• Explain fundamental financial math topics, including interest rates, financial statements, and budgeting

The Varied Career Paths Open to Individuals with an Accounting Education Cont.

Major Categories of Employers

Now that you’ve learned about the various career paths that accountants can take, let’s briefly look at the types of organizations that accountants can work for. The figure below illustrates some common types of employers that require accountants. While this is not an all-inclusive list, most accountants in the profession are employed by these types of organizations.

 

• Public accounting firms provide a variety of services including accounting, auditing, consulting, and tax preparation. They assist small businesses with financial statements and payroll, conduct audits, offer consulting for computerized systems and internal controls, and prepare taxes for businesses and individuals. They may also offer business valuation, forensic accounting, and other specialized services.
• Corporate accountants, including cost and managerial accountants, primarily offer internal information and decision-making support, and manage internal controls. Their tasks include tracking costs, analyzing financial performance, developing budgets, managing payroll, and overseeing computer networks.
• Governmental accountants ensure accurate tracking of taxpayer funds, often auditing other agencies’ financial activities. Unlike public and corporate accountants who use GAAP, they follow specific rules set by the Governmental Accounting Standards Board (GASB), tailored for governmental entities.
• Not-for-profit entities, such as charities, foundations, and universities, focus on fulfilling specific missions. Their accountants ensure donor funds are used appropriately, employing a specialized accounting approach that differs from other businesses, mainly in not paying income taxes.

Potential Certifications for Accountants

Professional certifications, in addition to a college degree, offer substantial benefits. They delve deeper into subject matter than typical college courses and showcase a commitment to specialized expertise. Certified professionals are often more sought after and command higher salaries. Companies benefit too, as certified staff enhance organizational professionalism and competitiveness. Certifications usually mandate ongoing training, keeping holders updated on industry advancements, benefiting both the individual and employer. These certifications are regulated by specific governing bodies, each setting its own content and requirements, with further information available on their websites.

Certified Public Accountant (CPA)

The Certified Public Accountant (CPA) designation is earned after passing a uniform exam issued by the American Institute of Certified Public Accountants (AICPA). While the exam is a uniform, nationally administered exam, each state issues and governs CPA licenses. The CPA exam has four parts: Auditing and Attestation (AUD), Business Environment and Concepts (BEC), Financial Accounting and Reporting (FAR), and Regulation (REG). A score of at least [latex]75\%[/latex] must be earned in order to earn the CPA designation.

Since each state determines the requirements for CPA licenses, students are encouraged to check the state board of accountancy for specific requirements. The majority of states require [latex]150[/latex] hours of college credit. Students often graduate with a bachelor’s degree with approximately [latex]120–130[/latex] credit hours. In order to reach the [latex]150[/latex]-hour requirement that specific states have, students have a couple of options. The extra hours can be earned either by taking additional classes in their undergraduate program or by entering a graduate program, earning a master’s degree.

Information about the Certified Public Accountant (CPA) exam is provided by the following:

• the American Institute of Certified Public Accountants (AICPA)
• the National Association of State Boards of Accountancy (NASBA)
• This Way to CPA

Certified Management Accountant (CMA)

The Certified Management Accountant (CMA) exam is developed and administered by the Institute of Management Accountants (IMA). There are many benefits in earning the CMA designation, including career advancement and earnings potential. Earning a certification enables the management accountant to advance to management and executive positions within the organization. The CMA exam has two parts: Financial Reporting, Planning, Performance, and Control (part 1) and Financial Decision-Making (part 2).

A score of at least [latex]72\%[/latex] must be earned in order to earn the CMA designation. A minimum of a bachelor’s degree is required to take the CMA exam. A minimum of a bachelor’s degree is required to take the CMA exam. An accounting degree or a specific number of credit hours in accounting is not required in order to take the CMA exam. Once the CMA designation is earned, thirty hours of continuing education with two of the hours focusing on ethics must be taken annually in order to maintain the certification.

Visit the Institute of Management Accountants (IMA)’s page on the Certified Management Accountant (CMA) exam and certification to learn more. ^[1]

Certified Internal Auditor (CIA)

The Certified Internal Auditor (CIA) exam is developed and administered by the Institute of Internal Auditors (IIA). According to the IIA website, the four-part CIA exam tests “candidates’ grasp of internal auditing’s role in governance, risk, and control; conducting an audit engagement; business analysis and information technology; and business management skills.” If a candidate does not have a bachelor’s degree, eligibility to take the CIA is based on a combination of work experience and education experience.

In order to earn the CIA designation, a passing score of [latex]80\%[/latex] is required. After successful passage of the CIA exam, certificate holders are required to earn eighty hours of continuing education credit every two years. ^[2] 

Information about the Certified Internal Auditor (CIA) exam is provided by the following:

• the Institute of Internal Auditors (IIA), Global
• the Institute of Internal Auditors (IIA), North America

Certified Fraud Examiner (CFE)

The Certified Fraud Examiner (CFE) exam is developed and administered by the Association of Certified Fraud Examiners (ACFE). Eligibility to take the CFE is based on a points system based on education and work experience. The CFE offers an attractive supplement for students interested in pursuing a career in accounting fraud detection. Students might also consider studying forensic accounting in college.

The CFE exam has four parts: Fraud Prevention and Deterrence, Financial Transactions and Fraud Schemes, Investigation, and Law. Candidates must earn a minimum score of [latex]75\%[/latex]. Once the CFE is earned, certificate holders must annually complete at least twenty hours of continuing education. The CFE certification is valued in many organizations, including governmental agencies at the local, state, and federal levels.

Visit the Association of Certified Fraud Examiners (ACFE) page on the Certified Fraud Examiner (CFE) exam to learn more.

Chartered Financial Analyst (CFA)

The Chartered Financial Analyst (CFA) certification is developed and administered by the CFA Institute. The CFA exam contains three levels (level I, level II, and level III), testing expertise in Investment Tools, Asset Classes, and Portfolio Management. Those with a bachelor’s degree are eligible to take the CFA exam. In lieu of a bachelor’s degree, work experience or a combination of work experience and education is considered satisfactory for eligibility to take the CFA exam.

After taking the exam, candidates receive a “Pass” or “Did Not Pass” result. A passing score is determined by the CFA Institute once the examination has been administered. The passing score threshold is established after considering factors such as exam content and current best practices. After successful passage of all three levels of the CFA examination, chartered members must earn at least twenty hours annually of continuing education, of which two hours must be in Standards, Ethics, and Regulations (SER).

Visit the CFA Institute’s page on the Chartered Financial Analyst (CFA) exam to learn more.

Certified Financial Planner (CFP)

The Certified Financial Planner (CFP) certification is developed and administered by the Certified Financial Planner (CFP) Board of Standards. The CFP exam consists of 170 multiple-choice questions that are taken over two, three-hour sessions. There are several ways in which the eligibility requirements can be met in order to take the CFP exam, which students can explore using the CFP Board of Standards website. As with the Chartered Financial Analyst (CFA) exam, the CFP Board of Standards does not predetermine a passing score but establishes the pass/fail threshold through a deliberative evaluation process. Upon successful completion of the exam, CFPs must obtain thirty hours of continuing education every two years, with two of the hours focused on ethics.

Visit the Certified Financial Planners (CFP) Board of Standards page on the the Certified Financial Planner (CFP) exam to learn more.

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