An Interview with Dhanush Arjun, CA
Dhanush Arjun, Chartered Accountant
Analyst, The National Investor, Dubai,
Past - Associate, KPMG Dubai,
Past - Senior Executive - Corporate Tax Advisory, KPMG India.
Dhanush Arjun is a Chartered Accountant who works as an Analyst with The National Investor, Abu Dhabi. Prior to joining The National Investor, he did his articleship with KPMG India and worked for two years with KPMG Dubai’s Corporate Finance department. Dhanush’s expertise lies in Business Valuations, Mergers & Acquisitions, Private Equity and Investment Banking. In this interview, he gives career guidance and advice to students who are interested in pursuing a career in Chartered Accountancy and Investment Banking.
You did a regular B.Com course from Loyola College, Chennai and then pursued your articleship with KPMG. Many students complete their B.Com through correspondence while pursuing their articleship simultaneously. Which approach do you think is better from an academic perspective?
During my time, the course was structured a bit differently. It used to take 5.5 to 6 years to finish CA but now you can complete it within 4.5 years. This change was brought in to normalize the CA program with other professional degrees such as Engineering. Upon completion of my B.Com and passing the CA Intermediate exam, I started my articleship. Now coming to Regular B.Com vs Correspondence, if you want to finish your CA in 4.5 years time, it makes sense to do the correspondence course. However, if you are interested in gaining college experience, then go for a B.Com from a reputed college like Loyola or SRCC as you will get great exposure there. I was very keen on going to college and I gained a lot in the process. On the flipside, I lost a year as most of my friends who started CA along with me and did their B.Com through correspondence finished a year ahead of me. But mine was a personal choice. A lot of people who are singularly focused on CA do not prefer to get their B.Com through regular college. I personally saw value in going to college and gaining college experience. Academically, I did not learn much from B.Com as CA is highly comprehensive and an extremely detail oriented course when compared to B.Com. If you study for your CPT or IPCC and do well in these exams, you can give your B.Com papers without much preparation and pass your degree, except for unrelated papers such as English and French. However, once you join articleship you will be working with some article students who will be 2-3 years your junior. If you can stomach that, then you are good to go.
Another interesting choice of course instead of the B.Com that could be relevant include B.A. Economics or B.Sc. Statistics. Either of the two subjects, though not extremely popular, could give you an edge in respective subjects that the CA course may not delve in great detail.
Can you talk about how you landed an articleship in a big 4 firm like KPMG?
Articleship years are very important and doing your articleship from a reputed company can make a huge difference to your professional experience when compared with doing articleship in lesser known, small firms. PWC, Deloitte, KPMG and Ernst & Young are the big 4 audit companies and they are spread across the globe in over 140 countries and each one of them have more than 20,000 employees worldwide. Getting an articleship in these firms is difficult and it is more than just your marks in CPT and IPCC. In India, there is this misconception that getting into these big 4 is only possible if you are a rank holder or have references. I did not have any references nor was I a rank holder. I had a good undergraduate B.Com GPA and I had completed my B.Com from a reputed college like Loyola which contributed a lot towards my personality and maturity. BIG 4’s usually, but not necessarily, prefer someone with more maturity when compared with someone who has just passed their 12th grade. Doing a B.Com from a good college will give you proper exposure and maturity. I also participated in plenty of extracurricular activities like drama, debates, organizing seminars and setting up alumni events etc. During the articleship interview at KPMG, I had enough to demonstrate and talk about. Communication is also very important. You need to be confident and communicate your intentions upfront and they will respect you for that. You have to demonstrate that you not there just to get CA qualification or to pass your CA exams. You have to let them know that you are there to learn and contribute to the objectives of the firm. CA final exam is important but you must value your articleship period as well.
What is the difference between doing your articleship from a big firm vs a small sized firm?
Doing your articleship from a big firm is very rigorous unlike that of a local firm where your exposure to large clients will be limited, access to resources and sector experts is limited. Your entire perspective to the CA profession changes once you join a big firm. Everyone is very professional and everything is so detail oriented. You may not get breadth of experience but depth is what you get. And breadth is something that you can accumulate later on in your career. During your articleship at a big firm, you will be very focused on a specific area. I got to do only tax services during my articleship and that was the flipside as I did not get audit experience. However, I had a very focused and in depth tax consulting experience and was always given an opportunity to work with Transaction Advisory team (Investment Banking related) and the Management Consulting teams whenever there was a tax angle, given my expressed intent to interact and understand these other service lines. In smaller firms, you may have the opportunity to work on different service lines including audit, tax and corporate law, but the nature of these assignments may not be as challenging as what you would typically get in a big 4 on a consistent basis.
