Accountants and Auditors Overview
Usually, at a minimum, Accountants and Auditors need a bachelor’s degree in accounting or a similar field to find work. Graduates with a professional certification or license, especially CPAs, will find the best job prospects, though opportunities are expected to be favorable for all. The career should experience employment growth that’s much faster than average careers thanks to a jump in the number of businesses, an increased scrutiny of corporate finances and new financial regulations and laws.
Nature of the Work for Accountants and Auditors
Accountants and Auditors can take on many responsibilities including ensuring that public records are accurate, taxes are paid correctly and timely and that firms are run efficiently. Many also analyze and discuss finances for individuals, corporations and government entities. While preparing, verifying and analyzing financial documents are the basics of the role, many go one step further offering financial and investment planning, budget analysis, light legal serves and information technology consulting.
Most Accountants and Auditors work in an office though some may work in part from home. Public accounting firms, government agencies and organizations with multiple locations may ask employees to travel frequently. Nearly 50 percent of workers in the field work 40 hours a week. Self-employed Accountants and Auditors, workers with a big client list and tax specialists during tax season can expect to work longer hours.
Within the career of accounting and auditing there are four main fields to choose from: Public accounting, internal auditing, management accounting and government accounting.
The clients of public accountants include individuals, governments, corporations and non-profits and work may cover taxes, consulting, auditing and accounting. So one public accountant could find work auditing financial statements to discover whether they were correctly reported and prepared as an external auditor, another may focus on taxes working with companies to determine the tax advantages and disadvantages of business decisions or preparing personal income tax returns. Most public accountants are Certified Public Accountants (CPAs) and work for public accounting firms or their own businesses.
Another sector of public accounting is forensic accounting or the investigation and interpretation of white-collar crimes. Embezzlement, bankruptcies, securities fraud and contract disputes are often complex and need a specialist. Forensic accountants have skills in law and investigative techniques as well as accounting and finance. They work closely with law enforcement agents and often attend trials as expert witnesses.
Internal auditors look for waste, fraud or mismanagement within the company they work for. Job duties for these accountants and auditors include evaluating and examining the company’s management procedures, financial systems, information systems and internal controls to ensure accuracy of records. Operations are also evaluated for efficiency, effectiveness and compliance with both government regulations and corporate policies. Internal accountants and auditors favor real-time date over personal observation because computer systems often automate transactions and make them readily available. To ensure the integrity and reliability of data, these workers may also review and suggest new computer system controls. Some internal auditors are specialists such as compliance auditors, environmental auditors and information technology auditors.
Management accountants are often referred to as private, corporate, cost, managerial or industrial accountants. These accountants and auditors record and analyze financial information for a particular company working in areas such as cost accounting, planning and budgeting and financial analysis. Budgeting, cost management, asset management and performance evaluation all fall under management accountants job duties as well. Often, these workers are part of a strategic planning or product development executive team. Management accountants and auditors help corporate executives make smart business decisions by analyzing and interpreting financial information for them. Many also prepare financial reports for regulatory agencies, stockholders, creditors and other groups.
The work of accountants and auditors is changing with rapidly changing technology. Software packages reduce tedious data management and recordkeeping and help summarize and organize data. Computers also give accountants and auditors the opportunity to be more mobile and retrieve important financial information from client’s computer systems. Extensive computer skills can give accountants and auditors an edge in work correcting and updating software to meet analytical demands. Many in the field also develop technology plans and implement, control and audit computer systems.
Training, Other Qualifications and Advancement for Accountants and Auditors
Recommended Education Level
- Masters Degree
- Bachelors Degree
- Associates Degree
- Professional Certificate
A minimum of a bachelor’s degree in accounting or a similar field is usually needed to work as Accountants and Auditors. To help advance their careers, many attain a certification such as a Certified Public Accountant (CPA).
While some employers seek Accountants and Auditors with a master’s degree in accounting or a master’s degree in business administration with an accounting concentration, most look for a minimum of a bachelor’s degree in accounting or a similar field. To prepare students to work in specialties such as internal auditing, some schools offer tailored accounting programs. Professional associations also offer continuing education courses, seminars and conferences to help keep skills up to date.
Junior accounting positions are open to some community college and technical college graduates and some accounting clerks and bookkeepers who meet minimum education requirements. Later, if they can demonstrate skills on the job, they can advance to accountant positions.
