Accounting Major Tips
Accounting is the process that allows business to operate; it's no exaggeration to say that people with an accounting major are the backbone of the business world. Through accounting a company is able to track and record expenses and financial transactions. This discipline helps to identify profits and loss for the firm. It is one of the oldest professions in the world, with documented primitive ways used to record trading and transactions. Today accounting practices have become more advanced and complex, and the means to record the information have become more technological. Just as in the past, the world relies on accounting to determine trade deficits and balances. A common global set of rules, such as IFRS or International Financial Reporting Standards, is being discussed, which will help companies compete for business around the world.
An accounting major offers many other career opportunities in auditing, financial and tax management, and management accounting. Corporations of all sizes need accounting professionals to help with financial planning, treasury, tax issues, and financial statements.
This field is becoming increasingly computerized, with new job opportunities for people with technical skills. Technology in the field of accounting has played a bigger role in recent years, and many career opportunities have materialized for the accounting graduate.
The government is another entity that hires a large number of accountants, with jobs at the Internal Revenue Service and General Accounting Office. Certain sectors of the economy, such as energy services, medical devices, education, and hospital administration have grown rapidly and as a result added more accountant jobs to the rolls.
A career in accounting requires:
- Strong analytical and computer skills
- A high aptitude in math
- The ability to synthesize data
- Strong communication and people skills
Responsibilities are diverse, depending on the firm you work for. Many entry-level jobs begin in auditing, which allows the graduate to learn a lot about the finances of a company. Recent changes in tax laws and audit requirements have led to an expansion in this field.
The accounting major can establish his or her own private practice and make money through consulting or managing the affairs of smaller firms. This is a growing area, as consultants are relied upon to bring new ideas to a company and challenge existing practices.
A substantial amount of money can be made in the profession, with top partners making several million dollars a year. In the past few years, larger firms have not added as many new jobs as smaller firms, because of fear of exposure and liability issues. However, overall, the accounting profession will remain strong in years to come and will continue to change with global and technological demands.
Accounting Major Specializations
The college accounting major is probably most familiar with the career of auditing because it is the profession most talked about. Auditors are responsible for analyzing organizations’ internal controls to make sure that correct processes are being followed. Larger organizations, such as banks and pharmaceuticals, have strict federal guidelines on how they should legally operate. An internal auditor to the company is responsible for ensuring that all required processes are followed. Most regulated industries also employ external auditors, independent workers outside the company, to assess whether the company is compliant with set standards.
- Governmental Accounting
Accounting majors looking for a job at the federal, state, or local level might consider governmental accounting. There are many advantages to working for the government, including job security and career growth. Two large government agencies that actively seek accountants are the Internal Revenue Service and the Federal Reserve Bank. Accountants who work for the IRS or Fed are responsible for making sure that businesses are spending money appropriately and legally. Employees at these firms are involved in analyzing finances and budgets.
- Certified Financial Accountant
For accounting majors interested in working with investments, the CFA or Certified Financial Accountant designation can be a way to advance their career and gain respect in the industry. The CFA Exam is difficult, with an average pass rate of 39 percent as of 2010; however, once attaining certification, the professional will easily find a job in a major institutional investment firm, bank, or government agency. This certification is a global standard and focuses on investments, ethics, and financial accounting. Four years’ relevant work experience is required before taking the test, which is a three-part exam.
- Certified Public Accountant
At some point during his or her career, an accounting major might decide to become a CPA or Certified Public Accountant. The CPA is a highly respected global credential. The designation is followed by a rigorous exam offered by AICPA. There are annual continuing education requirements to remain certified. A CPA might work independently or for an accounting firm, providing services such as tax consulting and auditing.
- Certified Management Accountant
Another highly regarded certification that the accounting major might consider is the CMA or Certified Management Accountant. These specialists are usually more involved in working with upper management at firms to help with strategic planning. The CMA might be asked to evaluate budgets and expenditures as they relate to increasing profits for a firm.
Taxation is a specialized field requiring the accounting major to take classes in law. Tax law changes every year and is complex, varying by state, country, and government. The main goal of taxes is to raise money for the government, although many times the money is used to support social, economic, and political goals. The taxation expert might represent the government by levying a tax on individuals, businesses, or other entities to recoup its money or might assist taxpayers during an audit. Many an accounting major goes to work for the IRS or for tax law firms.