The Pros and Cons of a Career as a CPA

Accounting

Are you on the fence about becoming a CPA?  Pursuing this certification can grant you many opportunities and a lucrative salary.  However, you may be wondering about what the disadvantages are as well.  Any career has its pros and cons, and below are some you may encounter on this path.

Pros

  • High Salary.  There is no doubt that one of the biggest draws for people to become accountants is the high salary potential.  The median salary of accountants is typically about $67,000, but it is not uncommon for those who want more to gain into the triple digits with time and experience.
  • Direct Education to Career Goal.  Unlike your other friends who may flounder about after college, you will be well on your way.  Liberal arts majors gain a lot of useful skills, but they are not necessarily skills that take them from Point A to Point B.  Accountants, instead, learn a technical and applicable skill.  They can execute a system based on the techniques they have learned.  This is not the case with many other majors.
  • Potential for Growth.  Accountants are always in demand.  In fact, the demand is only growing.  The IRS is raising the number of times a person gets audited in his or her lifetime, which means more people need tax consultations and assistance.  You will also have the opportunity to advance in your job.  If you would like to take on more responsibility and leadership roles in the future, that option is certainly available to you.  Your efforts at taking initiative and presenting relevant information will not go unnoticed.
  • Flexibility.  Not all accountants are chained to a desk.  You may be surprised to know that you are afforded the opportunity to work in many settings with different schedules.  If you want more freedom to travel or stay home with your kids, you can work independently with individual clients.  As a CPA, you have the option to work in a seasonal position, where the intensity of work comes and goes with tax season.  On the other hand, you may be interested in a nine-to-five job, and working within a business or corporation can will allow for that as well.

Cons

  • High Stress.  Accounting is known to be a high-pressure job.  Taking care of someone’s money is an important job, and it can bring about high-anxiety and clinical perfectionism.  If you make a critical mistake in a high profile job, you can experience depression and suffer from PTSD.  This is not true for everyone, of course, but it is a job that requires acute attention to detail, and if you make a mistake, it can cost you and your employer their jobs.  This is why some people get burnt out and end up changing their career path.
  • Boring.  Boring is all about perspective.  Many accountants are well aware that people see their jobs as tedious and uninteresting.  There are also plenty of accountants who agree.  However, it does not have to be.  Many accountants find their job stimulating because they have diversified their experience and gained more education.  In addition, accountants often find that their high salary is worth the payoff of an otherwise monotonous career.
  • CPA Exam.  Getting the distinguished profile of a CPA will open many doors into careers that would otherwise not be available to you.  However, you must first overcome the obstacle of passing the infamous CPA exam.  The exam comes in four parts, and each covers a different subject.  As soon as you take the first portion, the clock begins and you must pass all other portions by the eighteen-month mark.  Only about half of all candidates pass the entire exam, and many study for hundreds of hours, only to fail the first time around.
    However, this doesn’t mean the attempt isn’t worth it.  Many pass after taking the exam more than once, but continuing your studies will only increase your chances time after time.  Luckily, there are many resources at your disposal to learn how to overcome cpa failure.

The career path to the title of CPA isn’t easy, but it can be more than worth the effort. Consider the advantages and disadvantages of this career choice and decide if it’s right for you.

Advantages and Drawbacks of a Career in Accounting

Accounting

If you are intrigued by the idea of becoming an accountant, you may already know the basics of what an accounting career looks like. Without a doubt, you would likely earn respect , job stability, and no doubt a high salary. However, accounting is not a career for everyone.

Just like any career, there are advantages and drawbacks that must be considered before leaping into the field. After all, everybody has strengths, but not everyone is best suited or satisfied with a particular career choice. Thus, if you are on the fence, here are the pros and cons of a career in accounting.

Pros

  • A Clear Path. Unlike some other fields, such as journalism, political science, or the arts, accounting has a clear and direct career path. The path is straightforward: attend an accredited university, earn a bachelor’s in accounting, take on as many internships as possible and graduate fully qualified to get hired in an accounting position. What you will learn in college is in many ways a technical skill. While critical thinking and strategy is key, you spend much of your time learning technical accounting techniques instead of participating in roundtable Socratic discussion such as in the liberal arts. These skills can be applied directly to your job.
  • High Demand. Accountants continue to show a steady job market despite any economic downturn. Accountants work with individuals and businesses to make sure they are financially on track and up to date on their financial records. Certified public accountants even have the ability to manage budgets and implement financial strategy on behalf of a company or organization. You are essentially a link to your client and the financial world, so your job will always be in demand.
  • Diversity. Despite what some may think, accounting offers many opportunities for advancement and diversity. Depending on which sector you work in and which job you attain, you can work as much or as little as you’d like. For example, if you desire a 9-5 workspace in an office, you can work for a company in their office. However, if you work independently with multiple clients, you can work from virtually anywhere. Diversity also means you have opportunity to advance and to make a much higher salary.

