Everything You Need to Know About Accounting Certifications
Accounting is one of the most lucrative careers in business. It allows you to work in almost all industries in the private and public sectors. There are various accounting disciplines that you can major in. Your choice determines the trajectory of your career as an accountant. You must pay attention to details when choosing an accounting major. Consulting career experts is one way to ensure you study the right discipline. However, advice from practicing accountants gives you a clearer view of the job market for your chosen accounting discipline.
You must meet several requirements to practice as an accountant, irrespective of the accounting discipline you choose. These requirements are set by relevant authorities to regulate the operations of accountants around the world. Locally, several certifications are needed before you start practicing as a professional accountant. These certifications depend on the accounting discipline and the region you intend to practice in. Before you become a certified accountant, you have to undergo training and sit for a CPA exam. A CPA, Certified Public Accountant, the exam is set by the national board of accounting professionals. All prospective accountants are eligible to take this exam, including anyone that wishes to be an internal auditor.
To get a deeper understanding of an accounting certificate program, the requirements, and benefits, let’s explore the following:
- Types of accounting certifications
- Benefits of earning an accounting certification
- How to get an accounting certification
- Best programs offering accounting certifications
Types of Accounting Certifications
There are various types of accounting certifications. The certification you need depends on the accounting discipline you pursue. Different accounting professional bodies issue these certifications. Although they might have the same relevance, their application might vary from one state to another. Here are some common accounting certifications you might need to practice as a professional accountant.
- Certified Public Accountant, CPA, certification
The CPA certification is the most important certification for an accountant. The Certified Public Accountant, CPA, the certificate is a must-have for anyone seeking to practice in the finance accounting profession. This certification applies to all graduates, including those online accounting degree programs. Many employers, both small local businesses and large corporate firms, require CPA certificates before admitting you into their companies. To get the CPA certification, you have to sit the CPA exam. The exam has four parts covering all aspects of accounting. A CPA certificate is an indication that you have the right skills to execute accounting tasks such as auditing and financial reporting.
- Chartered Certified Accountant (ACCA) certification
If you wish to practice accounting beyond the US, this is the required certification. The Chartered Certified Accountant or ACCA certification is internationally recognized by accounting bodies. However, this certification alone does not give you the authority to practice as a professional accountant. The ACCA is an additional certificate to the CPA to expand your area of operation. This certification process consists of three levels with up to thirteen exams. Unlike the CPA exam, you might take up to three years to complete chartered accountant training and certification process. The high number of exams, thirteen, makes it hard for many people to complete this certification process. Most certification bodies record a graduation rate of between 30 percent and 80 percent.
- Chartered Alternative Investment Analyst (CAIA) certification
The hedge fund and asset management industries have grown massively over the past few years. Consequently, the demand for finance experts within these industries has risen. The CAIA certification body regulates the operations of accountants in these industries. The Chartered Alternative Investment Analyst or CAIA certification allows you to operate as a professional accountant and analyst in these industries. The main role of accountants in these industries is to manage assets and alternative investments for businesses and individuals. The certification process involves two levels, with an exam after each level.
- Chartered Financial Analyst (CFA) certification
This certification is one of the most sought-after in the accounting profession. The Chartered Financial Analyst or CFA certification is recognized internationally by accounting firms. The certification allows you to practice as a financial analyst in international organizations. It is among the most compressive certifications you might encounter in the accounting field. Due to the huge volume of content and complex exams involved, the certification process records very low graduation rates. Thus, you must put adequate effort into the certification process to succeed. Some of the accounting areas covered in this certification process include quantitative methods, financial reporting, and alternative investments.
There are many more accounting certifications that you might need in your accounting career. Other than the CPA exam, there are other requirements that you must fulfill to be a registered accountant. These include the completion of 150 college hours.
