Every ranking of the top accounting firms in the world begins the same way: PwC, Deloitte, EY and KPMG, in some order. Yet surveys and anecdotal evidence suggest that the Big Four offer a work-life balance that leaves much to be desired, despite providing a sense of prestige that keeps most accountants coming back for more. There is an alternative. Accountants who work at hedge funds say they largely enjoy the status that comes with the name of their employer but without all the long nights. The only problem: you may eventually find yourself stuck or even out of work.
Working as a hedge fund accountant is “pretty awesome from a pay and time-commitment perspective versus what you’ll be doing and making in a comparable job at an accounting firm,” said one former employee who worked at two top New York funds. “While you’re in the back office, it feels more glamorous that something similar at a non-hedge fund.”
He found the work to be more diverse than what he did earlier at traditional tax and accounting firms. Confirming trades, making payments, fixing trade bookings and even working on improving internal systems. Perks included working at a fancy office, interfacing with high-profile front-office staff and having access to proprietary software and other expensive resources, including a large support infrastructure, he said.
“We were responsible for making sure everything was booked correctly and showing correctly in P&L statements, which goes directly to the trading desk in their exposure reports, so you feel important and invested in the process and have ownership of the operations of the fund,” added another former accountant at a hedge fund. “It’s not like you're just an unseen, forgotten schmo who occasionally clears a trade.”
And while the work can be somewhat stressful, the pay is comparable to mid-level positions at the Big Four, with both reporting starting salaries of between $80k-$90k, plus bonus, with around five years of experience. Plus, as hedge funds operate alongside market hours, the work-life balance isn’t like anything you’ll experience at the Big Four.
The biggest pain point for hedge fund accountants takes a while to sink in. You begin to compare your salary to front office colleagues rather than accountants working elsewhere. “I began to realize how I made peanuts compared to the numbers being tossed around elsewhere,” said one former accountant who’s no longer in the business. “It was like a rounding difference on the payments you are instructing multiple times a day.”
But making the jump from the back office to the front office at a hedge fund is a near impossibility, recruiters say. You’ll likely to need got get your CFA and have the enormous support from a key decision maker. “There’s enough back office stigma to make it hard to cross the border into the front office unless you #*%* someone or have big [assets],” said the other, sarcastically, who is back working in tax after getting laid off.
Meanwhile, the resume of a hedge fund accountant won’t open near as many doors as one from the Big Four, companies known for their impeccable training and the exit opportunities they provide. Being an accountant at a hedge fund, particularly when working with proprietary software, can limit future options. Plus, the industry is shrinking. Fewer and fewer hedge funds have opened for six straight years while hedge fund closures have increased for three straight years.
The pros of working in the back office of a hedge fund are immediate, but they seem to be outweighed by the eventual cons.
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