What factor do many of the nation's top CEOs, government leaders and most influential business advisers have in common?
Many of them launched their careers with a degree in accounting. That's right - accounting.
The popular stereotype of the accountant is the solitary "bean counter" who quietly works behind the scenes recording financial transactions and balancing the books. The reality is that accountants are on the front lines helping businesses succeed, keeping cities and states running, and protecting the financial health and security of organizations and individuals.
As an accountant by training who now teaches the subject in college, I can attest to the diverse challenges and rewards of this respected and versatile profession. In today's marketplace, an accounting degree opens the door to a wealth of career opportunities across a range of industries.
Accountants are responsible for maintaining an organization's financial records and protecting its assets which requires strict adherence to accounting rules, tax codes and regulations as well as the ability to analyze data, question assumptions and resolve discrepancies. Their work touches every aspect of an organization's operations, from manufacturing and pricing products, to managing budgets, to planning business strategy and investments. Accounting is often referred to as the language of business.
In addition to being comfortable working with numbers, accountants must be good with words; they must be able to read business documents critically and make compelling presentations. Given the sensitive nature of the financial information being handled, personal integrity, honesty and the highest standard of ethics are essential.
The accounting profession offers a variety of career paths. Many accountants work within public accounting firms, which can range from large, multinational firms to local accounting practices. Within the firm, accountants can specialize in areas such as audit, tax and management consulting as well as serve a range of industries and clients. On the corporate side, careers are available in businesses of all sizes, working in areas including financial accounting and reporting, financial management and information systems. Accountants, especially those certified in Forensic Accounting, are also in demand at the FBI and the Treasury Department where they work with investigators to track down accounting fraud.
Economic growth and the increased regulation of company finances under Sarbanes-Oxley and the Affordable Care Act add up to a strong job market and high compensation for accountants, especially those licensed as Certified Public Accountant or Certified Management Accountants. According to the Bureau of Labor Statistics, 1.3 million people currently work as accountants in the U.S. and earn a median annual salary of $66,000. Partners in Big 4 accounting firms can earn compensation up to $2 million or more a year. The field is expected to grow by 13 percent or more through 2024. Due to the retirement wave sweeping through the baby boom generation, many of these newly created accounting positions will also be filled by recent college graduates.
Pursuing a college degree in accounting requires a strong personal commitment, persistence, and hard work. All states require students to complete 150 credit hours to obtain a state license for the CPA, which is 30 hours more than the usual four-year bachelor's degree. Students typically meet this requirement by taking a fifth year of additional courses beyond a bachelor's degree or by going on to complete a master's degree. The CMA exam requires an undergraduate degree from an accredited college or university.
Academic requirements include at least 24 semester hours in accounting and at least 24 semester hours in business courses. Students usually begin taking introductory accounting courses in their sophomore year, in which they learn how to read financial statements, make journal entries, track inventory and the other basic principles of accounting. In subsequent semesters, students learn more about the details of financial analysis and reporting, tax preparation and regulatory issues. Elective courses offer an opportunity for accounting majors to explore areas such as sports management, which provide alternate career options for graduates with an accounting degree.
Highly motivated and qualified students can consider an accelerated program to complete their academic requirements in four years. For example, my school, Centenary College, offers a dual major in Accounting and Business Administration Finance that allows students to complete 150 credit hours of study in four years, allowing them to achieve this dual degree at no additional cost and enabling them to start their careers a year earlier. While these types of accelerated programs are relatively new, they are worth seeking out for students who are prepared to shoulder the academic load.
While you can practice as an accountant without being a CPA or CMA, professional certification provides an advantage in the job market because it shows proven commitment and competence in the field. The reason is simple: the recent passing rate for the CPA exam is under 50 percent, while the CMA is about 51 percent. Preparing for the exam requires many months of intensive study and review. In addition, candidates for CPA certification must have a year of experience in the practice of public accounting or its equivalent under the direction of a licensed public accountant while the CMA requires two years of continuous experience using the principles of financial and management accounting.
Once you become certified as an accounting professional, you can invest in a career that provides a great professional and personal return. When you understand the numbers of a company, you understand how the company works. From the largest Fortune 500 company to the smallest entrepreneurial business in government agencies to not-for-profit organizations, that knowledge is essential to the successful operation of every national and global organization.
The bottom line: a career in accounting can take you anywhere you want to go.