There is a difference between accounting certificates and accounting certifications. However, some people confuse between the two. An accounting certificate is issued after completing an accounting course, which could be after an accounting degree program or a certificate program from an accounting trade college. On the other hand, certifications. are issued by professional bodies and allow you to practice as a professional accountant in your field. You don’t need an accounting certification to pursue an accounting certificate. However, some institutions might require an accounting certificate before you get admitted into a certification program.
Benefits of Earning an Accounting Certification
Accounting certifications have a wide range of benefits to you as a person and your career life. These benefits depend on the certification you get. Additionally, it depends on the institution you enroll in for the certification process. Many institutions offer accounting certifications. Some of these institutions are run by renowned universities and colleges. Enrolling in such institutions guarantees maximum benefits as the institutions could be well equipped to offer quality training. Accounting certifications impact your career in many ways. The extent of the impact an accounting certification has depends on the industry you practice in and your employer’s policies. However, some benefits are common in all industries with accounting needs across the country. These include:
- Increased career opportunities- Having an accounting or associate degree or certificate sets you on a lucrative career path. However, being a certified accountant increases your chances of getting employed. Many employers look for accounting certifications before absorbing job seekers into their businesses. Accounting certifications are proof that the employee is skilled enough to perform in a professional environment. Getting accounting certifications with international recognition widens your expertise, which means you can get employed and work in diverse environments. Internationally recognized certifications include the Chartered Certified Accountant or ACCA.
- Flexibility for professionals switching careers- Accounting certifications are pivotal when you want to change the discipline you practice. With an accounting degree, you have the foundation to specialize in an accounting discipline of your choice. When you want to change disciplines, you can go through an accounting certification program instead of starting over a new degree program. For instance, if you practice in an auditing firm, you can switch to the hedge fund and asset management industries by attaining a Chartered Alternative Investment Analyst (CAIA) certification.
- Increased chances of promotion- It is everyone’s dream to rise through the ranks in their career. In the accounting profession, one of the best ways to achieve this is by getting accounting certifications. Accounting certification training programs improve your skill set, making you more resourceful to your employer. In such cases, you are likely to be promoted to managerial positions to help run the business. Having more than one accounting certification allows you to work in various organizations. The experience you gain is useful in the formulation of accounting policies, implying that you could be appointed among the senior professionals in the accounting field to help in policymaking.
The business field has many job opportunities for certified accountants. Once you get employed, your job description depends on the employment contract. Job descriptions vary from one employer to another. However, some accountancy roles are typical across various industries. How fast you excel in your career depends on how best you perform in your field of practice. Some common jobs for certified accountants include:
- Tax managers- Accounting certification training equips you with essential knowledge about the taxation process. With these skills, you can work as a tax manager for individuals and business organizations. Additionally, you can work for the government to help in the determination of federal taxes. The tax manager analyzes the business operations and determines the amount of tax due. They also suggest ways in which the company can minimize the taxes without breaking the law. As a tax manager, you must have a vast knowledge of the taxation process and policies involved. Tax managers working for international firms must have basic knowledge of the international laws on taxation.
- Financial analyst- An accounting certification allows you to practice as a financial analyst. A financial analyst monitors the financial health of business corporations and advises the management on sound financial decisions. Being a financial analyst requires analytical thinking skills. In most cases, a financial analyst must come up with urgent solutions to the financial problems facing business corporations. In the public sector, financial analysts help the government determine the financial sustainability of development projects. Their role in government institutions ensures fair and productive allocation of financial resources. In some cases, financial analysts predict the future financial state of corporations and advise on viable investments.
- Forensic accounting- Forensic accounting is the main link between finances and the legal system. A forensic accountant analyzes accounts and cash flow related to criminal activities to generate evidence. They look at the financial activities of individuals to determine their involvement in criminal activities. They then report the evidence found to relevant authorities.
There are many other jobs you can do in the accounting profession. With the accounting certificate and professional certification, you can easily succeed as a professional accountant. The best way to earn money from your accounting certification is by starting your accounting firm. However, this might require you to operate as an employed accountant for long enough to gain experience.
