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Perhaps the American Institute of Certified Public Accountants (AICPA) summarized it best in its newly issued pamphlet: "Accounting: The One Degree with 360 Degrees of Possibilities": "You may already have an idea about what you want to do for a career. Then again, maybe you're not so sure. Either way, there's one degree that gives you the education to succeed at just about anything in the business world. It's an accounting degree. Accounting opens doors in every kind of business coast to coast. It can give you the foundation you need to go on and become a CPA. It can prepare you to become a partner in an accounting firm, to pursue a career in finance or corporate management, to work in government, or even to become an entrepreneur. In fact, no matter what you decide to do, having an accounting background can open doors wide."

The reason accounting may be the best route to a successful business career is because accounting has always been considered as the language and basic tool of business. It has always concerned itself with determining how a business is doing and what is the bottom line. But over the last two decades, the field of accounting has been changing dramatically in response to such explosive trends as the computer revolution, increased government regulations, frequent tax law changes, the globalization of business, and the on-going downsizing and restructuring of corporations. In this increasingly complex and competitive business environment, accounting skills are very much in demand and accounting has become a dynamic career. Accountants have shed their stodgy image of green eyeshades and thick glasses to assume the more prestigious role of financial experts, system professionals, management consultants, budget analysts, etc.. The demand for accountants appears to be growing and outstripping supply. Job opportunities in today's business climate are better than ever for accountants.

These opportunities are particularly good for women. Women have generally done well in accounting. In the last decade and a half, the number of women entering the accounting profession has almost doubled. In 1977, females made up 28 percent of all graduating accounting majors. Recently, according to an AICPA survey, there were more female accounting graduates than males (52 vs. 48 percent) and the gender breakdown of new accounting graduates hired by public accounting firms was 54 percent male and 46 percent female. There are now two national societies for women accountants, the American Society of Women Accountants and the American Woman's Society of Certified Public Accountants.

Once you have decided that accounting is your major, the next step is to choose which career path you will pursue. The varied job opportunities opened to accountants may be summarized into three major areas: public accounting, private accounting, and government and not-for-profit accounting.

PUBLIC ACCOUNTING

Public accounting firms provide auditing, tax, accounting, and consulting services to businesses and individuals. These firms range in size from a single practitioner to large international firms with hundreds of offices worldwide and thousands of professionals. Accountants in these firms work with a variety of and companies and gain wide exposure and experience. At the same time, the job often involves pressure, travel, and seven-day workweeks.

A certified public accountant (CPA) is usually qualified to audit the traditional financial statements prepared by a company and render an opinion on the "firm presentation" and reasonableness of these financial statements. The independent auditor's opinion lends credibility to the company's financial statements and helps the users of these financial statements make their investment decisions. The auditor thus plays an important role in facilitating the smooth functioning of the investment process and the efficient allocation of resources in the economy.

To protect the public from individuals who are not qualified to express opinions on financial statements, all states impose strict licensing requirements for the practice of public accounting. A CPA license is required in most states to perform independent audits. The state boards of accountancy, which are the regulatory agencies for each state, set the requirements for licensing. To become a CPA and practice public accounting, there are generally four basic requirements:

1. Education: Applicants must provide evidence of a baccalaureate or higher degree, or foreign equivalency, in any subject, a total of 150-semester units, including a minimum of 24-semester units of accounting subjects, a minimum of 24-semester units of business-related subjects, a minimum of 20-semester units of accounting study, and 10-semester units of ethics study.
2. Passing the CPA examination: The CPA candidate must pass all four parts of a uniform CPA examination. The exam is developed by the AICPA and administered four times each year in all U.S. states and territories. The CPA exam is a computer-based test and consists of the following four parts:
   • Auditing and Attestation (4 Hours)
   • Regulation (4 Hours )
   • Financial Accounting and Reporting (4 Hours)
   • Business Environment & Concepts (4 Hours)

Experience. One year general experience which includes any type of service or advice involving the use of accounting, attest, compilation, management advisory, financial advisory, tax or consulting skills. For those wishing to sign attest reports, the experience shall include 500 hours of attest.
Satisfying state requirements for education and experience, successful candidates are awarded the CPA certificate by a state. A new CPA must then pay a fee to obtain a state license to practice. All states have reciprocity laws, allowing a CPA to move to another state to obtain a new license from that state without having to take the uniform CPA exam again.

CPA firms generally offer the following types of services: auditing, income taxes, accounting and review, and consulting services.

