Becoming a CPA requires passing an exam and fulfilling several education and experience requirements. Obtaining the certified public accountant (CPA) designation requires a bachelor’s degree in business administration, finance, or accounting. Individuals are also required to complete 150 hours of education and have no fewer than two years of public accounting experience. To receive the CPA designation, a candidate also must pass the Uniform CPA Exam.
As such, CPAs are often accountants that perform the same duties and functions as an accountant without the designation. CPAs, however, are granted certain roles that only they can perform. These include performing audits of public U.S. companies and preparing audited financial statements for a company, such as a balance sheet or an income statement. While accounting salaries have grown over the years, their future growth trajectory is unclear. Artificial intelligence and machine learning are growing in complexity, and, in time, this technology might be able to take on more accounting tasks. While not every accounting professional requires auditing skills, it can be a useful skill since it ensures financial data is accurately depicted in accordance with modern accounting standards.
What credentials do you need along the CPA career path?
The application process for the CPA Exam is extensive and cumbersome. The first step is to have the state board of accountancy confirm that all educational requirements have been satisfied, and then submit a formal application once accepted. As you fulfill the CPA requirements, it’s a good idea to keep your job search materials updated, including your resume and LinkedIn profile. It’s also a good idea to improve your interviewing skills, such as researching a company, preparing questions to ask the hiring manager, and presenting your qualifications.
For example, a short-term milestone might be to acquire an in-demand skill like using accounting software, while a long-term goal might be to advance into a leadership position. As CPAs remain high in demand, and as retiring CPAs leave the market, there is a growing number of job opportunities for newly licensed CPAs. Certified Public Accountants have the potential for continued career growth, both within Nonprofit Bookkeeper vs Accountant Who Should You Hire? and outside of the CPA/accounting industry. Explore programs of your interests with the high-quality standards and flexibility you need to take your career to the next level. Integrity Network members typically work full time in their industry profession and review content for Accounting.com as a side project. All Integrity Network members are paid members of the Red Ventures Education Integrity Network.
Certified Public Accountant (CPA): Definition, What CPAs Do
This preparation will help to build your technical skill sets and financial literacy, as you will work to retain concepts and put them into practice in the testing environment. Accounting is the process of keeping track of your business’s financial transactions. It helps you to understand how money comes in and how it goes out. Accounting is like a powerful machine where you input raw data (figures) and get processed information (financial statements). The whole point is to give you an idea of what’s working and what’s not working so that you can fix it. This doesn’t mean that accountants will be replaced by machines, though.
CPAs are often the people who are called in to conduct audits — assessments of a business’s paperwork and financial statement. They can also hold chief controller or chief financial officer https://quickbooks-payroll.org/cash-vs-accrual-accounting-for-non-profits-which/ (CFO) positions, depending on their skill level and education. A major service area for the CPA is to advise on the tax strategies of clients, as well as to prepare their tax returns.
Renew and Maintain Licensure
You’ll also need to complete continuing education to remain licensed. Earning the CPA credential is a big time commitment, and the exam process is difficult. Still, those with a CPA earn 25% more, on average, than non-CPA accountants. Also, accountants with a CPA certification tend to advance to positions of more responsibility within one to two years and often are promoted to senior-level jobs within a few years after that. The AICPA requires that all CPA designation holders adhere to the Code of Professional Conduct, which lays out the ethical standards CPAs must adhere to.
- They work with complex data to develop models and projections that aid in decision-making related to risk management, investment strategies, and pricing.
- The Enron scandal in 2001 resulted in major changes in the accounting industry, including the fact that Arthur Andersen, one of the nation’s top accounting firms, went out of business.
- Large accounting companies expanded their services to incorporate various forms of consulting in the late 1990s, resulting in a boom in the accounting business.
- Many CPA applicants take the traditional route of earning a degree in accounting or management.
- It’s clear that accounting involves more than just crunching numbers—it’s an in-demand field with countless opportunities to offer.
- There are some workplaces that don’t want to consider someone for an accounting role who is not a CPA.