Do you get to choose the area you would like to work in during your articleship years?
When you are applying for your articleship, you can be very particular with what you want to work on. Tax and audit are the two broad streams which articleship students usually take. I focused on tax during my articleship years at KPMG. But, the thing is when you are applying for articleship, you are very young and do not exactly know what it is that you are interested in considering that you have no practical experience of tax or audit beforehand. What usually happens is that firms allocate students based on the vacancy available and usually not much choice is given to students. If you are very sure about which specialization of CA you are interested in, you can communicate it to your manager and explain why you are so sure to work in that area. As for me, I was not very sure in the beginning. I was not entirely keen on tax but I was sure on doing my articleship in a big 4 company as branding and association was very important for me. Also, I did not consider CA to be the end point of my life. From day one, I was very clear about that. I wanted to use CA to grow professionally. While being interviewed by KPMG for the articleship, I told my boss very clearly about my goals. I clearly communicated to him that I was not very sure about tax and audit may be a better choice. He assured me to learn, explore and absorb as much as possible and that I don’t have to keep working in just one area throughout. During my articleship years at KPMG, I learnt a lot. Even though what I am doing right now is very different from CA, I have learnt a lot of invaluable lessons during my articleship days including little things like best practices for formatting documents to client engagement and relationship building techniques.
Is it possible to do your articleship abroad?
KPMG has a chapter in Dubai and I have seen some students do their articleship in Dubai. I am not sure about London or USA, and how the visa sponsorship works there. The CA regulations has a provision which allows you to do your articleship outside India. (Refer Part B of the document: http://www.icai.org/resource_file/14461m_impart.pdf)
How important are tuitions for passing your CA exams?
Extra classes helped me immensely. The thing with CA, unlike other professional courses such as medicine or engineering, is that you are doing everything by yourself. There is no college, no guided structure, no routine classes, no professors, assignments etc. So, the tuitions help give you the much needed perspective on what each subject is all about. When you talk to someone who is very experienced in the field, you benefit a lot from the discussions. One subject that I had a lot of difficulty with was corporate law. I did not understand it much by myself. So, I went for tuitions. I attended classes by this brilliant professor who was a corporate lawyer himself. He covered subjects and helped us understand sections by coming up with quotes and examples. It was great. We did not have to mug anything. We just had to remember his examples.
Regarding which coaching centre to join, you should talk to people and ask around. Most students go to different coaching centres for different subjects. Ask around and enquire about the professors, how they teach, their teaching methodology etc. It’s not an easy decision to make. Sometimes I have had to take 2 classes for the same subject. The first time around the professor may not be good fit for you, but don't beat yourself up for it. Just attend the classes and do self study. If it still doesn't work out join another more suitable class. That is pretty much how most people do it.
Can you talk about your articleship experience at KPMG India?
Yes. I fortunately managed to complete all my exams before my articleship ended and I had enough information to make an informed decision that tax was not calling. My articleship years helped me understand other service lines which the big 4 had. If I had not worked in a big 4, I wouldn’t have had the opportunity to work alongside professionals from other departments and get first hand understanding of their typical work environment. The big 4’s have 3 main departments - audit, tax and advisory.
Audit is divided into certain verticals which include - financial services, IGH (Infrastructure Government Healthcare), and ICE (Information Communication Entertainment). Auditing requires industry specific expertise and exposure to industry specific audits gives you insight into issues peculiar to that particular industry. For example, if you have been working with banks, then you become proficient with bank audits. Software companies have issues with their audits and they prefer to take someone who has experience in software audit industry. Tax is broadly divided into direct and indirect tax. Within direct tax, there is broadly corporate tax advisory where you advise about corporate tax optimization strategies for large companies and then there is international expatriate tax advisory where you do advise on taxation for expatriate individuals specifically considering that they pay taxes in two different countries which becomes pretty complex. Such expatriate employees usually choose the big 4s for their taxes as not many small sized firms are competent to handle that kind of work. Under indirect tax, there is generally no segregation amongst customs, VAT, etc. they work as one big team, unless you are in Bombay or Delhi where they have teams earmarked for particular specializations. The important thing about big 4’s is that you find your groove and you dig really really deep as your articleship days progresses. During my articleship, I got the opportunity to do a little bit of everything within the tax department. I did direct, indirect and also Mergers & Acquisition (“M&A”) taxes. M&A taxes is a vertical that article students typically don’t do but given that I showed interest and aptitude to take that kind of work and I had plans of getting into M&A later on, my managers and colleagues encouraged me to work on M&A assignments as and when they came by.