AUDITING

Auditing is the most important function of the certified public accountant. International CPA firms and many national CPA firms devote a large percentage of their time and resources to financial statement auditing. Auditing fees account for 45~0% of their total revenues.

ACCOUNTING AND REVIEW SERVICES

CPA firms, both large and small, perform a variety of accounting services for their clients. These services range from maintaining accounting records to performing compilation, which is preparing financial statements without providing any assurance on them. A form of limited assurance can be provided by a "review" which is more limited in scope than a full-blown financial statement audit.

TAXES

CPA firms perform many tax services for their individual and corporate clients, including preparation and review of tax returns, tax planning (the legitimate avoidance or deferral of taxes), and tax litigation (appearance before a court or an administrative body on behalf of their clients).

MANAGEMENT SERVICES

The fastest-growing area for CPA firms is management consulting services, which was formally known as management advisory services. These services can cover such wide-ranging fields as computer systems, management information systems, marketing, executive recruiting, personal financial planning, and budgeting techniques, etc..

INCOME TAX PLANNING AND PREPARATION

Specializing in income tax preparation and planning is a very viable career path since taxation has such a pervasive effect on business decisions and on all aspects of our personal as well as professional life. If you want to work in the area of taxation, you may want to earn the E. A. (Enrolled Agent) designation or the master's in taxation.

An enrolled agent is a person who is qualified to prepare tax returns for a fee and can represent his/her client before the IRS for any audit, conference, hearings, and meetings (attorneys and CPAs are automatically eligible to practice before the IRS). There is no education requirement to take the E. A. Exam. The exam is open to anyone possessing knowledge about the income tax laws and code. It is administered yearly by the IRS and is given over two days in September or October. It includes true-false and multiple-choice questions and consists of three parts covering the following tax areas:

Individuals
Businesses
Representation, Practices, and Procedures

To learn more about the exam, obtain Publication 1470 "Package For The Special Enrollment Examination" from the IRS District Office nearest you or by contacting the IRS Office of Director of Practice in Washington D.C. at (202) 535~809. Besides background material for the exam, this publication includes Form 2587 "Application For Special Enrollment Examination" and Form 41 90A "Special Enrollment Exam Study Material Request and Mailing Label."

Once a candidate has successfully passed the exam, he/she has one year to apply for the E. A. designation which allows them to practice before the IRS. E.As must earn 72 hours of continuing professional education (CPE) every three years.

THE MASTER OF TAXATION DEGREE

Another degree that tax accountants should consider earning is the Master of Business in Taxation (MBT). The master of taxation is a valuable graduate degree combining both theoretical and practical knowledge of taxation. Because of its in-depth coverage of taxation, it is highly valued by employers.

THE J. D. AND LL .M. DEGREES IN TAXATION

For those accountants with an interest in the legal aspects of income tax law, earning a post-graduate J. D. (Juris Doctor) degree or LL .M. (Master of Laws) degree in Taxation from a law school is highly recommended since they can then practice as tax attorneys and command higher fees or compensation.

FURTHER SPECIALIZATION

There is a trend in public accounting toward specialization, both by industry and by function. The future of the following specialties in accounting looks particularly promising:

Personal financial planning: recommending investment strategies for wealth building, planning for college, retirement, estate planning, etc..
Forensic accounting: specializing in fraud detection and prevention.
Litigation support: providing expert testimony for civil and criminal disputes
Environmental accounting: analyzing the business aspects of environmental issues, such as assessing the damage after ecological accidents, determining the price of pollution, reporting the cost of corporate compliance with government regulations, quantifying the value of natural resources, etc..

Since being a CPA is an important credential for career advancement, and to be certified you must have audit experience with a CPA firm, many accounting graduates will most likely look for employment with a CPA firm. The question then is which type of firm is best to start with: large CPA firms such as the "Big Four" ( Deloitte & Touche LLP, Ernst & Young LLP, KPMG LLP, and Price Waterhouse Coopers LLP) and other well-known national firms, or a small to the medium-sized local firm?

Conventional wisdom holds that at the start of your career you need the training, exposure, and prestige that large firms can give you. However, the disadvantage is that in the more structured environment of the large firms, you are faced with greater competitive pressure, also you run the risk of being stifled and/or being pigeonholed into a certain industry or area of audit.

The advantage of working in small firms is that you can learn more in a shorter period of time, and have the opportunity to see much sooner how the entire financial statement package fits together. It is, however, more difficult to generalize about the kind of training you will get and the kind of work you will do in small firms. In the end, what really matters is not so much the size of the firm, but the quality of the firm and your relationship with your immediate colleagues and the professionals you will work with.

