Students who major in accounting are given the opportunity to prepare for entrance into a variety of fields which will use his or her skills in accounting and related subjects. Among the fields that accounting majors enter most frequently are the following:
A certified public accountant (CPA) in today’s environment must not only have a high level of technical competence and a sense of commitment to service, but must also have good communications and analytical skills and the ability to work well with people. In public accounting, service is provided to many clients as an objective outsider or in an advisory capacity. Currently, there are over 46,000 public accounting firms in the United States ranging in size from small local accounting practices to large international CPA firms. Public accounting services include, but are not limited to, the areas listed below:
Auditing is one of the most important and best-known services provided by CPAs in public practice. To better protect consumers and investors, the Securities and Exchange Commission (SEC) requires every publicly held company to issue annual financial statements. These financial statements are examined by an independent CPA, and the results are referred to as an audit. The CPA’s role as an auditor is to examine a company's financial statements in order to assure stockholders and other financial statement users that a company’s financial position is reported fairly.
Although privately-held companies are not required to have annual audits, many do so anyway. Privately-held companies that do not undergo an annual audit often engage CPA’s to conduct a "review" or "compilation" instead. Both involve an examination of a company’s financial statements, although a review contains less assurance than an audit, while a compilation contains no assurance.
Assurance Services is one of the newest growth areas for CPAs. Assurance Services are defined as services provided by a CPA that improve the quality of information for decision makers. Such information can be financial or non-financial, about past events or conditions, or about ongoing processes or systems. It can also be direct information about a product or indirect information about someone else’s assertion about a product. Assurance Services allows the CPA to use their analytical and information-processing expertise in a new way. Based on market research, everyone from business owners to ordinary consumers can find value from CPAs who provide these type of services. Electronic commerce, elder care, comprehensive risk assessment, entity performance measurement and information systems quality assessment are just a few examples of Assurance Services areas.
INFORMATION TECHNOLOGY SERVICES
The growth in information technology has created many job opportunities for CPAs with strong computer skills. There is a great need for professionals who can design and implement advanced systems to fit a company’s specialized needs. CPAs skilled in software research and development are also highly valued.
Cross-border transactions are becoming commonplace due in part to the dismantling of closed economies in Eastern Europe and Latin America, the passage of the North American Free Trade Agreement (NAFTA) and the General Agreement on Tariffs and Trade (GATT), as well as economic growth in areas such as the Pacific Rim. Functional skills needed in global economy include an understanding of international trade rules, accords, and laws, cross-border merger and acquisition issues, and foreign business customs, cultures and procedures. Multilingual skills are also important, particularly Spanish and French.
CPAs are often requested by individuals, businesses, financial institutions, not-for-profit organizations and government agencies to offer objective advice and technical assistance about a variety of business situations. Some common consulting engagements might be computerizing a company’s accounting and reporting function, projecting a company’s growth using trend analysis techniques, implementing an internal control system, facilitating mergers and acquisitions, assisting with production and marketing techniques and providing general suggestions on improving overall operating procedures. Other important growth areas of consulting which CPAs are involved in include litigation support, business valuation, strategic planning, succession planning for family-owned businesses, compensation and benefit plan design. Consulting services provided by CPAs may range from brief discussions with clients in the form of consultations, or may involve larger initiatives such as implementation, transactions or support services.
PERSONAL FINANCIAL PLANNING
As personal financial planners, CPAs provide assistance to individuals and companies in identifying financial objectives and counseling on the risk, liquidity, management and tax characteristics of investments. Personal financial planning services include helping clients better manage their money through debt reduction and expense control, developing investment strategies and asset allocation plans, tax consulting, insurance analysis and planning, retirement planning, and minimizing estate and gift tax burdens.
TAX ADVISORY SERVICES
With the ever-changing tax laws and growing complexity of business, tax professionals are involved in everything from preparing tax returns to reorganizing a multinational company’s domestic and foreign operations in a manner that takes into consideration such factors as U.S. and foreign taxes, cash investments, dividends, and economic growth. The CPA tax specialist must deal with a variety of tax problems and opportunities in three primary areas of tax practice: tax consulting, tax compliance and representation of clients before the Internal Revenue Service (IRS). In addition to supplying technical competence, the tax specialist must exercise good financial judgment and creativity in order to provide constructive solutions to complex tax problems. Therefore, a thorough understanding of the client’s business, investment, and personal objectives is required, as well as a thorough understanding of the tax laws and their applications.
Accountants in business and industry work for companies ranging from family-owned businesses to Fortune 500 companies. Industry surveys typically show that a significant percentage of today's financial managers, chief financial managers, and chief executive officers were accounting majors and began their careers in accounting positions. Accountants are considered strategic business partners of their organizations and work in a variety of different areas.
Under this broad category, accountants are responsible for analyzing a company’s future financing needs, making presentations to and negotiating with banks and other investors, and managing an organization’s cash and investments.
The accountant is responsible for accumulating and verifying the data required for the preparation of financial statements. Accountants are often in charge of the design, implementation and maintenance of the computer systems used in the preparation of financial statements.
The accountant as internal auditor is responsible for providing an objective review of the company’s financial and operating systems. The internal auditor also functions as an in-house management consultant to senior management.
The management accountant is responsible for the accumulation, analysis and reporting of financial and non-financial data in a format and level of detail required by management for making business decisions. Management accountants also make recommendations on business policy, resource allocation, and business operations to improve financial performance.
Accountants are broad-based experts whose knowledge and skills are sought and valued by management in various non-financial capacities. Accountants are top-level managers, chief executive officers, and company presidents at many of the world’s largest and most prestigious corporations.
Like their counterparts in public accounting and industry, accountants in government have responsibilities in the areas of auditing, financial reporting and management accounting. In addition, accountants in government have the opportunity to evaluate the efficiency of government departments and agencies at the federal, state and local levels as well as advise decision makers in the use of entity resources.
Some examples where accountants work include the Federal Bureau of Investigation, the Internal Revenue Service, Department of the Treasury and the General Accounting Office. They may be involved in investigating white-collar crime, managing financial statement audits for government agencies, performing research and analysis on financial management issues, testifying before a legislative committee on an audit or on the impact of pending tax legislation.
Accountants in not-for-profit organizations provide the information these institutions need to determine that the benefits and services they provide do not exceed revenues. Whether an accountant is on the staff of a not-for-profit organization or serves in an advisory capacity, he or she can help the organization solve business problems, set up an internal control system, budget resources, and prepare financial data for fundraising purposes.
As accounting educators, accountants are members of the faculties of colleges of business administration, professional schools of accountancy, graduate schools of business and community colleges. As accounting faculty members, accountants instruct students in areas such as auditing, financial accounting, taxation, cost and managerial accounting and financial analysis. In addition to their teaching requirements, accountants also conduct research to expand the body of accounting knowledge and author books and articles on accounting theory. Due to their research expertise, many educators also serve as business consultants to companies and firms as well as expert witnesses in litigation situations.