Accountants are most well-known for one thing: number-crunching. Whether they’re the “evil-money-grabbing-monsters” of the Internal Revenue Service, or the bookish accountant auditing your uncle and his shoebox of receipts, accountants and numbers are inseparable. Yet, accountants do more than just number crunch (I know, that may be hard to believe) and they are an important part of the business world. In fact without accountants, the collective business world would probably fall apart.
The stereotype about accounting is that it’s all about math—accountants are really, really good at math (in fact, if you tell people that you’re an accounting major, they’ll probably say something like, “Oh you must be good at math. You must really like math.”). Yes, there is a math component to accounting. But at its core, accounting is more about organization than math. It’s about problem-solving, and it’s about developing relationships that matter. Accounting is about giving people knowledge to make the best decisions for their business.
An accountant in a company has many roles. If cash is the lifeblood of a company, then accountants have a role in determining what a company does with it and how it’s managed. Accountants are typically involved in the back-end of a business. This means that in a company they are responsible for maintaining the books of a company, preparing accurate financial records and ensures that a company follows correct accounting principles and regulations. Accountants are also responsible for calculating the taxes a company may owe, preparing tax returns and making recommendations on how a company can reduce its costs and boost its profits.
On the outside of a company, accountants participate in audits, ensuring that funds and inventory are supposed to be, or they might be involved in developing systems of security and control to prevent fraud. They are involved in consulting, performing forensic investigations, and even arguing the finer points of tax law in the legal system. In short, if there is money involved, an accountant has a part in it.
The Four Types of Accounting
There are four main types of accounting: public, management, government, and internal auditing. Within each of these fields are a HUGE variety of specialties and functions.
- Public accounting is the largest field and consists of accounting service lines like taxes, auditing, accounting consulting for companies and individuals. The Big Four (PWC, EY, KPMG, and Deloitte) are the largest public accounting firms.
- Management accounting is concerned with analyzing a company’s financial information and helping management make decisions in planning, budgeting, and reducing costs.
- Government accounting is a tool of maintaining the checks and balances of the government and ensuring that government organizations, businesses, and individuals working with state, local, and federal governments are in compliance with regulation.
- Because of the very public financial misdeeds and fraudulent activities of a handful of rotten people, the field of auditing has grown considerably. Internal auditing looks at the operations of a firm in an attempt to root out any financial misconduct.
The question should really be what can’t you do with an accounting degree? An accounting degree opens doors everywhere in the business world. Even having a background in accounting can give you an edge in hireability. It shows that you have a foundation in the numbers side of the business and that you are fluent in the basic language of business.
So what does an accountant actually do? Well, it depends. Odds are if you’re a functioning member of the business world, you’re going to need the services of an accountant at some point. Whether it’s to help with your personal taxes (even an accountant needs the services of an accountant), or to consult on important business decisions, accounting is a growing field with lots of opportunities. An accounting degree leads to a wide variety of career paths. Here are some of the many careers you may be interested in as an accountant.
- Tax Accountant – With the only two constant things in this world being death and taxes, a career in tax accounting is an extremely stable job. Tax accountants are an important part of the business environment because everyone wants to pay less taxes. Tax accountants can be found in public and private firms preparing tax returns for individuals, corporations, and partnerships alike.
- Auditor—An auditor is responsible for examining financial records and determining whether or not there are any significant misstatements that could potentially conceal fraud and other problems. Auditors can conduct internal audits (from inside a company, with the company’s audit employees) or external audits (from an outside firm). Some auditors even audit government functions as part of federal, municipal, and state oversight.
- Accounting Consultant—Accounting consultants help with financial forecasting, determining the profitability of a business, and developing a strategy to help a company save money and adopt the right accounting practices that will ensure that a company continues being profitable.
- Forensic Investigator— Part accountant, part detective, forensic investigators are at the forefront of combatting white-collar fraud and financial crimes. Forensic investigators are called in when there is a suspicion of fraud. These skilled individuals are basically the financial police, a group of investigators that know how to find fraud and the people responsible for it.
- Actuary—What are the odds that something bad will happen? An actuary is someone that analyzes statistics and probabilities in order to determine insurance risks and premiums. Actuaries help companies determine the risks and consequences of a business decision and help provide solutions that can be used to safeguard against disaster.
- Controller—A controller in a company is responsible for the financial statements, general ledgers, payroll, accounts payable, accounts receivables, budgeting, forecasting, and tax compliance. What this means is that controllers are a hugely important part of a business.
- Chief Financial Officer—a Chief Financial Officer is responsible for managing the financial risks of a corporation and helps to weigh the financial impact of decisions. They oversee the financial activities of an entire company, manage the cash flow, and are basically the one in charge of the money in a company. Big job!
- Financial Analyst—financial analysts tend to focus on the big picture of financial decisions, reviewing data on market trends, business objectives, and investment options. Analysts are focused on what a company may do in the future.
- Accounting Information Systems—In today’s business world almost all transactions are done electronically. Because of this, it’s become increasingly important for companies to have strong security and controls on their databases and information systems.
These are just some of the many jobs available out there for accountants. Even if you don’t see something that really sparks your interest, don’t give up. An accounting skill is very valuable in the business environment. There are literally thousands of different accounting positions out there for individuals with the right skills that help people solve problems, and make the right decisions.