Pros and Cons of Being a CPA
CPAs are certified public accountants who have passed the national CPA exam administered by the American Institute of CPAs (AICPA). Check out the pros and cons before making a career decision.
|Pros of Being a CPA|
|Pays well ($65,940 median salary in 2014)*|
|Good job opportunities (13% growth between 2012-2022)*|
|Variety of specialization options*|
|Pleasant working conditions*|
|Cons of Being a CPA|
|Must pass CPA exam*|
|Requires 150 hours of college credit**|
|Meet state licensure requirements*|
|May work long hours*|
Sources: *U.S. Bureau of Labor Statistics, **American Institute of CPAs.
CPAs handle the accounting, taxes, consulting and auditing processes for governments, corporations and individuals. As a CPA, you deal with documents that your clients are required to disclose, such as the reports corporations must give to potential investors. These accountants may also fill out tax returns and advise clients on income tax matters.
CPAs may have their own business or work for accounting firms. The U.S. Bureau of Labor Statistics (BLS) reported that 20% of accountants worked more than 40 hours per week on average. The job can be especially grueling during income tax season and at the close of the fiscal year.
The BLS predicted that employment for accountants of all types, including CPAs, would grow by about 13% from 2012-2022. Corporate financial scandals have led to an increased emphasis in accounting, the BLS noted. The BLS also wrote that individuals with a master's degree in accounting or business (with a concentration in accounting) should have the best job prospects. Competition for jobs with top firms will remain fierce.
The median salary for an accountant was about $65,940 as of May 2014, the BLS reported. Accountants in the middle 50% earned a salary from $51,130-$87,530 during that same year. Accountants who worked in the accounting and tax preparation industry earned about $77,000, while securities and commodities accountants earned about $95,000 or more per year.
What Are the Requirements?
You'll need at least a bachelor's degree in accounting or a related field, along with some additional coursework, to become a CPA. However, most states now require a 150 hours of college credit, which means about 30 credit hours on top of a bachelor's degree, in order to sit the CPA exam.
Any accountant who files returns with the Securities and Exchange Commission (SEC) must pass the CPA exam as well as meet other state requirements. Other accountants often take the exam in order to demonstrate their expertise. After you earn CPA status, you have to complete continuing education courses from approved providers to maintain your license.
Many schools have accommodated the change in the credit hour rules by combining a bachelor's/master's program or offering a Master of Accountancy specifically for students who intend to take the CPA exam. Colleges often help students obtain internships in order to meet the experience requirements for the CPA exam.
CPAs must have excellent analytical ability and an eye for detail. Here are some additional qualities the AICPA says a good CPA must possess:
- Leadership ability
- Computer skills
- Communications skills
- Business savvy
What Employers Are Seeking
A glance at job postings shows that CPAs work in many types of enterprises, from health care to the aerospace industry. Employers are looking for CPAs with at least a year of experience and knowledge of accounting software. Here is a sampling of job postings from real employers in April 2012:
- An aerospace corporation in Florida was looking for a CPA with at least 10 years of experience in the aerospace industry. Candidates should be knowledgeable about the financial aspects of acquisitions, understand government contract accounting and be experienced in Sarbanes-Oxley 404 compliance.
- In New York, a small accounting firm was seeking an experienced accountant who was a CPA or who had enough courses to sit the CPA exam. The individual should be proficient in accounting software, primarily QuickBooks, and knowledgeable in Excel and Word.
- A firm in California needed a CPA who could speak English and Japanese. This person should have auditing experience with an accounting firm and be a self-starter.
- In Texas, an accounting firm was looking for an experienced CPA to prepare and review tax returns for businesses. The person hired should have demonstrated knowledge of tax law and accounting.
How to Stand Out in the Field
CPAs can demonstrate their knowledge in specialized areas of accounting and auditing by earning certification from the AICPA. CPAs who successfully complete a written exam and meet education and experience guidelines can earn the Accredited in Business Valuation (ABV) credential. If you specialize in financial planning and meet education and experience requirements, you can take the exam for the Personal Financial Specialist (PFS) designation. CPAs who are experts in information technology and its application in accounting can become Certified Information Technology Professionals (CITP) by meeting education and experience criteria and passing an examination.
Becoming involved in the accounting industry and networking with other CPAs is one way to stand out in this field. AICPA sponsors a Young CPA Network that offers seminars, awards and conferences to individuals just getting started in the field. AICPA also sponsors conferences and programs for experienced CPAs, where they can share information and update their knowledge. There are also state and local associations of CPAs all around the country that can support you in furthering your career through education, conferences and publications.
Alternative Career Paths
If you like accounting work, but don't want the stress and extra educational requirements that come with taking the CPA exam, you can work as an internal auditor. Internal auditors ensure that a business does not mismanage their finances or waste funds. While not required, the Institute of Internal Auditors offers the Certified Internal Auditor (CIA) designation. According to the BLS, accountants and auditors who worked for state governments earned a mean annual wage of $56,000, while those working in the management of companies made $70,200 in 2011.
Another career option is as a financial manager. These managers oversee an organization's financial health, and the BLS reports that the median salary was about $107,000 in May 2011. You'll produce reports, supervise investments and help create a financial plan. To work in this field, you'll need a bachelor's degree, preferably a master's, and at least five years of experience in some area of finance.
For a career working with numbers that doesn't require a 4-year degree, you can consider becoming an accounting clerk. You might get a job with a high school diploma, but employers prefer someone with an associate's degree or at least some post-secondary coursework. Accounting clerks may post transactions, calculate interest or monitor loans. According to the BLS, the median salary for an accounting clerk was around $35,000 in May 2011.