How To Get An Accounting Certification
Accounting certifications are essential for your accounting career. However, getting these certifications could be challenging. There are various factors you need to consider before enrolling in an accounting certification program. These factors determine how fast and comfortable the certification process will be. When ignored, you might not get certified to practice as a professional accountant. Several steps are involved in getting an accounting certification. These steps vary depending on the type of certification you intend to get. The state in which you apply for accreditation could also affect the steps involved. However, the variations are not as pronounced since most requirements are standard across all states. Typical steps in the accounting certification process include:
- Identifying the accounting discipline you want to major in
As stated earlier, accounting has diverse disciplines. When looking for an accounting certification, the first step is to determine what area interests you. Getting an accounting degree from your graduate school of choice forms the base for specializing. However, accounting certification programs in some institutions don’t require an accounting degree. If you have an accounting degree, you can practice as an unlicensed accountant, meaning you will only be allowed to work under a certified accountant. The accounting certification programs you can specialize in include the CPA, a general certificate needed to practice locally. Others include international certifications such as the CAIA.
- Choose an institution and program to enroll in
Once you have identified the accounting discipline you want to major in, you have to decide which institution to enroll in. This essential step determines how effective your certification will be. The certification program you enroll in also determines how long it will take to get the certificate. The certification program you enroll in is dependent on various factors. These include your commitment to other things and the urgency of the certification. If you have a tight schedule, you can enroll in part-time certification programs. These programs allow you to focus on other commitments while pursuing your certification. Full-time certification programs take a shorter period. However, you will have to strictly focus on studies as classes cover a lot of material within a limited time.
- Meet the minimum academic requirements of the program
Once you enroll in an accounting certification program, there are many requirements you must meet. These academic requirements determine whether you have gained the required knowledge from the training. For instance, CPA certifications require you to complete at least 150 college hours before you are certified. How well you master the concepts taught at different levels of the certification programs is determined through exams. Certification programs have different levels. In most programs, an exam is administered after every level. You must pass all the exams administered in the program to be certified at the end of the program.
- Obtain your accounting certification
After obtaining satisfactory results in your certification program, you receive an accounting certification. Relevant authorities award certifications depending on the discipline you have majored in. You might incur additional charges during this final stage of the certification process. The charges vary depending on the policies of the state in which you get satisfied.
Accounting certifications could take longer than you had expected due to various reasons. To avoid such losses, you can enroll in a certification program early. You can start the certification program before completing your accounting degree program. This approach is usually possible with institutions and certification programs that don’t require a bachelor’s degree before admitting candidates. Here are some tips you can apply if you plan to start an accounting certification program.
- Consult practicing accountants- Consulting individuals that are already in the accounting industry is essential. Such individuals will give you information on the actual market situation of the accounting discipline you want to major in. Information about the accounting certification program helps you determine the profitability of the process.
- Make financial considerations- Financial considerations are essential in all programs. Knowing the expected cost of the certification program allows you to plan for it. Financial preparations prevent the stress that comes from a lack of enough money to finance the certification process. Additionally, it helps you gauge how profitable the certification you get will be.
- Read about the program you wish to enroll in – A lot of information about accounting certification programs is available in a readable form. You can access reading material on the internet and in libraries. Reading about the certification program prepares you mentally for the workload involved. Additionally, it gives you an overview of the requirements that certain institutions might demand before admitting you.
CPA candidates might fail to secure employment after certification for various reasons. These include personal attributes that employers might dislike. After being certified, you must have etiquette when employed. Additionally, you must be in the right state of mind when attending interviews as they determine whether you get hired or not.
Best Programs Offering Accounting Certification
Many schools offer accounting certification, making it hard to find a program that perfectly suits your certification needs. Many different institutions offer these programs in every state, which implies there are differences in how the programs are organized. However, the process of identifying a good certification program is identical in all states. Here are some factors that make a good accounting certification program.
