Becoming a CPA is no easy task. Each state has its own strict requirements for becoming one, and passing the CPA Exam is one of the most difficult tasks you will encounter on your journey to becoming a CPA. However, this isn’t meant to deter you. Knowing what you’re up against is extremely important, as it’ll help you decide whether this path is right for you.
Being a CPA is an incredibly rewarding career. You get to help businesses, individuals and other entities achieve their financial dreams and make a successful future. This is why CPAs are held to such high standards. So, is becoming a CPA the right career move for you? That’s what we’re going to help you figure out. Read below to learn about the ins and outs of becoming a CPA, so you can determine whether this is the career you’re destined to hold.
What do CPAs do?
Accounting is an essential part of business. Everyone needs to have some concept of basic accounting principles, such as managing a simple budget or determining how much profit you make. However, understanding complex accounting principles isn’t for everyone, which is why many individuals and companies hire a CPA to manage their finances.
A question many people may have is whether a CPA and an accountant are one and the same. The answer is yes and no — all CPAs are accountants, but not all accountants are CPAs. This is because CPAs need to meet certain educational requirements and pass the CPA Exam in order to earn their title. The reason an accountant may want to become a CPA is that it opens doors to new opportunities.
The main role of a CPA is to help businesses, organizations and individuals reach their financial goals. Whether it involves budgeting for a new home, planning a million-dollar merger with another company, or starting a business, a CPA can help. Along with helping people reach their financial goals, CPAs have other job duties as well, such as helping individuals deal with the IRS if they owe back taxes, assisting businesses with IRS audits, and analyzing financial records to predict growth. These are just some of the responsibilities you may have if you become a CPA.
As a CPA, you can advance your career by entering a leadership or management position, have more job opportunities, and have greater job security.
How do you become a CPA?
Now that you know what CPAs do, you may be wondering how to become one. While the process of becoming a CPA can be demanding, it’s feasible, and anyone can do it with determination and hard work. To become a licensed CPA, you need to follow the three Es: education, exam, experience.
Education: The education requirements to become a CPA vary by state. However, most states typically require 150 semester hours of education, which is a little more than the standard hours it takes for most four-year degrees. Additionally, some states may prefer a graduate degree rather than 150 undergraduate credit hours.
Exam: The CPA Exam is standard across all states, but each state may have different eligibility requirements to sit for the exam. The exam consists of four sections:
- Auditing and Attestation;
- Business Environment and Concepts;
- Financial Accounting and Reporting; and,
- Regulation.
To pass, candidates must score at least 75 out of a 0-99 score range, with question types including multiple choice, simulation and written communication. In addition to the CPA Exam, some states may require candidates to take an ethics exam.
Experience: As a CPA applicant, you will also need to meet certain experience requirements, depending on your state. In most cases, candidates must have between one and two years of experience working under a licensed CPA.
What career paths can CPAs take?
Once you become a CPA, there are numerous avenues you can take to start your career. The first question you’re going to have to ask yourself is if you want to work in the private sector or public sector. Both sectors have high demand but differ in the types of clients you serve. In the public sector, you typically work for a firm that helps a wide array of people. In the private sector, you typically work for a business or entity.
After you figure out whether you want to work in public accounting or in industry, it’s time to determine what career path you’re most passionate about. Some career paths CPAs can take include:
- Tax professional: As a tax professional, you can work as a tax preparer and work at the local, state or federal level. Using professional tax software, you can help corporations or individuals prepare and file tax returns, represent clients in tax court, and ensure clients are abiding by IRS laws.
- Corporate accountant: As a corporate accountant, you will work for a specific company in their accounting department. Your job is to prepare and monitor financial records to ensure the company’s finances are in good order.
- Internal auditor: As an internal auditor, you will work for a company in their auditing department to review and analyze financial records.
- External auditor: As an external auditor, you will work for multiple clients, typically in an accounting firm, where you audit the financial statements of your clients and report your findings to those in charge, such as the board of directors or management.
As a CPA, there are numerous career paths you can choose from. Before making any commitments, make sure to reflect on your passions and values to ensure you pick the right choice.
Should I become a CPA?
Becoming a CPA isn’t an easy task. With a rigorous exam that requires hours of studying and years of experience, the path to becoming a CPA takes time and dedication. However, with the average CPA salary hovering around $119,000 per year, it can be a stable and rewarding career choice. If you’re wondering whether you should become a CPA, it’s important to think about your career aspirations and passions. Doing so will help you decide whether you’re ready to commit to becoming a CPA.
