What Do Accountants Do?
The realm of accounting is highly diverse and presents a range of lucrative career paths to pursue. No two accounting positions are identical, and depending on the sector or industry you specialize in, you can find a job that is perfectly suited to your talents. Before entering the profession or switching roles, it’s essential to familiarize yourself with what accountants do and how much money they typically make. You should be aware that pay rates vary from role to role. As an example, the most entry-level title may be “Accountant I” but you can advance to the rank of “Accountant II” and receive a higher salary as your experience grows.
It is essential to remember that most accountants hold a bachelor’s degree and must adhere to Generally Accepted Accounting Principles (GAAP) as decreed by the Financial Accounting Standards Board (FASB). U.S. public companies must follow GAAP when constructing their financial statements. It is also important to note that many accounting positions require a Certified Public Accountant (CPA) designation, but that is not to say you need one. Many accountants have a very successful career without one. According to the U.S. Bureau of Labor Statistics, there are roughly 1.3 million accountants in the U.S. The National Association of State Boards of Accountancy reports that there are approximately 669,000 actively licensed CPAs, meaning approximately 50% of accountants in the United States are CPAs.
How Much Does a CPA Make?
To obtain a CPA, candidates must possess a bachelor’s degree in a relevant field such as business administration, finance, or accounting and have completed 150 credit hours of coursework. In addition, they must pass the Uniform CPA Exam and have two or more years of public accounting experience. These requirements differentiate CPAs from non-CPA accountants. Moreover, the rewards for being a CPA-designated professional are more than monetary.
Accountants who possess a CPA are more likely to be in senior accounting roles than candidates who do not have one. Because of their skills and experience, CPAs typically make more money than accountants without a CPA. If you are considering whether getting a CPA is worth it, CPA vs. non-CPA salary is a difference of nearly $30,000. The average salary for accountants without a CPA is $53,604 per year, while the average salary for CPAs is $80,267 per year. Many accounting professionals also enroll in graduate school to get a Master of Accounting (MAcc) or a Master of Business Administration (MBA) to sharpen their skills and knowledge in the field. But it is up to you to decide the best career path based on your personal goals.
There are many different accounting careers to choose from, but here we cover six types of accountants that can be found working in public accounting firms, businesses, government agencies, nonprofits, and other organizations.
Types of Accountants:
- A controller is essentially a company’s chief accounting officer, typically occupying an executive staff position. With a broad background in tax management and business forecasting, controllers also possess a significant skill set in interpreting financial data. Furthermore, they are well-versed in investments, creditor relations, corporate governance, and more. In terms of educational requirements, there are none, although most controllers have a Master of Business Administration degree or higher. As a lucrative position, the average annual salary of a controller in the United States is $233,461.
- A specialized type of accountant, auditors are responsible for evaluating the work of their fellow accountants and inspecting financial statements to ensure accuracy. They typically perform their duties in two contexts: external auditors are employed by external accounting firms to audit a company from outside while internal auditors review reports within the firm. The key aim of auditors is to detect and rectify any accounting errors to avoid expensive investigations or severe punishment. Though auditors and accountants work with similar materials – financial documents – their work complements one another as companies require both auditors and accountants to optimize the precision and productivity of financial processes. The average auditor salary in the United States is $93,790.
- Tax Accountant
- Tax accountants offer crucial services, ensuring that their clients submit accurate returns in compliance with legal standards. They use their knowledge of taxation to maximize savings and avoid penalties. Tax accountants may work in-house with a company, for a payroll provider, for an accounting firm, or for other organizations in insurance or financial services. On a day-to-day basis, a tax accountant’s job includes reviewing financial documents, building budgets, sorting records, and analyzing companies’ accounting systems. To begin a career as a tax accountant, specialized college training is necessary; a major or minor in accounting, economics, finance, or tax law is ideal. For greater influence and higher earning potential, an advanced degree may be necessary. The average entry-level tax accountant salary in the United States is $61,800.
- Financial Accountant
- Financial accountants make sure that organizations are running effectively by analyzing financial reports, tax returns, financial records, budgets, and accounting documents. These activities allow them to undertake an array of duties such as account examination, financial statement investigation, and auditing. This ensures that the firm’s budget and tax documentation are up-to-date, exact, and in keeping with all applicable regulatory standards. Financial accountants must possess a robust understanding of accounting as the bulk of their work consists of producing and checking financial documents and accounts. Technical aptitudes can be polished through online classes and workshops, on-the-job training, and formal instruction. The average financial accountant’s salary in the United States is $69,800.
- Staff Accountant
- Highly-skilled professionals in the form of staff accountants are often sought-after by business leaders in places like public accounting firms, corporate accounting departments, and non-profit organizations. Typically working full-time, they provide support to clients, managers, and other employees, while also maintaining financial records and statements. With enough experience, staff accountants can rise to senior-level positions, such as supervising other accountants, filing tax returns, or managing whole departments. In addition, these professionals often conduct accounting and financial tasks, like logging financial transactions, analyzing financial statements, calculating taxes due, and recommending improved accounting procedures. The average Staff Accountant salary in the United States is $60,465.
- Accounting Managers
- The role of an accounting manager is to ensure that an organization’s financial records remain up-to-date and meet deadlines for reporting. These individuals establish procedures and internal controls that adhere to Generally Accepted Accounting Principles (GAAP). As part of their duties, they often review financial statements, coordinate budgeting efforts, and prepare reports for senior management. Furthermore, accounting managers must be aware of the laws and regulations in place and create and apply appropriate internal policies. Highly experienced accounting managers may shift their attention from everyday operations to more strategic activities, such as interpreting financial information and giving senior management advice when it comes to making financial decisions. The average accounting manager’s salary in the United States is $118,996.
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There is a broad selection of accounting careers one can pursue. One of the most advantageous facets of beginning a career in accounting is that a large amount of the skills and responsibilities obtained are transferable between positions. The Institute of Management Accountants (IMA), estimates that nearly 75% of financial professionals work in business as management accountants: financial analysts, accounting managers, controllers and chief financial officers, and more. Accounting professionals typically cooperate with other personnel and heads of departments. Those that are successful in such roles appreciate autonomy, possess great attention to detail, are orderly, and demonstrate outstanding mathematical abilities. Duties may extend to encompass supervising employees, controlling budgeting and forecasting, and developing accounting protocols.
Launching a career as an accountant may not be glitzy, yet these professionals are critical for any business to flourish. Compensation for these positions is determined by industry, expertise, and additional credentials achieved to refine and distinguish one’s expertise. If accounting is something you wish to pursue or transition into, our team can act as your guide to help you find the right fit in the industry. Contact us to see how we can help!
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