The Beginner’s Guide to
Becoming a CPA
Presented by: BestAccountingDegrees.net
It’s not uncommon for kids in school to grumble about taking math classes and think, "When will I ever need this in my life?" Well for the students who go on to become accountants, they use most of those skills every day. There are many different types of accountants, and the term "CPA” refers to a particular type of highly qualified accountant who has a knowledge of both finance and business. Check out this in-depth guide to everything a person needs to know about the career field, from what exactly a CPA is (chapter one) to resources for finding work after achieving certification (chapter 10).
Readers of this guide will also learn about what to expect from daily life if they become a certified public accountant and all about the "Four E’s" of certification – education, exam, experience, and ethics. CPAs need to meet strict requirements in all these areas – which vary somewhat according to state – in order to become licensed. When delving into this beginner’s guide, readers will also learn about what kind of salary they can expect to make and what the future holds for the profession (chapters 8 and 9, respectively). And for the more ambitious CPAs out there, chapter 7 offers great information about how to start an independent accounting firm.
"CPA" stands for certified public accountant, and is essentially someone who has an advanced understanding of both finances and business. In general, CPAs are in high demand and are very valuable in the business world. There is a list of requirements that a person needs to meet in order to become a CPA, which generally fall in the categories of education, exam scores, ethics, and experience. Accountants must be licensed by the board of accountancy in the state in which they wish to practice. CPAs provide a number of services and are employed by public accounting and other professional services firms and work in business, industry, government, and education. The links below provide some great, basic information about the CPA profession.
For most CPAs, no two days are exactly alike. Public accounting is a challenging job that requires CPAs to work at a fast pace while also being detail-oriented. Certified public accountants often get exposure to multiple departments within an organization, such as payroll, human resources, marketing, and finance. Daily activities could include anything from visiting an investment banker in an upscale part of town to counting inventory at a manufacturing plant. CPAs spend a lot of time meeting with clients and their days are organized around their clients’ needs. Take a look at the links below to get a better picture of what daily life looks like for CPAs.
Students who hope to become CPAs should complete 150 credit hours of education in order to develop the necessary skills and knowledge to be successful. Most states already mandate this high number of credit hours, and those that don’t, will. In most cases this means that students will have to go to graduate school after obtaining a bachelor’s degree. However, this does not mean that they need a master’s degree. Some students meet the requirement at the undergraduate level, and some simply take whatever credits they still need at the graduate level without obtaining a degree. The resources below offer more detailed information about educational requirements for CPAs.
One of the "Es” that CPAs must complete before becoming licensed is the certified public accountant exam. Part of the reason aspiring CPAs have to take an exam is that it protects the public by ensuring that only qualified people work in the profession. The process of signing up to take the exam usually requires contacting the state board of accountancy and requesting an application form. The application process could take as long as two months, so students should plan accordingly. It can be helpful to take a CPA review course before sitting for the exam, and some sources recommend spending as many as 400 hours studying! See the links below for more resources on the examination.
Although the exact requirements may vary somewhat from state to state, there is no question that all aspiring certified public accountants must meet strict experience mandates in the state in which they wish to practice. Students should look up what the exact requirements are early on in their studies so they can get a sense for what they want to do, and potentially choose between multiple qualifying pathways. The links below provide a lot of great information about the experience CPAs need in order to be qualified, including some examples of requirements put in place by specific states.
- Introduction to CPA Requirements
- General CPA Licensing Questions
- Obtaining a CPA Certificate (Louisiana)
- Certification FAQs (Massachusetts)
- Education and Experience Requirements (New Jersey)
- What Happens if CPA Candidates Can’t Meet the Work Experience Requirement?
- CPAs Might Meet Experience Requirement by Working in Industry
One part of the requirements CPAs must meet is related to ethics. CPAs must agree to uphold a stringent code of ethics in order to ensure that their practice remains professional. The ethics requirements are occasionally updated but generally have to do with maintaining objectivity, not abusing power, not bowing to external pressures, and staying up-to-date with the entire ethical code of conduct. Some requirements also relate to staying sharp in the profession by engaging in continuing education courses. Many states require students to pass an ethics exam that tests how they make ethical decisions. The resources below offer more details about ethics requirements and some examples of the process in different states.
Although in some industries it may seem overly ambitious to try starting a business, such entrepreneurial endeavors are quite realistic for CPAs. Most certified public accountants take business classes in college so should have some knowledge of how to set up a practice. It involves creating a business plan, acquiring the financial resources, obtaining equipment and technology, and setting prices. Most CPAs who are self-employed have one-man operations, and many work in practices with fewer than ten employees. Check out the links below for more about becoming an accounting entrepreneur. This information might make starting a business seem like a more manageable task!
Students interested in pursuing a career as a certified public accountant will be happy to know that not only will they make very comfortable salaries, but they make comparably more than other types of accountants. This increase in income is mostly because CPAs need to have more training and certifications than other types of accountants. It may feel like the path to becoming a CPA is a lot of work, but ultimately it could pay off with a six figure salary. In fact, over the course of a 40-year career CPAs can earn $1 million more than non-certified accountants. The resources below provide an in-depth look at what aspiring CPAs can expect to make.
Not only do CPAs make very attractive incomes, but they enjoy great job growth and job security. Many American companies are seeking more professional financial advice, which bodes well for CPAs. Although the field of accounting is growing in general, the greater experience, education, and certifications required to be a CPA makes their job prospects especially bright. In fact, in 2013 public accounting firms hired a record number of accountants, and most employers predicted that 2014 will bring the same numbers. Students can help themselves stand out from the crowd and increase their prospects further by selecting a non-accounting or business-related minor. To find out more about what to expect from the future of accounting, see the links below.
Although becoming a CPA may seem self-limiting, there are actually a number of different jobs from which CPAs can choose to launch their careers. Public accounting is a broad field that includes small and large firms, local companies and international corporations. Certified public accountants can work in audit, tax, or management consulting, can work in business or industry, or for a government or educational organization. Other CPAs work in reporting, analysis, or cash management. There are even opportunities within the nonprofit sector. CPAs can easily find jobs and learn more by visiting a number of great online resources, a few of which are provided in links below.
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