One of the fastest-growing sectors of employment is that of the CPA or certified public accountant. This professional role is becoming a necessity for business owners who want to put their finances in trusted hands and provides many opportunities for those who can get certified.
However, not all accountants are CPAs and the role of CFO in small business is associated with a significant reputation. That means that getting certified can be challenging. It may be tempting to pursue this position and the opportunities that come with it, but make sure you know everything you’re signing up for before you do.
What Is a CPA?
The CPA is an elite accountant trained not just in typical accounting tasks like keeping track of finances and filing taxes but also in handling large economic systems. For example, there will usually be a CPA in charge of the finances of a Fortune 500 company, as well as many nonprofits and other private and public institutions. Getting certified as a CPA means not only qualifying for an accounting position but a full-on Chief Financial Officer role.
Becoming a CPA is a multi-step, complex process, but it is worth it. If you apply for a job and have the CPA paperwork available, it immediately gives your potential employer notice that you’re ready for a high-level job. Most hiring managers will immediately give priority to any candidate with a CPA certification when they look at applications. That makes this a competitive field where the certification can be well worth the rewards.
How Is a CPA Certified?
Becoming a CPA is an intensive process in just about every state, but the process will differ depending on where you live. Before you start, check your state’s licensure website to make sure you’re starting in the right place. You’ll likely have to meet specific requirements before you can even sign up for the CPA exam.
The first step will likely be to complete your degree in accounting, which is most commonly a hundred and fifty hours of credits. This accomplishment may be achievable in some states with an undergraduate degree but be aware you may be required to enroll in a graduate program. You should also be prepared for a hands-on experience requirement, which may be a year working under a licensed CPA before certification.
Finally, you’ll need to pass the CPA exam, which means blocking out some time to study. Know the passing score you need, and develop a strategy for preparing. You can self-study using textbooks or find a study group that will allow you to get expert help. Once you pass, you may need to pass an ethics exam to finalize your certification.
Liability
Like any service provider, you should be careful to protect yourself from liability before going into business as a CPA. You’re going to be offering your expert opinion and managing large bank accounts, which means you could be liable for any omissions or errors and could be sued by a disgruntled client. Justified or not, defending yourself from a lawsuit can be costly and time-consuming.
The best way to protect yourself is with professional liability insurance for CPAs. This insurance takes the risk off your shoulders. You’ll have an insurance agency looking out for you, covering your costs in court and any related areas like investigations. The insurance may also pay for any settlements or judgments to the level agreed on in your policy.
Improved Career Potential
Many accountants don’t have CPA certification, and they usually start practicing with only a four-year degree. While there are many opportunities in private practice, the financial benefits of becoming a CPA can be huge. It’s estimated that a CPA can earn more than a million dollars more throughout their career than the average accountant.
That’s not considering that a CPA degree can open the door to the highest-paid positions in corporate America. Many institutions with high value will only consider CPAs for certain positions, including anything to do with fraud or forensics. These roles are prevalent in banks and any government institutions.
Open Doors by Becoming a CPA
If you’re considering a career change, becoming a CPA won’t be a quick change to make. This shift is a significant investment that may take several years, depending on your background and education. Once certified, research the best insurance to cover yourself if a disappointed client takes you to court. If you take this road, you’ll find that it pays for itself many times over, so make sure you’re prepared and understand all the requirements before jumping in.
