There are multiple testlets and routings, based on candidate performance, that are administered each window. Questions in each testlet are determined ahead of time. The individual questions within each testlet do not change. The adaptive portion of the exam is the testlet itself.

As stated above, for Audit, Financial Accounting and Reporting, and Regulation, the first testlet is composed of moderate difficulty questions. The second testlet is responsive to your performance on the first testlet. Finally, the third testlet is responsive to performance on combined results of both the first and second testlets.

The value proposition of a multi-stage adaptive test is that adaptive tests target groups of testing items at a person’s particular proficiency level. Thereby, this form of testing gives a better idea of where a candidate’s ability lies.

From a lay perspective, for example, the theory behind adaptive testing can be better understood through the following. In an oversimplified example, if you wanted to determine a person’s ability to do two-column addition using adaptive testing, you could determine the person’s ability by giving them a series of single-column, two-column and three-column addition problems. This would allow for efficiently determining the persons ability.

CONCLUSION

The Professional Accounting Society of America (PASA) would like to thank Gregory Johnson and the AICPA for their cooperation. Their commitment to providing up to date and accurate information to CPA candidates is admirable.

According to a recent informal poll, PASA discovered that the top five reasons public accountants leave their firm are:

Today we will explore in-depth the “Money” aspect of high turnover. Here are some basic facts we discovered through interviews and other research:

This is true in most cases. Especially if you switch to another accounting firm. The public accounting industry is very concerned with paying salaries to their employees that are in line with the rest of the market. This means that for the most part, seniors make about the same money (in their geographical area) no matter what firm they work for.

One of the only times a senior or manager can get an above market “bump” is when they switch firms.

Accounting firms are very competitive. If they think they can steal an experienced, well trained public accountant from another firm, it is in their best interest to use any weapons at their disposal. This includes money.

Firms love to entice experienced hires by throwing money at them. What is often left unsaid is that this quick money fix is only temporary. Experienced hires inevitable receive lower bonuses and raises than their new peers. This enables firms to let their other employees catch up. After all, it’s bad for morale to have the new guy make substantially more money throughout his entire career.

Throughout our interviews we came across an interesting PASA member who really understood the whole “bump” theory. For various reasons this member had worked at 5 different accounting firms over an 8-year period. After all that time, she was still only a senior at her current firm.

But, she made a whopping $20K more than any other senior. Why? Well, it makes sense when you consider that she received pay increases at every firm she went to.

I guess if your goal is to make money in the short term, her career path makes sense. There are obvious downsides though too. Bouncing around like that is not very fulfilling.

One of the greatest things about public accounting is that it is a merit based profession. If you are good, you will move up. If you move up, you will make more money. All the real cash is at the top. For those that switch to the private side, there will usually be a nice bump in salary. The problem is that after that bump, there is a significant plateau effect. Public accounting consistently gives larger salary increases per year than private industry.

Now, that being said, money isn’t everything. People leave their job for reasons besides money. Those topics will be explored further in upcoming articles.

There is an old saying in public accounting that goes like this: “Manage you schedule or your schedule will manage you.” Every year thousands college graduates enter the world of public accounting. Unless they interned at their respective accounting firm, or have very good existing relationships with people already working at the firm, there is a good chance that they will get put on some clients that are not so hot. This is normal and happens to almost everybody, so new hires better be prepared for it.

In order to understand how to play the scheduling game, it is important to first know a little bit about how it works. (An article about scheduling can be found.) Once you know the basics, it is not that difficult to create a work schedule for yourself that will provide you with the best opportunities for growth. Here’s how to do it:

I am a product. I had a partner come up to me at an after busy season party last year. (Those are always ragers.) I was doing some brown-nosing and the partner started to explain the “business” of public accounting to me. He told me all about how he was a salesman. He sold my time to clients at a premium. He even referred to me at one point as being similar to a “widget”. The sad part is that he’s right. If you take my annual salary plus bonus and divide it by the number of hours I charge a year, it comes out to less than $30 an hour. The partner then goes out and sells my time to clients for around $200. That’s an 85% Gross Margin!!!!

I’m not stupid. I realize that there are other costs involved in running an accounting firm. The suite at the Staples Center won’t pay for itself and the going rate on renting a few floors at a downtown sky rise isn’t cheap. NEVERTHELESS, the typical staff accountant earns his total ANNUAL salary in less than two months of work. The other 10 months of work you do goes right into the pockets of the firm/partners. That seems grossly disproportionate. Especially considering the fact that if you ask for a little extra money at raise time you’ll probably get laughed at.

Question or comment? Do you agree or disagree with the above article?Let your voice be heard. (Your responses will be posted in an upcoming article.)

At most accounting firms there is a designated scheduling person or department. Seniors, Managers and Partners will make scheduling requests and “pick up some time” from any available staff. The staff schedules are usually kept in scheduling software and/or on Excel spreadsheets. This schedule gives visibility to the staff and their supervisors about what clients they will be working on for the upcoming week, month, and year. The schedule is constantly changing, so it is important to check it often. Clients can be added or dropped from a staff’s schedule for a variety of reasons.

An in-charge chooses a staff for their client based on the following criteria:

A staff can use this knowledge to help manage their schedule. Please continue to visit the PASA website for helpful tips on how to get picked up on better clients.

Recently, one of our editors sat down with a partner at a large accounting firm and gained some insight into the ebb and flow of accounting professionals from firm to firm and job to job. The partner explained that everyone who quits is doing one of two things:

It is a simplistic way of looking at the situation, but it is 100% true. The partner went on to say that, from his 20+ years of experience, the group that is “running from” a firm very rarely, if ever, finds what they are looking for right away. In fact, oftentimes, the person will end up making another job change within a year. (We asked some of our members about this. One PASA member, who was a part of the “running from” group, changed jobs three times within one year after he left his old firm!)

The other group that is “running to” a great job opportunity has a much higher success rate for career growth and long-term employment. It is important before you switch accounting firms or completely leave the public accounting industry that you make sure you are “running to” the right job. PASA has provided several means to meet this goal:

In conclusion, the partner gave us some advice……Before you decide to quit your public accounting job, make sure you are doing it for the right reasons. Always be “running to” a great new opportunity. Also, if there are things you do not like about your firm, take action. Tell someone. Let your voice be heard. A firm’s greatest asset is its employees. A good partner recognizes this and will work with you to make the firm a better place to work.

From time to time the editors of the PASA News page will post accounting industry observations in an “editorial” style. The PASA Industry Notes are meant to spark a dialogue as well as inform others about the comings and goings in the industry.