What Does an Accountant Do?

As businesses grow, so do their accounting needs. Accounting is an essential function of any organisation, regardless of the size or industry. Accountants help businesses keep track of their financial transactions and ensure that they comply with local laws and regulations. In this article, we will discuss the roles and responsibilities of an accountant, the skills required to be an accountant, the different types of accountants, and the education and certification requirements for accountants.

Roles and Responsibilities of an Accountant

Bookkeeping

Bookkeeping is the process of recording financial transactions. It involves maintaining accurate and up-to-date records of all financial transactions, including purchases, sales, receipts, and payments. Bookkeeping is essential for businesses as it enables them to track their financial performance and make informed decisions.

Financial Statements Preparation

Accountants are responsible for preparing financial statements, including balance sheets, income statements, and cash flow statements. These statements provide an overview of a company’s financial performance and help stakeholders, including investors and creditors, to make informed decisions.

Accountants must ensure that financial statements are accurate, complete, and comply with accounting principles. They must also ensure that financial statements are prepared on time and submitted to the relevant authorities.

Example: According to a survey by Robert Half, 61% of CFOs said that their companies’ most valuable financial statement is the income statement.

Skills Required to be an Accountant

To be a successful accountant, you need to have a range of skills, including:

Accounting Knowledge

Accounting knowledge is essential for accountants. They must have a deep understanding of accounting principles, including the Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). They must also understand taxation laws and regulations.

Mathematics and Analytical Skills

Accountants must be proficient in mathematics and have excellent analytical skills. They must be able to analyse financial data, identify trends, and make informed decisions based on the data.

Example: According to a survey by the National Association of Colleges and Employers, 58.8% of employers said that they look for analytical and quantitative skills when hiring accounting graduates.

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Skills Required to be an Accountant (contd.)

Communication and Interpersonal Skills

Accountants must have excellent communication and interpersonal skills. They must be able to communicate financial information effectively to stakeholders, including clients, colleagues, and regulators. They must also be able to work effectively in teams and build relationships with clients and stakeholders.

Attention to Detail

Attention to detail is crucial for accountants. They must be meticulous when recording financial transactions and preparing financial statements. A small mistake can have significant consequences, including legal and financial repercussions.

Technology Skills

Technology is transforming the accounting profession, and accountants must be proficient in using accounting software and other technology tools. They must also be familiar with data analytics and other emerging technologies that are changing the accounting landscape.

Example: According to a survey by the American Institute of Certified Public Accountants, 84% of CPAs say that technology has changed the way they work.

Types of Accountants

There are four main types of accountants:

Public Accountants

Public accountants work for public accounting firms and provide accounting, tax, and advisory services to clients. They may work with individuals, small businesses, or large corporations.

Management Accountants

Management accountants work for companies and are responsible for managing the financial performance of the organisation. They provide financial analysis and advice to senior management to help them make informed decisions.

Government Accountants

Government accountants work for local, state, or federal government agencies. They are responsible for managing public funds and ensuring that government agencies comply with accounting principles and regulations.

Internal Auditors

Internal auditors work for companies and are responsible for ensuring that the company’s internal controls and processes are effective and efficient. They identify areas of risk and make recommendations for improvement.

Example: According to the Bureau of Labor Statistics, employment of accountants and auditors is projected to grow 6% from 2018 to 2028, which is as fast as the average for all occupations.

Education and Certification Requirements for Accountants

To become an accountant, you must have a bachelor’s degree in accounting or a related field. A degree in accounting provides you with a solid foundation in accounting principles, taxation, auditing, and financial statement analysis.

In addition to a bachelor’s degree, many accountants choose to become certified. The most common certification for accountants is the Certified Public Accountant (CPA) certification. To become a CPA, you must pass a rigorous exam and meet specific education and experience requirements.

Other certifications for accountants include the Certified Management Accountant (CMA) certification and the Certified Internal Auditor (CIA) certification.

Example: According to a survey by the American Institute of CPAs, 75% of respondents said that having a CPA certification enhances an accountant’s professional credibility.

Conclusion

In conclusion, accountants play a crucial role in the success of businesses. They help businesses keep track of their financial transactions, prepare financial statements, and ensure compliance with local laws and regulations.

The job outlook for accountants is positive, with the demand for accountants expected to grow by 4% from 2019 to 2029, according to the US Bureau of Labor Statistics. This growth is due to the increasing complexity of financial regulations and the need for businesses to ensure compliance.

Hiring a qualified accountant is essential for businesses of all sizes. Accountants can help businesses make informed financial decisions, identify areas for cost-saving, and ensure compliance with local laws and regulations.

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