Big 4 Accounting | Corporate Finance department - what you NEED to know
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- Опубликовано: 26 сен 2020
- In this video I explain what the Corporate Finance department at the Big 4 accounting firms does. Happy to answer any questions below!
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📝Brief script:
To begin with let's look at the team I work in, the M&A Advisory team within the corporate finance division. The team is also called deal advisory or lead advisory in some of the firms. M&A stands for mergers and acquisitions and there are various sub teams within this team, based on specific Services provided, particular sectors and different geographies. The main sub team in M&A Advisory is the M&A team itself. The team acts as advisors on M&A transactions and helps in the preparation, planning and execution of the transactions. So the team can work on both the buy side and the sell side, which means that they can advise a company when it is hoping to Acquire another company, or a division of a company, which is the buy side. And the sell-side is where the team advises a company, technically the shareholders of that company, when they are trying to to sell their shareholding. M&A stands for mergers and acquisitions and there are various sub teams within this team, based on specific Services provided, particular sectors and different geographies. The main sub team in M&A Advisory is the M&A team itself. The team acts as advisors on M&A transactions and helps in the preparation, planning and execution of the transactions. So the team can work on both the buy side and the sell side, which means that they can advise a company when it is hoping to Acquire another company, or a division of a company, which is the buy side. And the sell-side is where the team advises a company, technically the shareholders of that company, when they are trying to to sell their shareholding.
The M&A teams at the big four provide advice on mid market sized transactions. The definition of mid market does vary slightly but You're looking at transactions between £30m and £150m, on average.
Another difference between the Big 4 M&A teams and the big investment banks is their capability in raising capital for clients in the public markets. Services include reviewing and advice on suitability for listing, preparing the business for listing, identifying suitable brokers and providing guidance on all the regulatory aspects of the process.
Moving onto what is generally the largest team in the Corp Fin division in terms of the employees and usually revenue as well, the transaction services team, which provides due diligence services. Again this team has a different label at each of the firms. This is the Big 4s bread and butter when it comes to transactions and the Big 4 dominate when it comes to providing due diligence services in the market.
So what does the team do exactly? Due diligence provides a potential buyer of a company with independent assurance in relation to a company they are looking to buy, and is a detailed investigation into the Target i.e the business being sold. The DD team will interview the management and employees of the target, analyse the information that they provide and utilise other market information for the purposes of benchmarking i.e. comparing the targets performance against its competitors.
Moving onto the Valuations Advisory team at the Big 4. As the name suggests the valuations team provides Advice on existing and potential assets and/or liabilities. They can provide independent reports on valuation during a transaction to both buyers and sellers. They also perform compliance related work such as Purchase Price Allocation and work alongside audit teams whenever they need technical guidance on valuation in relation to financial reporting.
The final important team in Corporate Finance is the Restructuring services team. This team provides various services to companies that are facing financial difficulties.
The most high profile engagements that this team performs is the insolvency engagements. Insolvency occurs when a company does not have enough assets to cover its debts or it can not meet its debt obligations as they fall due.
🤔 The video provides answers to the following questions:
What does the Corporate Finance team at the Big 4 accounting firms do?
What is Big 4 Corporate Finance?
What are the different teams in Corporate Finance at the Big 4?
What do Corporate Finance teams do?
What does the M&A team do?
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This is genuinely one of the clearest, most well-rounded summary of corporate finance about. Even the presentation, lighting/ word choice is faultless. Congrats mate
Hope you found the video useful! Happy to answer questions below. 🙂
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01:37 M&A Advisory
08:18 Transaction Services
11:27 Valuations Advisory
12:56 Restructuring Services
🎥Audit to Corporate Finance at the Big 4: ruclips.net/video/KQit4P47tPs/видео.html
Thank you! your videos are all very well structured and informative!
My pleasure. Glad you find them useful 🙂
Best breakdown and summary I have seen covering corporate finance. Thank you! I am close to joining this field and I wanted to have a foundational understanding of the industry. You have provided it.
Thanks for the feedback and glad you enjoyed it 😀
Really appreciate your video! It is very helpful!
My pleasure, glad you found it useful 😀
I am going through an interview process to join a big 4 as a partner. Best overview I've seen, thank you!
You're welcome. Best of luck 🙂
Keep going bro... I love your videos
Much appreciated mate
very helpful video, thank you
Glad you found it useful
Perhaps the most detailed and easy to understand overview! Many thanks.
Would you mind kindly sharing your opinion in what aspect of DD/ transection service team, does value creation/ strategy plays in ?
Thanks for the feedback.
DD is very different to value creation/strategy. The M&A team will more likely cover those areas for a client.
Great vid
Thanks Alex, appreciate the support 👊
The content of the video is top-notch. Just a suggestion on the hand movement part - your hand movements are too repetitive... try different hand movements for more impact. Keep up the good work!
