The Accounting Podcast

Attention: This is a machine-generated transcript. As such, there may be spelling, grammar, and accuracy errors throughout. Thank you for your understanding!

Blake Oliver: [00:00:10] Hello everyone, and welcome back to the show. I'm Blake Oliver,

David Leary: [00:00:13] I'm David Leary,

Blake Oliver: [00:00:14] And we have the opportunity today to talk to an actual accounting student, a CPA candidate. Chayton Farley, welcome to the show.

Chayton Farlee: [00:00:22] Hey, thank you so much, Blake and David, I appreciate it.

Blake Oliver: [00:00:25] Yeah. Thank you for taking the time. Um, I think this is one of the things that as a profession, we don't do enough of, which is actually talk to the young people who are entering the CPA world, the accounting profession. You are a student right now. Chayton. Is that right?

Chayton Farlee: [00:00:40] Yep. So I am a junior at the University of Pacific in Stockton. So just like an hour outside of the Bay area. So

Blake Oliver: [00:00:51] all right, I went to high school in Sacramento. So you're not that far away from, uh, uh, where I lived?

Chayton Farlee: [00:00:57] Oh, not at all. Not at all. I'm, like, 30 minutes south. So, yeah, we had a lot of students at my high school who lived in Stockton. Um, what inspired you to study accounting? Um, it's kind of a long story. I can make it kind of short, but, um, so I served a two year service mission for my church right after high school. Had no idea what I wanted to, to study. So I went and I spent two years in Costa Rica. And then I came home in about, uh, six months later, the pandemic happened. So I was about to start school. And when Covid hit, I was like, yeah, I'm not doing that. I don't want to. I don't want to do school online. So I, I had just recently gotten married, and so I ended up just picking up a job as a carpet cleaner. So I was cleaning carpets, traveling all over. I was in Utah at the time, traveling all over Utah, cleaning carpets, and I started listening to business podcasts. So I actually came across a podcast called The Sweaty Startup. I don't know if you guys have ever heard of it. Um, by Nick Huber.

Blake Oliver: [00:02:12] Yeah, yeah, I follow him on Twitter. I think he's actually on an episode, like on a course that we have on earmark.

Chayton Farlee: [00:02:21] Is he really?

Blake Oliver: [00:02:22] Yeah.

Chayton Farlee: [00:02:22] I'll have to check that out. But, um, so he teaches about how entrepreneurship needs to be simple, like it's all about. Taking ideas that are already working, and just doing that until you can make enough money to invest in real estate and other things and such. So that really inspired me to not just go to school for a degree, but to go to school for skills that could make me a decent amount of money. Um, so I started networking, used my father in law a little bit to get to know some CFOs and CEOs locally here in California, and they all recommended accounting as the the best degree if I was going to run a business after school. So I started studying accounting. And I've just come to love accounting. And so that's that's how I got here.

David Leary: [00:03:18] That's great. And this goes to things we've talked about before on the show. This like if you get an accounting degree, you can do anything. You can go into any industry and have a business and you know what you're doing.

Chayton Farlee: [00:03:29] Yeah, exactly. And I, I keep I have a brother. I'm trying to convince he was gonna. He's a poli sci major, but he doesn't like it anymore. So I'm trying to convince him to to switch to accounting. And that's what I tell everybody. Just like what you said, David, is that if you go into accounting, you can do anything you want in the business world because everything revolves around the basic accounting principles. But if you study marketing, you can't switch and go into accounting. You're stuck. So your accounting classes like, how far along are you? Where are you at on this journey to becoming a CPA? And I take it you do want to become a CPA? Yeah. Yep. So the plan right now is actually to do to get my CPA and my CMA. I have a couple of friends who have done that. And then, um, you had posted a couple weeks ago about that, Blake, about how CMAs and CPAs actually make more money when you have both. Um, but I am, I would say. I am just starting the upper upper level accounting courses. So I've taken intermediate financial accounting one. I'm in my second intermediate financial accounting class. And then I also have cost accounting this semester. So I have I'm ahead on my accounting courses and behind on my GTS. I kind of did that purposefully to make my workload easier the rest of my my college career, but I should be able to be CPA eligible in the spring of 2026. So I'm in a dual master's bachelor's program, so I'm doing both at the same time right now.