Cons

  • Monotony. One of the biggest turn-offs to would-be accountants is the idea that accounting is boring. If you are one of those people, and the benefits don’t outweigh the costs, than this may not be the job for you. If you are not satisfied in a field that is highly regulated, and involves pulling together financial data constantly, then you might want to look elsewhere. If you are still interested in finance but want to pursue a different career, consider becoming a financial analyst or an economist.
  • Certification. It is true—many accountants remain un-certified and are perfectly happy doing basic accounting work. In fact, you don’t even need to become a CPA to become a CFO. However, CPAs have a huge advantage over non-CPAs. You are allowed more freedom in financial and tax matters within a business or organization, which is a plus if you want more diversity in your job. The one caveat is that the CPA is notoriously difficult. The exam has four parts that are set separately within a strict timeline and roughly half of all candidates fail. This includes first-timers and veteran test-takers. But look on the bright side—that means half do pass and become CPAs. It’s recommended that candidates prioritize their schedules to study for hundreds of hours around the exams. Plenty of candidates similar to you have passed before, so there is no reason why you can’t pass if you dedicate yourself. Many spend hours focusing on testing materials, mock exams and use a CPA exam course in order to speak with a live teacher and study among peers.
  • Highly Stressful. Many experience accounting as a highly stressful endeavor. Dealing with a person’s finances is serious business, and when tax season rolls around, the pressure is on. In addition, the more authority you have, the more responsibility is on your shoulders. You will have to manage others to be sure that payroll is handled properly (imagine doing this in a large company), and that any frauds or tax mistakes are avoided. If working in a high-pressure environment suits you and your goals, then this is a good job for you.

Understanding the Difference between a CPA and an EA

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If you plan to hire someone who can handle and prepare tax documents for yourself or for your company, you may be surprised to know that there are two different professions who are qualified to do just that.  Alternatively, if you are looking to enter a career that is involved in the finance and tax law fields, you might be curious to find that a plethora of careers are available to you that you may not have known before.

If you are confused about the difference between a CPA and EA, below is a description to understand the difference to make your next move.

What is a Certified Public Accountant?

A certified public accountant is an accounting professional who has gained an accounting or related degree, has passed a CPA examination, and has also passed all prerequisite state certification and experiential requirements.

The CPA exam is known to be an extremely difficult exam that usually takes hundreds of hours to study for, and comes in three parts that must be completed within so many months.  If all parts of the exam are not completed within the time frame, then the clock starts over and all parts have to be completed again.  Most people will have to take the exam more than once in order pass and become officially certified. Nearly 50% of test takers do not pass the exam.  All Certified Public Accountants must also complete 40 hours of continuing professional education annually in order to retain their certification.

The CPA exam is designed to make CPAs experts in all tax and accounting matters, which gives them a broad knowledge base to apply laws and regulations.  The job of a certified public accountant has broader opportunities than that of a non-certified accountant.  CPAs are legally permitted to perform more accounting functions and are usually offered a higher pay for their services.

CPA Responsibilities

In essence, an accountant is responsible for recording and reporting financial business transactions.  Technically, this work does not require an accounting degree, although many accountants do hold a related degree.  A non-certified accountant will perform basic bookkeeping tasks, maintenance of business accounts, and manage simple tax matters.

So what is it then that a CPA gets to do?  A CPA can do all of these things and so much more.  CPA’s are allowed to not only maintain but also audit company financial records to help protect a business.  During the audit they will check for errors, misinformation, fraud and overspending.  Certified Public Accountants can also attain financial management positions so that they can oversee a company or organization’s budget.

They are qualified to offer financial advice and even create and analyze budgets.  Finally, a CPA can also help prevent fraud and create strategic plans for the future of the business. CPAs can work in a variety of different contexts, including with individuals, businesses, and even law firms.

What is an Enrolled Agent?

Enrolled agents are those who are granted unlimited rights by the government to represent taxpayers before the IRS.  EAs are allowed to appeal in the place of the individual, business, partnership, estate, trust, or other organization whom they are working with.  Their job is to become an expert in tax law specifically, and to keep up to date with changing tax laws.

The major difference between an EA and CPA is the required education.  Unlike CPAs, enrolled agents are not required to have a college degree.  An EA receives his or her license from the federal government, as opposed to a state license.  They must pass an EA exam, called the Special Enrollment Exam (SEE), or they must have acquired experience working with the IRS in tax matters for at least five years.  While not as broad as the CPA exam, the EA exam still has three sections that require disciplined study.

Tax Law Experts

An Enrolled Agent does not have the extensive accounting knowledge that a CPA does, but they are expected to have a focused and deep understanding of tax law.  Like CPAs they can perform audits, but are somewhat limited in their capacity to do so.  Those that are interested exclusively in working with taxpayers on behalf of the IRS may find that this job suits his or her desires best.