Thanks for the feedback, have tried to cut it down in more recent vids. Hopefully it's better 🙂
Thank you for lifting the curtain on this interesting department! Which division exposes you to more interesting, diverse, and nonmonotonous work - TS or Valuations? Also, where is the level of workload and pressure higher? Lastly, is Valuations a bit more restricted in terms of exit opportunities? I have to make a choice between these two divisions. Therefore, any further important considerations I might be missing are welcome. Thank you very, very much for your support in advance!
Hey, in terms of interesting, naturally that's very subjective. You'll get more diverse work in valuations as diligence reports are fairly standard. Work load is fairly consistent on both sides. Overall not too much to split them, despite them being completely different in nature. One thing I'd think about if I were you is which role will help you build the skills required for your long term preferred role.
What do you think about the Valuations Team for a transition into M&A as a longterm goal. From my understanding, most (70+%) work is post-deal (PPA) / compliance-related (impairment-testing). What are exit opps (how realistic is corp. dev. really?) & is it possible to move into FDD after joining Val? (In your other video you talked about going audit -> FDD -> Val not FDD -> Val). Your Input would be of great help. Thank you!
Hi, thanks for your question. I've known individuals moving across to M&A from Vals. It certainly is a realistic move. Naturally, like in most career routes you go down, the earlier you want to make the transition, the easier it is i.e. don't wait till you get pigeonholed.
Moving across to FDD is slightly trickier I'd say as Vals is a big picture exercise (valuing businesses, infra. assets etc). In FDD you're digging deep into the accounts of a company, looking at trial balances, trend analysis on particular accounts etc. Saying that though, and as you point out, Vals does require strong accounting knowledge for PPA exercises. Overall, as long as your accounting fundamentals are fairly good, FDD isn't a far stretch at all in my conclusion.
Hope this helps :-)
Thanks found this really useful! What are the typical hours like in busy vs normal periods? Also could you do a video discussing how Big 4 M&A/deal advisory work differs from Investment banks - is it just about size of the deal or is there more to it? Thanks :)
My pleasure 🙂 The range is very wide tbh but you're looking at between 60-90hrs during busy periods in M&A. Normal will be around 50 hrs. Definitely will make a video on Big4 vs IB!
@@FinanceUnboxed Thanks - Will look out for that video!
Thanks for the info! When is your busy period and how long is it?
Hi, what do you think is a good answer to why M&A or why CF at these firms?
Thanks for this explanation! What sort of exit opportunities are available to those who work in Corporate Finance?
Hey, some of them are: Corp Dev (internal M&A), strategy roles, financial planning and analysis roles and senior roles such as financial director
Hey..thanks for such a nice informative video.
Currently, I'm working in Big 4 in FDD and I have an MBA degree as well. How hard/easy it would be for me to move into valuations?
Hi, not that hard I'd say. Clearly also depends on what level you're at as well. The more experienced you are, the more challenging it is. But you've got the foundations in place from an accountancy perspective.
I'd say start networking with that team and understanding exactly what they do.
@@FinanceUnboxed thanks for such a prompt reply. Keep up the good work!
Is there a case study as part of the interview process for a new grad role?
Yes, there is at the assessment centre. Atleast I had to do one.
What drives a person to do this kind of work? Compensation? Is it satisfying? Seems like it could be very rough on the soul.
Hey, it's a good education and good starting point for a career in Finance. Compensation is moderate (relatively) but you're still comfortable. A few other benefits as well, I've made a video about it 👉 ruclips.net/video/e79t1oBZ71w/видео.html
Hi i am interested in majoring in Corporate Finance, and i want to ask you what should i major in college to work in corporate finance
Hey, there is no "required" degree to work in CF. I've worked with people from Econ, Business, Maths, Law and various other educational backgrounds. Saying this, any degree which can help build your analytical skills will set you up well. Hope this helps!
I am a chartered accountants and have certificate in financial modeling n valuation . Can u please assist me in how to get a job in big 4 in corporate finance department
Hey, I would recommend having a look on the company websites as that is the primary way to apply for roles. Hope this helps 🙂
Can lawyers join the Corporate Finance Team ?
Do i need bachelor in accounting to work in corporate finance? Or bachelor in finance is fine?
Hey, there are certainly no specific degrees required to work in CF. Both degrees are fine 🙂
@@FinanceUnboxed thanks..I thought pwc prefers accounting grads
@@ameliatheressa1911 that's unlikely to be the case, unless they state it explicitly on their careers website
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What's your name sir?
Hey, I don't reveal my name on the channel but if you have any questions happy to answer them on Instagram. @financeunboxed
This is helpful but you should stop doing what you're doing with your hands and your inflection when you're trying to make a point. It's twitchty and weird. Saying that not to poke fun but really to help you become a better presenter.
Appreciate the feedback, hopefully the recent videos are much better on those points