You may be wondering about the difference between CPA (Certified Public Accountant) and accountants in general… aren’t they the same?
Well, yes and no.
Every CPA is an accountant but not all accountants are CPAs. I like to describe CPAs as “Black Belt Accountants”, meaning that they have achieved beyond what a normal accountant does through advanced education, training, education and high ethical standard.
Let’s compare CPA to accountants in terms of education, experience and opportunities.
The CPA educational requirement is the most demanding among all accounting and finance qualifications: you need to be in accounting concentration or have taken enough credit hours to demonstrate the same level. Also, you must have at least a 4-year bachelor’s degree, and have taken 150 credit hours of higher education.
As a CPA license holder, people have comfort in your education level simply by looking at your title.
CPAs, not normal accountants, fill senior finance positions.
In light of the financial scandals in the past years, corporations have increasing pressure to only hire qualified professionals in order to uphold the accuracy and integrity of the company’s finances.
At the same time, for non-CPA accountants who move up to such senior positions after years of hard work, they are asked by the company’s board to “get the CPA done” within a year or they will be fired. I have more and more readers in this situation.
If you are young and have the time and energy to take on this exam, it is the best time to do it.
Your opportunities aren’t limited to CPA firms or auditing. The CPA qualification is the most recognized in the accounting field, so it is applicable and beneficial to any career related to accounting.
It could be the typical Big 4 route towards partnership, or it could be as different as a strategic advisor to an amazing start-up. You could specialize in tax in an investment bank to offer valuable insight in M&A structure, or be the boss by launching your own CPA firm. Sky is the limit in terms of what the CPA qualification can help in your future career.
Because of these reasons, accountants in different backgrounds are considering getting a CPA to enhance their credentials and income generation power. You can learn more about why you may also want to become a CPA here.
A CPA candidate has to go through 5 steps in their journey towards a CPA qualification. These steps are proof of their expertise in the following areas:
You may still be debating whether becoming a CPA is a good idea, but I am more than happy to help you along the way!
If you find this article helpful, please consider signing up to my mini-course, the most effective way for me to send you:
So you’ve been chucking along in your accounting career for a while. Things are fine, but you are looking for more… whether it’s more money, more challenges, and more interesting work, your career is probably due for an upgrade. Let’s take a look at how you can do it.
Whether you are an auditor or a financial analyst in a company’s accounting department, you can always jump to a bigger competitor.
For auditors, it would mean switching from local/regional firms to national firms and the Big 4; for those working in non-public accounting, it could mean going from a regional company to a big, multi-national, Fortune 500 corporation.
If you are working in a “hot” industry and Big 4 is looking to expand that division, you have a good chance of success. But is the switching good or bad for you?
Here are the pros and cons of working in a regional CPA firm vs Big 4.
If you look at the triangular structure of any CPA firm, you will not be surprised that most auditors will end up leaving public accounting and working somewhere else. Most of them will likely work with their former clients or related companies on the business side.
Depending on the size of the company and whether it is a private or listed company, your experience will vary greatly.
It could be a pretty stable job churning out monthly management reports and annual financial reports.
It could also be an exciting and demanding job with handling the books for multiple subsidiaries, supplying data to business units, legal, investor relations, and other divisions, crafting projections, answering questions from senior management, and working on ad hoc financing projects…
General tips are to pick a business sector that (1) you are interested in and (2) has a relatively good future. Then it could be a stable yet interesting job.
The switch from corporate to public accounting is relatively rare. If it does happen, it is most likely at the senior level when the CPA firm looks for expertise in a particular business sector.
Suppose you started with public accounting and switched to corporate in the middle of your career when you accumulated enough experience and connections. In that case, you can certainly think about going back to public accounting by starting your own CPA firm.
As your own boss, there are more flexibility and upside, but it comes with the extra stress and risk that you need to consider as a business owner.
Specialization often requires specific skills, which means that the job nature could be more interesting and likely more pay.
Therefore, as mentioned in point 2, it is important to pick the “right” sector so you can benefit from an interesting and lucrative niche when you gain the necessary experience.
As an accounting professional, I am sure you know how the CPA title demands respect from your family, friends, colleagues, and business partners. More importantly, as you move up your career path, either in public or non-public accounting, you need the CPA title to secure the job.
If you aren’t a CPA yet, chances are that you’ve thought about becoming one from time to time.
Besides the respect, a CPA title helps you:
You can check out this beginner’s guide to pass the CPA Exam or a similar page written for candidates with international backgrounds. Good luck!
Once you become a CPA, you’ll find that it benefits your career in many unexpected ways. For instance, the IIA (Institute of Internal Auditors) offers the CIA (Certified Internal Auditor) credential. Normally, the path to becoming a CIA is lengthy and requires passing a 3-part exam. However, if you already hold a CPA, you can take the IIA Challenge Exam and take an expedited path. Plus, if you study with a course like the Gleim CIA Challenge Exam Review System you can gain your CIA qualification even easier.
