Pay & Salary

How Much Do Accountants Make?

March 9, 2021

Accountants lead challenging and financially rewarding careers. Earning additional certifications leads to even more lucrative ventures such as the career of a CPA. With combined knowledge and experience, accountants with this specialty earn more on average but also require greater skills and education.

In this article, we discuss what accountants and CPAs are and how much they earn per year.

What is an accountant?

Accountants record transactions for both individuals and businesses. They also perform audits such as analyzing transactions and reporting discrepancies to their employers. Additionally, accountants issue multiple types of reports such as financial statements, management reports and tax reports. With their advanced knowledge in finance, accountants advise on business structure, record sales, manage invoices and inform on changes within tax law.

Related: Learn About Being an Accountant

What is a certified public accountant?

Certified public accountants are a type of accountant with special training in taxes. In the U.S., CPAs are certified by their individual states and prepare and sign tax returns for both individuals and businesses. During an audit by the IRS, CPAs represent their employers. They also offer consulting services, addressing employer concerns and offering objective advice in financial and strategic planning.

Related: 16 Accounting Jobs That Pay Well

Average salary for accountants

Some accountants work full-time jobs while others remain strictly freelance. There's a substantial difference in pay depending on which route an individual takes. Experience and location also play a significant role in overall salary.

Average salary for CPAs

Requiring particular expertise and additional training, CPAs often earn higher salaries than general accountants. Their knowledge and skills are useful and in-demand in crucial areas such as defending against the IRS. Similar to general accountants, CPA salaries vary depending on experience and location.

Requirements for accountants

Becoming an accountant requires a significant level of education and skill. Not only do the best candidates have a fundamental understanding of business, but they also have thorough training in the practice of accounting procedures. The following areas describe in more detail each of the main requirements for accounting:

  • Education
  • Training
  • Skills
  • Certification

Education

Although not always required, many attend college and earn either an associate or bachelor's degree in accounting, business management or a related field. Students learn the basic fundamentals of business and business law along with the general practices and procedures related to accounting. In rare circumstances, some employers prefer graduate degrees in accounting.

Training

Toward the end of a college career, students become eligible for accounting internships. Most internships last around three months with hours dependent upon the season. For example, internships require full-time hours during the summer while fall and spring internships are often part-time, allowing students to schedule their classes accordingly. Other forms of training come with entry-level positions as new accountants learn the most valuable information while on the job.

Skills

Along with the skill of bookkeeping, accountants require a wide array of other skills that further help with the role. These skills include:

  • Strong written and oral communication skills for effectively advising employers on financial issues
  • High attention to detail, spotting problems in financial statements
  • Time-management skills as the role often involves filling out invoices and other forms in a timely manner
  • Mathematic skills for basic addition, subtraction, multiplication and division in bookkeeping
  • Clerical knowledge as some roles include the use of phones or other front desk operations

Certification

There are many certification opportunities for accountants, allowing them to specialize in specific areas. Some of the most popular certifications are:

  • Chartered Financial Analysts (CFA) specializes in investments. They're finance professionals who work on Wall Street or for investment funds. The CFA Institute issues exams for this certification.
  • Certified Management Accountants (CMA) specialize in internal management and often move into executive roles. Management accountants are very different from other types of accountants as they strictly focus on management and management principles. The Institute of Management Accountants issues exams for this certification.
  • Certified Public Accountants (CPA) are one of the largest growing accounting specialties in the U.S and abroad. CPAs write audit reports and focus particularly on tax-related issues. Becoming a CPA requires meeting standards set forth by individual states as well as passing all four sections of the exam issued by the American Institute of Certified Public Accountants (AICPA).

Related: 6 Essential Accounting Skills

Requirements for CPAs

As a specialty of accounting, CPAs have more specific requirements for fulfilling the role. The following areas describe in more detail each of the main requirements for CPAs:

  • Education
  • Training
  • Skills
  • Certification

Education

As a prerequisite to the exam, accountants must have a bachelor's degree at minimum. Recommended subject areas include accounting, business, business law, economics or related field. Minoring in accounting also helps if the primary major is a broader subject.

Training

Training for CPAs involves some of the same activities regular accountants undergo. Internships in accounting are beneficial as well as on-the-job training. Researching tax fundamentals and specific tax processes may also benefit those becoming CPAs.

Skills

The skills required for CPAs are the same as those for regular accountants. However, there are a handful of particular skills that come useful. The following list outlines some of these skills:

  • Public speaking skills grant CPAs the ability to communicate advanced terminology to the general public or involved parties
  • Advanced tax knowledge and preparation skills benefit many aspects of the role of a CPA as their primary duty involves taxes
  • Auditing skills help CPAs identify problem areas in business accounting
  • Advanced computer skills allow CPAs to use sophisticated technology in their work such as spreadsheet and bookkeeping software and some coding knowledge such as SQL

Certification

The primary certification for CPAs is the public accountant certification. It's a mandatory component in becoming a CPA and candidates earn it through an exam supplied by the AICPA. Additionally, earning a Certified Information Technology Professional (CITP) certification from the AICPA gives candidates further technical knowledge. As mentioned previously, some roles require advanced computer skills including some programming languages.

Related

View More 

How To Become a Transpersonal Psychologist in 5 Steps

Learn about the academic and career field of transpersonal psychology, and discover what steps you can take to enter this relatively new profession.

FAQ: How Much Does a Screenwriter Make? (WIth SKills and Duties)

Explore answers to frequently asked questions about screenwriting careers, including how much a screenwriter makes and what these professionals do.