[CPA2BEE]

Hello Everyone,

So I passed the CPA exam a few months ago and should be issued a CA license number any day now. Now that the extension deadline is over my boss just informed me that we are going to meet next week to discuss the raise I will receive and my future with the firm. I know what I want as my salary but fear I will not get it. Here is a little background about my situation to give you some basis for your inputs:

I’m 26 years old, have worked in public accounting for 3 years in Southern California, have a masters equivalent and soon to be a licensed CPA. I have worked for 2 different firms thus far in my career – one for about a year and my current firm for about 2 years (3 years total). We are a small firm and the partner doesn’t do the traditional promoting to new titles that you see at other firms (staff, senior, manager, etc). It is just the partners and a handful of staff beneath them with all different experience levels and skill sets. I am the only one currently on the staff with CPA credentials. The partner I work under has always praised me for my work and often tells me how well I am doing, mentioning a few times over the last few months that I am at senior level and performing senior work. He has also mentioned several times that he is soon going to increase my billable rate once I get my CPA license.

I don’t know what salary he is going to bump me to but I am anticipating somewhere around 65k-70k. I feel that I should be paid north of 75k, given my education/experience/qualifications in relation to what I am seeing on the market and my peers at other firms. I’ve never really spoken up when I’ve received raises or promotions if I thought I should be paid more money, and for the first time I feel like I should have some leverage to say something and speak up if I’m feeling shorted.

So my question to you guys is this: how do I go about countering what my boss offers me if I feel I should be paid more? Any other SoCal people out there who can gauge what I should ask for? I have the argument of what my qualifications translate into the market salary-wise, I want to offer to take on more work, etc. One thing I’m not sure if I should bring up is that just by having a LinkedIn profile, I often get messages from recruiters sending me job postings for senior positions (often Corporate jobs) that pay 80k-100k. Again, we are a public firm and a lot of these are private jobs so I don’t know if that is a valid argument.

Any and all feedback is appreciated, sorry for the long-winded post.

FAR - 80
AUD - 82
BEC - 80
REG - 85

ETHICS - 90
EXPERIENCE - COMPLETE
Application for California license mailed 8/4/2016

[Anonymous]

Be sure to update us how it goes. 🙂 Doesn't have to be specific figures of new salary, but at least a “I feel like we came to a fair agreement” or “Well…I'm sprucing up my resume tonight” haha. 🙂

[Anonymous]

lol @ salary at 50% of billable rate.

I'm at 10%. $225/hr. $250 if during busy season.

[Anonymous]

@ejoern Are you saying you get paid $22.5k/yr? Or $22.5 per hour? Cause the example was 50% of billable rate as annual salary, so if you're getting $22.5/hr, that would be about $51.3k/yr (if no overtime), which would be 22.8% of billable rate the way livealittle was calculating. If you're getting paid $22.5k/yr and billing at $225/hr, then you're substantially underpaid. Even at $51.3k/yr, it may very well be underpaid, but at least would be double of $22.5k. 😛

[CPA2BEE]

@Lilla I'll definitely update the post after I speak with my boss, should be an interesting day!

FAR - 80
AUD - 82
BEC - 80
REG - 85

ETHICS - 90
EXPERIENCE - COMPLETE
Application for California license mailed 8/4/2016

[CPA2BEE]

Just to give you guys an update, I had the meeting with the partner yesterday. Going into it I was worried about the salary not being high enough, and no I did not get that 20% raise I was hoping for (shocker, right?). However, I left our meeting yesterday very happy and excited. I received a 3k bonus for passing the exams, a 10% raise on my salary, and will begin receiving 10% of the gross revenues for any new clients that I bring to the firm. He said just by bringing them to the firm, I don't even necessarily have to be the one working on them, I will receive 10% of the gross revenues from those clients for whatever we bill them for the year. The firm is paying for me to join a networking group, plus with word of mouth and referrals I'm hoping I can pull in a lot of business for the firm! I realized yesterday that you can't just look at the salary but have to look at your whole compensation package, sometimes you have a lot more than it seems!

Thanks to everyone on the forum for your advice. It helped me keep an open mind and realize that giving raises have to work for both the employee and the firm – its a two way street!

FAR - 80
AUD - 82
BEC - 80
REG - 85

ETHICS - 90
EXPERIENCE - COMPLETE
Application for California license mailed 8/4/2016

[Anonymous]

Glad to hear you're happy with the result. 🙂 10% of gross billings could be very substantial depending on what you bring. If you could, say, land an audit client that was a $30k/yr audit, that's $3k/yr for a single referral!

[livealittle]

@ejoern lol @ salary at 50% of billable rate.

I’m at 10%. $225/hr. $250 if during busy season.

at 10% you have an annual salary of $22.50. I don't think you understood me.

When I first worked at a CPA firm, my salary was $28,000 a year. my billable rate was $60 an hour. 60 divided by 2 is 30. I was almost making $30,000 a year. That's about 50% and accurate to what I said. When I started at the firm I work at now, my billable rate was $110 an hour and I made $57,000 a year. That's about 50% the way I explained it. not sure what you were laughing at.

does this hold true for others in public accounting?

BEC - 8/8/16
REG - 66, 77
AUD - 81
FAR - 9/8/16

[CPA2BEE]

Thanks @Lilla. Selling the business will be something new for me and I do worry that some of the big, profitable clients (100k+ per year gross revenues) will see that I am a young guy and maybe my knowledge/experience might not match to other partners with years and years of experience trying to sell them at other firms. Although I will be selling the firm rather than myself, so hopefully they can pick that up as well. This will be a new skill for me to develop and it may take some time, but the possibilities with this are huge! I'm for sure excited.

@livealittle you are correct that your salary (in thousands) should be roughly 50% of your billable rate, or that is a rule of thumb at least. It holds true with my current salary and has in the past as well.

FAR - 80
AUD - 82
BEC - 80
REG - 85

ETHICS - 90
EXPERIENCE - COMPLETE
Application for California license mailed 8/4/2016

[Anonymous]

Sorry I was laughing at myself. My annual salary is $46,500/2080=$22.36/hr vs $225/hr billable rate. So using that calc I should be making $112,500.

[Vanessachy]

Congrats!!! CPA2BEE.

Far 10/26/2015, 64, 1/4/2016, 82
Reg 7/10/2015, 60, 2/27/2016, 86
Aud, 5/9/2016, 74 (ouch), 7/26/2016, I cannot wait to take this test again
Bec, 6/10/2016, 70,9/8 retake

[CPA2BEE]

Thanks Vanessa! Congrats on getting licensed, I'm STILL waiting here in CA its ridiculous.

FAR - 80
AUD - 82
BEC - 80
REG - 85

ETHICS - 90
EXPERIENCE - COMPLETE
Application for California license mailed 8/4/2016

[Author]

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