At the beginning, most Accountants and Auditors work closely with or under direct supervision of a more experienced colleague before working independently.
Accountants and Auditors filing reports with the Securities and Exchange Commission (SEC) must be a CPA by law, including senior accountants working on behalf of SEC-registered public companies. CPAs must pass a national exam and meet state requirements to be licensed by the State Board of Accountancy. Most state require CPAs to be college graduates, though in a few states public accounting experience can suffice.
Before Accountants and Auditors choose an accounting program, they should investigate the requirements in the state they wish to practice. As of 2009, 46 states (California, Colorado, New Hampshire and Vermont excluded) required 150 semester hours of college coursework for a CPA license, which is 30 hours beyond a typical 4-year bachelor’s degree. To fulfill the requirement, some schools offer a 5-year bachelor’s degree and master’s degree combo program even though a master’s degree isn’t required.
The Uniform CPA Examination is four-part computerized test from the American Institute of Certified Public Accountants (AICPA) and is consistent from state to state. The exam is known to be rigorous and under half of those who take is pass on the first try. If you pass one section, you typically have 18 months to pass the other three as well. To become a CPA, most states also require previous accounting experience. To renew, most states require CPAs to fulfill continuing professional education hours including courses, seminars, group study programs and more hosted by professional associations.
Many Accountants and Auditors gain hands-on experience in the field through college internship programs at business or public accounting firms. They can be incredibly valuable since many employers look for some sort of previous experience. Computer skills, knowledge of basic accounting and computer software packages at a minimum, are also a great asset to Accountants and Auditors since much of the work is automated.
Mathematics skills along with an ability to compare, interpret and analyze facts and figures will help prospective Accountants and Auditors immensely. On the job, Accountants and Auditors must communicate their work verbally and in writing to clients making people skills just as important as computer skills. High standards of integrity will also go far in the field as financial decisions are made based on the work of Accountants and Auditors.
For an advantage in the marketplace, accountants and auditors should seek a professional certification or designation, which can attest to competence in a specialized field.
The Institute of Internal Auditors oversees the Certified Internal Auditor (CIA) designation. Applicants must pass a four-part exam, work for 2 years in internal auditing and possess a degree from an accredited school. The professional society also offers designations of Certified Government Auditing Professional (GCAP), Certified in Control Self-Assessment (CCSA), and Certified Financial Services Auditor (CFSA).
The designation of Certified Information Systems Auditor (CISA) is offered by the ISACA to candidates with 5 years of experience in auditing information systems who pass an exam. Though, 2 years of the experience can be replaced by financial or operational auditing experience, information systems experience or related college credit hours.
The Institute of Management Accountants offers the Certified Management Accountant (CMA). Applicants must have a bachelor’s degree or meet a minimum score on graduate school exams and 2 years of management accounting work experience. They also need to pass a four-part exam covering financial statement analysis capital structure, valuation issues and more; comply with professional conduct standards and agree to fulfill continuing education requirements.
Accountants and auditors with a CPA can also attain a designation as Personal Financial Specialist (PFS), Accredited in Business Valuation (ABV) or Certified Information Technology Professional (CITP) by the AICPA to demonstrate an added level of expertise. The personal financial specialist designation requires a certain level of points related to education and experience and candidates must submit references and pass a written test. A written test and the completion of10 or more business valuation projects is needed to demonstrate experience and competence to achieve the business valuation designation. To attain the technology designation, applicants must have a certain amount of experience and education in business technology.
Most senior corporation executives have knowledge in finance, internal auditing or accounting. When they first start their careers, public accountants and auditors usually receive promotions with in a year or two and can move to senior positions a few years thereafter. The best in the field can become supervisors, managers and even partners. Others open their own firm or transfer to the executive side of internal auditing or management accounting.
While management accountants usually start as trainees for other accounting positions or junior internal auditors, as they move their way up the corporate ladder they can advance to positions such as budget director, manager of internal auditing, accounting manager or chief cost accountant.
Accountants and auditors typically can take advantage of career mobility meaning they can switch gears between internal auditing and public accounting or from management accounting to internal auditing. However, moving into public accounting is much less common for those that start as an internal auditor or management accountant. Internal auditors also learn the skills needed to become upper-level managers through their work reviewing internal controls of business units.