CPA
vs. Accountant
Not
All Accountants or Tax Preparers Are CPAs
Most
people use the terms accountant and CPA interchangeably,
but there is a big difference. The CPA credential
carries enormous weight in business and financial
circles. CPAs are considered some of the business
world's most trusted advisers, according to
a recent survey conducted by the American Institute
of CPAs. Specifically, when small business owners
were asked how often they rely on outside business
counsel, half said that they rely on their CPA
"always" or "often," ranking
slightly behind one's spouse or family member.
This
trust is not surprising considering the strict
requirements to enter and stay in the profession.
Achieving CPA status takes intelligence, ethics,
integrity, and lifelong commitment. First, candidates
must make it through some of the toughest business
courses at their college or university. After
graduation and a year of corporate experience,
they must pass a grueling, two-day test of business,
auditing, and general accounting skills.
The
CPA exam was developed in the early 1900s to
ensure the competence of CPAs entering the field,
much as the bar exam evaluates lawyers and the
medical boards test doctors. It maintains that
goal to this day, and it is continually revised
to meet the changing demands of the profession.
For example, candidates are now being tested
on their writing skills. The significant change
was made because the marketplace is demanding
much more of CPAs. Almost every state in the
country has passed legislation that requires
accounting graduates to complete 150 hours of
course credits before taking the exam. PICPA
supports efforts to add this requirement in
Pennsylvania, too.
The
CPA exam is not the only requirement to be a
CPA. CPAs also are required to follow a strict
code of ethics and perform within the high standards
of the profession. Every two years they must
complete 80 hours of continuing professional
education (CPE) to keep up with the new rules
and regulations in the financial, accounting,
and business world.
As
the profession has evolved, so have the services
CPAs provide. CPAs are no longer just number
crunchers and tax preparers, but business and
financial strategists who help chart the paths
of individuals and businesses. Individuals turn
to their CPAs for tax and financial planning
services, investment advice, estate planning,
and more. Businesses are tapping CPAs to not
only manage finances and taxes, but also to
determine profitable new product lines, seek
creative financing opportunities, help diversify
investments, and provide a variety of other
consulting and business services. As technological
advances, globalization, new laws and regulations,
and marketplace competition continue to complicate
financial and business decisions, CPAs will
be called upon to analyze information, determine
effective financial and business strategies,
and help individuals and businesses achieve
profitability.
©2009
The Neve Group
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