While working for the Big 4 is the dream for many aspiring accountants, this may not be an ideal job for your long-term career. Essentially, this comes down to the difference between small accounting firms vs. large accounting firms.
Let’s take a look at the pros and cons of Big 4 accounting firms weighed against small firms so you can make an informed decision for your accounting career.
At the Big 4, you work on big clients and are staffed on big teams most of the time. As a junior staff member, you will specialize in a specific part of the audit – for example, fixed assets. And if you work in tax, you might only work on state and local taxation (SALT).
On the other hand, at a small firm, you work with smaller clients, and junior auditors can work on an audit from beginning to end. Similarly, while working in smaller firms as a tax associate, you will work on individual and corporate returns and many types of returns in between.
You’ll get great exposure in many aspects as a first-year associate in the Big 4. The breadth and the quality of the client base are unrivaled. Thus, you can get your hands on some complicated situations and learn how to deal with them with the help of senior accountants.
As you progress, you will be exposed to companies in many different industries. If you perform well and people generally like you, you can tailor your career within the firm and gradually move towards a specialized industry.
The Big 4 firms have the resources to provide numerous in-house training for junior accountants. It begins with a one- to two-week national training for new hires, then regular training and online webinars on special topics afterward. These classes are free and helpful for your career development, as well as for fulfilling your CPA CPE requirements.
Speaking of the CPA qualification, the Big 4 will help you get licensed quickly. These firms offer CPA Exam prep like Becker CPA Review for free or may reimburse the cost of another review course if you’ve purchased that already. After passing the exam, you’ll get a CPA bonus. What’s more, you will also have no problem getting your work experience verified by your manager, who by default is an actively licensed CPA.
When it comes to exit opportunities, Big 4 is hard to beat. Whether you want to stay with the Big 4 or move on to a smaller firm, this experience is seen as a seal of approval from a resume perspective. Your halo will continue to glow at your new company as people generally give more respect to those with previous Big 4 experience.
The Big 4 firms serve the biggest corporations in every industry. Therefore, it is understandable that the clients’ demands and expectations are higher. As part of the Big 4, this basically means that you will need to work hard (and fast) to deliver the product. Additionally, there will be extra pressure to make sure the product is of the best quality.
Many accountants find it overwhelming, but some perform better in a high-pressure environment. A Big 4 work-life balance can be difficult to achieve if you must work nights and weekends. A 40-hour workweek isn’t exactly something big 4 firms are known for, so expect that you will spend 60+ hours working each week.
The Big 4 is not a place for someone looking for a stagnant lifestyle. Staying in one level and not moving up is simply not a viable career choice. If you aren’t promoted within a certain amount of time, you may be forced to leave. That’s why many Big 4 accountants end up leaving the firm despite all the attractive qualities mentioned above.
Also, big 4 firms require you to earn the CPA certification to move you from an associate to a senior position. Therefore, you may have many things to juggle at once if you didn’t complete the CPA Exam while in school (if you met the requirements) or immediately after you graduated.
Depending on the nature of clients in your office, you may spend more than 80% of your time on one single client. This client is large and high-profile, which is great if you plan to stay and move up the public accounting hierarchy in Big 4. However, if you prefer variety, you won’t like it because the large client swallows up most of your schedule. Subsequently, you’ll have less exposure to other companies and industries.
The Big 4 accounting firms have grown so large that you probably won’t know people outside your department. Also, in terms of client servicing, given the size of the clients and the audit team, you might get stuck with mundane work for the first couple of years.
Regional and local CPA firms are often smaller, so developing a close working relationship with the partners is easier. Also, the audit teams are much smaller, so you will have more chance of working directly with the firm’s partner(s). Conversely, at Big 4 firms, your supervisors will be seniors and managers.
Since you don’t have the luxury of formal training, you learn on the job at the client’s site or while preparing a tax return. This steeper learning curve can be exciting and satisfying (some may find this terrifying, though). You’ll get your feet wet earlier in the process, which can be a confidence-builder.
Because your clients are likely private companies, you’re less likely to feel the pressure from deadlines and complexities from the publicly listed companies that the Big 4 are getting. This usually translates to better hours and work-life balance. While there’s still a busy season, there’s also the possibility of lighter hours once the busy season ends.
Accountants working at a small CPA firm have the chance to perform entire audits alone and do taxes during the busy season. Your practical experience will cover the vast majority of FAR, AUD, and REG, more than 75% of the CPA exam content.
