you are an accounting major or currently in the accounting profession feel free to connect with me on LinkedIn. I enjoy connecting with future and current CPAs.
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