Different Careers in Accounting
While it is true that with the fast paced and unprecedented development of the workplace, every organization must grow in correspondence with the changes taking place ( & , 1998; & , 1995; , 1996). It could also be deemed that careers do change. With the dynamic stages of globalization and world convergence, every person is obliged to deal with the demands of living.
This paper specifically discusses the different careers in accounting. To fully understand the concept of accounting, a brief theoretical discussion is included. Further, to give emphasis to the careers in accounting, its importance as a whole process is also stipulated.
Accounting
Accounting can be defined as the process of recording, classification, analysis and interpretation of financial information which in turn is reported to the concerned stakeholders through the financial statements (, 1974). It requires a record for each and every transaction the business enters into. Accounting has five (5) basic categories. The categories are (1) Assets; (2) Liabilities; (3) Equity; (4) Revenue; and (5) Expense.
Different stakeholders have the need for accounting information in order to make informed business decisions. These stakeholders include investors, creditors, governmental agencies and others. Because the main objective of accounting and financial information is the provision of reliable data and information for decision-making purposes, it is more commonly referred to as ‘a means to an end’, with the end pertaining to the decision that is supported by the presence of accurate and reliable accounting data and information. Information are used in making imperative decisions, served as basis for predicting and solving specific problems, and utilized in the daily operations in business management (, 1992, ). To be useful and helpful to various stakeholders, accounting and financial information must be relevant, reliable, comparable, and consistent. With the aforementioned concepts of accounting and its processes involved, it could give a fundamental idea on what are the careers possible for accounting degree holders.
Careers for Accountants
Accountants play a very significant role in the corporate world – it has been known that accounting is the language of business. However, accounting services industry has experienced major changes in the nature and scope of services provided in recent years. In an environment of increased competition and maturation of the traditional audit and tax business, accounting firms have become more diversified and more specialized (, 1997). Globalization and rapid fluctuation of the world markets are two main reasons why such changes took place ( and , 2003). There was no choice for CPAs too, but to be flexible to the changing needs in business accountancy. As (1995) have cited in a statement by (1995), “CPAs must revolutionize their thinking not only to endure the pace of this change, but to thrive on it.” CPAs are learning that their traditional services are inadequate to suit the needs of clients (, 1997), and as businesses become more complex and technology advances, accountants must work more creatively ( and , 1998). Thus, there is a need for continuous learning in the profession of business accountancy because it can help a CPA in adjusting to the current changing needs in the industry.
But still, regardless of what technological advancement is involve, the basic idea of accounting will never be changed. The processes involved are still the same and will remain to play its intended functions. People having a bachelor’s degree in accounting have many considerable opportunities in the job market. To name a few, the following are the most common.
Accountants
Traditionally, an accountant is a person involved in accounting practices. He/she classifies, analyzes, and interprets the financial records of an enterprise. It is important that he/she must be licensed. There are many regulating bodies – local and international in nature, which can grant license to practice the profession.
Generally, the works of an accountant include:
Evaluation of records from the bookkeeper that contains the comprehensive result of the enterprise’s losses and gains, changes in value, economies, and leakages that will tell if the organization is failing or drawing back
Drawing up financial records in set and prescribing a system of accounts that will provide information needed by the firm’s stakeholders
Reviewing economic and legal aspects of the business taking into consideration the effect of every transaction made specially on the profit-and-loss statement
Supervising and determining the factors affecting the overall and true condition of the business environment
Showing actual records of cost over specified duration of time, services rendered, and production in cost accounting
Contributing to the decision-making process of the company in particular capital budgeting and line of business analysis
However, the succeeding career opportunities for accounting degree holders are specialized segment of the general functions of the accountant. Among these are the following:
v Financial Officer
v Budget Manager
v Auditor
v Analyst
v Business Consultants
The financial structure of an organization serves as one of the most important and crucial area within the firm that needs effective management. There is a notion that a survival and profitability of the company lies within this structure. Financial structure also determines the accounting system that firms can have. & (1992) said that whatever accounting system a corporation adapts, it should be compatible with organizational structure and should be designed to supply needed information to all levels of decision making.
Since finance is a major determinant of the accounting process, thus, there is a vital career opportunity of the accountant in this area. Given the specified qualification for the position, a financial officer and staff must possess the fundamental skills needed on this challenging job.
