Researchers Examine Employee Turnover At Public Accounting Firms.

A new research study provides a rich understanding of how CPAs in public accounting actually experience the turnover process.

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Employee turnover and staffing shortages are major concerns for public accounting firms. A new research study provides a rich understanding of how CPAs in public accounting actually experience the turnover process. The study also examines how turnover experiences, including how employees are treated during their exit process, can have important downstream consequences for firms. After all, those who leave public accounting are often in positions to recommend accounting firms for future business.

In the study, researchers used two surveys to gather data from CPAs about the turnover process. Survey respondents worked in audit, tax, or consulting and were from both Big 4 and non-Big 4 accounting firms.

One survey targeted CPAs who had left a public accounting firm (“leavers”). Leavers were asked to describe a memorable experience leaving a public accounting firm and were asked questions about the turnover process and how they were treated after leaving the firm.

The other survey was completed by experienced CPAs who have stayed at their public accounting firm (“stayers”). Stayers were asked about other CPAs’ turnover experiences and best practices for handling turnover within their firms.

The study is titled “Turnover experiences in public accounting and alumni’s decisions to ‘give back’” and is forthcoming in Contemporary Accounting Research. The study’s authors are Lindsay Andiola of Virginia Commonwealth University and Derek Dalton and Nancy Harp, both from Clemson University.

“Poor work-life balance is a primary factor influencing the decision to leave. Firms must offer genuine improvements if they want people to stay. Leavers are skeptical of empty promises for work-life balance improvements, so efforts to retain employees need to provide authentic, realistic solutions,” says Harp.

The study finds that leavers often discuss their thoughts about leaving with others at the firm (e.g., co-workers, mentors, supervisors) and spend months thinking about leaving before making their decision. Stayers also report noticing several warning signs of leaving. Top warning signs include lower quality work and personality changes. Thus, firms have ample opportunities to intervene in most turnover cases.

“Mentors are involved in several key aspects of the turnover process, but most managers and partners who remain in public accounting report that mentors at their firms do not receive any training on how to navigate the turnover process. For example, they may not be trained in how to handle delicate discussions about leaving. Further, while keeping in touch after employment ends is a key factor in obtaining future business referrals from leavers, findings from our study suggest that most mentors do not continue to mentor or communicate with former employees after their departure,” notes Harp.

Several aspects of the turnover process affect the likelihood that a leaver will recommend their former firm. For example, those who experience negative work-related “shocks” (e.g., a bad supervisor experience) are not only less likely to stay with the firm, but they are also less likely to recommend their former firm for business in the future.

Harp concludes, “Our findings suggest that firms should take a ‘lifetime’ view of employees because how a firm treats employees during employment, especially during the sensitive exit phase of the turnover process, has enduring implications for both retention and future business referrals.”