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The accounting scandals that rocked the corporate world several years ago have certainly taken their toll on the industry, but the government's regulatory crackdown also means that demand for accountants is higher than ever. And while accounting may never shed its nerdy, bean-counter image entirely, exciting new positions in forensic accounting and information risk management are attracting a new generation of students hoping to sniff out corporate misconduct before it hits the headlines. Perhaps that's one reason why Big Four accounting firm KPMG ranked 12th on a list of where undergraduate business majors most want to work (See BusinessWeek.com, 5/4/06, "Hello, Mickey").
Blane Ruschak, KPMG's national director of campus recruiting, says those areas are definitely hot. "If I was coming out of college again, I would probably be looking at forensic myself," he says. Ruschak spoke recently with BusinessWeek.com reporter Kerry Miller about the opportunities KPMG offers to students interested in public accounting. Edited excerpts of their conversation follow:
Blane Ruschak KPMG
With so many recruiters on campus lately, how do you differentiate KPMG? We focus on things that we think make our firm very strong. One thing we focus on is our international presence, and that's very appealing to this generation of students that understand the global nature of business. Typically, after you've spent two to three years with us, you become eligible for our Global Mobility Program, where, if the Paris office is looking for people with auditing experience, they'll post the position, and someone in a U.S. office can apply for it.
The firm moves you over there, you live there for 18 to 24 months, and then they bring you back to the office that you left from. It's a tremendous program. At any point in time, we have hundreds of people, either inbound or outbound, that participate in these programs.
Have you noticed that students graduating today have different priorities from students in the past? We definitely have seen some changes in students. One thing we find that that's really critical to them is community service. They're all involved in community-service activities at school, and they want to extend that when they join a firm. So we talk about volunteer-time release and about how we build community service projects into a number of our core training programs. So, for example, our tax hiring just started this week, and tonight they'll be going to the New Jersey Food Bank to spend two hours putting together food packages and doing mailings for them. We also build community service into our internship program, so if you intern with us, you'll spend anywhere from one to five days of the internship working on community-service projects.
What is the most common question you hear when you talk to students? A common one is, "Tell me a typical day." And we turn around and say, "There is no typical day." We explain to them that in public accounting, no matter how much you plan your day, the day will never look the way you planned it, because it's a client-service industry and what you think you'd work on changes as the day goes on. That means that one thing we're looking for in students is adaptability, and I focus a lot on that when I'm on campus recruiting.
Do you get a lot of questions from students about the ongoing tax-shelter trial? (See BusinessWeek.com, 9/1/05, "Inside the KPMG Mess") Surprisingly, no, but we are usually proactive in bringing it up. Usually at an information-type session, we'll have a partner who will be going through a firm-wide overview, and when we get to some of the firm's strategies, especially the tax side, we'll have a bullet point that talks about the deferred prosecution agreement. We'll refer to what happened, how we resolved it, and where we are right now with the situation. We talk about the practices that we had to divest ourselves of, and then we focus on the risk management procedures that we have in place so the student can see that we have lots of controls in place to make sure we're not getting involved in any activities that would be construed as inappropriate.
The students, because they're very well-read these days, they have seen in the paper that there are many firms that are going through the same kind of inquiries. I think they take it all in, and then are able to say, "OK, we feel comfortable with where KPMG is."
Overall, are your hires going to be up this year? Yes, our total hiring this year is a little up over last year, and that's mostly in our advisory and tax divisions. On the tax side, the core services we're offering are more and more in demand in terms of helping clients with their tax strategies and dealing with some of the very, very complicated tax rules. On the advisory side, a lot of it was work generated by [the Sarbanes-Oxley Act] and now we're doing mostly follow-up work on that, in terms of helping companies analyze their risk and do things to mitigate risk as much as possible.
What types of positions are open for recent college grads? Everybody comes in as an associate within one of our three divisions: audit, tax, or advisory. On the audit track, I'm going to go into audit, get my audit hours, take the CPA exam, and become a CPA. With tax, there are about five different practices—federal tax, which is the largest, as well as state and local tax services, international corporate services, international executive services, and economic and valuation services, which is transfer pricing and valuations. On the tax track, some of them do become CPAs, but it's not a requirement.
