What is the Difference Between an Accountant and a CPA?

What is the Difference Between an Accountant and a CPA?

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Hiring an accountant can save you a lot of time and money. An accountant can help you keep track of your finances, prepare your taxes, and advise you on financial matters. Accountants are trained to understand the tax code and financial regulations, so they can help you save money on your taxes and avoid costly mistakes.

If you’re running a business, an accountant can also help you track your expenses, prepare financial statements, and manage your payroll. An accountant can be a valuable asset to any business owner, so it’s important to choose one who is qualified and experienced.

Before you can hire an accountant, it’s important to recognize the difference between an accountant and a CPA. In this article, we’ll discuss this difference.

What is an Accountant?

An accountant is a professional who provides financial services to individuals, businesses, and organizations. Accountants typically have a four-year degree in accounting or a related field. Many accountants are certified public accountants (CPAs), which requires passing an exam administered by the American Institute of CPAs (AICPA).

What is a CPA?

A certified public accountant (CPA) is a type of accountant who has passed the Uniform CPA Examination, which is administered by the AICPA. CPAs are licensed by state boards of accountancy and must meet continuing education requirements to maintain their license.

In order to become a CPA, an individual must:

  • Be at least 18 years old
  • Have a high school diploma or equivalent
  • Complete 150 semester hours of college-level education
  • Pass the Uniform CPA Examination
  • Meet experience requirements (varies by state)
  • Be licensed by a state board of accountancy

What Services Do Accountants Provide?

Accountants provide a wide range of services, including:

  • Bookkeeping: Bookkeepers record financial transactions and keep track of accounts receivable and payable. They also prepare financial statements, such as balance sheets and income statements.
  • Tax Preparation: Accountants can help you prepare your taxes and maximize your tax deductions. They can also help you resolve tax problems with the IRS.
  • Financial Planning: Accountants can help you plan for your financial future by creating a budget, saving for retirement, and investing in stocks, bonds, and other financial products.

What Services Do CPAs Provide?

CPAs provide all of the services that accountants do, plus additional services, such as:

  • Auditing: CPAs audit financial statements to ensure they are accurate and comply with generally accepted accounting principles (GAAP).
  • Business Consulting: CPAs can help businesses improve their financial performance by providing advice on topics such as mergers and acquisitions, financial planning, and risk management.
  • Forensic Accounting: Forensic accountants use their skills in accounting, auditing, and investigation to detect and prevent fraud. They may also be involved in litigation support and provide expert testimony in court.

How to Choose an Accountant

When choosing an accountant, it’s important to consider the following factors:

  • Qualifications: Be sure to choose an accountant who is qualified and experienced. The best way to do this is to choose a CPA.
  • Fees: Be sure to ask about fees upfront. Some accountants charge by the hour, while others charge a flat rate or percentage of assets under management.
  • Specialization: If you have a specific need, such as tax preparation or financial planning, be sure to choose an accountant who specializes in that area.
  • Location: You may want to choose an accountant who is located near you so that you can meet in person. However, with the advent of technology, many accountants now offer their services online, so location is less important than it used to be.

When choosing an accountant, it’s important to do your research and choose someone who is qualified and experienced. An accountant can be a valuable asset to any business owner, so it’s important to choose one who is qualified and experienced.

Accountants are trained to understand the tax code and financial regulations, so they can help you save money on your taxes and avoid costly mistakes.

CPA vs Accountant: Which is Better?

The answer to this question depends on your needs. If you need someone to simply keep track of your finances and prepare your taxes, an accountant will suffice.

However, if you need someone to provide more comprehensive services, such as auditing or financial consulting, you’ll need a CPA.

What is the Average Salary of a CPA?

The average salary of a CPA is $120,000. However, salaries can vary depending on experience, location, and specialty.

CPAs who work in public accounting firms tend to earn more than those who work in corporate accounting departments. CPAs who specialize in tax preparation or financial planning also tend to earn more than those who don’t specialize.

What is the Job Outlook for CPAs?

The job outlook for CPAs is strong. The demand for qualified CPAs is expected to grow 11% from 2018 to 2028, which is faster than the average for all occupations.

This growth is due to the increasing complexity of the tax code and financial regulations. As businesses become increasingly globalized, there will also be a need for CPAs who are familiar with international accounting standards.

Can You Get a CPA Without an Accounting Degree?

It’s not possible to get a CPA without an accounting degree. In order to become a CPA, you must have a bachelor’s degree in accounting from an accredited college or university.

You’ll also need to pass the Uniform CPA Examination, which is administered by the American Institute of Certified Public Accountants (AICPA).

How Long Does it Take to Become a CPA?

It typically takes four years to complete a bachelor’s degree in accounting. However, some students may be able to complete their degrees in less time by taking advantage of accelerated programs or earning credits through prior learning assessments.

After completing a bachelor’s degree, you’ll need to pass the Uniform CPA Examination. The exam consists of four sections, and you must pass all four sections within 18 months.

What Does the Uniform CPA Examination Consist Of?

The Uniform CPA Examination consists of four sections:

  • Auditing and Attestation (AUD)
  • Business Environment and Concepts (BEC)
  • Financial Accounting and Reporting (FAR)
  • Regulation (REG)

You must pass all four sections within 18 months.

How Can I Prepare for the Uniform CPA Examination?

There are a few different ways to prepare for the Uniform CPA Examination. The AICPA offers an online review course, as well as practice exams.

You can also find study materials from third-party providers, such as Gleim or Becker. These providers offer comprehensive review courses that include study guides, practice exams, and personal coaching.

Important Tips for Hiring the Best Accountant

When hiring an accountant, it’s important to do your research and choose someone who is qualified and experienced.

Accountants who work in public accounting firms tend to have more experience than those who work in corporate accounting departments.

CPAs who specialize in tax preparation or financial planning also tend to have more experience than those who don’t specialize.

You should also consider the size of the firm you’re hiring. Smaller firms may be able to provide more personalized service, while larger firms may have more resources.

Finally, make sure you understand the fees associated with the services you’re looking for. Some accountants charge by the hour, while others charge a flat fee. Be sure to get an estimate of the total cost before you commit to any services.

Conclusion

As you can see, there is a clear difference between a CPA and an accountant. A CPA is a certified public accountant who has met certain educational and experience requirements.

Accountants are not required to be certified, but many choose to become CPAs in order to demonstrate their expertise and commitment to the profession.

 

If you want accurate financial records for your business, consider hiring a reputable accounting firm. One of the trusted accounting firms in Florida is Swiftbooks, LLC. Call 786-204-2881 today to help your business keep its financial records straight!

Further Reading

What is the Difference Between an Accountant and a CPA?

Top 12 Accounting Tips for Startup Businesses

Do Bookkeepers Need to be Licensed or Certified?

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