I’m often asked what led me to where I am. “What did you do before Ceterus?” or “How did you get where you are today?” and “Why did you leave public accounting?” Questions like these are never simple. Addressing them requires the kind of context that can only come from explaining the “Why” behind every step along my professional journey.
My path to Ceterus was simple, yet also very complex. Including Ceterus, I have worked for two companies in my professional life. So my path, though long in years, was short on change. Background details might shed light about why the decision to jump on board was simultaneously the easiest and most difficult decision I’ve ever made.
My story begins with two questions. Why accounting? and Why Northwood University?
From a young age I knew I wanted to be a part of “business,” but I didn’t altogether understand what that meant. During my junior year of high school I took the only accounting course offered. Accounting came naturally to me, and it piqued my interest.
It made sense to pursue an accounting degree as the next step. That said, I was drawn to Northwood because of its focus on freedom, business, and management. Every class I took during my time there centered around those concepts – no added fluff. My first accounting class started first semester, five days a week – at 8 a.m. I loved that I felt I was growing [more] into a professional every day.
For as long as I can remember, I have always had a “big picture” view on things. My family even likes to joke about “Derek the philosopher.” This became even more apparent near graduation leading into the job search. I had serious reservations about what life looked like after college. I struggled to see the value in the jobs I had starring me in the face, but also had no idea what to do about it. All I knew was getting a job was next on the list and I was going to control that process.
My time at Northwood sold public accounting as the best path for accounting graduates. Get in with a good sized public accounting firm, study hard, and get your Certified Public Accounting (CPA) license as quickly as possible. ‘Those magical three letters behind your name will open doors in the accounting world,’ they told us. It made sense. So that’s what I did.
On the job hunt, I spent a great deal of time researching the public accounting firms interviewing on campus. I quickly realized one firm fit what I wanted coming out of school. I’m sure it was short-sighted, but I only set interviews with this and one smaller local firm as a test run. Luckily, I received and accepted an offer to be a member of the assurance department from the firm I wanted before graduating. I did it! I had a great four years and landed a great job. The real world beckoned me and I eagerly awaited it.
What Did I Get Myself Into?
I think virtually all graduates that choose public accounting make the statement, “I didn’t know what I was getting myself into.” This was certainly true for me. In addition to the typical ignorance graduates have about public accounting, I also chose not to do the standard college internship with a public accounting firm. I had a very good non-accounting gig during college that was too good to turn away, so I didn’t have a clue what awaited me – for better or worse. I was an auditor with a very good firm – things were good.
Fortunately, I found my personality was made for the public accounting world. I am a very competitive, highly confident person, and I love a challenge. It was a natural fit. Regardless, it didn’t take very long before my first “I didn’t know what I was getting myself into” moment.
During the dreaded “busy season” I worked as the staff auditor on an engagement. We ran into many issues throughout the audit process; and we worked a ton of hours to try and get it done as quickly as possible. One afternoon the partner overseeing the engagement was called away. Before leaving, he told the lead auditor and me in no uncertain terms ‘the audit would be done and on his desk by 8 a.m. the next morning.’ And so it was. We got the job done. We delivered on time, at the small cost of a 22-hour workday. I went home, slept a couple hours, and made it to another client before lunch. Hello real world!
That’s only a small excerpt from the 11 years I spent in the public accounting world. I credit the knowledge and skills gained as an investment still paying dividends today, but it was hard-won. It wore on me, and eventually, I lost passion for my work. I believe my story gives added insight from an industry insider who chose a different path right on the cusp of making partner and achieving all that most accounting professionals strive to attain.
What You Can Expect from Public Accounting
High Billable Hours Goals
Success in public accounting ties to meeting or–better yet–exceeding billable hours goals. Billable hours are those hours accountants spend working for clients. In many ways, it creates a series of perverse incentives to overcome.
This structure can create a rub between meeting billable hour goals and being as efficient as possible for each client. Meanwhile, exceeding billable hour goals creates another challenge. Exceed it this year, and rest assured you will see an increase in billable hours goal for next year. That would be fine if compensation aligned with hours worked – it does not.
The hours part of the public accounting excited me. I loved that fact goals centered around billable and non-billable hours. Even more than that, I loved that every person in the company had visibility in everyone’s hours. It created a highly competitive environment which I enjoyed and thrived on. I could easily see if I was “winning” or not.
Ultimately “winning” meant working an average of 55+ hours a week all year long. This is clearly not conducive to any reasonable work-life balance. I sacrificed to make sure I was as present at home for my kids as possible, but it was extremely difficult and put me in difficult situations on occasion. This proved yet another obstacle to overcome.
Navigating a public accounting career also, in large part, encourages participation in playing politics. Ultimately partners in your firm hold the keys to your career development, promotions and so on. Ensuring the “right” people know who you are, what you have done, what you can do, and what you want to do is a very difficult part of public accounting – but absolutely necessary.
Turnover in public accounting is extremely high – turnover rates at large firms average 17%, with one out of six firms experiencing rates over 20%. A significant factor in career progression hinges on the ability to build a team. Having staff follow you and want to work with you is vital in getting to the next level. Turnover rates approaching 20 percent make it very difficult to have the time with staff to build the trust and respect necessary to build a strong team. Not to mention, this commonly leads to general negativity among staff adding to the stress of growing a team.
I found building a team to be the most gratifying part of my job. I was in a unique position to work in an industry with no industry-focused partner support in my local office. Even without this, I built an extremely strong, deep local team of assurance staff that served in one of the largest industries in our firm. Building the team we had was far and away my proudest accomplishment while working in public accounting. It proved instrumental as my path evolved.
