Accounting is an exciting yet stable profession that presents a world of opportunity to analytical, hard-working individuals. Unfortunately, accounting career paths often seem difficult to navigate, especially at the outset.
One of the biggest sources of confusion? Determining the difference between a CPA and an accountant. Both roles are worth pursuing, but it’s important to clarify where they diverge before you proceed with your degree program.
Are you interested in pursuing an accounting career — but not sure if it is worthwhile to go through the effort of becoming a CPA? To help you clarify your accounting career path, we will explain everything you need to know.
What Is a CPA?
The Certified Public Accountant (CPA) is a professional designation granted to accounting experts who have undergone rigorous training and testing. Upon achieving the necessary licensure, CPAs hold an esteemed position marked by increased respect and trust from potential employers and clients alike.
What Does a CPA Do?
There is no simple answer to the question, “What do CPAs do?” After all, the roles and responsibilities of a CPA largely resemble those held by other accountants — and in both cases, these vary considerably from one position or environment to the next. In general, however, CPA duties follow a general pattern: conducting audits of financial statements and providing financial and tax advice to clients. Work as a CPA may also encompass risk assessment, proposals for cost-saving solutions, and analysis of accounting system efficiency.
Is CPA a Certificate, Degree, or License?
Qualification as a CPA depends strictly on licensure from a state’s board of accountancy. The right degree program is crucial to fulfilling the educational requirements for licensure. Each state also has different requirements for licensure outside of the required education. Such state requirements may include licensure exams, background checks, certain work experience, and more.
CPA vs. Accountant
Those with a limited understanding of the accounting profession often mistakenly use the terms CPA and accountant interchangeably. There is some crossover, of course, as every CPA is an accountant. However, not every accountant is a CPA because becoming a CPA involves challenges above and beyond those needed to qualify for basic accounting positions.
Employment data reveals that the official CPA distinction goes to an exclusive subset of accountants. According to the Accountancy Licensee Database (ALD), there were over 665,000 actively licensed CPAs in the US as of August 2022. Meanwhile, Bureau of Labor Statistics (BLS) data indicates that there were nearly 1.5 million jobs for accountants and auditors in .
Licensing, Education, and Experience Requirements
There is no specific credential required to work in accounting. While today’s employers express a clear preference for accountants with at least an associate or bachelor’s degree, it is not unheard of for people with other majors or from other career fields to transition to accounting — and when they make this switch, they do not necessarily need to return to school. That being said, finding employment will generally be easier with a targeted degree — and this may be actively required for certain specialty areas or for moving up the career ladder.
Everything changes once you decide to become a CPA. Before you can achieve this label, you will need to clear several hurdles, including, most notably, the CPA exam. To take the CPA exam you will need to have earned a minimum number of credit hours. Additional requirements for credit hours and work experience exist, although these vary from state to state. You must check with the state in which you wish to pursue licensure to understand the specific requirements.
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Cost to Pursue CPA Title
Some accountants neglect to pursue an official CPA title simply because they prefer to avoid the added cost and hassle. The most significant expense relates to preparatory coursework, which some aspiring CPAs pursue outside of a standard college degree. By determining your intention to be a CPA early on, however, you can build study efforts into your general accounting coursework.
No matter where or when you complete your degree, you will still want targeted training from a dedicated CPA review course. While a college-based program can provide a thorough overview of key accounting concepts, a CPA-oriented course focuses more on the exam itself. These courses can be surprisingly expensive, with many costing several thousand dollars. Check with your employer, as some might cover the cost of these courses for their employees.
The test also comes with a significant price tag attached. This varies somewhat between states, as individual jurisdictions are responsible for determining both registration fees and pricing per section. In addition to the four main sections, there is also an ethics exam, which involves its own separate fee.
The expenses do not end once you ace your test. You may also need to pay a fee for CPA certification in your state, as well as ongoing renewal fees to keep your license active.
Typically, accountants are not regarded as fiduciaries. While it behooves accountants to act in clients’ best interests, there is no outright requirement to behave as a fiduciary.
As the CPA Journal points out, the concept of fiduciary is defined as the “duty to act with the highest degree of honesty and loyalty toward another person and in the best interests of the other person.” This seems like a no-brainer for both accountants and CPAs, but there is a caveat: dilemmas are possible when CPAs need to act independently.
Because independence is a central component of the overarching CPA standards, there is no fiduciary duty when it would be necessary for CPAs to place the interests of the clients above their own independent practice.
Standards and Regulations
A variety of laws and regulations govern accounting professionals of all types, including CPAs. These standards are set by regulatory bodies, such as:
- Government Accountability Office
- Federal Accounting Standards Advisory Board
Accounting professionals from all backgrounds must also adhere to the Generally Accepted Accounting Principles (GAAP), which are issued by the Governmental Accounting Standards Board (GASB) and the Financial Accounting Standards Board (FASB). Consisting of ten core principles, GAAP standardizes accounting procedures to ensure reliable financial evaluations.