Was it easy to find a job with KPMG considering that you did your articleship with them?
Not at all. Just because you did your articleship doesn’t mean it is easy to find a job in the same firm. In my case, plenty of things contributed towards my being hired for a full time job.
I invested considerable amount of time to understand what exactly each department was working on. The advisory department within a big 4 has verticals which include Management Consulting, Transaction Advisory, IT Consulting, HR Consulting etc. I learnt that Transaction Advisory would be the best fit to pursue my interests and leverage on the fundamentals acquired through the rigors of the CA course. Under the umbrella of Transaction Advisory Services, I could not get into Financial Due Diligence (“FDD”) Services as I had limited audit experience. While FDD required audit experience, other Transaction Services such as Business Valuations and Mergers & Acquisitions required prior deal experience or an MBA from a top tiered B-school. I was in a slight fix as I had neither. I knew from the beginning that a CA would equip me with all the skill sets I needed for the challenges that lay ahead of me, but I was conscious of the fact that it was not a finishing degree that would directly land me a job in an Investment Bank. No investment banks or corporate finance teams come for the campus interviews arranged by the CA institute. So, after my articleship I decided to joined a 3-month intensive course at the School of Investment Banking(SIB), Mumbai where I learnt all the skills required to work in investment banks. I have to admit that the three month intense course may not have taught me many theoretical concepts that were not in the CA curriculum and my prior reading, but it certainly helped solidify my understanding and tweaking it as per Investment Banking working standards. I learnt to build integrated financial models (the core of most M&A and Investment Banking assignments) and perform valuation analysis. After 3 months, I was confident of taking up any interview from any investment bank or corporate finance firm. That’s how I made it to the KPMG corporate finance team.
Now, shifting to different departments or service lines within big firms is difficult. I had to leverage on the references and network built during my articleship years to land an interview at the corporate finance department of KPMG India. I made it through the rigorous interview and was in-principle approved to join the Valuations team in KPMG Chennai. But, before I joined, the spot disappeared due to some political rigmarole that affected the entire department and there were significant exits from the team. I then applied for a vacancy that I learnt of from an ex-colleague in the KPMG Dubai corporate finance team. While I had good references that were available on request, I made it through the interviews primarily because of the SIB course that gave me the much needed confidence boost. On hindsight, I got the opportunity because of the network I built during my articleship period at KPMG India and the finishing course at SIB that strengthened my fundamentals.
At SIB, we were a batch of about 15 students, all with extremely different backgrounds, but in the end, the CAs were the first to get placed in the investment banks. Why? It is because CA’s are extremely equipped and sharp at picking up commercial nitty-gritties as we were trained to be very diligent. We knew accounting very well and at the end of the day building financial models requires a strong foundation of accounting. During articleship days, we had to go through every line item of a financial statement and dig deep to find out what could be wrong, what is unique in the business, how could they operate better, what they could avoid etc. During the interviews, I had enough fodder to confidently speak about a given industry, its key performance metrics etc and I found the interviews to be relatively simpler when compared with Non CAs for whom this is a wholly new field. Presently, even though I am not doing anything directly related to CA, I have the required fundamental arsenal that can be accessed to deal with a wide range of complex issues.
How good are the campus interviews as of 2014?
Right now, the CA institute is actually promoting campus interviews a lot and they are purely merit based. All the big 4 and other large firms come for campus interviews. Few companies like Hindustan Unilever, P&G and Boston Consulting Group (BCG) used to send invites to the rank holders to come and apply to their companies. While I would not advise one to place complete reliance on the campus interview, it definitely is a good way to kick-start your job search process.
In my case, I was very keen on joining investment banking or corporate finance and none of the firms were hiring out of the campus for these respective teams. So, I did not attend the campus interviews.
How are the placements faring for CA grads as of 2014?