The responsibilities of the financial officer and its staff are:
Preparing financial statements based on the records presented by the bookkeeper
Involving him/her self in significant decisions with regards to special areas and functions (e.g. mergers and acquisition, planning, and/or financial projections – short-term or long-term in nature)
Budgeting financial resources of the business in accordance to the objectives of the organization
The essence of budgeting lies on the assumptions that the mere process of budgeting, (1) requires all levels of management to plan ahead, (2) provides definite objectives for evaluating performance at each level of responsibility, (3) creates an early warning system for potential problems; (4) facilities coordination of activities within the organization; (5) results in greater management awareness of entity’s overall operation and; (6) motivates personnel to meet planned objectives. These benefits are reasons enough to persuade managers to conduct a way to manage their budget. The process is sure to provide them foresight of the future of their business ventures. Furthermore, budgeting will also ensure the smooth flow of resources and wise use of the allocated budget.
Nonetheless, budgeting should be done following a multi-dimensional approach. Multi-dimensional budgeting must be complemented with computerized executive information systems (, 1992). In this way, managers can analyze information from several different angles and can address several of never-before-asked questions about the company’s present and future performance.
In addition, budgeting allows the managers to; (1) create a better way to direct and control resources; (2) create an explicit and clear relationship between budgets and the business strategies they fund; (3) permit comparisons of detailed expense information across organizations; (5) provide powerful framework for measuring customer value, internally and externally and; (6) help the company understand the costs of operating its organization (, 1992: ). These speak of the fact that results are worth the efforts of embarking on “looking beyond budgeting”
Budgeting does not have to be a financial form of fortune-telling. The organization must use a conservative approach when coming up with its sales and expenses. It is also important that the budget tells what the organization intend to do with the business. Constantly, evaluate actual numbers versus budgeted numbers to see how the organization is actually doing. Lastly, consider the budgeting process as a management tool to help keep the company profitable and keep it running as smoothly as possible. This is done by the budget manager and its staff.
Auditing is also a crucial factor in the financial section of accounting. Effective management of finance means a balance of all the essential properties and assets of the organization. In auditing, the financial requirements of the firm must be supplemental to the firm’s continuous operations. It could be said that auditing goes hand in hand with budgeting and other finically-oriented transactions.
Accountants are known to have the special abilities to identify the most significant aspect of a business operation. May it be pioneering or already existing, accountants are reliable sources of vital business theory. This idea paves way to a career in consultancy.
In general, the accounting functions are integrated in all these potential career offerings. The rationale for this can be easily stated with the understanding of the important sectors of accounting. For instance, the specialized area of budget and financial concerns are important in the company’s everyday operation. There is basically a need to understand financial issues and reports are needed to make sure that cash flow within the company is smooth and there is no problem whatsoever. However, structuring the financial system of the company also involves a crucial decision-making process. Companies can either choose if they want their financial structure to be bank-based, market-based, service-based or legal-based.
The Importance of Accounting
Accounting is the art of identifying, measuring, recording, interpreting and communicating the results of economic activities (, 2000). It is the language of business being utilized by investors, managers, and business decision makers. It is utilized by individual file tax returns and supply information when applying for credit and at the same time government use it to control their resources and measure their accomplishments. Everyone benefits from comprehending accounting’s nature, significance, and limitations. Its purpose is to provide decision makers with information useful in making economic decisions concerning the allocation and the use of scarce economic resources.
In another source, accounting as the word implies, is a reckoning of the financial results of an enterprise between those who control the employment of capital or assets and those who provide the capital or assets (, 1993). Accounting responds to the needs of business and follows developments in commercial activity. The earliest records of business transactions, the essence of accounting, are over 5,500 years old. These are Egyptian and Sumarian records on agricultural production and tax collection. Other ancient records include both sides of a trade or barter and the amount of inventory in storehouses (, 1993). The earliest extant records of depreciation, an expression of the idea of the wasting away of physical assets, go back to the days of the Greek and Roman record keepers. A wall, for example, would be depreciated over a period of eighty years, which one might construe as a measure of its useful life and the efficacy of ancient construction practices.