Like CPAs, EAs have the ability to work with a variety of people and organizations before the IRS.  They may both find themselves even working in the same law firm.

Why You Should Consider an Accounting Degree

Accounting

If you are exploring professions that offer a lucrative salary, then look no further than becoming an accountant.  Accounting offers a median salary of approximately $67,000 and offers limitless opportunities to grow.  You can work for virtually any company to explore different interests, and move up into management positions.

Imagine working as an accountant for aerospace, biotechnology, production studios, the government, and much more. The opportunities are endless, and you’ll find a great deal of flexibility in the field of accounting.

Flex Your Soft Skills

Before you decide to pursue a career in accounting, you must be honest about whether you have the right skill set.  You’ll require not only technical expertise, but also personality and character traits as well.  For example, you will need excellent communication skills.  This is because you will have to present your reports to other people in and outside your department.  In many instances, you will have to report your findings to people who are not accountants, and thus you will have to communicate in terms he or she can understand.

Another quality you will have to possess is critical thinking skills.  It is necessary in your job to analyze the data and present interpretations of the data.  You should also exhibit impeccable organization.  With so much data in your hands, it’s important that you keep your records organized in such a way so that you can access them quickly.

Opportunities for Growth

Accountants have a straightforward career ladder.  Unlike more unconventional career paths of English majors, political science majors, or art majors, your accounting major will give you a plan from start to finish. Once you get a job, you will likely have the chance to move up in the ranks as you acquire experience.

One of the best ways to stand out on your resume is to become a CPA. CPAs—or certified public accountants—are those that have taken an exam to become certified to perform certain tasks.  These tasks include the ability to audit accounts, create and supervise budgets, create financial strategy, and have the unlimited right to represent taxpayers before the IRS.  Without a doubt, showing that you are a CPA on your resume will already show your potential employer that you have the competence and expertise to take on almost any job.

However, becoming a CPA is not so simple.  All CPA candidates must go through a demanding examination process.  The exam is broken into four sections that are all sat separately. Once you take the first exam, you have eighteen months to pass all other portions before the clock starts over.  If you would like to become a CPA, it is recommended that you utilize all resources available. This includes study guides and choosing the right CPA course for your learning style.  Preparing yourself before and during the 18 months will be difficult, but it will be worth it when you get a job that offers a hefty paycheck.

High Job Demand

Accountants are always in demand.  As long as people have tax issues or companies need their finances organized, you will have a job.  It is one of the only jobs that remains relatively steady throughout fluctuations in the economy.

Work Virtually Anywhere

As mentioned earlier, accountants have a lot of freedom to work where they choose.  Any larger business, nonprofit, or organization needs people to help them manage their finances correctly to remain successful.  This is why you can explore any field you desire.  You can, for example, build expertise as an accountant to the stars and manage the finances of popular celebrities.

Alternatively, you can put your IT knowledge to good use and work for software developing companies.  The possibilities are endless, and building expertise will make you a desirable candidate to the job you pursue.

Make a Career Change into Accounting

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Before you change your career, you must ask yourself, “Why do I want to make a career move into accounting?”  Whether you want to have a more lucrative career, work in a steady job market, work in a different setting, or utilize your mathematical skills, there are many options available to you in the accounting world.

Also, consider your strengths.  Accountants aren’t just math-minded.  Good accountants also have excellent communication and organizational skills in order to be successful.  If this sounds like you, here are the ways you can make a career change into accounting.

