FREQUENTLY ASKED QUESTIONS

A CPA stands for certified public accountant. Many accountants choose to become CPAs as it’s regarded as a gold standard within the profession. While certification requirements vary from state to state in the US, the passing of the Uniform Certified Public Accountant Examination is always mandatory. This exam is written and graded by the American Institute of Certified Public Accountants.

An accountant’s day-to-day duties and responsibilities are likely to include record-keeping, financial analysis, bookkeeping, budgeting and forecasting, tax preparation, audit preparation, ensuring compliance, and using accounting software and other tools to create reports, manage financial data, and streamline processes. They are also required to communicate with colleagues, clients, and management to answer questions, provide financial information, and provide appropriate guidance.

Different types of accountants have different areas of expertise. The main areas of accountancy include public accountancy, management accountancy, government accountancy, forensic accountancy, and tax accountancy.

Forensic accountants specialize in investigating financial fraud and other types of financial crime. They may work for law firms, government agencies, or private companies and use their expertise to analyze financial data and provide evidence in court proceedings.

EA stands for enrolled agent and is a professional accountancy designation that denotes expertise in tax preparation and representation. EAs are required to pass an exam and are licensed by the Internal Revenue Service (IRS).

Bookkeeping is widely regarded as the initial stage of the accounting process, and bookkeepers usually work for a company in-house or for private clients. There is typically an overlap in the duties of a bookkeeper and an accountant, including balancing accounts, processing invoices, payments, and receipts, completing VAT returns, and processing and amending cash flow statements.

Accountants can be held liable under both common law and statutory law. The former liability includes fraud, negligence, and breach of contract, while statutory liability includes any federal or state securities laws.