Job hiring is great. Since the pass percentages have gone up slightly there was this rumor that it is affecting the job market adversely as supply is going up. But, I think there is still a huge demand for CA’s. If not in the audit section in the big 4, most companies will require a CA to handle the finances. What I am surprised is that the base salary of Rs 6 Lakhs per annum has still not gone up over the past 2 years considering the inflation.
How vulnerable is CA to recession?
If you are in accounting, auditing or working in the finance division of a company, then there is not much vulnerability. Investment banking is very volatile and vulnerable to recession. A year back, many in my department got fired overnight as we did not have sufficient deal flow. But if you are in audit, then you are in a good place. In fact, during recession a few years back, KPMG, being an accounting firm, has a restructuring practice and they did really really well during this period as many businesses had to undergo significant restructuring in order to survive the recession. So, CAs with restructuring skills will be in great demand during recession. An accountant has the upper hand even during down cycles. Being an accountant gives you access to multiple roles that you can assume in every cycle of the economy. So, doing a pure accountancy course will keep you quite insulated to recessions and fluctuations in the economy.
Other than the big firms, do other popular companies like Morgan Stanley hire CA grads in India?
The brilliant thing about India is that you can get experience in any big name or many of the fortune 500 company, but more likely in the back office as India is a huge outsourcing hub. I know a few people who moved from the back office of Morgan Stanley to the one of their headquarters in South Africa but it is not 100% assured that you will get this opportunity to work in their front office. However, there is scope and room for this to happen as you are already working in their setup, you understand how they work and you basically do all the work for their New York or London offices. The company that I am presently working for has hired a KPO in India from where we get a lot of work done from there. KPMG hires KPMG Global Services, located in Bangalore and Delhi, a back office service for all KPMGs across the globe. Every big name has a back office in India. Goldman sachs, for example, hire CAs in their Bangalore back office. So with every company, there is an opportunity to work with any big name you want to in India. Getting into these companies is competitive but easier when compared with moving into their front office which is quite a challenge as it is extremely competitive.
Why did you feel the need to transition from KPMG to The National Investor?
At KPMG, my role was an advisory role whereby the nature of the services we provided like that of an agent. In other words, we would always be hired to act in best interests of the client.
However, in Private Equity (“PE”) the nature of your work changes significantly. Though you manage funds on behalf of investors in your PE fund, there is significantly higher autonomy in terms of selecting a particular target company to acquire. In my new role, we even get to hire advisory firms like KPMG or PwC or McKinsey to help us wherever required. In the banking circle this switch is called from sell-side to buy-side.
And with buy-side / PE your responsibilities change. Identifying and acquiring a business which is all that I used to do at KPMG, is just one of the many responsibilities that a PE firm has. The PE firm has to get involved in managing their portfolio of investments by participating in each investee company’s board meetings and directing the strategy of the company in a manner that maximizes the value of the company. Since, I felt the urge to take on this higher responsibility and get involved in the day-to-day strategic management of a company, I decided to make the move.
After completion of CA, what other extra qualifications will help with better career prospects?
There are many qualifications which a CA can do like CIMA, ICWA, Company Secretaryship, CFA etc. I have noticed that many students just want to accumulate more and more degrees without understanding which qualification will add more value to their profile and which will not.
The CA by itself is a very rigorous course and if you have managed to clear the exams within a particular time frame, then it means you have gone through the cast iron of being molded into something which employers see a lot of value in and appreciate. So, don’t add on a qualification that is similar to CA. Do qualifications that are very different and enhance your profile and give you unique skill sets. If you want to get into consulting, investment banking or corporate finance, then an MBA from a reputed college helps. Big companies like McKinsey don’t take CA’s unless you are a rank holder or an MBA from Wharton, Harvard or any of the other big schools. You can do CFA if you want to get into equity trading; CA does not teach you too much about hedged derivative products; there are a few chapters in one subject that introduces such topics but the CFA is an entire course on these topics. You can do ICWA if you want to become a management accountant. I personally see a value in MBA. An MBA will open doors to global private equity shops like KKR and Blackstone. Another interesting field is actuarial sciences as CA course does not equip you with the skills to work in actuarial sciences. IAS is also a good option. I was recently reading that the Indian Planning Commission (“IPC”) is hiring interns for a one year internship which I think is very interesting. If I had this opportunity a few years back, I would have definitely applied. Anyone can apply to the IPC internship, not just CA’s and it will be a great opportunity to be part of the team that formulates economic policy for the country. And then you have entrepreneurship route as well.