Blake Oliver: [00:05:15] So you'll graduate in four years and you'll have a master's or is it a five year program? How's it?

Chayton Farlee: [00:05:21] It's a five year program. But so I actually just transferred to the University of Pacific. I was at Brigham Young University, Idaho before I did that. And at BYU-Idaho, they have a three track system, so you can take three semesters a year instead of two. So I actually got an extra two semesters done the first two years of school. So I'll finish in about four and a half years instead of the five. Okay. So how do you feel about the 150 hour rule this five years of education? It obviously hasn't deterred you. What do you think? It's it's hard. So I, I see the value in getting extra education if it's in accounting and if it helps towards what you're going to be doing after. Right. But just setting it as a standard for to sit for the CPA exam doesn't do much. Um, I don't know specifically the requirements in every state I know here in California, there's certain accounting courses you have to take in order to sit for the CPA exam, and some of those are included in the master's program that I'm going to be in. But I mean, it's hard looking at all the finance students who are going to graduate in four years probably make more than me their first couple of years after school, and they don't have to sit for an exam or get any specific certification. They just have to network like I'm doing right now. Right? So. It's oh go ahead, David.

David Leary: [00:07:02] It's interesting you said that because I think I think we've talked about that in the show before. Is that the social implications? Right. Your friends are graduating. They're going off to make some money and you're going to still be in school. Like, I've never really thought about it from that point of view before. It's good that you brought that up.

Chayton Farlee: [00:07:18] Well, and I find accounting very interesting, but what's hard is most people in my generation don't see accounting as interesting. They see it as boring, right? Like everybody wants to go do consulting at BCG or at McKinsey. They don't want to go, you know, do audits for a local firm or do taxes for even a Big Four. So it's, you know, the big four market themselves really well. But aside from that, like, I mean, if I'm talking about in my community, like, everyone sees the accountants as the boring people. Why do you think that is? Chayton like, is this something you have experienced directly with your classmates, with your fellow students? What's the reason for it? I. I don't think there's enough people talking about it. I mean, running into the earmark podcasts and all the podcasts that are associated with it gets me about excited, excited about accounting because I listen to it every day. I mean, I was just doing the dishes and listening to your guys's episode from yesterday, and I get excited about it. Right? But if you're just sitting through the classes and for example, yesterday we were just talking about short terme liabilities. It's hard to see the long view when you're just getting those basic principles in your classes. Right. So it's. Maybe it's easier for me because I see the long view, right? I see what it could be. I could see a couple years in audit and then going and doing advisory for myself and being able to really add value. But when students don't see that as an accountant, they can add value to their clients. I think there's a disconnect there between all the principles they're learning in school and what they can actually go and do.

Blake Oliver: [00:09:23] Yeah, so too much focus on the rules and not enough on what you can do when you master those rules.

Chayton Farlee: [00:09:32] Yeah, I so something another thought I've had is I've listened to you guys specifically you Blake interview all the people on on your earmark podcast is. Almost every person you interview, it goes back to bookkeeping. So if if the books are good. Taxes are good. If you're doing the books for a company, it almost makes sense to be doing advisory for them because you see all the transactions in their business. But there's no bookkeeping courses in in college. I mean, there's some universities that offer like a QuickBooks course so that you're familiar with the platform and understand how to use it. But you do debits and credits and financial accounting, but you're not doing month end closes all the time. You're not seeing those transactions come in and seeing how they apply to the company. So I think if more students had bookkeeping roles or there was a course where maybe you just acted like you were a small business and you had to do the bookkeeping for that entire course of the business. I think that would make a huge difference on how accounting students see accounting, and how it ends up making an impact on the company and on future clients.

David Leary: [00:11:00] Was your accounting 101 Introduction to Accounting? Was that you do that at BYU, or did you do that at, uh, University of the Pacific?

Chayton Farlee: [00:11:06] So I did that at Brigham Young University, Idaho.