Top 4 Ways to Start Your Accounting Career

    • Go Back to School.  Unless you already have an accounting or finance degree, you will have to go back to school.  Almost any accredited college or university will offer an accounting major, so pick one that suits you best. Can’t afford to be a full-time student?  You are not alone.  There are many programs that offer part-time student classes, and still others who offer online variations.  If you are a working professional or have other obligations that keep you from attending a typical four year school, then do not hesitate to research online institutions that will give you what you need in the time you can accommodate.
    • Network ASAP.  Whether you take classes on campus, a satellite campus, or online, it is essential that you network with your peers.  Attend all of the events that you can, and be sure to develop your interpersonal relations.  You and your colleagues can assist each other by helping each other study in the classroom and beyond.  You never know who will have the job that has an opening, or someone who may want to open a firm with you in the future.  Get the best advice from your peers, who are all in the same boat as you.  Likewise, networking events may be a good opportunity to talk to visiting accountants who are there to speak with you and share their experience.  Networking at these events is a valuable asset, and what is best is that they are included in your tuition.
    • Land a Full-Time Job or Internship.  Whether it’s a job or an internship, get experience that pays.  It may be inconvenient to take on a job that pays you less money than your current job at first, but in the long run, it is more advantageous to gain the experience necessary to get the next job.  In addition, many internships will pay you for the hours you put in, and at the end of your term, your boss can write you a fantastic letter of recommendation. If you’re fully committed to a career change in Accounting, apply to the Big 4 Accounting firms internship programs. That experience on your resume will open doors to you for the rest of your life
    • Pass the CPA Exam.  Although it is not required, it is highly recommended that you pass the CPA exam and become a certified public accountant.  Not all successful accountants are CPAs, but you will afford yourself broader job opportunities if you do. Unless you want to pursue the career of a CFO—which does not require even a master’s degree—you may want to become a CPA to give yourself better job prospects. As a CPA, you are empowered to do much more than a typical accountant can do.  In addition to the basic bookkeeping and reporting tasks of an accountant, a CPA has the ability to create and manage accounts, oversee budgets, audit accounts for mistakes or fraud, and take on managerial positions.  If you want to expand your skillset and capabilities, then you will want to become a CPA.  To become a CPA, you will first have to pass the arduous CPA exam.  Do not hesitate to try to take the exam perhaps a year out of college.
      Give yourself at least several months to study.  Most candidates study for hundreds of hours in order to pass all four sections of the exam.  What’s more, the exam has about a 50% pass rate, which implies that many people do not pass on their first try, let alone their second or third.  Invest in recommended CPA materials, and give yourself the best chance to dominate that exam!

Making a career change doesn’t need to be scary; consider taking on accountancy and take advantage of the numerous benefits of this career.

Should You Become a CPA or an Enrolled Agent?

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If you are interested in a career in finance, you might wonder: should you become a certified public accountant or an enrolled agent? Both jobs entail many similarities, differences, and entirely different paths to get there. If you are struggling to choose between either of these careers, here are a few pros and cons of becoming a CPA or EA.

Enrolled Agent (EA)

      • Enrolled Agents Are Not Required to Have a Degree. Yes, you heard that right. Enrolled agents have the privilege of not having to have a college degree. However, although Enrolled Agents do not need to have a college level education, they are still required to have extensive tax law knowledge.In order to prove this, you must follow one of two options: work for the IRS in a tax-related capacity for five years, or take a comprehensive exam, called the Special Enrollment Examination (or SEE). If you take the SEE, you will need to put in as much studying as possible to be well prepared for the exam. The exam consists of three parts, which all pertain to entirely different aspects of tax law.These parts are 1) Tax law regarding individuals, 2) Tax law regarding business, and 3) Representation, reviews, and procedures. There are many materials available to study from, but the best EA review courses include mock exams and various resources.
      • No Representation Limitations. Enrolled agents, certified public accountants, and licensed attorneys are the only positions allowed by federal law to represent taxpayers without any limitation. This is one of your biggest advantages of becoming an Enrolled Agent versus a non-certified accountant.This allows you a higher annual salary as well as more stable job security, as more people may seek your professional services to represent them in court. If you are interested not simply in organizing someone’s taxes but also applying tax law in person in real time, this may be a thrilling route for you.
      • Diverse Career Opportunities. As an enrolled agent, you are not simply restricted to court proceedings. If you would like to one day open your own tax practice, your designation as an enrolled agent will rank you a high in the competition amongst your peers. Because the IRS deems an enrolled agent as elite status, you will always be in demand.Employers will see your status as an enrolled agent and automatically know that you hold extensive knowledge on tax related laws and issues. They will know that you are able to organize and account for someone’s taxes, can consult on estate and gift taxes, help companies with their employment taxes, advise taxpayer’s on their retirement planning, and much more.

Certified Public Accountant (CPA)

  • Degree Required, and More. Certified public accountants are expected to be highly knowledgeable in all areas of accounting, finance management, and consulting. This requires at least a bachelor’s degree, and many go on to gain a master’s in finance or an MBA afterward. Certified public accountants must have a broader knowledge of finance than do enrolled agents, and thus their schooling is much more difficult and intense.Competitiveness on college campuses is extremely high, as students have to fight the grading curve and compete with each other to obtain the best internships. You must also pass the CPA exam, which is an exceptionally difficult exam in which about half of all people fail, especially on their first try. People who pass the exam will usually put in hundreds, if not over a thousand hours of studying to complete all three parts.
  • Broader Job Prospects. With such extensive education, it is no wonder that their job prospects are broader. CPAs can become accounting experts in forensics, the environment, research, IT, international accounting, and so much more. In addition, certified public accountants still have unlimited rights granted to them before the IRS to represent taxpayers.Those looking for diverse career opportunities may find this certification gives them just that. Despite this, there are many certified public accountants that will work together with enrolled agents as a team at a law firm.
  • Higher Salary. Certified public accountants can make a considerable CPA salary, depending on their position and experience. It is even possible to make it into the triple digits. This is less common with enrolled agents, who tend to make less than their CPA counterparts.