If my ultimate goal is to become CFO, which is better? Going the traditional Big 4 audit route, getting a CPA, and then lateral to the finance division of another company or taking part in a rotational finance program (such as that of JP Morgan), getting a CPA (no audit work experience necessary), and either stay or lateral to another company (possibly after a top MBA)? Would going into industry too soon limit my future opportunities or does it not matter as long as I take part in a respectable program and have a CPA?
In Canada, standard route toward CFO is via Audit Partnership at Big4…
I was talking to a buddy of mine recently who worked at a Big 4 firm for years and now works at a start-up. We were having this exact conversation and he said that Big 4 isn’t the traditional route to CFO. Most CFO’s have an MBA, not CPA. I’d actually argue i-banking is a great route to CFO.
Do you want to be a CFO at a small/medium or large company? A lot of the consulting clients I work with are CFOs at small/medium tech companies. Most of these folks were hired out of larger fortune 500 companies where they were in roles like project finance management, division finance managers, or worked directly for corporate finance at the central office. Agreed, most of them are MBAs not CPAs.
From my experience, especially with SOX, you would definitely need a Big 4 accounting accounting knowledge level, so you could get it either way, then likely go into the industry in their finance dept, while moving up and taking increasing leadership roles. Remember, you are the one basically advising Sr. Mgt and CEO about virtually every detail of the business and financial implications and projections. And I mean every detail. Or start off in the finance dept. of the company. I think engineer background also helps, as picking up financial math and concepts are probably easier, esp for many industries. Ie. telecom, auto, oil gas, etc. These guys know their stuff, and you would also need to look forward to being the face of the company when it comes to quarterly financials, raising money, meeting bankers, etc.
Most big firms have a CAO (Chief Accounting Officer) or somebody with a similar role serving under the CFO, auditing would be a good way to get to that role. The best way to CFO is to have varied experiences and have a unique background. You could stay at the same company for 20 years and maybe get there, but that doesn’t usually work. You could become a partner at an audit firm, however, they often don’t know how to help run an actual business enterprise…but these guys are sometimes hired by smaller companies as CFO which they can then lever for interviews at bigger companies.