If an accounting graduate does not want to go into public accounting, he can go into management and private industry accounting. Unlike public accounting, private industry accounting has no rigid minimum requirement. In private industry accounting, you work for one company and gain in-depth knowledge and experience in accounting for that company. You prepare the financial information necessary to help management plan and control company activities. Thus, besides preparing financial statements for external reporting, you will also be working on many internal accounting reports, such as budgets and cost analyses, for the use of management.

WIDE VARIETY OF CAREER PATHS

In the private industry, your career path can take you from an accounting or management trainee to the top position in accounting and finance in a company. Accounting background and experience is highly appreciated in the top echelons of industry, and many CEO's and Presidents come from the accounting and finance department.

Another possible career path is to become an internal auditor for a company. The internal auditor works for the company and conducts an independent appraisal of the various departments and/or subsidiaries of the company to promote the efficiency of operations and adherence to management's policies. Many companies use their internal audit department as a training ground for future executives. After a two-year stint in the internal audit department, the internal auditor has acquired valuable insight into the organization and operation of the company and is ready to move into higher management.

THE CMA

The Certificate in Management Accounting (CMA) is not required to work as a management accountant, however, it is an important credential for management accountants to have. This designation was first established in 1972 to recognize the special needs of management accountants. The CMA exam is sponsored by the Institute of Management Accountants (IMA) and is given twice yearly in June and December. In some ways, this exam may be more difficult than the CPA exam because it covers a broader range of areas, among them economics, statistics, banking, and finance. The two parts of the exam are as follows:

Financial Reporting, Planning, Performance, and Control (4 hours - 100 multiple-choice questions and two 30-minute essay questions)
Financial Decision Making (4 hours - 100 multiple-choice questions and two 30-minute essay questions)

To obtain an application and registration forms for the CMA exam, write to:
The Institute of Management Accountants 
10 Paragon Drive 
Montvale, New Jersey 07645-0405 
Tel. (201) 573-6300

THE CIA

The professional designation for an internal auditor is the Certified Internal Auditor (CIA). This title was created in 1974 by the Institute of Internal Auditors. The CIA exam lasts 6.5 hours and covers the following areas:

Internal Audit Basics (2.5 hours - 125 questions)
Internal Audit Practice (2 hours - 100 questions)
Internal Audit Knowledge Elements (2 hours - 100 questions)

To obtain registration and application forms for the CIA examination, write to:
The Institute of Internal Auditors, Inc. 
Certification Division 249 
Maitland Avenue P.O.Box lll9 
Altamonte Springs, FL 32701 Tel. (407) 830-7600

The goal of the accounting department in a typical government agency is to function within the budgetary constraints mandated by the legislature. Government accountants also monitor the appropriation of funds and awarding of contracts to private agencies that must follow governmental regulations.

FEDERAL, STATE, AND LOCAL GOVERNMENT AGENCIES

More than 100,000 accountants in the U.S. work for the government in federal government agencies such as the General Accounting Office, the Internal Revenue Service, the Security and Exchange Commission, the Defense Contract Audit Agency, etc.. Many others work in state government agencies such as the Franchise Tax Board, the Board of Equalization, the Employment Development Department, etc...At the municipal level, there are also many job opportunities for accountants. These government jobs often offer high or at least competitive starting salaries, good fringes benefits, and better job security. Also, there is not the same degree of pressure on the job, making it easier to combine job and family demands. However, the disadvantage with government jobs is that it is often difficult to move back later on to public accounting or private industry.

NOT-FOR-PROFIT ORGANIZATIONS

Not-for-profit organizations are not organized to realize a profit on the goods or services they provide as their basic activity. Instead, they exist to provide goods or services considered socially desirable by and for the general public, a community, or its members. There are about 1.2 million tax-exempt organizations in the U.S. today and they cover the gamut of civic, religious, social, professional, scientific organizations, hospitals, schools, colleges, universities, and voluntary health and welfare organizations, etc...They range in size from local agencies to large organizations of national or international scope.

CAREER PATHS IN GOVERNMENTAL AND NOT-FOR-PROFIT ORGANIZATIONS

Governmental and not-for-profit organizations tend to have specialized accounting and reporting practices, often differing from those of profit-oriented enterprises. Accountants working in these organizations should be familiar with the peculiarities of not-for-profit accounting and the independent auditors should be knowledgeable in the special auditing standards applicable to not-for-profit organizations.