Over the last decade, as SMEs are sprouting up all over the world, there has been a very large shift in the way small businesses view accounting. There has been a complete shift in their requirements and companies are now leaning more towards CPAs than regular accountants. Despite the fact that artificial intelligence is taking the accounting sector by storm, there is still an essential need for a human touch and the CPAs know it. This of course, has lead to a much larger number of professionals, both men and women, lining up to get themselves the CPA certification.
The Uniform Certified Public Accountant Examination (CPA) is the examination undertaken by professionals who aspire to become U.S. Certified Public Accountants. This exam is based on actual professional practice and explores every aspect of accounting, auditing and reporting. The exam spans over 16 hours and covers four broad categories, broken into four hours each. The broad topics covered in the CPA exam are Auditing and Attestation, Business Environment and Concepts, Financial Accounting and Reporting, and Regulation.
Businesses today prefer CPAs to accountants for various reasons, making CPAs the most sought-after accounting designation. First off, CPAs are licensed. Getting a license to practice in the state of your choice requires a CPA candidate to undergo rigorous testing and qualify under strict requirements. Even after they receive their license, it is mandatory for CPAs to continue their education throughout their careers and stay abreast with the developments in the field of accounting. Accountants neither receive a license to practice, nor are they accountable to update their knowledge at regular intervals. When it comes to the dynamic professional environment in the world today, every business wants to make sure that their accounts are in the safe hands of someone who us current and updated.
Another big way in which CPAs have an upper hand over accountants is the fact that a knowledge of tax laws is a large part of the CPA exam and most CPAs take refresher courses every year to stay aware of the newest updates to the Tax Code. While accountants may also gain similar knowledge, and have the ability to prepare and sign tax returns, the designation of accountant doesn’t come with the same prerequisite skill sets that a CPA comes with. Additionally, accountants are also not authorized to represent a business in front of the IRS.
When it comes to seeking financial advice, then too, it is more reliable to seek this advice from a CPA. Book keepers often take care of the routine tasks of interring all the data and making sure all the records are in place. Accountants then review this data and then use it prepare and analyze financial reports. However, more often than not, they do not offer financial advice, like the CPA can. In fact, a survey conducted by the American Institute of Certified Public Accountants (AICPA) showed that CPAs have actually proved to be some the most trusted advisors in the world of business. Additionally, CPAs, unlike accountants, are also considered fiduciaries of their clients, with the legal duty and power to act on their behalf, and in their best interest.
Despite all the perks of being a CPA, like most things that are great in life, that title does not come easy. The process of studying and preparing for the CPA exam is grueling and stressful. However, there are some ways in which the process can be made just a little bit easier.
The most important thing to do before you get started is to make sure you collect as much information about the exam as possible. This will help you organize your study schedule and keep on track. Secondly, many candidates have actually found it helpful to take on an accounting internship, during the busiest season of the year. Through this process, they were able to apply the skills they learnt in their books in real world scenarios, leading to a better understanding of the subject. Another method that has proved to help several candidates has been to find a study partner. Not only does this help bouncing ideas off each other and get help whenever needed, it also holds you accountable to another person, ensuring there’s no scope for slacking off.
While you may prepare yourself as much as possible and learn as much as possible, nothing will actually make you exam ready quite like practice will. To be able to give the CPA exam confidently, you would need to be familiar with all the different types of questions that are asked in the exam. Make sure to answer each and every question – whether it’s a book question, a practice question or a test question. It would also be helpful to take CPA and CIA review courses to make sure you’ve covered all grounds.
Lastly, never lose hope. In today’s world, where CPAs are some of the most valuable assets of any business, it’s always worth going that extra mile. Don’t lose hope if you don’t clear the exam in your first attempt. Put in that extra effort and be rest assured, it will most definitely pay off.
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