If you don’t meet all the CPA requirements, don’t worry! Several other accounting designations could propel your career, too.
For instance, consider the CFA vs CIA. And if you might be interested in the CFA (Chartered Financial Analyst), you might be interested in the related SIE (Securities Information Essentials) exam. The SIE exam is for professionals interested in securities and financial advising, and candidates can also pass related “Series” exams. Furthermore, the SIE exam has a strong pass rate, especially if you use one of the best SIE exam courses, best Series 9/10 study material, or best Series 99 study guides to prepare.
And if the CMA designation doesn’t work for you, the Enrolled Agent requirements are some of the easiest to attain. Basically, Enrolled Agents are specialized tax practitioners who have technical expertise in many areas of federal taxation. The IRS bestows the credential, which you can attain after passing a 3-part exam. However, the EA exam pass rates are higher than most other accounting credential exams, including the CPA Exam. What’s more, if you study with a review course, your chances of passing the EA exam increase even more.
Think of public accountants as “external” accountants who provides services to clients such as audit, consulting and tax planning services.
Then, think of private (non-public or corporate) accountants as “internal” accountants who work in a company, non-profit organization or a government agency. You can work in the financial accounting, management (cost) accounting, budgeting, corporate planning, treasury or in the internal audit department within the corporation.
It largely depends on your career aspiration, strengths and personality.
Good People Skills. Public accounting is a client oriented business. This means that you need good interpersonal skill. For example, you’ll need to communicate effectively with your clients. It is also helpful to understand the client’s business and to request information for your analysis.
It may sound easy, but not all clients are willing to release all information. You need to be tactful and consistent to get the data and complete the audit work.
As you move towards partnership, you’ll acquire important skill in how to deal with difficult clients and maintain ethical standards and integrity at the same time.
Good Sales Skills. You need to solicit business for your firm, and this is people skill at the next level. Good sales and marketing skill (while keeping your professionalism) is critical if you aspire to become a partner or launch your own CPA firm
More Stressful Environment. Because you are dealing with a wide variety of people and demands, public accountant’s work is more stressful. On the other hand, private accountants work with the same group of colleagues and tend to have a more relaxed lifestyle.
Longer Hours. Because you work with clients instead of colleagues, the deadlines are often hard deadlines. Over-time and late nights are common especially for junior accountants. Other than the account-closing month, corporate accountants have more or less a 9-5 job.
Less Stability. While accounting job is considered one of the most secure jobs, the boom and bust of economic cycle does affect CPA firms as clients cut budget and corporate finance activities. Within public accounting, audit and tax teams are more secure than advisory teams for this reason.
Better Exposure. Working in a public accounting firm expose you to a wide variety of projects, possibly in different industries. This is an unrivaled experience when compared to an accounting role in one company.
More Doors Opened. An experience in CPA firm (especially Big 4) is valuable for your resume. It is always easier to go from public accounting to private accounting than vice versa.
Both public and non-public accounting can offer rewarding careers for students interested in the accounting field. There are lots of interesting CPA career paths as you gain more experience in your niche.
Jake has been working in the Internal Audit department at his alma mater for a year now. He is kind enough to share his experience with us.
How did you get this job?
I saw a job opening at the university I went to when I took the master’s degree. It is really interesting to see how the university is run on the other side.
How do you like about your job?
I LOVE it. As an internal auditor, I get to meet with people in different departments — from the college, law school, medical school, to the state-of-the-art stadium, art galleries, medial center to construction (they are building new dorms at the moment). I feel like I am exposed to and learning something new every day.
More importantly, I feel valued and that I am making a difference.
How is the work-life balance?
I worked in a mid-size public accounting firm for a couple of years. Compared to that it’s been great work-life balance here. I normally work 8 hours on weekdays and there is little stress. Colleagues are nice, flexible and understanding, probably because no one is stressed out here.
Also, there is not much traveling. Some people like the experience of traveling around the world. For me, as a husband and a new dad, I appreciate the fact that we have little traveling.
What are the cons?
Work mostly involves operational audit versus financial audit. This means you look at purchasing, payroll, and various programs. If you enjoy working on lots of numbers and complex mathematical models, this may not suit you.
Also, salary tends to be lower unless you work in a big, research-intensive university. Benefits is usually good though. If you work in a state school you get state retirement plan.
What is the career path?
I need to take and pass the CPA exam within 3 years in order to become a senior. A certification and/or experience is required for a supervisory role. Going forward, I am not sure — the office isn’t big… senior positions become available only if someone move on or retire.
Any advice for those interested to become a University Auditor?
I’ve met with other IA people in neighboring universities. It seems like most of us prefer to hire someone with master’s degrees.
The fact that you went to the university is helpful. My interview was actually quite tough, meeting everyone in the team for an afternoon. But at the end of the day it’s personality fit.
If you are still in college, try landing an internship at the Internal Audit office. It’s a great experience and they will likely offer you a position if it is available, either right away or years later if you keep in touch with them.