In a typical regional CPA firm, the client base is smaller, and you’ll have less of a chance to develop a broad base of experience. This could mean frustration if you get stuck in an industry you are not interested in. You may also have fewer networking opportunities.
Competition to move up the ladder can be tougher and slower than in a large firm. A handful of partners decides your assignment and promotion. This can be very subjective and sometimes unfair.
It’s safe to assume that the Big 4 can afford to pay more than the smaller firms. A small accounting firm’s salary typically starts at a few thousand less, and they may not offer a bonus after passing the CPA exam.
Salaries are largely the same from firm to firm if you’re working in Big 4. In contrast, salaries at small firms will vary. Here’s a general breakdown of expected CPA salaries for tax services at small accounting firms vs large accounting firms according to the Robert Half 2021 Salary Guide.
Big 4 Firm
Small CPA Firm
|Associate (starting salary)||
$57,250 – $75,750
$40,500 – $49,000
$70,500 – $93,500
$49,000 – $59,750
$87,250 – $115,500
$62,000 – $73,250
$127,000 – $167,750
$88,500 – $107,000
$165,000 – $217,000
$114,250 – $137,500
The difference between small and large firm salaries increases over the length of a career. Additionally, small firm accounting tends to come with fewer bonuses. However, remember that Big 4 hours will continue to be longer and the work more stressful. Finally, you may have fewer exit opportunities after passing the manager level at a Big 4 firm.
People are generally well aware of the benefits of the Big 4 experience. Therefore, I would like to highlight the opposite — how local and regional CPA firms could be attractive. Here is a testimonial from an accounting graduate who started at a small firm.
Yes, I think it is better to start out with a smaller firm than a larger one simply because you will get a better chance to get to know your co-workers better and nothing will be a rush. You will also get to learn more about the career you chose with the one-on-one rather than being thrown out in a sea of sharks.
I know because I have work[ed] for a small company with at least five other people working under me . It was better for us because we got to know each other and what was expected of each one of us without all the drama.”
Here is another supporter of small CPA firms.
Joining a small firm always helps in gaining more experience faster. In the larger firms, the work is distributed into smaller chunks between more number of employees, and so you get to gain experience in just one small area.
In smaller firms, since they do not have the luxury of a large pool of employees, more work is distributed to small number of employees. So the breadth of learning is quite high. Survival in the initial days will seem to be difficult, but over a period of time, you get to learn more and handle stuff yourself.
One good way to cope up with difficult situations is to ask someone to mentor you (not train but mentor) so that you can go to them and talk about the problems you faced. They can in turn give you valuable advice in terms of managing such issues.
Another way is to network with as many seniors as possible and try to learn without eating into too much of their time. And once you gain experience, you will be surprised at how well you will be able to guide freshers.
But there is a downside to all this. Because your experience is only through field work and without proper training, sometimes the learning will be haphazard. But the pieces will fall into place in the long run. During your free time, you can also Google on stuff which you were stumped about in case there is no one to help you out.”
Many people who spent a few years working at a Big 4 firm before moving into an industry job find that their time at the large firm opened many doors for their careers. However, that doesn’t mean it’s right for everyone.
After hearing all the benefits of working for the Big 4, you may wonder why anyone would want to work at a small firm. However, small accounting firms have several benefits, including a better work-life balance, broader job experience, less pressure, and closer relationships with co-workers. The decision between small accounting firms vs. large accounting firms comes down to your priorities and long-term career goals.
As you acquire experience with the Big 4, you’ll likely find that job site head hunters begin contacting you about a wide array of other job opportunities. When you decide to leave may depend on whether you’re looking for audit vs. tax exit opportunities. Big 4 audit exit opportunities peak after about two to three years with one of these firms. On the other hand, your public accounting tax exit opportunities increase once you have hit the manager level after four or five years. At that point, you’ll be a highly sought-after tax expert.
I’d love to hear your thoughts. Please share your view in the comment section below.
I am the author of How to Pass The CPA Exam (published by Wiley), and I also passed all 4 sections of the CPA Exam on my first try. Additionally, I have led webinars, such as for the Institute of Management Accountants, authored featured articles on websites like Going Concern and AccountingWeb, and I'm also the CFO for the charity New Sight. Finally, I have created other accounting certification websites to help mentor non-CPA candidates. I have already mentored thousands of CPA, CMA, CIA, EA, and CFA candidates, and I can help you too!