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Public Accounting: Should You Work For A National Or Local Firm?

By David Satava

Each year approximately 26 percent of the over 50,000 accounting graduates receiving bachelor degrees enter public accounting (AICPA 1994). One of the most important decisions individuals entering public accounting will make is determining whether to work for a local or national accounting firm. This is an important decision since, according to the 1994 AICPA study, national accounting firms experience nearly twice the annual employee turnover as compared with local firms (20% and 11%, respectively).

This article reviews the working environment and corporate culture of local and national accounting firms in order to help graduates make an informed decision when choosing a full-time public accounting job. Understanding the working environment of local and national firms is important since recent studies indicate it has a significant effect on employee tenure. Thus, in order to maximize one's career success, it is important to objectively evaluate and match one's personality, abilities, and professional aspirations with that of the working environment and corporate culture of a firm.

The factors of a working environment that should be understood before accepting a job include such issues as hours worked per week, competition for promotion, evaluation process, variety and scope of work, growth opportunities training, and jog satisfaction. As we will see, not only are there differences in working environments between local and national firms, there are even significant differences between offices of the same national firm. A proper understanding of these factors should assist public accountants and increase the opportunities for job satisfaction and promotion.

Overview Of National Versus Local Firm

Local accounting offices are typically owned and managed by one or two CPAs, along with several staff accountants, and usually operate in an informal manner. Frequently, staff accountants work alone, starting and completing assignments with little or no direct supervision. Local staff accountants, for the most part, perform their work in the accounting office rather than at the client's office. They generally talk to and coordinate their work with the owner of the business.

Staff accountants of local firms are constantly involved with many of the routine accounting issues faced by clients such as auditing, write-up work, payroll, tax, and management advisory services. It is common for staff members to obtain a significant overview and understanding of the daily accounting activities affecting a business. Thus, a person who prefers to work alone and in a quiet setting can be quite successful and satisfied working at a local accounting office, since the primary source of evaluation comes from successfully completing technical assignments.

National accounting offices are composed of a large number of partners, managers, seniors, staff accountants and support, and typically operate in a more structured manner. Staff accountants traditionally work as a member of a team and complete highly structured and repetitive tasks for very large, corporate clients. Due to the nature of accounting work, staff members perform highly specialized tasks which give them very little opportunity to understand a firm's entire operation. A large portion of the work is conducted at the client's facility where is frequent interaction with fellow and client staff members.

These staff accountants generally have little contact with top management and direct most of their questions to the accountant in charge. Staff members of national firms are evaluated on their technical competence as well as how they work within a team. Later on, they are evaluated on how well they supervise and direct a group project. Staff members are selected for teams as needed, with teams being formed for the sole responsibility of completing a task. After the task is completed, the team typically disbands and each individual moves onto other group projects.

Best And Brightest

Being the best and the brightest does not insure job success in public accounting. Traditionally, national firms hire the top 10 percent of accounting graduates (Scarbrough 1993). Yet ironically, national accounting firms experience nearly twice the employee turnover as the local firms. One reason for this is that competition for promotion at the national accounting offices is often stressful. Star accounting students quickly go from being the rare, exceptional student at school to being an average commodity on the job. Fellow staff members frequently view each other as competition for promotion and may not help one another.


Promotion is somewhat limited within local firms. While many local firms use the same titles as the national firms (staff, senior, manger, and partner), what promotion that occurs is generally based on totally different criteria. At the local level, promotion is an informal process and typically based on a person's technical competence. That is not the case with respect to the national firms. While early CPA job success with national firms is primarily dependent upon the individual's technical competence, advancement does not occur without the development of management skills.

If a staff accountant wants to become a senior at a national firm by the end of the second year, that individual must learn how to supervise and direct the work of other, less experienced individuals. Seniors are expected to maintain a high degree of technical competence while they develop the ability to supervise, motivate, and direct the work of younger staff members. This may be a major hurdle for individuals who prefer to work alone and in a quiet setting. Furthermore, seniors must quickly learn how to interact with highly successful and demanding managers and partners.

In order to become a manager or partner, it becomes increasingly important for CPAs to learn more sophisticated management skills such as communicating, organizing, motivating, and directing the efforts of larger and more numerous teams of staff and senior accountants. By the time a person is considered for partner, his or her primary responsibilities, in order of importance, are that of client development, staff supervision, and, finally, technical accounting activities. Thus, while technical ability is the most important skill needed at the start of a career, it is not the most important skill needed to become a manager or partner of a national accounting firm.

Hours And Hours

While most people are familiar with the long hours CPAs work during tax season, many are not aware of the currently long hours worked year-round at national accounting offices. Scarbrough (1993) found that the longer a person is employed by a national firm, the more one is expected to increase his or her commitment, hence hours on the job. Frequently, by the fourth year, CPAs of national accounting firms are working 50- to 60-hour weeks for much of the year.

The number of hours worked continues to increase for those hoping to become a manager or partner. One national recruiter, when asked what it took to succeed at her firm, said, "we have found that people who like to spend time with their families don't do well here." The prospects are not really that bleak. There is another side to this issue that needs to be understood. My recent study of 439 CPAs across the country found that partners were significantly more satisfied and more committed to their jobs than were managers, seniors, and staff members. Why is this?

