It is no secret that the economy has been in a rut for some time, and there have been few signs that the economic situation will improve in the near future. As companies and individuals do their best to stay on their feet, many are reaching out to Certified Public Accountants to help them deal with their financial woes. As accountants become an increasingly necessary part of the business world, many people are wondering how to become a CPA. Like any financial career, becoming an accountant involves training, examination and a deep understanding of how a company makes and spends its money. If you are interested in becoming a CPA, there are a number of steps you can take to make sure that your career starts off on the right foot.
Types of Certified Public Accountants
Before you start your CPA training, it is first important to consider what type of Certified Public Accountant you would like to be. While some offer generalized services, most accountants have a specialty. In fact, there are several main classifications of CPA’s. The first type serves the public sector, through assurance services and public accounting. This means that they provide audit services and testify to the accuracy and reasonableness of a company’s financial statements and disclosures. Some CPA’s in the public sector are also involved in income tax preparation. In fact, many public CPA firms offer tax services as well as auditing services.
The second type of CPA serves the private sector. Private CPA’s work for private corporations and may hold positions such as CFO (Chief Financial Officer) or finance manager. While it was once common for CPA’s to hold jobs as business consultants, this trend has fallen out of favor in recent years due to a number of high-profile corporate scandals, such as the Enron case. This does not mean, however, that it is impossible for a CPA to be a business consultant while maintaining their professional integrity, and this job remains a career option for many hopeful accountants.
Once you have chosen a specialty, it is important to keep it in mind when you are planning the rest of your CPA training. Although the certification process may be similar for all types of Certified Public Accountants, you will be more attractive to prospective employers if you have experience in their particular field. For example, if you hope to serve the private sector, it is important to understand current trends in the corporate world. Understanding these trends is less important if you plan on working in income tax preparation.
State-Specific CPA Requirements
The next step is to research the specifics of how to become a CPA in your state. While the certification process is similar across the country, requirements may differ slightly from state to state. The National Association of State Boards of Accountancy, or NASBA, is one resource you can turn to. They provide comprehensive information about each state’s requirements. If you plan on going to school out-of-state, this can also be a great tool to help you decide on a location and a school.
Regardless of your specific state requirements, the basic steps to becoming a CPA are the same nationwide. The first step is to get a bachelor’s or graduate degree. It is important to make sure that you attend an accredited college, as some schools may not be approved. It is particularly important to double-check any web-based university. While some online schools are considered to be reputable institutions of higher learning, many are not and you should make sure that you are not throwing your money away on a program that will not qualify you for your chosen career.
The exact number of college credits you need is one factor that differs from state to state. While some states require you to take at least 24 hours of accounting courses, others may require more. If you are becoming a CPA in Texas, for example, you must complete at least 30 hours of accounting courses. While the gap between these numbers may seem small, it can mean the difference between success an failure. If you are six hours short, you will not be able to move on to the next step. Some states may also require you to take additional classes, such as business classes or ethics classes.
Work Experience and Examinations
Once you have earned your university degree, you must complete a number of hours of work experience as well as several examinations, before you can become a Certified Public Accountant. Some states require that the work experience be done before the exam, and some allow applicants to take the exam as soon as they have obtained their bachelor’s degree. Regardless of when you must do it, however, it is important to find out how many hours of work experience are required and to make sure that all work experience is done under the supervision of a reputable, practicing CPA.
All states require you to take two examinations before being granted your certificate. The first is the main CPA examination. It consists of four sections, and you must pass all four. You will be asked to provide a number of documents in order to take this exam, including an application and your college transcripts and passport photos. You will also be required to pay a fee. The second exam you must take is the American Institute of Certified Public Accountants Professional Ethics Exam. This test is available online and you must earn a score of at least 90% in order to pass.
Once you have completed your work experience and examinations, you must submit several more documents to the State Board of Accountancy. In most cases, five letters of recommendation are required, and at least two must come from a CPA. A work history covering the last ten years may also be required, along with certification of all job experience. You must submit your college transcripts, with proof that you completed all necessary courses and obtained all required credits. You must submit an application and passport photo, and will have to pay another fee. In the end, the path for how to become a CPA may seem long and complicated. In many cases, however, it can result in a successful and rewarding career.