The medical analogy comes up often when discussing the fount of credentials available as shiny new letters hitched to the back of an accountant's name.
To put the comparison in familiar standardized testing format, cardiologist : heart :: PFS holder : personal finances.
In many cases, those looking to carve out specialty niches have already finished the extensive education required of a CPA, making the above an apt comparison, especially as the number of accountants seeking credentials - and the number available - continues to rise.
Below is an overview of some of the most popular designations held by CPAs.
The AICPA's credential menu. The American Institute of CPAs offers four credentials: the Personal Financial Specialist, the Accredited in Business Valuation, the Certified Information Technology Professional and the Certified in Financial Forensics.
Having just celebrated its 25th year in existence, the PFS designation has been around the longest and offers a "holistic approach to financial planning," according to Mark Koziel, director of specialized communities and PCPS/firm practice management at the AICPA. "The [certification] includes all aspects of it, including one of biggest pieces that sometimes gets missed," he explained. "The tax impact of how you invest - taking advantage of tax breaks, retirement and college planning. It all could have a negative impact if the tax impact is not considered upfront."
There are currently more than 5,000 CPAs with the designation, up from 4,435 in July 2010. The exam is available in the summer and winter, with the next test window open from June 20-July 29, 2011.
While those with the PFS designation are often found in the offices of a CPA firm's wealth management practice, ABV-credentialed accountants play a prominent role in the courtroom, where they serve as expert witnesses. "The credential is most visible in the legal community," Koziel said. "We see it on witness stands, where it gets challenged on a regular basis and does quite well."
Those who pass the exam, previously offered annually but now available twice a year, will "have a leg up on those they are testifying against, those that aren't CPAs," said Koziel, who cites the increased level of education in licensure as the pivotal factor.
Nearly 3,000 CPAs currently hold the ABV, a rough jump of about 100 from last July.
The CFF is the newest credential offered by the AICPA, and interest "erupted" after it was established in 2008, according to Koziel, with designations currently following the surnames of 4,755 holders. The institute initially projected CFF numbers to hit 3,000 in the five years after its introduction, but it "blew past that target in 18 months." So far, the credential has only been awarded under a grandfathering rule, with a bi-annual exam available for the first time this fall.
Koziel attributed the interest to companies looking to better understand risk from a forensic perspective - and to its wider appeal that includes credentialed members of the FBI. The CFF attracts this diverse crowd because of the service areas it encompasses: bankruptcy, insolvency and re-organization; computer forensic analysis; economic damages calculations; family law; fraud prevention, detection and response; financial statement misrepresentation; and valuations.
"We're finding in the marketplace that it has a variety of uses," Koziel said. "It's really having your specialty focus on the forensic aspect of engagements."
The 1,737 people who hold the CITP were also grandfathered into the ranks, with the AICPA in the process of creating an exam that will be out in pilot form later this year.
With a focus on information assurance and management, the CITP is the closest of the pack to a generalist credential in combining the CPA perspective and risk knowledge with technology solutions to more efficiently run company systems and understand "the cloud." CITP holders "wear several hats, with HR and IT and reporting to the CFO," Koziel explained. "It's critical to understand the flow of technology, and sell that."
The firms that employ these credential-holders, on the other hand, need to step up their efforts, said Koziel. "Firms could push it more and get marketing folks involved," he continued. "Once you have it, how are you going to market those credentials? CPAs should not be in charge of the whole marketing initiative."
It falls on the firms, then, to advertise the expertise. Koziel suggests integrating these credential-holders into proposals and encouraging them to share their knowledge at speaking events.
The CFP. Where the public awareness for credential-holders might be low, some are finding the inverse to be true for their salaries. According to the 2011 Survey of Trends in the Financial Planning Industry report from the College of Financial Planning, which created the Certified Financial Planner credential, new CFP holders reported their mean earnings this year jumped to $126,452 from $96,952 the year before they attained the credential. The current mean annual gross for CFP survey respondents was $190,922.
"The data is pretty astounding," said Jesse Arman, vice president of academic affairs for the college. "In every survey, since 1990, the people who earn the CFP inevitably make quite a bit more in subsequent years. My feeling is that it is because they know a lot more."
The credential is owned by the CFP Board of Standards, founded in 1985, which requires applicants to complete a personal financial planning curriculum and a 10-hour, two-day exam; provide evidence of relevant experience; and uphold character and fitness standards. "To our knowledge, the CFP Board is the only designation-issuing organization that requires those holding the designation to abide by a set of ethical principles and rules, which are rigorously enforced through an investigative, hearing and appeal process," said Dan Drummond, the CFP Board's director of public relations.
A CPA license is not required for the CFP.
The CVA. The National Association of Certified Valuation Analysts' CVA credential does require a CPA license, along with coursework and an exam. Established in 1991, the credential is now held by more than 4,000 designees. The CVA is "extra important because the profession - valuating businesses - is in a constant state of change," said Mark Morris, chair of NACVA's valuation credentialing board. "New theories and methodologies are being devised all the time to fine-tune the valuation process."
In Morris' experience, even those accounting firms that employ CVAs seek outside credential-holders like himself to help with valuations during busy season. He also does "quite a bit of litigation, where I serve as an expert witness on litigation cases, whether it's a dispute or divorce case."
The CFE. The Association of Certified Fraud Examiners is seeing an increase in CPAs - though the license is not required - and auditors seeking fraud detection and prevention training, according to ACFE program director Bruce Dorris: "They see changes recently in the regulatory environment and are looking at what are our best practices here when it comes to anti-fraud measures?"
Though the CFE, established in 1988, is held by more than 30,000 people, the public is not sufficiently knowledgeable of its merits, said Dorris.
Public education is the primary goal of the recently launched DesignationCheck.com, where people can learn more about credential specifics for financial professionals, as well as locate a financial advisor.
"They all run together in consumer's minds," said Keith Hickerson, senior strategy consultant at The American College, an institute specializing in financial education and a sponsor of the Web site. "With the list of letters, they think [the advisor] must be pretty bright because there are a lot of letters after their name. But it depends on what the letters are."
All letters are not created equal. Hickerson is aware of several organizations that award credentials with no exam and scant requirements. "Some are very good - there's others where you can go to a hotel over the weekend, write a check, put letters after your name, and consumers don't know the difference," he continued. "It's studying for two to three years versus going to a Holiday Inn over the weekend."
Joseph T. Wells, founder and chair of the ACFE, believes that the same research is required of those seeking a credential. "If you don't know what or who is behind the certification, you should check," he said. "If you're called as an expert witness and you have a certification that in the South we'd call 'hokey,' it's going to hurt you more than it can help you."
The right credential, on the other hand, can only help an accountant, according to Hickerson. "Accountants have such a wonderful background, the language of business and a natural advantage to branching out to other credentials with their core base of knowledge," he said. "CPAs are not afraid of rigor. It's nothing new for them to go in-depth on information."
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