David Leary: [00:11:09] Got it. And then can you just paint a picture of what that that class was like? Was it 500 students? Was it how was the professor? Because I think that's the big first experience. First exposure to accounting. Yeah. I'm just wondering how how that was obviously for you, it might have been different than everybody else, but how was the class in general?

Chayton Farlee: [00:11:25] Yeah. So I've been really blessed in that both the universities have gone to have been, um, really small class sizes. So that was a big class size. And I would say that was probably 30 to 40 people. I think the problem with it was I really liked the professor and got to know the professor. Um, but most of the students already have their eyes set on. Oh, I'm just going to be a regular business student, or I'm going to be a regular marketing student, and everybody tells them ahead of time, like, oh, you're accounting courses suck. Like, you just they there's rumors going around before you even get in the class. Wow. The class is going to be terrible because it's accounting. And so the marketing kids and the other students who aren't going into accounting don't. I feel like they don't see the value in the class because they're already they already have their mind set on what they want to do and don't want to learn how to do debits and credits. Yeah, but maybe if the class was, you know, I think we all could do a better job at talking about accounting classes as being exciting and not being boring. But maybe one thing that really struck me and helped me continue to choose accounting after that was the real world business application that my professors did. Um. Specifically in my managerial accounting course. So that's the second basic accounting course that I had to take that every business major has to take. I had a professor who had started out at a big four and then had worked in industry the rest of his career, but he had come on as a CFO to a really small company and had essentially turned their books and their business around and the way he taught the class. Showed me directly how. Operations and accounting. Were meshed together, and that with bad books you had bad operations. And once I saw that connection, it was like a light bulb. It was like, hey, I can go do anything I want in the business world. If I can understand basic accounting concepts. And I think if more students had that connection, um, you know, if people who wanted to go into consulting and or advisory or wanted to be their own business owner, if they could understand. That if they really honed their accounting skills, it would be beneficial to everything they're going to do in their career.

Blake Oliver: [00:14:11] I agree completely with you, Chayton. When I was going back to school for accounting, I had the benefit of not only being a freelance bookkeeper, so I was actually doing the books and putting these debits and credits into practice. But I also owned my own business as a freelancer, and I got into the habit of updating my books every single day in the cloud, and I knew where I stood as a business owner every single day. Every morning I would go in and reconcile the previous day's transactions, thanks to the advent of cloud based accounting. And I had so much comfort, especially when I started hiring employees, and I had costs, and I had to figure out what were my margins and make sure that, you know, my cash flow was going to be all right. I actually was doing like short, firm cash flow projections for myself and. It's a lot of fun when you can actually use the accounting to run the business. As opposed to just this. After the fact thing. Right? And I feel like those students in those introductory accounting classes would get so much more out of it if it was less theory and more. Application. Like even something silly like run a lemonade stand and do the accounting on paper for it is really eye opening. Yeah. Just right.

Chayton Farlee: [00:15:37] Well, that's the fun part of accounting, I feel like. Right. So last semester in my intermediate financial accounting class, the very end of the semester, we had to. Do all of the the end of the year entries and then make sure the financial statement was correct based on those entries. I loved that that was my final exam. I loved that, but I would have loved to do that the whole semester. Right.

Blake Oliver: [00:16:05] Yeah.

David Leary: [00:16:07] It is kind of funny where, you know, you students go through their whole entire college career to get a business degree, and unless you go to get a master's or go to get your MBA, they don't actually have you try to create a business or run a business or do any business related stuff, which really you should make people do at their freshman year, and they'll realize all the difficulties and maybe motivate them to learn, right?

Chayton Farlee: [00:16:30] Yeah. And I think it goes full circle too because. So accounting students, if they own their own firm someday, or even if they become a partner, they need to have the the skills that you get as a business owner from sales, from marketing, from, uh, being client facing and being able to understand where your clients are coming from, where if you've just sat and audited cash. On a huge fortune 500 company for ten years. You're not going to have any of those skills.

Blake Oliver: [00:17:00] So Chayton you mentioned audit as a potential path after you graduate. Is that your primary goal? Go work as an auditor. Are you considering anything else? You mentioned you want to do your CPA and your CMA, so I imagine that will decide a lot of where you go.

