An accountant is a crucial component of any business or organization making financial transactions. Many individuals also employ accountants to oversee their personal finances. Academic preparation for accounting involves training in auditing, financial accounting and taxation. Ultimately, most accounting training leads to professional certification from the American Institute of Certified Public Accountants (CPAs).
Accountants are responsible for the preparation and maintenance of financial records. They also ensure clients meet government regulatory standards for taxes, reporting, and other legislative compliance. Performing these tasks well allows businesses to operate in a cost-efficient manner that meets governmental tax and compliance rules.
Busy companies manage multiple revenue streams and conduct hundreds of thousands of transactions as part of the normal course of business. Accountants create financial statements, handle tax obligations, audit books and systems for legal compliance and cost efficiency, and organize reporting systems. All of these tasks must be communicated to management, and accountants are expected to provide cost-saving solutions for the business at hand.
Undergraduate accounting degree programs commonly require students to take courses such as:
- Governmental Accounting
- Accounting for Not-for-Profits
- Forensic Accounting
- Federal Taxation I & II
- Managerial Accounting
- International Accounting
- Accounting Software
Graduate-level accounting courses generally cover:
- Financial Statement Analysis
- Advanced Forensic Accounting
- Entrepreneurship Law
- Tax Research Methodology
- Issues in Reporting
- Accounting Information Systems
- Business Mergers and Acquisitions
The U.S. Securities and Exchange Commission (SEC) requires that any accountant who files tax returns be a certified public accountant, or CPA. Most states require a bachelor's degree and an additional year of coursework before an aspiring CPA may sit for the certification exam. Many CPAs enroll in five-year degree programs that grant both bachelor's and master's degrees and qualify graduates to take the CPA exam. There are also certificate in accounting programs available.
An associate in accounting is the fast track to an entry-level career. In some respects, it is also an affordable first foray into the field. Once earned, students can decide if they want to continue to pursue an accounting education, another degree or simply a job. Bookkeeping, payroll and billing positions can all be pursued by an associate degree holder. More likely than not, someone with an associate's will start off as an assistant to a certified accountant.
A typical four-year bachelor's in accounting requires that students spend the first two years of school taking general education courses, along with supplementary classes that cover economics, advanced mathematics, and business law. The core of an accounting program prepares graduates for the CPA exam, and stresses technical competence in auditing, taxation and financial accounting.
At this point, new graduates of a bachelor's degree program may continue on to another year of schooling to earn the extra credit hours required for the CPA designation through a master's in accounting. Some firms hire these graduates in junior positions and allow them to continue their education, and some only hire accountants who have passed the CPA exam.
The master's degree program for accountants may either be a five-year program designed to award both degrees, or may be a separate program designed to prepare bachelor's graduates for the CPA exam.
The graduate work mentioned above is all relevant to the doctoral experience as well. But where the master's program is typically a vehicle for professionals who want to pass the CPA exam and then enter the workforce, the Ph.D. in accounting is more for committed research and education positions.
Most Ph.D. graduates will go on to teach at the university level, work on an academic, accounting-centric publication or become a senior member of some sort of financial think tank.
Ideal Candidates for Accounting
Accountants must first have a knack for math. Aside from the ability to crunch numbers, well-developed analytical and critical thinking skills lead to effective auditing and identification of inefficient business practices. Accountants must also be extremely detailed, organized, and able to explain complicated financial concepts to their employers and clients.
If you are skilled with numbers and detailed problem-solving, accounting may be the field for you. Consider exploring the wealth of undergraduate degree programs available; accounting is a degree program that lends itself well to online study. Young CPA groups exist on Facebook and LinkedIn, and many professional organizations like the American Institute for CPAs also offer resources for aspiring accountants.
Once qualified as CPAs, accountants have many choices in the field. Most CPAs fall into one of four categories: public accounting, management accounting, government accounting, or auditing.
Public accountants are the most visible of all CPAs. Their clients may include individuals, corporations or government entities. For each of these clients, a public accountant must ensure all legal requirements are met. These include tax form preparation and payment, reporting, and disclosure of financial information or internal auditing of financial practices. Generally public accountants work as sole practitioners or with a group of other public accountants.
Management accountants work directly for an organization. Duties for management accountants include budgeting, financial document preparation, strategic planning, cost-efficiency analysis, and asset management. Management accountants often report to senior management.
Government accountants work for local, municipal, or state government agencies. Extensive legislative rulings in the accounting industry must be met, including tax payment and reporting compliance. Government accountants audit the entities that are subject to their employers' rules, ensuring that the governmental revenue stream is managed lawfully and efficiently.
Internal auditors usually work for an organization, sometimes as consultants. They scrutinize the organization's financial practices and identify fraud or cost inefficiencies. Internal auditors can help an organization avoid hefty fees and penalties for noncompliance with government regulations.
Accounting is a growing field, due to increasing governmental legislation on so many aspects of tax, reporting, and legal compliance. The U.S. Bureau of Labor Statistics projects 16% growth in new accounting jobs throughout 2020.
Newly-minted CPAs can choose which industry is most appealing. Public accounting firms, corporations, not-for-profit organizations and government regulatory agencies are all areas where CPA skills are valued. The typical career path for a CPA begins with an associate position. With time and good performance, promotions to the title of senior associate may follow. Ultimately, the career ladder for accountants extends all the way to senior management and Corporate Financial Officer (CFO) positions.