An accountant is a professional who performs several accounting functions for a business or an individual. Common functions include audits, financial statement analysis, preparation and submission of tax documents for individuals and companies, bookkeeping, etc. Accountants can be employed by a large firm as an internal accountant. Or they can set up their own offices to provide accounting services to small businesses.
Duties / Job of an Accountant
An accountant performs several accounting functions like recording transactions on behalf of the company/business, issuing financial statements, etc. Following are the general duties of an accountant:
- Duties / Job of an Accountant
- Types of Accountants
- Steps to Become an Accountant
- Giving invoice to the customers which involve recording the sales and accounts receivables in the books of accounts.
- Receiving an invoice from the suppliers which involves recording inventory and accounts payable.
- Distributing salary or wage payments to the employees which involve recording salary expense and cash outflow.
- Summarizing the financial status of a company by paring financial statements of the company by compiling and analyzing the accounting information. Financial statements include the Income Statement, the Balance Sheet, and the Cash Flow Statement.
- Preparing and issuing various reports to the management. These reports usually present the current position of the company. Also, the reports may include topics such as sales of different product lines, investigation of the dip in sales of various items, investigating the rise in costs of the company, etc.
- Issuing tax reports to several government entities. These reports include details about the amount paid for income taxes, property taxes, sales taxes and so forth.
- Validating the financial transactions and financial statements of the company by auditing the company’s documents.
- Ensuring that his company does comply with all the local, state and federal financial laws and regulations. This involves constantly studying and keeping himself updated on existing and new legislation.
Types of Accountants
Accounting professionals can find employment in many different sorts of work. There are many sub-fields within accounting within which a professional can specialize. Here are some examples of different types of accountants:
Businesses are always trying to improve their processes so that they can cut down costs and save money. This is exactly what a cost accountant helps a company with. Cost accountants examine every expense associated with an organization like labor costs, materials costs, production costs, administration costs, etc. This information is then put together and handed over to the top management to help them identify opportunities to improve financial efficiency.
Cost accountants must be equipped with a bachelor’s degree in accounting or finance. It is also recommended to acquire a specialized license such as the Certified Cost Accountant (CCA) accreditation.
Management accountants help business leaders in taking strategic decisions. They provide leaders with information on the organization’s financial health and how it can be improved. So, the common duties of a management accountant include financial planning, budgeting, risk analysis and management, profitability analysis, etc.
A management accountant must earn a bachelor’s degree in accounting. The aspirant has to pass an exam to become a Certified Management Accountant (CMA).
These accounting professionals vouch for the accuracy of a company’s financial statements and other accounting information. The job of an accountant is to write a report upon completion of the audit. This report decides the degree of accuracy and clarity of a company’s financial reports. Auditors do this by examining financial statements, inspecting account books and accounting systems, etc.
Auditors must have a bachelor’s degree in accounting. Generally, to act as an external auditor, the person must have a certification of practice from the regulatory authority.
Forensic accountants are the detectives in the world of accounting. These specialized accountants examine financial records to ensure that they are compliant with laws and standards. Forensic accountants also work with State and Federal law enforcement agencies to find evidence of corruption, fraud and other financial crimes.
A person willing to become a forensic accountant must have a bachelor’s degree in accounting. Also, most forensic accountants earn a Certified Public Accountant (CPA) credential by passing an exam. You also consider becoming a Certified Fraud Examiner (CFE).
Investment accountants work in the field of finance and investments. They are typically employed by brokerage and asset management firms. The job of an investment accountant is to maintain the investment of his company’s clients by protecting ad increasing their wealth. Investment accountants also help a firm in developing its financial strategy. Hence, these accountants must have keen knowledge about stocks, bonds, currencies, precious metals, ETFs, etc.
Investment accountants must hold at least a bachelor’s degree in finance, accounting, economics or business. Also, they may choose to earn CPA credentials, and some may choose to become Financial Advisers.
Steps to Become an Accountant
Step 1: Earn a Bachelor’s Degree
A bachelor’s degree is generally the minimum qualification you need to become an accountant, especially to get an entry-level job. A bachelor’s degree in accounting includes courses on accounting, taxes, audit, etc. Additionally, they also include courses on general management, marketing, and finance, etc.
Step 2: Gain Work Experience:
Gaining work experience is the one thing which will help you the most to advance in your career as an accountant. More so, because an account learns more about accounting while doing it. Also, some states make work experience mandatory to appear for the Certified Public Accountant (CPA) exam. By gaining work experience through an entry-level position in accounting, or an internship in the same, the aspiring accountant also gets the opportunity to find his interest in the specialized fields of accounting by performing different roles.
Step 3: Consider a Master’s Degree in Accounting
Although a master’s degree is not included anywhere in the list to work as an accountant or become a specialized accountant, it is generally beneficial for a person who desires a higher-level position in accounting. Master’s degree programs in accounting include managerial courses that cover advanced topics in accounting, taxation, audit, and finance.
Step 4: Become Licensed
Licensing and certifications are not mandated anywhere to become an accountant or work in a specialized field of accounting, but many employers prefer to hire accountants with some credentials. Licenses are in the form of Certified Fraud Examiner (CFE) to become a forensic accountant, Certified Management Accountant (CMA) to become a management accountant and so on. Also, Licenses boost the qualification of an aspirant to become a specialized accountant.
Step 5: Continue Education
The final step (not so final) is to take part in continuous education. In order to stay current with new regulations and practices, many states mandate Certified Public Accountants (CPAs) to renew their licenses. Some states also require CPAs to pursue ethics courses as a part of their continuing education.