Many students who have completed their 12th and interested in doing an MBA further down their career tend to get confused between pursuing CA or only a B.Com and then further do an MBA. Which approach do you think is better?
Well, this is a rather interesting question. If you have MBA set in your mind as soon you finish 12th grade, that’s great. But like a CA, the MBA gives you many options to branch out. MBA’s have specializations or business schools that are known for specific areas IIM A or New York University is known for Finance, XLRI is known for HR, Insead is a breeding ground for those who want to get into management consulting, marketing is another very sought after MBA specialization too.
Having said that, I would not advise one to be content with only a B.Com / BBA before you go out to do an MBA. I’m not saying that CA is the route to go. Given your lack of maturity and lack of experience in at the end of 12th grade you may not be sure if finance / accounting is something you want to do. The perfect time to deep dive and understand if what you are thinking about is a good fit for you or not is while you’re doing under graduation. B.Com and other under graduate courses are not very intense for a reason. The reason is to allow you to do a lot lot more including extra-curricular activities during this period. You can do CPT and may be even the first group of IPCC and drop out of the CA course if you don’t enjoy it. There’s no shame in it. In fact, you have emerged as a much wiser person by understanding your own likes / aptitude / passion better. And by no means am I propagating that CA is the only course you should try out while doing under graduation. Almost all certification courses including marketing, HR, actuarial science are all long-distance-self-study courses. Investing time in yourself during under graduation pays rich dividends.
Also, all things being said, it definitely is not a good idea to sign up for an MBA without significant work experience. The MBA is built for people who have spent time understanding nuances of their respective fields. That’s when the course adds value to you and that’s the reason why the average age of a MBA class in the top global business schools is between 28 to 30. Your work experience is an extremely critical factor while your candidacy is evaluated by for an MBA slot in a top-tier business school. When you have rich work experience, you are more likely to contribute significantly in an MBA class room discussion and you have higher probability to get a job post doing an MBA and you would be good brand ambassador for the Business school. It’s as simple as it can get to understand why good work experience is highly valued when you apply to B-school.
Having stressed the importance of quality work experience and given that you have already decided to pursue an MBA in the 12th grade, take yourself three years ahead – i.e. time when you graduate. You have just an B.Com or BBA whereas another person applying for the same dream job has cleared 2 levels of CFA or has finished ICWA or has some other relevant exposure. In simple words, the odds of you landing a dream job are considerably lower which in turn will affect the odds of getting into a top class B-School.
To answer the question whether CA + MBA is relevant? Yes it is. CA and MBA are like the left brain and right brain respectively. Doing both definitely makes you quiet the phenomenal package. Let me delve into this further. The key skills ingrained through the CA course is how to handle rigor, be extremely detail oriented, remember laws and regulations, sharpening your analytical skill sets, and strengthen your accounting fundamental – which is your new language that you will be talking for the rest of your lives. The MBA course is where you learn how to solve case studies using all your collective knowledge and experience and applying it in the most creative manner, looking at the bigger picture, multi-tasking to make holistic progress and never losing clarity of the end vision. You don’t want to be learning the nuances of accounting during an MBA as that could have been mastered through a self-study CA course earlier on. On the flip side, a lot of people would say the MBA course merely teaches CAs to communicate better. It sure does. But it also adds a whole new dimension of problem-solving, holistic thought process that is an extremely integral skill set as you assume senior organizational responsibilities. There comes a time in your career where reliance on just technical knowledge will stunt your growth. That’s where the MBA helps you grow. Also, the MBA classroom is where you make some of your most life altering friends. An MBA classroom of a top business school is teeming with highly motivated people. In a very few years, they will all be holding extremely senior positions across all industries. And there’s an invaluable network that will support each other through the good and bad times.
To all you folks who dream of getting into Investment Banking, here’s a quote from a seasoned senior banker – “In addition to corporate finance skill sets that’s a de-facto requirement, a great Investment Banker should be an expert in one or more of the following – Accounting or Legal Structuring or Corporate Banking.” Doing a CA checks the one of a key specializations required to elevate you to greatness in Investment Banking.
In conclusion, I’d like to add- There’s no one right way, everyone’s journey is unique. Enjoy it! All the Best!
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