The Types of Deadlines in Public Accounting
In the wonderful world of public accounting, there are many different types of deadlines that you might need to deal with. These deadlines range from minor inconveniences to profession-defining events, and it's important that you know which deadline is which so you can allocate your stress appropriately. Today, I'm going to share with you some of the various types of deadlines you might encounter in public accounting and some background on them.
SEC Reporting Deadlines - reporting in accordance with the requirements of the securities and exchange commission is the most stressful deadline there is. Missing this deadline will not only get companies in trouble with the SEC, but it will also send a warning out to the company's investors and potential investors, something management does not want. For these reasons, SEC rewarding deadlines are taken very seriously within the profession. Most companies that have to file with the SEC on a regular basis are handled by the top seven accounting firms, so if you aren't interested in this kind of stress, work for a smaller firm.
IRS and tax Reporting Deadlines - The IRS deadlines are perhaps the most well-known deadlines out there, because everyone understands their own tax filing deadline. The March 15th and April 15th deadlines, along with the September 15th and October 15th extension deadlines are enough to define a tax professional's calendar. In addition to those dates, there are various other dates related to different tax filings that can drive even more deadlines for tax professionals. I would call these the second most stressful deadlines in the accounting profession because they are very clearly defined and widely applicable, but do not get as much attention from investors as the SEC deadlines noted above. Plus, being able to extend filing allows tax professionals to spread the work out over the year.
Board and Bank Deadlines - when you work with smaller companies, they might Have a board of directors or a bank that requires a timely completion of a financial statement, audit or other project. I have seen companies with audit reporting requirements between 60 and 180 days from the end of their fiscal year. These deadlines are stressful on a client-by-client basis, but they can be planned around. Most importantly, they tend to vary from client to client, which means that the clients and the public accounting firm can plan everything in advance.
Statutory Audit Deadlines - this audit deadline is imposed by a government and can feel very similar to the SEC reporting deadline. The main difference between the two is the level of investor or public scrutiny. There will always be some people that dig through publicly available information to see who filed timely, but in this case, there might not be as many (or any) investment related risks associated with the deadline. Internally, these deadlines are still very stressful since no Company wants to get in trouble with their regulators.
Internal Deadlines - I couldn't get through this article without mentioning internal deadlines. These are the deadlines that are created by the accounting firm to ensure that things are getting done timely. While they might not represent a government or external institution imposing a hard deadline, management can make them feel just as important. The reason why internal deadlines exist is because firms need to allocate their time and energy to the right jobs to get things done prior to the external reporting deadlines. This means that firms need to coordinate the preparation, review, and QC review of their jobs on top of coordinating with the clients. This creates an environment where engagements are planned in such a way that some will get done early and others will get done right on time, depending on the client's needs and the availability of internal resources. The consequences for missing these deadlines can range from mild inconvenience to personal contempt from a manager or partner, depending on your level. While these might be the least strict of the deadlines I mentioned today, it's important to understand that they might affect you personally the most as a professional working in public accounting.
As working in public accounting, it's important for you to understand why things need to get done, and understanding why the deadline exists will give you some perspective that will help you understand your engagements. Take the time to understand the deadlines that you interact with and use that knowledge to help plan your work schedule. Good luck!