State Requirements and Codes of Ethics
As we’ve mentioned, CPAs must pass ethical exams in most states before they are allowed to practice. Once they become full-fledged CPAs, they are expected to abide by the ethical framework provided by the AICPA Code of Professional Conduct. This mandates that CPAs “act with integrity, objectivity, due care, competence.” Additionally, they must maintain client confidentiality and “fully disclose any conflicts of interest (and obtain client consent if a conflict exists).”
A Day in the Life: Key Roles and Responsibilities Often Held by CPAs
At first glance, a ‘typical’ day as a CPA may appear reasonably routine. As you might expect, there may be a lot of number-crunching involved, not to mention detailed document reviews and reporting. Often, however, these positions are far more dynamic than they appear at first glance. Every day brings new challenges. There is also a surprising social element. CPAs meet with clients, executives, or even Internal Revenue Service (IRS) representatives on a regular basis, so the job is not as solitary as you might assume.
Depending on the scope of the position, a CPA can expect to encounter at least a few of these key tasks on any given day:
- Create detailed financial records
- Conduct audits
- File tax documents
- Implement cost-cutting initiatives
- Make targeted financial recommendations
- Represent clients during IRS disputes
Steps to Become a CPA
At the outset, the path to becoming a CPA echoes that of becoming an accountant in general: enroll in college and pursue an accounting degree. While an associate degree in accounting can be an excellent option for anyone who wants to enter the field quickly and gain employment in bookkeeping, a bachelor’s degree in accounting is highly preferred as the minimum education for aspiring CPAs. Often, BS in Accounting programs can be used to satisfy requirements at least partially for the CPA exam.
Following graduation, the next step involves applying and studying for the
Once the time comes to actually take the exam, some level of strategy may be required. There are four sections total, which must be passed within 30 months. The test is administered throughout the year, so you enjoy plenty of flexibility to complete each section as you see fit.
Passing the CPA exam is exciting, but it means little without work experience. Requirements vary between states, with many requiring 2,000 hours of experience in addition to the requisite 150 relevant semester hours. Often, this experience can be obtained while sitting for the exam.
CPA Education Requirements
Not only must CPAs pass rigorous exams, but in some states they are also required to obtain their bachelor’s degrees before sitting for the exam in the first place. In these cases, not just any degree program will cut it; aspiring CPAs must study accounting. While most states mandate a specific number of credit hours to sit for the exam or obtain licensure, this could potentially be satisfied by majoring in accounting. If you already have a different type of degree but hope to transition into accounting, you could gain relevant skills with an online Post-Baccalaureate Certificate in Accounting. Due to the variances in state requirements, it is important to understand the specific requirements in the state in which you wish to pursue a license so you can plan your education goals accordingly.
Skills CPAs Need to Have
Most CPA skills overlap with those expected of accountants in general — although to pass the CPA exam, these skills and concepts may need to be more fully developed. Examples include:
- Cost accounting
- Financial statement analysis
- Data analytics
- Accounting information systems
- Internal controls
- SEC reporting
- State taxation
Additionally, CPAs must develop soft skills, which are increasingly valued by all types of employers. Effective written and verbal communication are crucial, but creativity, collaboration, and empathy will also come into play.
Prepare for the CPA Exam With Post
If you’re determined to take the CPA exam, you can began preparing by enrolling in a rigorous degree program that also provides a supportive environment. You will find the best of both worlds at Post, where our Bachelor of Science in Accounting will equip you with a variety of analytical and soft skills — not to mention a deep-seated understanding of core accounting principles. Available online or in-person, this degree will provide a fundamental understanding of accounting and the personal satisfaction of gaining a range of in-demand skills. If you already have your bachelor’s and would like to obtain graduate level accounting education, Post offers an online master’s in accounting with a CPA track that could help you get closer to your goals of pursuing a CPA credential. Reach out today to learn more.
Accounting degree programs at Post University may be used to partially fulfill Certified Public Accountant (CPA) education requirements. The program is not designed, however, to fulfill CPA education requirements in any specific or individual state.
Post University assists in researching and providing information regarding licensure; however, each state has different requirements for such licensure outside of the required education. Such state requirements may include licensure exams, background checks, certain work experience, and more. It is ultimately the responsibility of each student to manage their own licensure process and to ensure that all requirements are met in order for the student to obtain licensure. Post University does not speak on behalf of any licensing board or body and does not guarantee licensure. Requirements for licensure are subject to change without notice.
The following table shows whether Post University, with completion of the appropriate curriculum, does or does not fulfill the educational requirements for a specific license:
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