Tax Guru – Ker$tetter Letter

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Posted by taxguru on April 11, 2002

Fringe Benefits

Back when I was in college for my Bachelor’s in Accounting (1973-77), there were three main types of employers recruiting among the Senior class.

Private Industry Companies offered by far the highest starting pay and benefit packages for those willing to work in their finance and accounting departments.

The Big 8 CPA Firms were offering about two-thirds the starting pay of the private industry companies plus extra long hours and almost no benefits. They were able to do this because of the potential high pay for those who could stick it out and make Partner within 10 years. They also had (& still have) a captive employee pool because in order to qualify to become a CPA in California, you were required to work for at least two years with a CPA firm, with a certain number of hours spent performing certified audits. It’s a mandatory paid intern program that many other states don’t require for their licensed CPAs.

Government Agencies, State and Federal, including IRS and FBI. Starting pay was about a third of that offered by private companies, with an upper range much lower than with either of the other two types of employers. This meant that most people who accepted government jobs did so because they were passionate about the cause they were working for, or because nobody else would hire them.

Because of the relatively low pay that most government workers receive, some of them make up for it in other ways. For many, it’s a power trip, where they can intimidate other people and get their jollies that way. For others, it’s more direct extortion for financial gain. This IRS auditor in Denver probably had worked out deals all around the area where his position enabled him to obtain freebies and discounts. He was busted when he got too greedy with his car mechanic.

KMK

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