Do You Have to Pass the CPA Exam to Be an Accountant?

CPA certification, while desirable, isn't required to become a professional accountant.

While you don't have to pass the CPA exam to be an accountant, the designation of CPA is prestigious in the accounting profession, affording holders more opportunities for advancement and higher pay. In addition to passing an exam, CPAs also must adhere to a code of ethics and perform within the standards of the profession.

History

The American Institute of Certified Public Accountants or AICPA is the national professional organization of CPAs in the U.S. Founded in 1887 with a handful of members, the organization counts more than 369,000 members as of 2010. The CPA exam was developed in the early 1900s to help lend more credibility to the accounting profession. The exam serves as a licensing similiar to that of the state bar for lawyers and state boards for doctors.

Considerations

There are several requirements that must be met before taking the CPA exam. First, candidates must take undergraduate courses in business and finance. Each state has its own laws regarding the number of course hours. For example, Delaware requires 21 semester hours in accounting classes, including coursework in audit, U.S. taxation and financial accounting. In some states, upon graduation you must work in the accounting field for a year under the supervision of a CPA. According to the AICPA, about 50 percent of candidates passed the two-day, four-part exam through the third quarter of 2010. The good news is that since most states use the Uniform CPA Examination, your license should be recognized in most states once you pass the exam.

Benefits

While accountants can and do perform many of the same duties as CPAs, the CPA designation holds a lot of weight in the industry. CPAs go beyond the traditional accounting roles of tax preparation and bookkeeping, acting as financial advisers for individuals and companies. CPAs also have the authority to attest to financial statements. In 46 out of 50 states, only CPAs may attest to a company's financial reports and audit results.

Misconceptions

Tax preparation providers, such as employees of H&R Block, usually aren't CPAs. Tax preparers receive specialized tax preparation training. They do not possess the depth and breadth of training of a CPA and don't need to hold a degree in finance or business.

Salary

PayScale reports that a senior manager of audit with forensic accounting experience can earn about $175,000 per year, while CPAs at top accounting firms Ernst & Young, Pricewaterhouse Coopers and KPMG can earn more than $70,000 per year. The U.S. Bureau of Labor Statistics says the top 10 percent of CPAs earn $102,380 per year. Bookkeepers, tax preparers and payroll service accountants earn a median income of $61,480 per year.

References

• National Association of the State Boards of Accountancy: Each State
• American Institute of CPAs: Uniform CPA Examination
• State of Oregon: PAs Licensed
• National Society of Accountants: NSA Lobbies
• Wiley Publishing: Attest
• "Vault Career Guide to Accounting"; Jason Alba, Manisha Bathija, Matthew Thornton; 2005

Resources

• Bureau of Labor Statistics "Occupational Handbook 2010-2011 Edition": Accountants and Auditors
• "Great Jobs For Accounting Majors"; Jan Goldberg; 2005
• "Career Opportunities In Banking, Finance, and Insurance"; Thomas P. Fitch; 2007
• H&R Block: Tax Preparer
• Big Four Accounting Firms
• AIPCA: 50 Percent