On the advisory side, there are seven different service lines: forensic accounting, internal audit and regulatory compliance, CFO advisory, transaction services, operations risk management, financial risk management, and information risk management. Information risk management is our largest group, and the student in that group might be an accounting major that also majored in accounting information systems, or an information systems major who's taken some accounting classes along the way.
Are you interested in students who didn't major in accounting? Our largest department is the audit department, and for that, we primarily look for accounting students, and they need to meet the qualifications for the CPA exam. But pretty much anyone from a business school has an opportunity at KPMG in one of our practices. Firm-wide, we'll hire students from economics, finance, engineering, liberal arts, computer science, and information systems. It's the advisory side where you're going to see the students that have business-type degrees but not accounting.
Are there certain tracks within public accounting that undergrads are really interested in right now? Forensic accounting is the hot area right now, so that's got a lot of appeal to it, as does information risk management—those are two that I'd say students inquire the most about out of college. If I was coming out of college again, I would probably be looking at forensic myself. It's a fascinating group. They travel a lot, and they have some very exciting projects.
There are also a lot of interesting local niche practices. For instance, in our Washington office, there's a federal government practice that works on some really exciting, high-profile government engagements. In New York, the financial services marketplace of the world, working with clients like Citigroup (C) is very appealing and exciting to students, and typically, those big global accounts also offer opportunities to do two-year rotations internationally, working on the Citigroup subsidiary in Japan or in Europe, for example. In L.A., the entertainment industry is big, so students can work on the Universal Studios (GE) engagement. I think people find what industries they're interested in, and then they migrate to where the major players in those industries are.
What type of internships do you offer? We offer an eight- to 10-week internship for college juniors, to give them a chance to try out audit, tax, or advisory. If they do well in that internship, they get a full-time job offer at the end of the internship, so even before they go back to school they're done with their recruiting process. Our conversion rate of interns to full-time hires is about 95%, and we think it's because we make it a working internship. As an intern, you're doing the same things that you'd be doing when you start with us full [-time]. We really put you out at the clients. You're not sitting in the office doing self-study modules at the computer.
What does the typical career path look like for a full-time hire? The typical career path in audit is two years as an associate, then three years as a senior associate. Then you're up for manager after five years, and then you spend anywhere from five to seven years as a manager or senior manager before you're up for partner. Typically, that process takes 10 to 12 years. Within the other groups, it's a similar path.
Do you see most people coming in, getting their feet wet, and then moving on? Believe it or not, turnover is significantly down from the past, so what we're seeing is that people are looking at the ability to try to do things within the firm first before they look outside. One of our popular programs we offer is called the Optionee Program. That gives individuals in audit, after they've been in audit for a year or two, an opportunity to formally do a three- to six-month transfer to tax.
If they like tax, they can stay in tax, and if they decide they liked audit better, they have a guaranteed return back to audit. Students are attracted to that because they feel like they're not making this lifelong commitment to one thing that they don't even know much about because they've only had one audit class or tax class in college, and we're now trying to take that program and roll it out into the other practices.
What's the pace like? Public accounting is a demanding client service-oriented profession, and we tell our students to expect to work 50, 60 hours a week during the busy tax season, but they have to understand there are weeks when they'll be working 40. We also tell them if you're in audit, we go out to the client. So they're going to be traveling to clients and they're going to be working out of the client facility.
They have to understand that they will be with clients every day and talking to clients, and they have to like that, vs. in tax, they do most of the work in the office. In advisory, they do travel a lot because they're specialists. They will travel to sites, either regionally or nationally, to service a client based on their skill set.
How do you assign new hires to specific clients? It's up to the individual to decide what they're interested in. At the intern level, we ask for their top three industries that they want to try out, and then we try to work with the scheduling group to get them on one client in each of those three industries. When they start out full time, it's basically the same thing, but after a couple of years we ask them to then focus on one or two industries that they will specialize in. Everybody migrates on a path where they either work on an industry they love or they find teams of people they really enjoy working with.
For example, when I started out in the general audit pool, I worked on some banks and decided that really didn't interest me. I asked to be put on some resort hotel audits, and I traveled out to Hawaii and just fell in love with it. So the hospitality industry became immediately what I wanted to work on. I also randomly got put on a health-care client, and though I really had no interest in health care, I really enjoyed the audit team I was with, and I found that health care was actually very fascinating once I went on that audit. So two years later, health care became my specialty industry, and I worked about 80% of my year auditing health-care clients, and the rest of the year I did my resort hotel clients.
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