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If you’re thinking about following the career path to become a certified public accountant (CPA), it can be difficult to figure out exactly which steps you’ll need to take if you wish to meet your goal.
While the requirements can vary from state to state (you can ask questions of your local state board of accountancy or check their website), the basic milestones and educational level you’ll need to achieve to get your CPA license generally remain the same.
The process can seem difficult, but it’s worth the effort. On average, individuals with a CPA license earn a salary of five to fifteen percent more than unlicensed accountants in public accounting, not to mention the increased opportunities for promotion, advancement, and international job opportunities.
When you become a CPA, employers and clients know that your services come with the backing of the National Association of State Boards of Accountancy (NASBA,) the state Board, and a large portion of the accounting community. Your credentials and education will be more widely accepted with the knowledge that your state’s Accountancy Board has already vetted you and you received passing grades on all four CPA examination sections and the ethics exam.
There are certain accounting tasks that only licensed CPAs are legally permitted to provide. Without your CPA license, you won’t be allowed to file reports with the Securities and Exchange Commission (SEC) - a major employment requirement for many accountants. Non-CPA accountants are also prohibited from performing auditing and attestation services, though they can do most reporting functions for their firm. A CPA license is also required to sign tax documents for a client or employer.
Because of the lack of accountability and restrictions in permitted work that can come with uncertified accountants, many accounting firms only hire those who show they are CPA licensed on their application. Becoming a CPA is an investment in your future that can pay off dividends if you plan to work in an accounting or financial environment. It offers specific training and testing that can give you access to leadership positions and allow you to become a member of some of the most exclusive organizations for working professionals.
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Certification and Licensure Requirements
The required qualifications often vary in detail from state to state. Every state (and an additional five districts) has their own Board of Accountancy. Each Board is responsible for creating and enforcing the guidelines needed to secure your CPA license and practice legally within your state, which you can view on your state's site.
Though each state has their own rules, the Uniform Accountancy Act streamlines the process so that it doesn’t vary too greatly depending on where you live. This bill was jointly created in 1984 by NASBA and the American Institution of Certified Public Accountants (AICPA) to reduce discrepancies in what states need.
In every state, CPA candidates must first complete the three E’s to qualify for licensure: education, examination, and experience. Each prospective CPA must complete at least 150 semester hours of college or university credits as students, pass the Uniform CPA test, and gain at least one year of verifiable accounting work experience prior to licensure to build their skills.
However, the policy varies from state to state when it comes to the individual specifications that must be met in each stage of eligibility. Credit distribution, required courses, years of higher education necessary, and pre-exam study requirements may change depending on which state you’re seeking licensure in, as can the necessary experience hours and nature of work. Many states also require completion of an approved ethics class prior to licensure.
Before you can apply for your CPA license, you’ll also need to meet a predetermined number of verifiable supervised hours performing specific accounting tasks. This generally needs to take place over at least one year, accumulating a number of hours that vary based on your state (often somewhere between 1200 and 1800).
Relevant experience must take place in a public or private practice, or a government, academic, or industry setting. You’ll need to be supervised, likely by a licensed CPA. Check with your state’s Accountancy Board for help finding information on experience needed if you want to receive your license.
Your experience must cover a variety of the tasks you’ll be expected to handle upon licensure to ensure you learn and review these tasks. These fields may include taxation, auditing, attestation, business accounting, and/or finance.
No matter what state you’re in, you’ll be required to complete a number of Continuing Professional Education (CPE) hours each year after licensure. Exactly what you'll need varies on a state-by-state basis, but you can expect to attend classes, seminars, and the occasional meeting to make sure you’re up to date on constantly changing rules and regulations.
Education Degree Programs and Course Requirements
Before you’re able to sit for your Uniform CPA Exam, you’ll need to finish your education requirements.
In every state, the Accountancy Board requires you to have a minimum education of at least a bachelor’s degree. Your time spent learning in an accredited undergraduate program typically covers 120 of your 150 required credits.
