In public accounting, Accounting Advisory is all the rage.
What exactly is accounting consulting? Is it something you should consider? If the only reason you’re in audit is because you’re not ready to go directly into industry, then yes! You should probably consider it.
- The work is interesting and you’ll add real value to companies
- You’ll identify new opportunities
- It pays well
Do you dream of being a CFO? What about running your own consulting firm, or even moving into Private Equity or Investment Banking one day? We’re going to discuss a few particularly in-demand areas of consulting that will push your resume to the top of the stack.
Financial Planning & Analysis
FP&A should be on your short list if you're the analytical type. These roles can take many shapes depending on industry, size of company, and other factors. Ultimately, the role of the FP&A guru is to transform useless, disparate data into meaningful information for management to make decisions.
Let’s take a PE-owned, middle market tech company. There’s probably an FP&A guru who is working alongside the CFO. This FP&A guy or gal prepares forecasts, budgets, and board presentations. Most importantly, they identify opportunities for growth and profitability.
Take for example a company that sells goods that expire after 3 years. It’s very likely creating a process for identifying goods that are nearing expiration would benefit the company. Perhaps it's merely important to know for Financial Reporting purposes. It could also be an opportunity to "firesale" them before all value is lost.
Bottom line: Experience in FP&A will teach you how to optimize a business.
Financial Transformation and Audit Prep
Financial Transformations are all about laying the ground work for companies undergoing change. Companies exploding in growth can quickly outgrow their cash basis accounting, and if they’re aiming to raise capital, there’s a lot of work to be done.
Generally the best route for that company is to bring in top accounting consultants who can quickly establish effective financial processes. Once the processes have been established, the consultants will be replaced with full-time accountants to keep things running smoothly.
As you'll be creating new processes from scratch, there's a creative element to these roles. Most ex-auditors find these projects incredibly interesting and engaging due to the problem-solving nature.
Technical accounting consultants are like the transactional lawyers of the accounting profession. They occupy their time understanding a business, researching US GAAP (and more specifically, how the Big 4 firms interpret US GAAP), and then apply this research to their clients’ business and transactions.
Technical accounting experts live in the grey area, and they’re tasked with putting together policy documents to defend their conclusions when the SEC comes knocking.
Times are good for technical accounting experts these days, as companies are furiously trying to implement ASC 606 (Revenue) and ASC 842 (Leases).
Transaction Services is a general term that applies to several different areas, so we’re just going to cover a few that we come across the most.
M&A / Corporate Strategists
M&A Strategists analyze whether their client should acquire another company, and if so, which company they should acquire. Larger companies with excess capital may acquire a new company vetted by experts every week.
If you ever wanted to make a move into private equity or investment banking, consulting in the M&A Strategy space might just get you there.
Buy-side and Sell-side Diligence
Acquirers hiring buy-side diligence consultants to make sure the company they just bought doesn’t have any glaring issues that wasn’t brought to their attention. If you make the switch into this specialty, you’ll be preparing quality of earnings analyses, proving that cash exists, and ensuring there’s no significant litigation against the acquiree.
On the other hand, if the company being acquired hires you, you’ll perform sell-side diligence, and you’ll provide them with a health check to make sure the buy-side diligence won’t uncover anything wonky.
Once the acquisition goes through, that’s when the Integration consultants come in. These people are experts at merging an acquired company’s operations into the acquirer’s existing business. If you have a knack for systems and moving people around, then this is a specialty you’d probably enjoy.
Integrations can often look similar to the financial transformations described above. Oftentimes acquired companies are smaller and are accustomed to a lower bar when it comes to financial reporting standards.
Other Acquisition-related Advisory
Additionally, there are consultants who specialize in purchase price allocations and assign the value of the acquired company’s intangible assets. This work is necessary for the purchase price adjustments to be recorded, which is often performed by the consultants working on the integration.
The areas detailed above only scratch the service. Accounting and financial advisory is an extremely general description of services that extend well beyond the scope of this article. If you are interested in learning more about accounting advisory services, continue to research different niches within advisory to help identify what most appeals to you.