CPA stands for certified public account as I am sure many of you already know. A CPA must have taken and passed a test called the Uniform Certified Public Accountant Examination. They must also have met additional state experience and educational requirements to be certified as a CPA. In the state of California, in order to earn the prestige that is associated with the CPA license people are required to demonstrate their competency and knowledge by passing an exam, making the grade for high educational standards and completing a certain amount of general accounting experience.
In order to follow your dream of becoming a CPA you must first meet two important goals. You must first pass the Uniform CPA Exam and meet the licensing requirements of your state.
Many states have less strict tier or accountant qualifications, one of them known as Public Accountant. A lot of states have now closed the designation of PA to new entrants. Today, only approximately ten states offer the designation of PA.
Here are the main educational requirements that you must meet on the road to becoming a CPA. This applies to all states except California.
- Bachelor's degree from an accredited college or university
- 24 semester hours in accounting-related subjects
- 24 semester hours in business-related subjects
- 150 semester hours of education
- Passing the Uniform CPA Exam
- You must have one year of general accounting experience that is supervised by a CPA who has a current license
- Pass an ethics course
The primary function that CPAs fulfill relates to assurances services, or, to put it simply, public accounting. Assurance services are also known as financial audit services. CPAs attest to reasonableness of disclosures, freedom from material misstatement as well as adherence to the generally accepted accounting principles in financial statements. CPAs can be employed by corporations – this is termed ''the private sector''- in such finance functions as chief financial officer which is also known as the finance manager or CFO, or as CEOs subject to their full business practice and knowledge. These CPAs are not involved in providing services directly to the public.
While some CPAs serve as business consultants, this role has been brought under scrutiny following the Enron scandal. Today, with our country in such an economic upheaval, the job of the CPA in the private sector is going to come under the closest scrutiny. In audit engagements, the CPA is required by professional standards as well as federal and state laws to remain independent from the entity for which they are conducting an audit and review. However, most CPAs who work as consultants do not work as auditors.
You will find that most CPAs are involved in income tax preparation. Most small to medium sized firms have a tax and an auditing department. CPAs are scattered all over the business world.
CPAs Can Operate in Almost Any Area of Finance Including the Following:
- Auditing and review services
- Corporate Finance which would include Merger & acquisition, share & debt issuing and initial public offerings
- Estate planning
- Corporate governance
- Financial accounting
- Financial planning
- Financial analysis
- Forensic accounting which includes preventing, detecting as well as investigating financial frauds
- Information technology, particularly as it is applied to accounting and auditing
- Income tax
- Management consulting and performance management
- Venture capital
- Tax preparation and planning
What kind of salary can you hope to make if you become a CPA? The average salary is approximately $95,000. Here are some different specializations in the accounting field as well as the salary. These salaries are for New York City, New York. The average CPA salaries here are about 23% higher than what the average CPA would make nationwide.
- CPA in New York, NY - $104,000
- Tax manager public - $113,000
- Audit senior public - $83,000
- Audit manager public - $110,000
- Tax senior public - $82,000
- Senior tax manager - $134,000
- Audit manager - $114,000
- Audit public - $66,000
- Tax public - $65,000
- Manager internal audit - $120,000
- Corporate controller $149,000
- Audit senior - $88,000
- Tax manager - $117,000
- Senior auditor - $85,000
There are four parts to the CPA exam. They are as follows:
- Auditing and attestation
- Regulation – this encompasses professional responsibilities, taxation and business law
- Financial accounting and reporting – this encompasses not-for-profit organizations, business enterprises and governmental entities
- Business environment and concepts
Each state administers the exam and reports the scores to the test takers. The examination is offered six days a week during the months of January, February, April, May, July, August, October and November.
Now you know what it takes to become a CPA, the specialties you can go into, and the amount of money you can hope to make by going into this field. If you like working with numbers and statistics, then perhaps you've discovered your niche.