While not every state specifies that your degree must be in finance, accounting, business, or a similar field, you’ll want to check with your state’s Board to make sure you’re taking classes that will center you on the CPA career path.
Some subjects you’ll want to include in your class load include:
- General accounting
- Business ethics
- Business law
- Business administration
- Business communications
- Business statistics
- Budget management
- Cost accounting
- Capital management
- Financial management
- Information technology
- Risk analysis
Discuss your future plans with your student advisor to make sure you’re fully preparing yourself for your career in accounting.
Undergrad Plus or Graduate
Since your bachelor’s degree will likely only cover about 80% of your required credit hours, you’ll likely need to continue your education after you receive your degree.
Depending on your school and state, you may have options regarding how you can choose to move forward.
A specialty master’s degree in a finance or accounting subject can put you on the right path while satisfying your education requirement. A focus in a field like financial management, taxation, business administration, or economics may be especially valuable for your chosen career.
If your college allows, you might be able to roll your additional required hours into a five-year program instead of completing both a bachelor’s and master’s degree. Some schools offer an extended undergraduate degree in accounting to meet your semester hour requirements without having to enroll in an entirely separate program. Check with your school to find out what options may be available to you.
You can also choose to seek education beyond the traditional requirements. A PhD in accounting can set you up for future success within your chosen specification. CPAs who hold a doctorate may be well-suited for careers in academia, government, or advanced research positions in the field of accounting.
Is Being a CPA the Right Career for Me?
Not everyone is going to be the best fit to pursue a career as a CPA. You should consider your needs and personality before you join any field, including accounting.
There are several qualities that could impact your success and happiness as a CPA. Studies have shown that people who are drawn to accounting and business as a career choice tend to have qualities of the STJ personality type - sensing, thinking, and judging.
Whether you’re introverted or extroverted, there may be a place for you in the accounting field. Introverts might excel in a research or investigative arena, whereas more outgoing types may do well in a manager or business role.
Of course, prospective CPAs should be skilled at and interested in mathematics. Other areas of competence that can be helpful include business, finance, communication, and computer science or information technology. In fact, some CPAs now specialize in IT and work on auditing databases.
There are many benefits that come with obtaining your CPA licensure. Before you even begin your education, you’ll be able to identify exactly what steps you’ll need to take, depending on the state in which you live. The CPA license comes with a clearly defined career path that doesn’t exist in other professions.
Once you do have your license, CPAs can expect to bring in a decent salary upon certification. In 2017, the Bureau of Labor Statistics reported the median salary among CPAs to be $69,350, with the top ten percent of accountants bringing in an average of $122,220. On top of that, most accountants receive benefits such as health insurance, vacation time, and retirement plans.
Another benefit of becoming a CPA is knowing you’ll have job security for as long as you choose to maintain your license. Most businesses keep at least one accountant on staff, if not an entire team. Taxes will always have to be filed, and books will always need to be kept. When you have a license in such a specialized and in-demand field, you can be sure you’ll always be highly employable.
There are downsides to being a CPA. For some, the work can be tedious, and the licensure requirements strenuous. You’ll need to continue your education throughout your career, taking away from personal time and all but guaranteeing potentially unpaid overtime hours. Tax season tends to bring on a surplus of work, while other times of year may be a little less constant. A career as a CPA can be a bit of a grind, and it can be difficult to balance your personal life with your work obligations.
However, for those who have the personality and inclination, accounting can be a rewarding career path. The life of a CPA can be stressful at times, but the high pay and job growth potential makes it a worthwhile endeavor for many accountants.
Once you obtain your license, you may consider joining a national or locally based organization of accountants. The AICPA is a nationwide group that provides valuable information and resources to members of the accounting field. They can also direct you to local organizations within your state. You can network with like-minded professionals, and stay up to date in the regulations and rules in the fields of business and accounting.