Certified public accountants (CPAs) are crucial in today’s complex and ever-changing business environment.
CPAs’ responsibilities include providing reliable financial information, assisting with tax preparation, and ensuring the accuracy of financial records.
The CPA designation is a prestigious credential that stands for high competence and adherence to professional standards.
Here you will learn more about what a CPA is, the roles and responsibilities of certified public accountants, and the process of obtaining a CPA license.
In addition, we will explore the various career paths and specializations available to CPAs and the importance of ethics and professionalism in accounting.
What is a CPA?
A CPA, or Certified Public Accountant, is a designation awarded to accountants who have met specific training, examination and experience requirements.
They have the knowledge and expertise to perform various accounting services including financial accounting, tax preparation, auditing and consulting services.
The distinction between a CPA and a non-CPA accounting professional is crucial. A non-CPA can have an accounting degree and perform accounting or financial reporting duties.
However, a CPA has passed the rigorous Uniform CPA Exam, met the work experience requirements, and is licensed by their respective State Boards of Accountancy. This license indicates a higher level of expertise and competence in accounting practice.
The American Institute of Certified Public Accountants (AICPA) is the national professional body representing CPAs in the United States.
It sets professional standards, provides resources, and supports CPAs in their careers by providing continuing education and professional development opportunities.
What are the training and license status requirements for CPAs?
Aspiring candidates must meet specific education and licensing requirements to become CPAs. These include:
Educational Background: Applicants must have a bachelor’s degree in accounting or related field. Some states also require a master’s degree or a certain number of semester hours in accounting courses to qualify for licensure.
Uniform CPA Exam
Administered by the National Association of State Boards of Accountancy (NASBA), the Uniform CPA Exam is a comprehensive and challenging test that assesses a candidate’s knowledge and skills in a variety of accounting areas.
The exam consists of four parts:
- AUD: Auditing and attestation.
- BEC: Business environment and concepts.
- FAR: Financial Accounting and Reporting.
- REG: Regulation.
Please note that candidates must pass all four sections within an 18 month period. Once passed, one can get their CPA certification.
Every state has one Government Accountancy Office responsible for licensing CPAs. These councils determine the eligibility, education, and experience requirements for licensure.
Generally, CPA candidates must complete a certain number of work experience hours under the supervision of a licensed CPA before obtaining their CPA license. In addition, some states require continuing professional education to maintain licensure.
Related: How can I help my CPA?
What job opportunities are available for CPAs?
CPAs have a wide variety of career options available to them, including working for:
- Public Accounting Firms: CPAs can work for large, medium, or small public accounting firms, providing services such as auditing, tax planning, and consulting to clients in a variety of industries.
- Government Agencies: CPAs can work for federal, state, or local government agencies, such as the tax authorities (IRS), managing budgets and financial reports and ensuring compliance with financial regulations.
- Nonprofits: CPAs may work for nonprofits, oversee financial records, manage budgets, and ensure compliance with tax laws and regulations.
- CFO and Chief Financial Officer Positions: CPAs with extensive experience and knowledge may advance to board-level positions, such as Chief Financial Officer (CFO), overseeing an organization’s financial operations and strategy.
Related: How to Choose the Best CPA Firm for Your Startup or Business
What services do CPAs provide?
CPAs offer a variety of services, including:
- Financial accounting: preparing and maintaining financial statements and records to ensure accurate and reliable financial information.
- Tax Preparation and Tax Return: Help individuals and businesses prepare and file their tax returns while ensuring tax compliance.
- Auditing and Attestation: Perform audits to verify the accuracy and integrity of financial statements and provide assurance about the reliability of financial information.
- Financial Planning and Advisory Services: Helping clients achieve their financial goals by advising on investment, budgeting and financial management.
Whichever area of accounting you choose, a CPA career can be exciting and rewarding. The job offers growth opportunities and the chance to work with clients from all walks of life.
This is why so many people pursue careers in accounting and become CPAs.
What are the specializations within the CPA profession?
CPAs can choose to specialize in specific areas of accounting based on their interests and career goals.
Some of these specializations are:
This specialization includes investigating financial fraud, litigation and other irregularities. Forensic accountants may work with law enforcement agencies, legal teams, or corporations to uncover financial misconduct and resolve disputes.
CPAs who specialize in financial planning advise individuals and businesses on various aspects of financial management, such as investments, retirement planning, and estate planning.
Tax specialists focus on tax compliance, planning and consulting for individuals, businesses and non-profit organizations. They help clients navigate complex tax laws and regulations, minimize tax liabilities and take advantage of tax-saving opportunities.
Non-Profit and Government Accounting
CPAs working in this field focus on the unique accounting and financial reporting requirements of non-profit organizations and government agencies. They monitor compliance with specific regulations and assist with budgeting and financial management.
CPA consultants provide specialized advice and solutions to businesses on a variety of financial, operational and strategic matters, such as mergers and acquisitions, business valuations and risk management.
What are the ethical and professional guidelines in the CPA profession?
Ethics and professionalism are essential parts of the CPA profession. To maintain public trust and uphold the reputation of the profession, CPAs must adhere to the AICPAs Code of ethicsoutlining their ethical responsibilities and providing guidelines for maintaining the highest standards of integrity and professionalism.
Continuing Professional Training (CPE) is another essential aspect of maintaining ethical standards.
CPAs are required to earn a certain number of CPE hours each year to stay abreast of the latest industry trends, regulatory changes, and accounting best practices.
Related: How leaders and their teams thrive through continuing education
Consider a career as a CPA
If you are interested in a career in accounting, a CPA is an excellent option. With the right education, experience and willingness to learn, you can become a successful CPA and enjoy a rewarding career filled with many opportunities.
If you want to know more, take a look australiabusinessblog.com for other detailed articles on accounting and other financial topics.