Feeling Like a Burden on Your Clients
I worked with many clients over the years. Most years this meant about 20 unique clients per year. I worked on large engagements, so the number of clients was fewer than many of my peers. Still, I enjoyed moving from one engagement to another. Like most, I had clients I really enjoyed working with and others that were more challenging.
Ultimately, my job as an auditor was to dig into how people did their jobs, tell them when they were doing things wrong, and when they could do things better. That was not always an easy task. It required a strong set of soft skills. Some of this came easy; much of it came with personal growth.
At the conclusion of each audit, the Board of Directors reviewed results. I loved this part. At the end of the day, my team and I worked for them, so this generally the one time of the audit I felt value. Otherwise, I often felt like we were intruders.
Imagine someone coming to your job and needing things from you for weeks at a time – not a very enjoyable experience.
Selling Public Accounting
Becoming partner in a public accounting firm requires the ability to sell. Practice development is vital, and promotions don’t come for those incapable of growing the business. Current partners want to know they only promote new partners that will continue to grow the business.
As a general rule the skills that go along with selling are not common among accountants. I truly didn’t have any idea about this piece of public accounting – I didn’t get the business. Mingling at industry events, speaking at industry events are necessary requirements to become proficient in practice development.
The biggest difficulty I faced with practice development surfaced in selling a compliance activity. Third parties ultimately force audits. They’re extremely costly, and the value isn’t immediately apparent. This made it incredibly difficult for me to carry my passion into selling an audit.
What Did I Know About Business?
Turns out, nothing! As an auditor, I was trained to analyze accounting systems, accounting standards, audit assertions/testing, assertions/collecting, and audit evidence. Everything I knew about business, I witnessed from a 20,000 foot view.
I could tell you if a balance sheet was properly stated. I could tell you at a high level how certain functions of the business were handled. But I had no idea how business really worked until years later.
In spite of the high standards and challenges, public accounting fit me personally — I thrived. I built a robust team. I worked on the biggest, best engagements in a rapidly growing industry, and developed a reputation as a leader in my industry. The firm had begun discussions about promotion to partner. Behind me laid a track of proven results. Before me stood a financially lucrative opportunity.
So what made me do it? Why did I leave it all behind for Ceterus?
I first met Levi Morehouse in 2001. We were both working at the firm where I spent my first 11 years and became friends immediately. We shared common interests and a common path to public accounting. He left the firm not long after. We stayed in touch, but life went on down our own separate paths.
Fast forward several years, in 2008, Levi pitched Ceterus to me for the first time. All I saw that day was a very small business with a founder who actually slept less than I did. Tough as it is to admit, I lacked his vision. I saw Levi’s high-risk, unproven business concept matched against the backdrop of predictability, financial gain, and notoriety I had carved through my career in public accounting.
Nearly three years passed. 2011 started. A light bulb finally flickered.
Making the Switch
The way I thought about my professional career began to evolve. I assessed the work I was doing daily and recognized an unhappiness I felt in my day to day work life. I came to terms with my distaste for the system I worked in – where my promotion was a finish line based on time, not merit; where the goals and the playing field were both out of my control. The more I mulled it over, Levi’s vision gained credibility. It challenged my disposition toward my circumstances. It made me imagine alternative I hadn’t before.
I pictured myself in a situation where my input directly translated into real, lasting value; where my ideas and recommendations truly affected success; where the results I delivered enabled businesses and business owners to make more money, employ more people, and grow more. Thinking about the tangible ways I could help businesses… that excited me.”
In the following months, Levi and I talked more regularly. Things fell into place and it became make or break. All of my boxes checked yes:
- I could add value to someone or something every day I went to work
- It would be a chance build something from the ground up – my ideas would be instrumental in the success or failure of the company
- I would be a better business professional by working in private industry
- We would build a dynamic team of individuals that would ultimately do everything they could for Ceterus
- I would be able to provide for my family in a way I could feel proud of every day
I remember being genuinely excited about work again for the first time in years. It was like experiencing freedom for the very first time. I understood what I had to do to make it happen.”
Finally, in March of 2012, in what proved to be one of the easiest decisions of my life, I took the leap. I left public accounting and joined Ceterus.
Life After Public Accounting
It would be inaccurate to say the rest is history. It’s been a grind.
There have been many culture shocks, like immediately jumping into tasks most high school kids would consider, “below their pay grade.” There have been multiple occasions which left me wondering, “Can Ceterus be as big as we say it can?” There have been unforeseen trials and tribulations as we’ve built it from the ground up, but I don’t regret one single second.
Each new difficulty provided an opportunity for me to grow and for us to move closer toward our identity as both a team and company. We’ve come through each difficulty stronger and with greater resolve. In the face of these, my personal values and the values of Ceterus crystallized:
It became apparent these had guided me toward each milestone–from my first accounting class to choosing the right university, laboring through a 22-hour long day, delivering on audit after audit. Ultimately, the opportunity to continue living out those values in my work led me to Ceterus. Knowing that makes it easy to understand how I got where I am today.
I am where I am because of the seeds my values planted at each step along my professional journey.”
It took nearly two decades of intense work to articulate these values as the metrics for my professional success. Similarly, as a growing team and company, we did not spell them out at the start. In both cases, honing in on them required trial by fire.
Today, those values–results, accuracy, efficiency, independence, and flexibility–live at the core of everything I do and everything our Ceterus team does. They showcase the identity of our company and the characteristics of our team members. They’re not buzzwords. They’re trail markers. They led me to Ceterus, and they stand as an open invitation for others–like Levi, like each member of our team, like me–to join us in our mission to empower entrepreneurs.