How To Become A Certified Public Accountant (CPA)

Working toward any academic field and achieving even the most basic qualification is a major accomplishment. Perhaps you have found yourself with an accounting degree and you are wondering what the most natural next step in your career is.

Perhaps you could consider becoming a certified public accountant (CPA). Before you pursue this certification, you need to know exactly what it is and how you can obtain it.

Being a CPA is different from being an accountant. An accountant is someone who has completed a degree in the field of accounting. However, often look at with prestige and seen as utterly admirable, a CPA is someone who has obtained certification by exhibiting superior knowledge and understanding in the aspects of education, experience, and the examination they have completed.

CPAs are those who have displayed superior expertise not only in the theoretical understanding of accounting as a subject but in executing accounting processes with accuracy and integrity.

While the steps to becoming an accountant are the basic steps you would need to take in becoming a CPA, this process is far more intense. Coming out on the other side as a qualified CPA is seen as admirable and a great testament to your character because of the hard work it takes to pursue this field.

To become a CPA, you would need to check what are the minimum state board requirements where you are hoping to obtain your CPA, you would need to earn a degree, gain experience, apply, prepare, and pass the CPA exam, and then maintain this license and certification.

Let us take a deeper dive into this field and let us take a closer look at what you would need to do to become a successful CPA.

What Is A CPA?

This prestigious and sought-after role within the accounting and finance field is usually the best way to fast-track your growth within accounting. It is often seen that CPAs earn far more than those who work as accountants and only hold a degree in accounting.

Having your CPA in hand grants you access to professional accounting practices which you may not otherwise have had access to with just a degree.

As a CPA, you could acquire a role within the finance division or a private corporation serving as an in-house CPA, you may work for an accounting firm, or you may establish your own accounting business having the qualification and authority to do so.

Some of the services you would be able to offer from your own firm and with your CPA are providing tax and accounting services to as many clients as you could handle, as well as managing the financial books of these clients. Over and above providing accounting services, you would be able to successfully execute financial audits.

CPAs need to obtain specific licenses which not only allow them to only perform certain duties but to also be recognized as CPAs. Having a CPA gives you a key to unlocking very specific duties that you couldn't otherwise fulfill as an accountant.

What Does A CPA Do?

As a CPA, you hold a high ranking, and your word is often true and correct as it pertains to finances. You would often fulfill the role of a trusted financial advisor, and proving that you have met the strict requirements it takes to be a CPA shows your stature and your level of expertise in the field.

When you are a CPA, you have been certified by the Board of Accountancy within your specific state and you would complete duties that include preparing taxes, advising companies and clients on their taxes, executing government audits, taking up representation roles on behalf of your clients before the IRS, and executing a wide range of bookkeeping and financial planning duties.

It is important to note that before you decide to work toward your CPA, you should know if this is the desired role you are hoping to fulfill. There are a number of other roles within the field of finance that neither requires a CPA nor an accounting degree. Such roles include that of financial analysts, managers, and even budget specialists.

If you find that the role of a CPA is for you, you could see your career projection reaching the roles of senior accountant, chief financial officer, and even financial controller.

While the roles and duties that you may execute as a CPA can greatly overlap with that of an accountant, having your certification in hand streamlines your access to financial operations within an organization.

It is also important to note that the company you choose to work for or that has an available position that you are hoping to pursue may align with that of an accountant. In such cases, while having a CPA will be great for your personal achievements, the company's available roles may not be for a CPA, and this could mean that you may find yourself not earning as high of a salary as you had hoped for or not having the role and title you were hoping to have.

What Are The Requirements To Become A CPA?

While the below may serve as a list of general requirements, it is important that you check your specific state requirements as they may differ from state to state. Once you know what the basic requirements are, you can then proceed through the necessary steps that you need to go through to sit for your CPA exam.

The first requirements you would need to meet to sit for your CPA is that you need to be 18 years or older and you need to have a social security number. Given that you would be required to meet certain academic requirements, this may come across as an obvious requirement, but it must be explicitly mentioned.