- It should be affordable- Financial considerations are essential when enrolling in an accounting certification program. A good accounting certification program should be affordable according to your financial status. The expenses you incur during the training and certification program should not exceed the benefits you reap after. If you intend to enroll in an accounting certification program while still studying, you should find inexpensive accounting degrees. These degree programs allow you to spare funds for your accounting certification program.
- It should be marketable- Studying the current market situation before enrolling in an accounting certification program is essential. It helps you tell how fast you will find a job for having the certification you intend to have. The marketability of your accounting certification determines how profitable it is. Internationally recognized certifications such as the CAIA are marketable. These certifications grant you the authority to practice in a wider jurisdiction.
- It should match your specialization- Another factor that affects the quality of the certification program is the institution where you enroll. That said, the institution does not affect your performance much since the licensing bodies make the tests standardized. Accounting certification programs involve various courses. These courses are classified in stages, after which candidates are tested. The courses you study in these stages vary depending on the accounting discipline you pursue. However, some courses are standard across all certification programs. These courses include:
Other factors that affect the quality of certification programs include the institution you enroll in. However, the institution does not affect your performance since the tests are standardized by the licensing bodies. Accounting certification programs involve various courses. These courses are classified in stages, after which candidates are tested. The courses you study in these stages vary depending on the accounting discipline you pursue. However, some courses are standard across all certification programs. These courses include:
- Auditing and attestation
This course is usually part of the CPA training program. It targets to equip candidates with skills and knowledge to audit issuer and non-issuer entities. Additionally, it prepares candidates for roles such as attestation engagements for issuers and non-issuers. There are many other roles CPA candidates play with knowledge of auditing and attestation. This course is examined at the end, and the score is recorded for certification.
- Business environment and concepts
Business Environment and Concepts (BEC) is a course taught in all accounting certification disciplines. This course focuses on equipping candidates with the right skills to operate as professionals in the accounting industry. Under Business Environment and Concepts, candidates learn how to prepare taxes, financial reports, and other activities in the accounting field.
- Financial accounting and reporting
Financial Accounting and Reporting is the basic skill needed in accounting. All accounting certification programs teach this course. To pass, you have to understand various organizations playing a part in businesses across the country. These organizations include the Financial Accounting Standards Board and the US Securities and Exchange Commission, among others. The questions in the financial accounting and reporting exam are divided into four sections. Each section carries a minimum of 15 percent of the total score.
Regulation, REG, is a section of the CPA training program. This course equips candidates with the skills and knowledge needed to operate as professionals. It mainly focuses on the policies that govern the operations of accountants within the professional space. Knowledge acquired during this course includes federal taxation, ethics and professional responsibilities, and business law. The examination at the end of this question is divided into four sections. The Federal taxation of entities section bears the highest percentage of the total score.
Having information before enrolling in an accounting certification program is essential. There are many sources of information about accounting certification programs. Platforms such as career outlook provide critical information about the accounting profession. Through such platforms, you can tell how many certified accountants are available in your field of interest.
The accounting profession has a wide range of opportunities. However, you cannot benefit much from these opportunities unless you are certified. You can work as an uncertified accountant with a bachelor’s degree in accounting or any other related course. With a bachelor’s degree, you will have to work under a certified accountant until you are registered by the professional body responsible for the discipline you practice. There are many accounting certifications that you can acquire. The certification you acquire depends on the accounting discipline you pursue. However, you can acquire more than one certification to increase your jurisdiction as a certified accountant.
Financial considerations are essential in the certification process. Besides ensuring your comfort during the certification program, your financial considerations help you determine the profitability of the certification you pursue. The choice of the institution you enroll in for the certification program determines the quality of training you get. Some institutions are more equipped than others, implying that the quality of training you receive might not be the same even though the requirements are standardized. Private and public academic institutions offer some accounting certification training programs. The professional board puts together examinations and the final certification.
Accounting certification programs involve various courses. The number of courses in a certification program depends on its nature. Students take exams after every course in each certification program, implying that for certification programs such as the CPA, you will have to sit for four exams, one after each course. You must attain the minimum requirements in these exams to be certified as an accountant.