Accounting: Skills and Talents

Accounting offers superb career opportunities in many different contexts. The field is normally divided into three broad areas: auditing, financial/tax and management accounting.

Accounting is very team-oriented.

You will usually start as a junior member of a team responsible for auditing an important account or preparing financial statements. It is important then that you enjoy working as part of a team and that you learn to do so in your education.

You've Got to Surf Waves of Innovation

The field of accounting has seen constant technological and intellectual innovation in recent decades. Firms are implementing new electronic systems for submitting and preparing financial statements. And ways of tracking costs have improved with the introduction of techniques such as activitity-based costing.

Cultivate Your Network

It's important to have a good network of business contacts in consulting as you progress. New business development becomes part of your job. As your classmates rise in their respective business areas it is important to stay in touch with them as they may become your future customers.

Accounting: Job Options

Audit

Work in audit involves checking accounting ledgers and financial statements within corporations and government. This work is becoming increasingly computerized and can rely on sophisticated random sampling methods. Audit is the bread and butter work of accounting. This work can involve significant travel and allows you to really understand how money is being made in the company that you are analyzing. It's great background!

Budget Analysis

Budget analysts are responsible for developing and managing an organizations financial plans. There are plentiful jobs in this area in government and private industry. Besides quantitative skills many budget analyst jobs require good people skills because of negotiations involved in the work.

Financial

Financial accountants prepare financial statements based on general ledgers and participate in important financial decisions involving mergers & acquisitions, benefits/ERISA planning and long-term financial projections. The work can be varied over time. One day you may be running spreadsheets. The next day you may be visiting a customer or supplier to set up a new account and discuss business. This work requires a good understanding of both accounting and finance.

Management Accounting

Management accountants work in companies and participate in decisions about capital budgeting and line of business analysis. Major functions include cost analysis, analysis of new contracts and participation in efforts to control expenses efficiently. This work often involves the analysis of the structure of organizations. Is responsibility to spend money in a company at the right level of our organization? Are goals and objectives to control costs being communicated effectively? Historically, many management accountants have been derided as "bean counters". This mentality has undergone major change as managemnet accountants now often work side by side with marketing and finance to develop new business.

Tax

Tax accountants prepare corporate and personal income tax statements and formulate tax strategies involving issues such as financial choice, how to best treat a merger or acquisition, deferral of taxes, when to expense items and the like. This work requires a thorough understanding of economics and the tax code. Increasingly, large corporations are looking for persons with both an accounting and a legal background in tax. A person, for example, with a JD and an CPA would be especially desirable to many firms.

Places Where Accountants Work

Public Accounting Firms

Public Accountants work in partnerships which provide accounting services to individuals, businesses and governments. The largest, high-profile public accounting firms are known as the Bix Six and dominate the field of accounting. This field offers advancement potential to audit manager, tax manager or partner reached by only two to three percent of new hires.

Government

Government accountants may work at the local/state level or the federal level and administer and formulate budgets, track costs and analyze programs. This work can have high impact on the public good but can also get political and is subject to bureaucratic obstruction. Government accounting offers advancement in most organizations to controller and possibly to higher administrative positions. Places which hire heavily at the federal level include the Department of Defense, the General Accounting Office and the Internal Revenue Service.

Corporations

Corporations big and small typically have an accounting group which prepares financial statements, tracks costs, handles tax issues, works on international transactions. The work is exciting and offers tracks to audit manager, tax manager, cost accounting manager and controller on the accounting side or to manager of financial planning and analysis and Treasurer on the finance side.

Solo

A time-honored form of employment is to become a CPA and hang out your own shingle. This form of work requires you to generate your own business, but has the benefits of offering close customer contact, a high degree of independence and, depending on how good you are, high financial rewards. This work can be risky but puts you in the midst of community affairs.

Accounting: Salaries

The median entry level salary in public accounting in 1999 was $29,000. After four years you can expect to make something approximating $40,000 to $55,000. Salaries are usually similar in the private sector and slightly lower in government. They tend to higher in major cities.

Accounting: Facts and Trends

Future is Bright

The future of accounting is bright according to the Bureau of Labor Statistics which projects a 34% increase in job openings by the year 2005. Much of this reflects the increasing complexity of corporate transactions and growth in government. Demand is especially high in the tax and health care areas.

Managerial Accounting Ideas Taking Off

An important new way of thinking about accounting in the 1980s was activity-based costing. Now firms are focusing on activity-based management, process-view analysis, constraint checking and business process analysis as well. The world of management accounting is evolving rapidly and there is high demand for accountants who are knowledgeable about these trends.

Image of Accountants Improving

Accountants are working on their image. The AICPA announced a $3 million campaign to spread the word about how CPA's add value. In a Wall Street Journal on the topic Mitchell Klein, a partner of Fasman, Klein and Feldstein, a New City, N.Y., accounting firm, said "Too many people associate accountants with death, tax and bad news and question our integrity because of the big audit failures that major accounting firms have failed to catch."

Ever Think of Working as a Temp?

An interesting option for persons interested in not spending their entire lives in the office is become an accounting temporary. There is high demand for specialized accounting temps and CPA firms have started to hire temps to smooth out their staffing through seasonal cycles in the business.

Skill Depth Becoming Deeper for CPA

Over 30 states now have laws which require a fifth year of education to become a CPA by the year 2000. This change reflects a more competitive business environment and increasing skills requirements because of the rising complexity of many businesses.

Skill Requirements Becoming Broader

There is high demand for individuals who can go beyond technical skills and display good interpersonal abilities, legal knowledge sales abilities and foreign language skills. Accountants are broadening as business globalizes and becomes more team-oriented.

Experienced Players Gaining Currency

There is also rising demand for persons with consulting skills or industry experience and falling demand for college graduates.