If you have strong mathematics skills, an analytical mind with good money management skills, this article on how to become an accountant is what you need to make a clear career decision.
People outside the accounting industry see accounting as an uneventful career, but it is one of the most fulfilling career - whether you are working in the private or public sector.
You need skills like analytical, interpretation and adaptability to communicate right financial information, set realistic targets and drive business growth. The accounting profession is so broad, even if you own the required attributes of an accountant, you'll still need to decide which area of accounting suits you and see the preferred qualifications of that specialization.
Who Is A Chartered Accountant?
A chartered accountant is an accounting professional who has studied thoroughly, successfully passed some of the most tasking examinations in the industry. They will have had at least five years of practical experience while working for accountancy firm and will also be a member of a professional accounting body.
As a chartered accountant, it is your fundamental duty to offer advice, audit accounts and give reliable information about the financial records of your employers. This could include financial reporting, taxation, auditing, forensic accounting, business recovery and insolvency, etc.
What Does A Chartered Accountant Do?
An accountant is a professional who specializes in various aspects of personal and business finances. Accounting involves measuring, communicating and managing financial information that helps investors, managers, business owners make good financial decisions. An accountant keeps record of business transactions, monitor and report periodically on a company's financial performance and prepare financial statements.
Accountancy professionals serve in four areas. These areas are taxation, financial accounting and reporting, applied finance, and management accounting. The specialization an accountant chooses determines the area he or she works. Chartered accountants can do many tasks, they can oversee a business’s entire accountancy needs. Their functions are specific, like being in charge of just one aspect of a business like auditing or taxes. Some of these extremely skilled accountants will go out on their own as freelancers or consultants for hire.
Some of the functions of a chartered accountant are:
- Prepare and issue invoices to customers.
- File tax reports to government for a company or person.
- Reconcile bank statements.
- Analyze profits and losses.
- Maintain and process payroll (salaries).
- Prepare and review budgets.
- Create and keep up financial databases for people and companies.
Types of accountants
While all accountants work with finances in some capacity, there are different types of accountants. The most common of them are:
An auditor is an accountant that performs audits and records reviews for an organization. All auditors are accountants but not all accountants are auditors. Auditor's tasks includes assessing and maintaining financial records, analyzing account books and records, verifying financial statements and recommending ideas for financial improvement. Companies outsource their auditing to another company specialized in auditing for objective and transparent auditing.
2. Forensic accountants
A forensic accountant studies and make sure financial records are correct. They may also be brought into a company to find any financial conflict, errors or fraud in most cases.
3. Government accountant
Government at all levels need accountants. A government accountant may work on federal, state or local level to analyze and use taxpayer money in the most efficient way. A government accountant aids the government in formulating a fiscal plan for each year. This type of accountant may also work for the Internal Revenue Service (IRS) and responsible for auditing government's accounts.
4. Management accountant
Management accountants helps business owners and managers make sound financial decisions for their business. A management accountant prepares budgets, analyze profitability, access risks and prepare external financial reports. An accountant prepares and communicates a company's financial statements in a way that the users can easily understand.
5. Cost accountant
A cost accountant is responsible for assisting a business improve their processes for more profitability. Cost accountants analyze all costs related to labor, production, shipping and other daily operations of an organization. Through this information, cost accountants then make recommendations to business owners on how they can cut costs.
Steps To Become A Chartered Accountant
1. Obtain A Bachelor's Degree
Although, not all accounting openings in some companies need a bachelor's degree, many do. Even if a particular accountant job does not need higher education, having a bachelor's degree can increase your chances of landing the job and potentially increase your annual salary. Some of the common degrees accountants pursue include accounting, finance, taxation and auditing.
2. Study The Right Accounting Professional Qualifications
The AAT qualification (accounting technician) is the least level expected of an accountant, but to become a chartered accountant (CA), one must progress to the ACCA, ACA or CIMA qualifications. Although many accountants will hold a university degree, it's often an advantage not essential.
So, while mathematics and economics at A-level with an accounting degree are important, if you didn't go down this focused route you'd still be able to get the qualifications you need - as professional bodies offer courses for students and workers at all levels. A variety of finance qualifications are available to those interested in accounting careers, which are confusing when searching for job opportunities.
To give you a good starting point, the most popular accountant qualifications include:
- AAT (Association of Accounting Technicians) accounting courses - made up of three qualifications across three levels, they combine industry knowledge and practical work skills.
- ACCA (Association of Chartered Certified Accountants) qualifications - they consist of two levels: Fundamentals and Professionals. The study modules cover a variety of topics from corporate and business law to audit and assurance.
- ICAEW (Institute of Chartered Accountants in England and Wales) chartered accountant status - also called the ACA, this qualification consists of three to five years of practical work experience and to complete 13 modules.
- CIMA (Chartered Institute of Management Accountants) business finance award - oversees the widely recognized CGMA (Chartered Global Management Accountant), which requires you to have already gained the postgraduate-level Certificate in Business Accounting.
Many accountancy firms will accept qualifications from any board, but if you have a definite career path in mind, it's worth taking a look into the preferred qualifications of that specialism.
For example, if you want to become a chartered accountant, you'll need to study for the ACCA qualification and have three years' work experience in a relevant role. It normally takes about a total of four years to become fully qualified.
You can become a chartered accountant without a degree, all you have to do is apply for the ACCA qualification with a combined GCSE and A-level or apply for ICAN ATS with your WAEC O'level result. However, by already having a degree or Masters in any subject, you will be exempted from some of the papers. You can enter the accounting profession without any formal academic qualifications and study at the foundation level.
3. Get An Intenship Or Entry-level Position
Getting enough experience before and after graduation can greatly boost your CV and increase your chances of securing an accounting job.
4. Choose Your Accounting Specialism
Accounting career is divided into two important areas: management accounting and financial accounting. Within these divisions are specialist fields such as budget and financial analysis, controller, etc. The difference between management accounting and financial accounting is that while management accounting gives information to people within a company, financial accounting provides information to those outside, example; shareholders.
Unlike financial accounting, management accounting is not required by law and only covers particular products, while financial accounting covers the organization. Most graduates will enter accounting via financial accountancy, which can offer a variety of career prospects such as:
- business recovery and insolvency
- corporate finance
- forensic accounting
For each accounting specialism, graduates have the choice to work in the public or private sector.
5. Get Relevant Accounting Work Experience
Another way to enter the accounting industry is via a work placement, voluntary or part-time role. Work-shadowing for a day can make you know the kinds of accounting activities to expect.
Formal summer accounting internships with larger accounting firms like PwC, KPMG or Deloitte, are very competitive for students, as they're usually subscribed beyond availability. Any experience in finance industry will boost your chances of securing a full-time job in an accounting role.
Frequently check websites of companies you'd like to work for to get updated with job vacancies. You can get employment by sending speculative job applications to local small medium-sized employers (SMEs) in the financial sector.
If you are still a student in the university, consider volunteering for treasurer of a club or society, or seek part-time job which will help you develop skills in this area.
Depending on the firm's size, you may get to work on real projects and manage your own workload as you get key accounting skills. Those engaging in work experience are trained and will get to make industry contacts that can help your future career.
As most employers will only support a trainee accountant in studying for their accounting qualifications if they've relevant work experience, this will be a valuable addition to your CV and aid you on your journey to becoming a qualified accountant.
Consider pursuing continuing education
Many successful professional accountants don't end their education after getting their degree and necessary certifications in accounting. Participating in continuing education is key to having a successful career and staying up-to-date with accounting trends. Opportunities available for accountants to further their education include more certifications and master's degrees.