When you’re working in the world of accounting, there are a number of paths and specialties that you can participate in when it comes to your accounting journey—but, somewhere along that journey the question will be asked: Do you need a CPA to be an accountant? In short, no. Not all accounting roles require a CPA license. It takes a keen understanding of the distinctions between accountants and CPAs to map out your accounting career.
That’s why today, we’re diving into the importance of a CPA designation and when you might find yourself pursuing this credential to elevate your accounting career.
Let’s get started!
What’s the Difference Between an Accountant and a CPA?
Before you make a solidified decision on whether or not to pursue a CPA license, it’s important to figure out what separates a CPA from any other accounting professional. On a fundamental level, a CPA, or Certified Public Accountant, is a licensed accounting professional who has successfully passed all of the exams required and met all educational and work experience requirements.
It’s important to note that while every CPA is an accountant, not every accountant holds a CPA license. Most accountants are knowledgeable in managing finances, prepping financial statements, and delivering basic tax services without the need for a CPA designation.
CPAs on the other hand are held to a higher level of practice. Your CPA designation is a signal of the additional expertise and commitment to your ongoing career development. That’s because CPAs are required to complete a series of continuing education courses to maintain their license. So, when we’re thinking about the question, “Do you need a CPA to be an accountant?” The answer will rely heavily on the level of authority and types of services you want to provide.
Carer Paths in Accounting – With and Without a CPA License
When it comes to the accounting industry, there is an array of roles and responsibilities that range anywhere from bookkeeping to high-level advisory positions. Let’s take a quick look at a few of these paths and whether a CPA designation will be necessary in your case:
Bookkeeping
Bookkeepers typically manage the day-to-day financial transactions and maintain up-to-date records. More often than not, this role requires no CPA license.
Tax Preparation
There are quite a few tax preppers that are accountants, but not necessarily CPAs. A CPA license might be helpful in your job search, but there are lots of tax preparation positions that don’t require CPA designation.
Financial Analysis
When it comes to financial analysts, their goal is to help businesses understand their financial health on a deeper level, which often has no requirement for a CPA license, but absolutely does demand some strong accounting skills.
The answer to the question “Do you need a CPA to be an accountant” Will only become clear once you know where you want to take yourself and your business growth. If you’re working towards leadership roles or have an interest in public accounting, a CPA designation would pose a huge benefit to you and in some cases may be required.
Advantages of Obtaining a CPA License
It’s no secret that having a CPA designation under your belt opens a lot of doors to a lot of opportunities, especially if you plan to work in a public accounting firm, corporate finance, or as a consultant. Let’s dive into how becoming a CPA can help:
Increased Job Security
When it comes to your CPA destination, employers recognize it as a sign of your dedication and industry expertise–which, more often than not, translates into elevated job stability.
Enhanced Earning Potential
Studies have shown that CPAs earn more on average than their non-designated counterparts. You could see an increase as high as 10-15%, yearly, which would make a CPA designation a pretty lucrative investment.
Greater Professional Prestige
If you are the proud carrier of a CPA license, that’s a clear indication that you’ve met the highest standards in the field! With that comes responsibility and a solid reputation. You’re regarded as a trusted financial advisor and expert, which in turn, will open more doors for even better positions.
Access to Leadership Roles
For senior positions in finance and accounting, whether you’re interested in becoming a CFO or controller, you’re going to need a CPA designation. Understand that when it comes to climbing the social ladder, you’re going to need a license.
The Estess CPA team gets to see first-hand the positive impact that a CPA designation has on careers and clients. Because we hold our CPA designations, we’re equipped to deliver a high level of accounting solutions, something our clients find invaluable. If you want to establish yourself as a high-level advisor, getting a CPA license would serve you tremendously well.
When You May Not Need a CPA License
Although getting your CPA license is absolutely valuable, it’s important to note that it isn’t always necessary when it comes to fulfilling a strong career in the accounting industry. Here are a few where you won’t need to ask “Do you need a CPA to be an accountant?”, and still find great success:
Non-Public Accounting Roles
Most positions in corporate accounting don’t require you to have a license, especially if your role just has a strong focus on budgeting, forecasting, and reporting.
Specialized Finance Roles
If being a financial analyst, investment analyst, or controller tickles your accounting fancy, these are roles that highlight niche finance knowledge more so than a CPA designation.
Small Business Accounting
Accountants who work in small business roles usually find that more practical accounting skills and experience are more valuable than a CPA license.
Tax Preparation
While CPAs do deliver tax preparation solutions, it’s important to note that you can work in that field unlicensed. Lots of professional tax preppers build lucrative careers without ever having obtained a CPA designation.
So, do you need a CPA to be an accountant? That answer depends on you and your own business goals. Each path has great benefits and will equip you to make valuable contributions to whatever organization you work with. That said, we’re always here to help! Click here to get in touch with the Estess CPA team and start your accounting journey today!
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