A Certified Public Accountant (CPA) is a trusted accounting professional who has gone through a rigorous vetting process. CPA professionals have completed and mastered the three areas required for this accounting license: education, experience, and exams.
Passing the CPA exam and obtaining this prestigious title means that an individual has a thorough knowledge of accounting practices and acts with the utmost integrity.
Table of Contents
- What does a CPA do?
- What are the duties and responsibilities of a Certified Public Accountant?
- CPA in Public Accounting Firms
- CPAs in Government
- CPAs in Business
- CPAs in Non-Profit Industry
- CPAs in Education
- CPA vs Accountant
- How do I become a CPA?
- Eligibility for CPA Exam
- Study for the CPA Exam
- Why should I become a CPA?
- Similar Articles
What does a CPA do?
CPA understands accounting, the language of business. This understanding enables CPAs to act as trusted financial advisors and work with businesses, individuals, schools, and other organizations to achieve their goals. CPAs are practiced throughout the business and financial world, including business and industry, public accounting, education, government, and non-profits.
Every organization, regardless of size, needs the skills, knowledge, and experience that can be provided through a CPA firm or by a CPA who works directly for the company.
Certified public accountants serve a wide variety of individuals and businesses and may specialize in areas such as tax and forensic accounting.
The American Institute of Certified Public Accountants (AICPA) highlights the five popular areas in which CPAs work.
- public accounting
- commercial and industrial
- non-profit organization
This is not an exhaustive list. Earning a CPA certification opens opportunities in almost every industry.
What are the duties and responsibilities of a Certified Public Accountant?
Generally, CPAs are responsible for understanding, organizing, and reporting the financial information of businesses or individuals.
The main responsibilities of a CPA in private accounting are:
- Monitoring financial records
- Preparation of annual accounts
- Create, maintain, and review budgets.
- Ensure compliance with local, state, and federal tax laws.
- strategic planning
- cash management
- Monitor and improve financial management systems.
CPA in Public Accounting Firms
Certified public accountants in the CPA industry work with businesses and individuals to review and prepare financial information for publication or submission to governments. They can offer a wide range of services, usually in three main areas.
Auditing & Assurance
The Audit and Assurance Department, through its activities, is responsible for the execution of audit and confirmation orders and the issuance of audit reports.
Tax Preparation & Services
The Tax Preparation and Services Department is responsible for preparing the required tax returns and providing tax planning and analysis services.
Consulting services range from helping clients identify and implement new financial systems, to helping clients understand their financial statements, to providing recommendations on accounting best practices. over. Consulting specialties include forensic accounting, financial and estate planning, and litigation.
CPAs in Government
CPAs can work in federal or state and local governments.
According to AICPA, at the federal level, CPAs can expect:
- investigate white-collar crime
- Administration of final exams for government agencies
- Conducting research and analysis on financial management issues
According to AICPA, at the state and local level, CPAs can expect:
- Analyze a school district’s ability to remain profitable
- Evaluate the adequacy of spending on prison construction.
- Checking the effectiveness of the worker’s accident compensation system
CPAs in Business
A CPA has held various managerial and other positions, such as corporate controller and CFO, and CEO.
CPAs in Non-Profit Industry
Certified public accountants in the non-profit industry oversee financial reporting and controls to ensure that an organization’s mission and goals are achieved. Certified public accountants in this industry can be expected to assist with tax returns, internal controls, budget preparation, financial management, and reporting.
CPAs in Education
Education CPA performs the financial management and reporting functions of an organization. Some CPA professionals want to educate others about accounting practices, and these professionals are also in the education industry.
CPA vs Accountant
All CPAs are accountants, but not all accountants are CPAs. An accountant is a person who keeps and interprets financial records. What is a CPA? Do you need to be a CPA to become an accountant? CPA is not limited to one industry or one job. In addition to maintaining and interpreting financial records, CPAs can provide other services with knowledge gained through exam preparation and continuing professional education (CPE) requirements.
