Congratulations! You are on your way to becoming an esteemed professional and one of the pillars of our economy: a certified public accountant. Here’s everything you need to know to get there.
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Not all accountants are CPAs! While most people use the terms accountant and CPA interchangeably, there’s a big difference. The CPA credential carries enormous weight in business and financial circles. Achieving CPA status takes intelligence, ethics, integrity, and lifelong commitment. That means tough business courses at your college or university, a year of real-world experience, and finally, a test of business, auditing, and general accounting skills. CPAs also are required to follow a strict code of ethics as well as perform within the high standards of the profession. Every two years, Maryland licensees must complete 80 hours of continuing professional education to keep up with the new rules and regulations in the financial, accounting, and business world.
For undergraduate accounting students who want to accelerate their success stepping into the CPA profession.
As a public accountant you would provide services in areas such as:
The Securities and Exchange Commission (SEC) requires every publicly-held company to issue an annual financial statement and the CPA is there to assist. CPAs examine clients’ financial statements to assure stockholders and other financial stakeholders that the company’s financial situation is reported correctly and fairly. The CPA offers advice to the companies on their internal finances , as well as prepares reports for the SEC. Many privately held companies also choose to have either an audit or a review in order to maintain good relations with their stakeholders.
CPAs specializing in assurance services are part of the fastest growing niches in the industry. Assurance services are methods designed and implemented by the CPA that improve the quality of information for decision makers. Electronic commerce, elder care, comprehensive risk assessment, entity performance measurement and information systems quality assessment are just a few examples of assurance services areas.
As our global industries must pay close attention to environmental issues, CPAs are playing a key role. From environmental compliance audits and systems and procedures audits to handling claims and disputes, CPAs are advising their clients in creating systems for environmental compliance, preventing future legal claims, and advising in other legal matters.
A CPA can also double as a detective of sorts. The forensic CPA looks beyond the initial numbers of accounting records to determine if fraud or criminal acts have been committed. The forensic CPA identifies evidence of criminal conduct and may assist in the litigation of claimed damages. In addition, companies consult forensic CPAs on decisions to declare bankruptcy or to remain solvent. CPAs are also called upon in family law and divorce cases to help determine property value and other financial matters.
INFORMATION TECHNOLOGY SERVICES
The expansion in information technology has created numerous opportunities for CPAs with computer skills. CPAs who can create and execute advanced technology solutions to fit a company’s specialized needs are in high demand. CPAs with skills in software research and development are in demand.
CPAs are essential in our global economy. With knowledge of international trade rules and laws, merger and acquisition issues, and foreign business customs, languages and procedures, a CPA can be invaluable to an international company. Management Consulting Service CPAs are known for their objective advice and technical assistance to individuals, businesses, financial institutions, non-profit organizations and government agencies. Consulting engagements, ranging from brief conversations with management to implementation of a system to improve operations, allow for variety and flexibility for the CPA.
PERSONAL FINANCIAL PLANNING
As personal financial planners (PFP), CPAs provide assistance in identifying financial goals and advising on the risk, liquidity, management and tax characteristics of investments. A PFP assists his clients to better manage their assets through controlling expenses and decreasing debt, develop investment tactics and asset allocation strategies, tax consulting, insurance planning, retirement planning, and understand estate and gift tax.
TAX ADVISORY SERVICES
The CPA with expertise in tax matters works in three main areas: tax practice, tax consulting, tax compliance, and representation of clients before the Internal Revenue Service (IRS). The tax specialist must use sound financial judgment and innovation in order to provide solutions to complicated tax problems.
CPAs are responsible for studying a company’s financing needs, dealing with banks and other investors, and managing the company’s cash and investments.
The CPA is responsible for collecting and checking data required for the preparation of financial statements. These CPAs are often in charge of various aspects of the computer system used in the preparation of financial statements.
The internal auditor is responsible for providing an objective review of the company’s financial and operating systems. The CPA also advises senior management on financial moves and planning.
CPAs working in management accounting are responsible for the accumulation, analysis and reporting of financial and non-financial data in a format and level of detail required by management for making business decisions. Management accountants may make recommendations on business policy, resource allocation, and business operations to improve financial performance.
CPAs are broad-based experts whose knowledge and skills are sought and valued by management in various non-financial positions. CPAs can succeed in business as top level managers, chief executive officers, and company presidents.
CPAs determine the company’s liability for income tax, licenses, sales tax, property tax, and payroll tax. The CPA would analyze the effects of tax accounting alternatives and study laws and regulations to ensure correct application of new tax measures.
Federal level: CPAs work in such departments as the Federal Bureau of Investigation, the Internal Revenue Service, Department of the Treasury and the General Accounting Office. They may be involved in investigating white-collar crime, doing financial statement audits for government agencies, researching financial management issues, testifying before a legislative committee on an audit, or on the impact of pending tax legislation.
State/local level: At the state and local level, CPAs are involved in conducting financial, performance or compliance audits which may include analyzing a school district’s ability to remain viable, the propriety of expenditures for constructing prisons, the effectiveness of the workers’ compensation system, or the regulatory compliance of hazardous waste programs.
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