Are CPAs and Accountants the Same Thing?
Many people are unsure about the different areas of accounting and wonder whether CPAs and accountants are the same thing. Accounting is a broad field with a variety of opportunities for a career. Advanced education in accounting may provide additional levels of income and professional challenge for those who are considering the accounting field.
What Is An Accountant?
Accountants are people who have been trained in accounting practices. These practices are used to organize financial matters of businesses and individuals so that an outside agency can get a clear picture of the financial status of the entity. Accounting also helps those within the company assess the financial health of the business and determine what changes should be made to accommodate future conditions. Accounting is used to pay taxes, acquire financing and make business decisions. If you’re interested in pursuing an accounting degree online, read 10 Best Online Accounting Schools for more information.
Common Roles For Accountants
Accountants may work in a wide variety of positions, including such jobs as claims adjustors for insurance, loan administrators for banking, underwriters, stockbrokers or investment analysts. These tasks all require an understanding of basic financial principles and how financial information is used in analyzing business needs. Almost any industry has need for personnel that can understand and organize the finances of the business to ensure success in its planning and investment.
Certification for Accountants
Essentially, all certified accountants are accountants but not all accountants are certified, according to the American Institute of CPAs. Certification is a process in which accountants’ skills are recognized and approved by state agencies. Getting certified generally involves taking an examination that tests a person’s knowledge of accounting practices and principles. Certification may be given for general accounting knowledge or for specific areas of accounting, such as financial management, internal auditing, business advising, fraud examination or financial planning.
Why Is Certification Needed?
Certification ensures consistency of the application of accepted accounting principles over in variety of industries and financial situations. In some states, anyone with minimum training or experience can call himself or herself an accountant. Being a CPA shows that a person has fulfilled the educational and experiential requirements needed to handle complex financial issues. Certification allows people who are trained as accountants to acquire positions with greater responsibility and higher salaries.
Requirements To Become Certified
Each state has its own requirements for certification in accountancy. Find out about the requirements in your state here. These requirements generally include educational credentials, a certain length of practical experience and passage of the Uniform Certified Public Accountant Examination. The examination is rigorous, and as many as half of the participants do not pass it on the first try, according to Accounting Coach. In addition, accountants are required to participate in continuing education courses to retain their certification status. Continuing education ensures that certified public accountants stay up to date on changing requirements for effective practice.
Many accountants begin careers in their field without certification and later decide to take the certification examination to advance their prospects for future employment. The accrued work experience fills some of the requirements for certification and increases their understanding of real life application of accounting principles. If you’re wondering whether CPAs and accountants are the same thing, keep in mind that in addition to the CPA examination, the greater number of opportunities and higher levels of pay available to CPAs generally distinguishes between the two.