Posted by: LYF | April 23, 2009

Tax Season

During the third week of February our office gets ready for busy season.  Around lunchtime we get a memo that outlines the stepwise increase in hours, which begins with working every Saturday morning.

It’s a first blow.  Working Saturday mornings sucks no matter how you look at it, but you know that’s only the beginning.  In a few short weeks you’ll be working full days on Saturday and well past 8 during the week.

It’s easy to take for granted the gradual increase in knowledge that comes from working at a steady pace.  I mean it’s easy to take for granted the relationship between what you learn and how fast your have to learn it – the relationship between necessity and application.

Busy season isn’t hard because the work is more complex.  Busy season is hard because the pace has increased to such a level that learning can no longer be passive.  You can’t work slowly and incidentally learn.  You have to learn purposefully and focus your attention on the things you don’t know and aren’t comfortable with.

Here’s some examples of what I’m talking about.  The first one I managed to come out on top.  And the second, well, not so much.

Example 1 (conversation between CEO and myself re upcoming audit)

Me: Hey how come this amount is sitting as a due from your subsidiary when we’re doing the consolidation?

CEO: Do you have the subs bank statements?

Me: Yeah

CEO: Well if you have the subs bank statements, then you also have the subs bank activity for the year.  And if you have the subs bank activity for the year, then you’ll have the information you need to determine what that balance relates too.  Plus, you have the GL, so you can see exactly what’s going through that account.  I think you have enough information to figure this out on your own.

Me: [while feeling emotionally and mentally crushed] True, I do have that information.  However, the bank activity does not explain the nature of the $1,000 and the GL detail is a single line item with no description in the memo field.  There’s no description because the accounting software you are using runs on DOS and doesn’t allow this – but that’s a different issue we’ll bring up in the management letter.  I know we can both say that $1,000 is well below materiality, and probably was just a transfer to cover the small legal costs in the sub, but I was just curious what the amount related to, so I can reverse it correctly instead of just plugging it.

CEO: Oh

Me: [you just got served]

Example 2 – (conversation between me and my partner)

Partner: Where’s this rental income coming from?

Me: I think the operating company is renting space from him

Partner: Well why the hell are they doing that?! The operating company is in a loss position, so they don’t need the extra expenses and we’re trying to minimize the guy’s taxable income so he’s getting screwed as a result.

Me: Uhhh…

Partner: The client pays us to be smart, not [insert very colourful words] dumb.

Me: [I just got served….big time]

These aren’t isolated incidents.  I have conversations like this every day.  And everyday, at some point, I feel insignificant, mentally inferior and generally stupid.  But if you bang your head against something long enough, it’ll usually leave a mark.

In the past two months I’ve done close to 50 tax returns, seniored 3 different audits (at once) and I’m starting another junior mining company tomorrow.  I’ve done research on support payments eligible for deductions, flow-through shares, principle residence when a change in use occurs, whether same sex married couples can couple their tax returns, the audit implications of determining the rights and existence of mining claims and impairment testing on resource properties.  I’ve written a qualified audit report, sat in on two audit committee meetings and experienced what it’s like to drop a client.

Throughout all of this I screwed up often and people let me know it – usually very quickly too.  It’s an awful experience not knowing how to complete a file when you’ve been given a ridiculous deadline.  It’s sink or swim.  There’s no way around it.

This is why busy season is awful.  Not because it’s hard, but because it makes you better.  And to do that, you need to focus on everything you’re not good at and accomplish it in half the time you’re used to.

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Responses

  1. I’m horrifically jealous that your busy season doesn’t start until late Feb, and that you only work until 8pm.

    For me, busy season is hard because I don’t sleep for 3 months and don’t see my family and friends often for even longer.

  2. That’s brutal. I’m at a small firm, so things aren’t as crazy.

    Have you seen this article (http://www.examiner.com/x-3040-Minneapolis-Life-in-the-Cubicle-Examiner~y2009m3d10-PWC-Deloitte-EY-and-KPMG-Big-4-employees-modern-indentured-servants ). I thought it hit the nail on the head when it comes to busy season.

    Are you at a big 4 firm?

    • Yup, at a big 4.

      I agree, that article really nails it! I think a huge part of it (at my firm) is the inconsistency – some people get great experience and lots of appreciation for their blood, sweat, and tears. Other people get the complete opposite.

      Having worked in the “outside world” before starting my CA, I find it so removed from the real world – working those hours, and the general expectation to do things in less and less time.

      • Is the outside world really that different? I have no point of comparison. I went into accounting straight out of school.

        And yeah, the expectations are ridiculous some times. How do you cope with that?

  3. […] Original post by LYF […]

  4. I think that’s one of the toughest aspects of public accounting in general…I always thought I was a fairly smart guy but each day people make me doubt my intelligence…frustrating haha.

    I can’t believe you’ve written a qualified audit report. I thought that was pretty rare…client must have really messed up.

  5. It’s not always because they messed up. This was a not-for-profit and a lot of them contain a scope reservation over the completeness of revenues because its mostly a cash business.

    You can’t test controls over people fundraising/collecting cash during the year. And there’s not much you can do as you’re doing the audit.

    The other one I wrote was a scope limitation too. But that was the result of a prior year problem. I haven’t found anyone doing anything malicious to date – thankfully.

  6. […] young Accounting Elf – check out the clever post about tutoring accounting, and fellow Torontonian Look at Last Year's File – check out how to serve a CEO the hardcore way, who may win the "amusing name" contest […]

  7. Ah qualified opinions. What great fun. All depends on where you work and what kind of clients you deal with, fer sure.

    As for coupling, I’m pretty sure they’ve been able to couple their returns since the 90’s, before it was all fashionable and hip to support that sort of thing… if my recollection of university tax is any guide anyway.

    Sounds like you’re having a great time. As much as the vortex sucks you and your life in, you definitely can take LOTS out of it. And office work still doesn’t feel as bad as a proper physical boot camp. :p

  8. Ah not for profit makes sense. I can see their financials always being kind of wacky.
    I always thought qualified opinions were just a tool in the auditors belt to get clients to comply with us.

    I can’t believe you’ve done 50 tax returns while senioring audits…I’m lucky if I’ve done 20 T1s at this point…doesn’t help that my T1s range from 10 hour jobs to 50 hours jobs :S

  9. Some tax returns are easier than others. I can whip through a really basic T1Simple by hand in 5 minutes flat.

    The big “I’m loaded” returns aren’t necessarily harder if there’s just a small set of income entries.

    When you have someone with every single special category of income and deduction under the roof – and complicated stock options! – then things get a bit insane.

    Qualified opinions are a tool, but tools get used. 🙂

    • So true…

      The worst are sole prioprietors. You have to do a notice to reader first, so you can get their income statement to input into a T2125.

      Investment schedules always make things tricky too.

      • Re: “outside world”

        Dude yes. When doing audits, haven’t you noticed those companies where everyone disappears at 5 p.m. sharp, if not sooner? Yup.

        This reminds me of a post I meant to write ages ago. Seems like a good time to do it.

  10. […] be readily apparent that a "long day" has different meanings to different people. In a recent conversation, I realized however that what's considered normal is not, however, all that … to someone who may have 'grown up' in a CA […]


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