Top 7 Differences Between a CPA and an Accountant

What is a CPA?

A Certified Public Accountant (CPA) is a professional who helps organizations and individuals manage their money and taxes, as well as offers advice on financial and business decisions. A CPA helps accountants and tax preparers with their finances and taxes as well as helping those who do not have accounting or tax expertise. A CPA is a professional who is a legal adviser and a highly trained specialist in taxation and accounting. Tax accountants work with a wide range of taxpayers from individuals to corporations.

 The CPA will be able to help you if you need to file and pay your taxes, make sure the company is following the rules related to taxes, and keep track of your finances. CPAs can help solve problems with IRS matters, such as communicating with the IRS and help with audits. CPAs may also be able to identify tax deductions and credits, such as depreciation and accelerated depreciation.

What services do CPAs offer?

While many accountants and CPAs offer similar services and skills, there are some key distinctions between the two that will be helpful to know when making a hiring decision. CPAs are licensed to offer a wide array of services or oversee more complicated companies and organizations. CPAs offer their insight and expertise to the financial and legal aspects of running a business, such as tax preparation and management, financial statements, and compliance programs. CPAs must keep up with the ever-changing legislation and developments of the accounting profession, which means they may receive more training than accountants who can specialize in any one area. CPAs also have more requirements for continuing education and may be more likely to charge higher fees.

What is an Accountant?

Accountants are one of the most valuable professions in the world. They are highly educated professionals that are required to ensure that businesses are doing what they are supposed to do. Accountants are instrumental in the decision-making processes of businesses. They are usually highly educated and have a degree in accounting. They must have extensive knowledge of financial laws and regulations in order to work in this profession. Accountants help businesses save money, increase profits, and be competitive with other companies. Accountants are instrumental in the success of any business.

What services do accountants offer?

​An accountant is a professional accounting practitioner who has the ability to take responsibility for all phases of accounting. They are specialists within the broader field of accounting, with the training and experience to provide qualitative assurance about the qualitative aspects of accounting. An accountant is able to calculate, check, and verify financial information. They will make sure that the numbers are well organized and make sense for different businesses. Accountants are able to help with tax preparation, reviewing cost-benefit proposals, advising on business investments, handling payroll administration, and providing computer support services. Accountants are generally very detail-oriented, good communicators, well organized, and are able to manage any situation that arises.

Accountants vs. CPAs: What’s the Difference?

The average person may not know the difference between an accountant and a CPA. Both professions are in the accounting field, but there are differences between the two. There are a few differences between accountants and CPAs,

a) Contribution to the company

CPAs can be partners in a company, whereas accountants will only serve as employees. CPAs offer a wider range of services such as estate planning and forensic accounting, while accountants usually specialize in bookkeeping and tax preparation.

CPAs are considered to have more knowledge in accounting and financial planning, while accountants have more hands-on experience with bookkeeping and auditing.

b) Degree

CPAs need at least a bachelor’s degree to practice, whereas accountants do not need a degree. CPAs must pass a national exam and complete continuing education requirements, while accountants are not required to do either. CPAs can provide more complex services, such as audits and reviews, while accountants typically cannot. 

c) Tax preparation

CPAs should have a background in tax preparation, whereas accountants do not need to have a background in tax preparation. Lastly, CPAs often have a wider range of services they offer their clients, such as audit and assurance services, while accountants typically specialize in bookkeeping and tax preparation. 

d) Work Processes

Role of the Accounting Profession Accountants is in charge of performing tasks such as analyzing the bookkeeping of the organization in order to ensure there are no errors in the accounting practices. They also take care of the payroll for the company, the company’s taxes, prepare financial statements, oversee the budget, and more. Role of the CPA A certified public accountant is in charge of auditing accounting records, providing access to financial transactions, and even offering tax advice. CPAs also analyze financial statements in order to ensure that the accounting is in order and give their clients an idea of how the company is doing financially.

e) Industries Served

The CPA is a much broader term that covers a lot more than just a financial accountant. CPAs are often experts in a wide range of areas that an accountant would not be so qualified for. This includes tax law, employment law, and construction law. CPAs are usually licensed for their state and prevented from practicing in another state. On the other hand, accountants are licensed to only perform the specific service for which they were trained.

f) Specialization

One of the main differences between a CPA and an accountant is specialization. CPAs are given a license to deal only with the public accounts and the reporting of the results of the audits and financial statements. CPAs work closely with company management to put together and improve financial reporting. Accountants work on the more technical aspects of the financial statements, such as the cost of goods sold or depreciation. They also help with tax planning for clients. An accountant does not focus strictly on auditing reports and financial statements like a CPA does. They focus on creating and maintaining financial statements, assisting with tax planning, and

g) Work Environments

A Certified Public Accountant (CPA) and an Accountant have similarities in their work environment because they must work in an office setting. However, CPAs tend to be more experienced than accountants and the work environment for a CPA is much more complex. CPAs typically have much more opportunities for career advancement than do accountants because they have a broad variety of opportunities to prove their skills.

Author Bio

Shawn is a technical content writer at MyQbHost a QuickBooks desktop hosting he has long experience of working in the accounting industry. With an accounting background and interest in technology, topics like cloud accounting, cyber security and accounting software become his favorite topics.