Going Back to School for Accounting
The numbers are significant: 7.6 million students over age 25 will be returning to colleges and universities in 2018-2019, according to the National Center for Education Statistics (NCES). As the demand by Certified Public Accounting (CPA) firms for qualified individuals has increased in the past few years, more professionals are pursuing accounting degrees, according to the Association of International Certified Professional Accountants (AICPA). Whether professionals are making career changes or striving to build their resumes, going back to school for accounting can be a smart decision to help increase job opportunities and future earnings.
What Is Accounting?
Accounting is a critical function of any business. The process of accounting examines various financial statements such as balance sheets or cash flow statements to determine the financial health of an organization. Accountants collect and analyze financial documents to create reports that look at the financial success of a company in a given period.
Accountants use standards known as the Generally Accepted Accounting Principles (GAAP). The objective is to ensure that all financial transactions are recorded correctly and to specific tax and regulatory laws. As well as GAAP, many publicly traded companies have adopted the International Financial Reporting Standards (IFRS). These provide additional guidelines as to how companies should prepare and report financial statements.
Types of Accounting Degrees
Many professionals begin their accounting careers after earning a bachelor’s degree in accounting. Degrees in finance, economics, or business administration can also help graduates land positions such as junior-level accountants or auditors. However, professionals who are going back to school for accounting may find pursuing a master’s degree in accountancy to be beneficial to career advancement.
There are options for those who are pursuing an accounting education. For example, students without an accounting background can follow a general track to build a strong foundation of accounting skills before re-entering the workforce. Also, previous accounting professionals with experience can follow an advanced track to continue developing their professional knowledge.
Accounting and Finance Skills
Employers typically look for the following critical accounting and finance skills:
- Analytical decision making: Business leaders will often look to accountants to offer additional insight about financial reports. Accounting professionals must be able to understand and analyze large volumes of data to provide the most useful information to help leaders make well-informed decisions.
- Math comprehension: Math is the foundation upon which accounting is built. While complex mathematical equations can be part of an accountant’s daily routine, knowing how to use spreadsheets and other mathematical software will help accountants calculate results quickly.
- Attention to detail: Reports and financial statements must be accurate because errors can materially impact how a business operates. Accountants must diligently examine their work, identifying and correcting any errors before work is submitted to supervisors.
- Ability to stay organized: Most financial reporting is accomplished on a monthly, quarterly, or yearly basis. During these times, accounting professionals must ensure they are especially organized to provide reports within specified timelines.
- Effective communication: Accountants must clearly articulate their findings involving budgets, reports, and beyond to supervisors and leaders. Accountants may also be tasked with gathering additional information from colleagues and must carefully listen to a variety facts and findings before making decisions.
Potential Accounting Careers
While many graduates begin their careers as accountants, students who are going back to school for accounting may discover several other opportunities for jobs and career advancement.
- Certified Public Accountant
To work in a public company and provide trusted accounting advice, professionals must become CPAs. Each CPA meets a minimum number of completed post-secondary work hours and years of experience, and must also pass a four-part exam to become certified. An accountant must then obtain a license to practice in their state. The average salary for CPAs is $119,000, according to the Journal of Accountancy, although entry-level CPAs may start at $66,000 per year. The U.S. Bureau of Labor Statistics (BLS) projects that accountant and auditor positions will increase by 10 percent from 2016 to 2026.
- Financial Manager
Financial managers prepare financial reports and analyze data to provide insight for senior managers to make the best business and financial decisions. Financial managers may also be responsible for a team of employees who produce these reports. According to the BLS, employment of financial managers is expected to grow 19 percent from 2016 to 2026, compared to 7 percent for all other occupations. The median wage for financial managers is $125,080, although this can vary by industry.
- Budget Analyst
Budget analysts are responsible for the budgeting aspects of an organization. They work with business managers to create project and departmental budgets, aggregating these various reports to form an organization’s overall budget. The BLS reports that budget analysts earn a median wage of $75,240, although this can vary by industry. The projected employment of budget analysts is expected to grow by 7 percent from 2016 to 2026, expanding as fast as the national average for all jobs.
- Director of Accounting
The director of accounting is responsible for creating and implementing a company’s accounting policies and procedures, ensuring that all systems support the organization’s financial and reporting requirements. According to the compensation and employment authority PayScale, the median salary for a director is $98,427, although a director with less than five years of experience may start closer to $74,000. Also, most directors have a CPA certification. The BLS projects an 8 percent growth in employment in management positions from 2016 to 2026.
- Chief Financial Officer (CFO)
The CFO oversees the entire financial operations of an organization to ensure that the business is operating efficiently. As a top company executive, CFOs earn a median salary of $128,468 per year, according to PayScale. The BLS is projecting the demand for chief executives to decline by 4 percent from 2016 to 2026, as current companies mature and the growth of new companies slows.
Businesses, for the most part, are built on a foundation of numbers. It follows then, that professionals who are going back to school for accounting are likely to be well positioned — whether as an accountant or in senior management — to provide data-based decisions to help companies thrive.
Find out more about how Ohio University’s online Master of Accountancy program works to prepare students for success as financial professionals.