Certified Public Accountant
Certified Public Accountants, or CPAs, are the heavy hitters of the accounting world and are often considered to be some of the most valuable members of any business. CPAs perform a vast array of duties involving analyzing the way money is used by individuals, governments, non-profits, and businesses. In short, the money system is the backbone of our society, and CPAs are the backbone of the money system.
Typical Job Duties of a CPA
A typical day in the life of a CPA involves a variety of auditing, tax, and accounting tasks. It is the job of the CPA to ensure that private, business, and organization clients work within the limits of the law by reporting income properly and paying required taxes. In addition, the CPA often analyzes the activities and structure of a company to provide tax advice regarding decisions of the business.
CPAs often also serve as consultants, offering advice regarding protection of assets, salaries, employment benefits, systems for data processing, and more. In fact, the CPA is such an integral part of business that they are often involved in the development of budgets, strategic planning meetings, negotiation of contracts, fraud prevention, preparation and filing of taxes, and the resolution of financial disputes.
Common tasks of the CPA include analyzing ledgers, preparing reports and financial statements on a regular basis, supervising accounts receivable and payable, and predicting future revenue and expenses. It is also the job of the CPA to constantly monitor the financial activities of the business and to find and examine any irregularities as well as to resolve financial issues of any kind.
The specific job duties of a CPA may vary somewhat depending upon the client for which the CPA is working. These clients may include individuals, small businesses, corporations, healthcare providers, government agencies, or nonprofit organizations. In addition, CPAs may choose to work as independent contractors or as part of private or public accounting firms. In many of these positions, CPAs may be responsible for hiring and training new employees or serving as mentors. Typically, they work a traditional 40-hour work week, but the hours may be substantially longer during tax season and other financially important periods. In addition, some employers may require travel as part of the job.
Typical CPA Salary
The salary of a CPA can vary greatly depending upon experience, location, employer, and responsibility. According to the United States Bureau of Labor Statistics, the average salary for CPAs nationwide is around $73,800. However, this salary can be as low as $45,000 to $50,000 or can reach well over $100,000. In addition, many CPAs enjoy comprehensive benefits packages that may include health and life insurance, retirement plans, vacation pay, car programs, bonuses, and more.
CPA Education and Training Requirements
In order to work as a CPA, candidates are required to complete at least 150 semester hours of college, of which a minimum of 30 semester hours must be in higher-level accounting courses. At minimum, candidates must have a bachelor’s degree from an accredited four-year school. Typical courses will include principles of accounting, financial and tax law, cost accounting, accounting information systems, and more.
Once students have completed the required education, they must become certified. State requirements for certification may vary, so it is vital to check with the state licensing board for specifics. Typically, candidates must complete the educational requirements and gain two years of continuous accounting experience in public accounting or five years of continuous experience in another accounting field. Experience must immediately precede the application date for the certificate. Once the requirements are met, candidates may schedule a date to sit for the CPA examination.
About the Examination
The CPA examination is computer based and consists of four parts: Auditing and Attestation, Business Environment and Concepts, Financial Accounting and Reporting, and Regulation. The Auditing and Attestation portion of the test consists of three multiple choice sections and seven short task-based simulations over planning the engagement, internal controls, obtaining and documenting information, reviewing engagement and evaluating information, and preparing communications. The Business Environment and Concepts portion of the test includes three multiple choice sections and three written simulations. This portion of the test covers business structure, economic concepts, financial management, information technology, and planning and measurement. The Financial Accounting and Reporting section of the test consists of three multiple choice sections and seven task-based simulations and covers concepts and standards for financial statements, typical items in financial statements, specific types of transactions and events, accounting and reporting for government entities, and accounting and reporting for nongovernmental and not-for-profit organizations. The Regulation portion of the exam covers ethics and professional responsibility, business law, federal tax procedures and accounting issues, federal taxation of property transactions, federal taxation of individuals, and federal taxation of entities. This portion involves three multiple choice sections and six task-based simulations.
While the total cost of taking the CPA exam can vary based upon area, section, application, and re-take fees, it typically costs around $1,000 to take all four parts and an application fee is due each time you apply. To cut costs, try to sign up for as many sections as you can confidently take within six months.
In addition, to the CPA exam, many states require candidates to also pass an ethics examination. This exam is typically self-study and can cost between $100 and $200 dollars. If you are a member of the American Institute of CPAs (AICPA), you may receive a discount on this charge. Once candidates pass the examination and meet all other state certification requirements, they will receive a CPA certificate.
Career Path Options for a CPA
There are many career paths available to CPAs. They may choose to work as self-employed business owners, as independent contractors, or as part of an established public or private accounting firm. They may also choose to work in public accounting, education, government, business, or for nonprofit organizations. Within each career area, many CPAs specialize in the type of work they do. They may work as chief financial officers for large corporations, advisors to small businesses, as tax or accounting consultants, and more. In short, there is no limit to what CPAs can choose to do once they have completed training and licensing requirements.
Pros and Cons of Becoming a CPA
While the career of CPA is exceptional, it is not for everyone and has its pros and cons. Some of the advantages of a career as a CPA include an excellent salary and benefits package and a large variety of career options. In addition, this field is expected to grow by an impressive 22% by 2018. As accounting and auditing regulations become stricter for corporations and the tax law continues to change, this demand will likely continue for the foreseeable future, making this an excellent career to enter. CPAs enjoy a 40-hour workweek most of the time and work in clean, professional environments.
Of course the career is not free from disadvantages, as is true of most fields. CPAs face a great deal of stress and are legally responsible for all documents and forms they sign. In addition, keeping up with ever-changing laws requires constant study and continuing education. Finally, many CPAs find themselves working 60 to 70 hour weeks during tax time and other financially important periods.
If you enjoy working with numbers and are detail oriented, the career of CPA may be perfect for you. If this is a career that piques your interest, now is the perfect time to enroll in an accredited accounting program so you can start on the path to your new career.