What is the Difference Between an Accountant and a CPA?

Accounting is a function at the heart of businesses large and small. It’s a function that both accountants and CPAs are qualified to handle, but there are differences between the two-namely in terms of education, experience and scope.

Qualified accountants can keep good financial records for their clients and ensure the company’s financial practices are lawful. Accountants also analyze records and data to offer business owners advice on how to improve their operations and save money. Cash flow and tax planning and filing are some other duties accountants typically perform. An accountant does not have to obtain a Certified Public Accountant (CPA) licensure. Accountants will usually have some education, often in the form of a bachelor’s degree.

Becoming a CPA requires additional training, knowledge, and certification that a standard or entry-level accountant position does not. Accountants will typically gain experience or perform an internship before they can become CPAs. The common duties of a CPA are to prepare and file tax returns for clients, organize financial records, write audited financial statements, and act as an intermediary between clients and the IRS.

What is an Accountant?

Accounting is central to managing finances and keeping track of money in businesses of all sizes. A typical day in an accountant’s line of work may include gathering important financial documents, interpreting records, preparing taxes, and advising their clients on ways to improve the finances of their business.

Most accountants work in office settings, but a few may work from their homes or travel, dependent on the client situation. Most often, they will work independently, but bigger companies may have a team with multiple accountants and auditors.

What is a CPA?

A Certified Public Accountant, or CPA, is someone who has met all the requirements in their state and passed the necessary examinations to get the designation CPA. Accountants require considerable experience in their field before they can become a CPA. This can take the form of an internship or on-the-job experience. While there is much overlap between the roles of CPA and accountant, the increased education and experience increase the responsibilities. For instance, only a CPA has the ability to act in legal matters as a fiduciary for their clients.

To become CPAs, candidates must pass a Uniform CPA exam administered by the American Institute of CPAs (AICPA) that consists of four sections: Financial Accounting, Regulations, Business Environment, and Auditing. The more rigorous requirements to become a CPA let companies and clients know that these candidates have attained a higher level of knowledge and commitment to ethics than without this certification.

Key Differences Between an Accountant and CPA

• Educational Requirements. Accountants typically have a bachelor’s degree, but individuals may choose to earn a diploma or associate degree and work in the field as a billing clerk or accounts payable clerk before advancing their education to become an accountant. A CPA must meet more rigorous educational requirements to obtain that title, typically a bachelor’s and often a master’s degree from an accredited institution. CPAs are also required to complete continuing education classes throughout their career to stay current on practices and new information.
• Job Duties. Accountants will document financial transactions and make sure financial records of clients are in accordance with regulations and laws. Often, accountants with no certification may also perform bookkeeping tasks. CPAs typically offer services to individuals, financial institutions, governmental bodies, and non-profit organizations to prepare and file tax returns.
• Licensing. Accountants are typically not required to obtain a license, while CPAs require licensure for the state they practice in after they pass the Uniform CPA exam.
• Fiduciary Responsibility. Non-CPA accountants are not considered to be fiduciaries to their clients, while a CPA can represent a company and perform advanced accounting tasks, such as a financial statement audit. This responsibility enables CPAs to work on behalf of their clients while accountants cannot.
• Taxes. Accountants prepare and file tax returns for individuals, large companies, and non-profit organizations, but CPAs typically possess a deeper knowledge of tax codes. CPAs learn more in-depth ways to help people get the most from their taxes and can act as a representative for them with the IRS.
• State Requirements / Code of Ethics. A CPA is expected to follow a strict code of ethics and act honestly and transparently in their interactions. A code of conduct is followed according to membership in the American Institute of Certified Public Accountants. Conflicts of interest, acting with integrity, maintaining client confidentiality, and using due care are all part of the code of conduct that CPAs are required to follow.
• Job Outlook. There is always a need for qualified accountants and CPAs in a variety of settings, from self-employment to working for large institutions. According to the BLS, the projected employment growth rate for the accounting field-both accountants and CPAs-comes in at 4 percent from 2019 to 2029.

Quality Education and Skill Development

Accountants and CPAs can find excellent employment opportunities as tax accountants, analysts for financial institutions, management positions, and other areas of interest. A well-rounded skill set should be part of a quality educational program. Generally accepted accounting principles (GAAPs) should be instilled in any course of study as well as critical business skills to assist graduates in their career goals.

For over 170 years Bryant & Stratton has offered students career paths in a wide range of areas and vocations. We offer a bachelor’s degree in Business Administration for Accounting to help aspiring professionals gain the knowledge and certifications needed to begin long-lasting and rewarding careers in accounting.

For more information about our programs, financial aid, or admissions, contact us today. Take a step in the right direction by pursuing a higher education from a professional college with staff who care about the students and want to prepare you for the real world.