The primary reason partners are more satisfied and committed to their jobs, despite the long hours, is that, as one moves up the CPA hierarchy in national firms, the variety of jobs become more interesting and professionally more satisfying. Also, partners have more flexibility in choosing when they work and continually select the type of work that gives them the most satisfaction. As one recruiter said, many individuals leave the national firms just before the work really becomes more interesting and more satisfying.

What are the chances of becoming a partner with an accounting firm? According to Source Finance (1995), a personnel placement and recruiting firm, only about two percent of all persons entering CPA firms ever become a partner in public accounting firms. Thus, 98 percent of all accounting majors entering the public accounting profession will never reach that plateau and will consequently change to another area of accounting or business.

Corporate Culture

Regardless of the type of firm (local or national) accounting majors start working for, they need to be aware of the effect that organizational or corporate culture has on job tenure. Organizational culture essentially describes how a firm operates and what values are considered to be the most important within the firm. Typically, corporate culture can be broken down into three overall dimensions.

First, there are the firms primarily concerned with the work and tasks to be performed and operated in a highly analytical, detail-oriented, predictable, rule-based, careful, and conservative manner. Second, there are the firms placing a high value on interpersonal relationships and concerned with teamwork, respect, fairness, and tolerance for other people. Third, there are the firms placing great emphasis on individual behavior, high personal expectations, aggressiveness, and individual achievement.

Sheridan (1992) studied the organizational culture of public accounting firms as it affects employee turnover. He found that the corporate culture of a firm significantly affects job turnover. His study found that professionals hired by accounting firms emphasizing interpersonal relationship values stayed on the job 14 months longer than professionals hired by firms emphasizing the work and task to be performed. Thus, firms that place a high value on the welfare of their employees tended to have lower staff turnover.

Training And Evaluation
Obtaining training in public accounting is very important. It is so important that state accounting societies do not permit one to become a licensed CPA without adequate and verifiable, real world public accounting experience. Without a doubt, the national accounting firms have a better and more structured training program for their young staff members than the typical local firm. National firms provide a great deal more feedback and direct supervision than local firms. The traditional training at the local level, at best, is both informal and infrequent.
Staff members of local firms are frequently expected to learn by doing and generally receive very little direction or support. Most national accounting firms evaluate each employee after every major job assignment. Thus, at the end of each review period, a staff member has been evaluated by a wide variety of individuals. Frequent evaluations help serious-minded individuals learn and understand the important values of their respected firm much faster than the informal process practiced by most local firms.

To Specialize Or Not To Specialize

One advantage of working for a local accounting office is the wide variety of accounting work performed for clients. Staff accountants are exposed to all facets of the accounting process from basic bookkeeping to the complete preparation of financial statements, as well as personal and corporate tax returns. Accountants of local firms frequently obtain a fuller and broader understanding of the accounting issues relating to small- or medium-sized businesses. This type of experience may also be helpful for individuals whose ultimate goal is starting their own CPA practice.

Very early on in his or her career, the national accountant will have to make two career choices. First, a staff member must decide between auditing, tax, or management advisory services (MAS). Once decided, it is unlikely that he or she will be exposed to or permitted to work in the other areas of accounting. Secondly, because clients of national accounting firms are large, CPAs have to specialize by industry and frequently have little voice in determining the industry they will work.

Thus, at the national firm, success may be determined by random assignment out of the job pool into a growth or lack of growth industry. The longer a staff member stays with a particular industry, the more he or she will be identified with that same industry. Therefore, this double selection process makes it more difficult for an accountant to obtain and understand how a business operates on a day-to-day basis.

Not All National Offices Are Alike

National accounting offices are not all run in the same manner; rather, each office develops a personality of its own. The reason for this is that each national office specializes in different aspects of accounting (auditing, tax, or MAS). Furthermore, each office may also specialize in different industries, which may require handling clients differently from one office to the next. National firms may operate in very large metropolitan areas, as well as in many smaller cities. Thus, when evaluating a national accounting firm, it is important to find out more about how a particular office conducts business.


After an individual has decided to go into public accounting, he or she must determine whether to work for a local or national accounting firm. the consequences of such a choice can have a dramatic effect on his or her career and should be made with as much objective information as is possible. Working for a national firm is not for everybody and neither is working for a local firm.

Individuals must take great care when they look into a mirror and decide what they really want from a public accounting career. Very early on, successful CPAs learn how to manage their career based on their individual needs, aspirations, and the opportunities available. The key to managing a career, designed for increased job success and job satisfaction, is to properly match personality, ability and goals with that of a firm.


AICPA Academic & Career Development, "The Supply of Accounting Graduates And the Demand For Public Accounting Recruits-1994," 1994.

Scarbrough, D. Paul, "Psychological Types and Job Satisfaction of Accountants," Journal Of Psychological Type, Spring 1993, pp. 3-10.

Sheridan, John, Organizational Culture and Employee Retention. Academy O Management Journal, 1992, pp. 1036-1056.

Source Finance, Accounting and Finance Salary Survey. 1995.

David Satava, DBA and CPA, is an assistant professor at the University of Houston-Victoria.

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