An overview of accounting professions
Accountants generally work with a company’s finances. Some focus on tasks like payroll or payment from customers, while others handle taxes and auditing. Most accounting professions require at least a bachelor’s degree while others need a master’s degree or the Certified Public Accountant, or CPA, designation. Understanding what each type of accountant does can help you decide which type of accountant you need for your business.
Key roles, skills and duties
While the day-to-day responsibilities of an accountant will depend on the specifics of their field, some duties and skills are universal for all accountants.
Many accountants perform these duties:
- Managing financial records
- Evaluating processes and procedures
- Calculating and preparing taxes
- Analyzing the company’s money usage
- Maintaining legal financial standards
- Auditing expenses
These skills are necessary for accountants:
- Understanding mathematics
- Performing analysis
- Providing clear communication
- Maintaining organization
- Being attentive to details
- Demonstrating thorough work
Types of accountants
The type of accountant or accountants that will benefit your company depends on your industry and company size. Here are some of the most common types of accountants.
- Accountant: Accountants can work for an accounting company and take your business on as a client, or you can hire an in-house accountant. These professionals handle financial records and might also prepare taxes and payroll. General accountants can handle a variety of responsibilities depending on the needs of your business.
- Accounting clerk: Accounting clerks, also called bookkeepers, generally work under accountants. They handle duties like data entry and organization that may not require as much education or skill as an accountant. They can be useful for large companies that need more than one person to maintain financial information.
- Auditor: Auditors are usually employed by an outside firm and review a company’s financial documents, such as payroll, tax forms and investment information, for accuracy and legality.
- Chief Financial Officer (CFO): CFOs usually manage an entire accounting department. They are most common in large organizations that have many executives. CFOs are responsible for financial forecasting, advising other executives on financial opportunities and managing a team of accountants.
- Controller: Controllers are usually in-house accountants who manage a variety of accounting responsibilities. They may manage a team or work on their own. Controllers can work for large or small companies.
- Financial analyst: Financial analysts are usually third party accountants who assess a company’s viability as an asset or investment. They will review a company’s financial documents to see how much money they make and determine the value of the company and the risks and benefits of investing.
- Payroll manager: Payroll managers handle all aspects of a company’s payroll. They will track employee work hours, assess deductions for unpaid time off or add money for commissions or bonuses. They may also participate in hiring and training new employees. They are usually in-house employees.
- Forensic accountant: Forensic accountants review a company’s financial records in cases of fraud. They will reconstruct spending or other financial activities to determine the legality of certain activities. Forensic accountants are almost always third party accountants and do not work for individual companies.
- Tax accountant: Tax accountants are usually third party accountants that companies hire to manage their taxes. They specialize in tax law and preparation. They often work with a variety of clients and are only hired during tax time.
- Finance manager: Finance managers assess the company’s financial goals and develop strategies to meet them. They can work in-house or be hired in for a short term project depending on the company’s needs.
- Accounts payable: Accounts payable accountants manage all the money a company spends. Usually, this includes things like payroll, invoices to others and general company expenses. They are almost always in-house employees.
- Accounts receivable: Accounts receivable accountants manage all company income. Primarily, the income in question is payment from customers for products or services. They may also issue invoices to customers and follow up on missing payments. Accounts receivable accountants are almost always in-house employees.
Here are some of the most common frequently asked questions about accounting.
How much should I pay our accountant?
Accountant salaries depend on factors like education, experience and job duties. For example, if your company hires a bookkeeper with a high school diploma to manage a small company’s payroll, they will receive a smaller salary than the CFO of a major corporation.
Does my company need an accountant?
Most companies will benefit from hiring an accountant either in-house or contracting one for specific projects through a private accounting firm. Handling financial tasks like payroll, accounts receivable, accounts payable, financial documents and tax preparation can be a full-time job. Review your company’s financial goals and current financial responsibilities to determine what type of accountant might best benefit your business.
Should I use more than one accountant?
Some companies may only need a single accountant to handle all the financial responsibilities of the business. Other companies may require several accountants to manage different types of accounting such as financial planning, payroll and tax preparation. Consider the size of your company and your current financial responsibilities to see if you need more than one accountant and the types of accountants you will most benefit from hiring.