According to AICPA, those with a CPA designation have access to five popular specialty dishes:
- Audit and verification
- Tax preparation and advice
- Consulting Services
- financial plan
- process consulting
Earning your CPA license takes time, patience, and planning. In addition, to become a certified public accountant, it is necessary to continue education even after obtaining the certification of a certified public accountant. CPAs are often required to complete 40 hours of Continuing Professional Education (CPE) each year, depending on agency requirements.
Due to the difficulty of passing the CPA exam, and the requirement for continuing education, many finances, and accounting professionals consider the CPA license to be the most prestigious CPA/accounting credential a professional can obtain.
How do I become a CPA?
To become a CPA, you must understand and meet the requirements, study for the CPA exam, take the exam, and pass an ethics review (if applicable).
Eligibility for CPA Exam
All states require some degree of accounting education to become CPA licensed. In most states, this includes 150 credit hours in college-level accounting courses. Some CPA accounting candidates fulfill this requirement as an undergraduate. A master’s degree is not required to meet educational requirements, but some of the 150 credit-hour programs lead to a university degree. To study for the CPA exam, it is necessary to make a study plan and stick to it. The CPA exam refresher course can provide the curriculum and all related learning materials.
Study for the CPA Exam
CPA candidates should start studying months in advance and increase their study time as the exam date approaches. Planning, discipline, and balance are key to the CPA exam preparation process.
Pass the CPA Exam
Passing the CPA exam can be the most difficult requirement for some candidates. The CPA exam has four sections.
Auditing and Certification, Business Environment & Concepts, Financial Accounting & Reporting, and Regulation.
After passing each section of the CPA exam, the CPA candidate may be required to pass the AICPA ethics review. This is a short self-study course with a take-home test. It’s also not required in all 50 states, but it’s required in most (and recommended in all).
Why should I become a CPA?
NASBA (National Association of State Boards of Accountancy) states five reasons to become a CPA are prestige and respect, career progression, career security, job satisfaction, and money and benefits.
Prestige and Respect
A CPA license brings a certain level of admiration from colleagues and clients. Considered an elite group in the industry, CPAs are accorded more weight, trust, and respect than standard accountants.
CPA opportunities are endless, with opportunities in areas such as technology, artificial intelligence, cybersecurity, healthcare, energy, sports and entertainment, and government. Every industry needs a CPA!
CPA is in high demand. And while there may be a dozen accountants, there are very few qualified and experienced CPAs (especially in certain industries where more expertise is required). This will give you more job stability and more leverage in your job search and negotiations.
CPAs experience high levels of job satisfaction because they make a difference. They have a variety of career paths available and opportunities to make a positive impact on individuals, companies, or the purposes for which they work.
Perks & Benefits
Depending on the specific skill set, the average CPA accounting salary can be higher than the employee’s other accounting professionals.
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What does CPA stand for in accounting?
Certified Public Accountant.
A Certified Public Accountant (CPA) is a certified public accountant who has met state licensing requirements through education, experience and passing the CPA exam.
What are CPA Exams Pass Rate?
The CPA exam tests a candidate’s ability to meet the strict standards of the accounting industry. Over the past decade, the CPA exam pass rate has been about 50% (including 2020 & 2021).
What is a certified public accountant’s responsibility?
It’s a credential that helps accountants develop their careers. If you are looking to obtain a CPA license, you can work in a variety of areas including but not limited to:
- Public Accounting
- Business and industry
What Is a CPA License?
A CPA license is a professional title awarded by each state board of accountancy. A CPA license is obtained by meeting specific educational & work experience requirements, passing the CPA exam, and fulfilling other specifications set by the accountancy state board.
How Do I Find My State’s CPA Requirements?
To take the Unified CPA Exam, you must be considered eligible by one of the 55 US states or jurisdictions. Each state has its own fees & educational requirements. Some states also require permanent citizenship or residency.