You would need to complete your state-specific education requirements to sit for the CPA exam which may mean obtaining a bachelor's degree in accounting or in a finance-related field. You would also need to meet specific experience requirements.

Additionally, there are some cognitive skills and soft skills that you are expected to have in order to be a successful CPA. These include having good moral character and integrity since you will be working closely with the finances of others, superior organizational and communication skills, a strong understanding of math, accounting, and computer-related software, and extensive knowledge of local, state, and federal tax laws.

Steps To Become A CPA

Step One: Obtain Your Qualification

To become a CPA, you first need to obtain the appropriate qualifications. In most cases, the minimum requirement is a bachelor's degree in accounting or finance, but you may be allowed to sit for the CPA exam if you have a degree in a different field. However, given that being a CPA is directed toward the field of accounting, it is always best to have an accounting-related degree to further guarantee your success in this role.

So long as you have completed between 120 to 150 credits (depending on state requirements) you could qualify to sit for the CPA exam. To obtain additional credits, you may even consider vying for a master's degree in accounting, if the requirements are 150 credits and you only have 120 credits with your bachelor's degree.

Step Two: Gain Direct Industry Experience

You will need to complete a certain amount of full-time accounting experience before sitting for the CPA exam. This ensures that you have the hands-on skills of applying your theoretical knowledge in practice.

A general rule of thumb is that a minimum of two years of experience is required, with a preference given to roles directly under the supervision of a CPA.

Step Three: Apply To Take Your Exam

Unfortunately, taking the CPA exam is not as easy as walking into a room with a pen in hand and writing down answers. Instead, you are required to go through an application process with your local state Board of Accountants.

There is also a non-refundable fee that you would need to pay to take the exam. This fee can be anything between $50 and $200. If your application to take the exam is approved, you will receive a notice to schedule which will allow you to set an appointment for each section of your CPA exam.

Step Four: Prepare for Your Exam

Once you have scheduled and written the first section, you have 18 months to complete the remaining sections of the exam. Preparation for the exam is intense and rigorous. It Is recommended that you do not pursue this exam amid life-changing circumstances, for example, a wedding, changing jobs, or any other major life events that are in your control.

To prepare for the exam, you need to know exactly what you are preparing for. The test is comprised of four sections (as mentioned, all four sections need to be completed within 18 months), and each section is a four-hour long test. You can complete the sections in the order you choose.

The four sections are the auditing and attestation section which covers all related services in public accounting, and it aims to test your knowledge in the audit process, and compliance reviews to name a few.

The next section is the financial accounting and reporting section which is probably the most extensive of the four and which covers, in great detail, a variety of financial accounting and reporting topics.

The next section is the regulation section, and while not explicitly related to accounting processes, it focuses on business processes, taxation for businesses and individuals, business ethics, and laws related to businesses.

The last section is the business environment and concepts test that assesses the environment in which businesses operate, micro- and macro-economies, and much more.

The tests are broken up into subsets that are simulation-based or multiple-choice questions.

To be successful in the completion of this exam, you would need to obtain 75% in each section.

Step Five: Obtain Your License

Once you have your certificate in hand and you have met all your state requirements, you can then apply for your license, and you can begin fulfilling your role as a CPA.

How Much Does A CPA Earn?

According to the U.S. Bureau of Labor Statistics (BLS), accountants and auditors earn a median annual salary of $77,250 and a median hourly salary of $37.14.

FAQs

How Long Does It Take To Become A CPA?

Considering that you would need to first obtain your degree, experience, and then your CPA, it can take about seven years to become a CPA.

What Is The Difference Between An Accountant And A CPA?

A CPA is certified in the field and has therefore been approved to complete very specific tasks and responsibilities. The scope of their role is therefore far higher than that of an accountant.

Conclusion

With hard work and determination, you could better your career growth by putting in the effort required to successfully obtain your certificate and license. You can then easily find yourself working in the role of a CPA, completing complex requirements, and performing duties that carry great responsibility and pride. If this is the career your heart chooses to follow, then strap in and let the determination begin.