Chayton Farlee: [00:17:21] Yeah. So it's hard. Um, so in a couple of episodes, you guys have talked about how, um, about ten years ago, the big four. Well, for decades now, the big four have been the big push. I feel like it's still the same, um, at both my universities, which, you know, for some people, that's not a bad thing. Um.

Blake Oliver: [00:17:46] Meaning the professors are saying that's the path. They're saying. Go big four. Are they recruiting on campus?

Chayton Farlee: [00:17:53] Yeah, yeah, and a lot of local firms, too. Um, I think both universities have gone to have done a lot better job at giving options. Right. Um, there's a lot of small firms that are doing really cool things. And I think both of the universities I've gone to have given equal opportunity to the smaller firms, as well as the bigger firms to be in front of the students. But for the students that want to go places and do big things, it's always still continued to be said that you need to go big for, for your, you know, tell senior manager and then. You can move on. Um, I'm not completely sure where I want to go yet. Um, I think both you and David have me sold on starting a cloud accounting services business someday. Um, I love clients. I love being able to interact with people. And I love technology. And I think it'd be amazing to build something remote someday that would allow me to to do that. But, um, I don't know what the best way. I'm still working to find out what the best way to get to that point would be, right? Like, would it be best to have a couple of years of Big Four on my resume to then be able to start that? Or would it be better to go work for someone like summit Virtual CFO or work for, um, reconciled or a firm that's, you know, already doing these cloud accounting services to get that experience and then go and do it on my own.

Chayton Farlee: [00:19:34] So that's something I'm working through and trying to decide and find. Where to go. Um, I know, so I've networked with quite a few people at EA in Sacramento. Uh, really small office, and they don't seem to be working. 80 hour weeks during busy season. Um, they do a lot of mix of consulting and accounting work or audit work. And at that office, they're actually doing three days remote, two days in person. So if Big Four experience is not 80 hours a week and I would have the resources at my disposal, it might be might be a really good path. So.

Blake Oliver: [00:20:23] Well, and I went to high school in Sacramento. I lived there for, uh, for a little bit. It's a nice place, you know, a lot of farm to table restaurants. You know, it's not too not too busy. Could be a good place to start your career.

Chayton Farlee: [00:20:36] Well, and you're just outside the Bay area, so you get all the perks of being close enough to the Bay area to take part in those without having to deal with the traffic and prices and.

Blake Oliver: [00:20:47] Cost of living. Yeah. All that. Yeah. Well, this is I'm torn chayton because I kind of want you to go big for us so that we can, uh, you can call us back in a couple of years and tell us how it's going. Like a spy. Yeah, well, you know, or maybe it's a good thing. I don't know, maybe we're totally off on this, and. And like you said, um, well, like you implied, every office is different. So, you know, a and that's the thing about these big firms, right, is that they all share a logo, but in the end, it's the team you work with that determines your experience. And so if you find the right team inside of a big firm, it doesn't matter what it's called. Yeah, that's the important thing. It's the people you work with that in accounting I think that make the that make the job great or terrible.

Chayton Farlee: [00:21:32] Yeah. And just for some context, there were actually a few people at that office who had worked at bigger offices like San Jose or San Francisco and had moved to this office, and it had a completely different experience. Um, so, you know, I think that something else to consider as you choose your firm and choose where you want to work, like you just said.

Blake Oliver: [00:21:55] Well, Chayton, we'd love to stay in touch and keep us appraised of your progress and how you're feeling about the CPA and the CMA. Um, thank you so much for taking the time to chat with us.

Chayton Farlee: [00:22:08] Yeah, I appreciate all you guys are doing. I wish more students were listening to your podcast because I think there's a lot to be excited for, for a career in accounting. If you're if you're listening to earmark.

Blake Oliver: [00:22:21] So fantastic.

David Leary: [00:22:23] Job. Spread the word.

Blake Oliver: [00:22:24] Spread the good word. All right. Talk to you soon. Chayton.

Chayton Farlee: [00:22:28] Hey, thank you so much.