Accounting is important especially if you don’t know how the business is doing, if you don’t want to have professional looking financial statements for your bank, potential vendors or interested parties and if you want to process sales order, purchase orders, invoices, payroll and other business functions manually. The accounting profession has participated in the development of cities, trade and the concepts of wealth and numbers. They are the ones who participated in the development of money and banking, do the company book keeping, saved companies from bankruptcy and helped developed the confidence in capital markets necessary for western capitalism and are central to the information revolution that is transforming the global economy.
Moreover, in management accounting, this job involves the development and interpretation of accounting information specifically to aid management in setting goals, evaluating performance, deciding to introduce a new product line and in every aspect of running a business. This is also utilized in non-financial information like political considerations, environmental factors, public image and worker productivity. They are also responsible for the decision which involves financial considerations.
In general, accounting is the result of choices-choices made at the individual level (as management decides how it wishes to represent its transactions, events, and states) and choices made at the social level (as standards-setting and regulatory bodies decide which methods to mandate across firms and time) (, 2003). added that it is also used for both pre-decision and post-decision by managements so that businesses may be ran better, investors and analysts may value businesses, regulators and directors may oversee businesses, and trading partners and government to settle contracts and tax payments.
Accordingly, accounting choice integrates concepts from different fields, such as information economics, measurement theory, information technology, economics, finance, individual, group and organizational behavior, industrial organization, ethical behavior and reputation, regulation, law (both civil and criminal), and political economy (, 2003). Although all these subjects are distinct from each other, all are important in understanding accounting today and also, they are important in order to make predictions about the future of accounting (, 2003).
All in all, the accounting systems – serving as the financial structure of the company provides information for three broad objectives: internal routine- reporting to managers to provide information and influence behavior regarding cost management and the planning and controlling of operations; internal non-routine, or special, reporting to managers for strategic and tactical decisions on matters such as pricing products or services, choosing which products to emphasize or de-emphasize, investing in equipment, and formulating overall policies and long- range planning; and external reporting through financial statements to investors, government authorities, and other outside parties ( and , 1991).
Accounting and Career Management
In accounting, there is a need to plan the development of career. A careful planning and scrutiny will eventually help the individual focused on the chosen area of service in relation to accountancy. Thus, career management is important. In an interview, of Fortify Services believed that: “full-on career management requires professionalism, total commitment and large reserves of enthusiasm and energy every step of the way.” He added that career management is not an innate talent but a process to be learned. It is not a ‘frivolous luxury’ but a ‘necessity’ in the workforce. Career management is, at its most fundamental level, all about survival in these increasingly uncertain times. It is about carefully building and nurturing people’s skills and reputation (, 2004).
Career development describes the structure and longitudinal nature of career behaviour, as well as the psychological, cultural, economic, and political influences that involve strategies that might transform in order to facilitate more positive and purposeful career behaviour than would likely occur randomly ( & , 1990). Furthermore, agility, strength, precise movement and the ability to deal with continuous change are key attributes in career development (, 2000). Chances in accounting careers are high. A person can actually utilize chance as an opportunity. There are five attitudes that are essential in recognizing, creating, and using chance as an opportunity (, 2000):
1. Curiosity – which will prompt you to explore new learning opportunities;
2. Persistence – which means you exert extra effort despite setbacks;
3. Flexibility – which enables you to change attitudes and circumstances;
4. Optimism – which will allow you to view new opportunities as possible and attainable; and
5. The willingness to take risks, which will enable you to act in the face of uncertainty.
To fully develop a career in accounting, there is a need for continuous learning in the profession of business accountancy because it can help a CPA in adjusting to the current changing needs in the industry. One of the ways to improve knowledge is by earning a master’s degree. Earning a master’s degree can help a person become updated in the latest trends in accountancy, and furthermore, improves the professional status. According to (1994), instruction in accounting must be focused on corporate accounting. This is evident with the fast growth of corporations that operate in global setting. According to (1997), at the master’s level, accounting graduates made progress compared to MBAs with technical undergraduate degrees. Because the aim of taking masteral studies is to refine skills, a CPA who has earned the degree will have the chance to perform better and to adapt to new types of CPA firms characterized by reduced administrative structures and a reduced number of hierarchical levels, supports learning for all its personnel through policies, practices, structure and values. Because learning is an imperative requirement, any form of study can help an accounting professional met his or her goals. (2001) stated that accounting professionals who experience learning should have a more positive attitude towards their work and firm. Thus, it can be said that personal learning is significantly related to attitudinal outcomes among accounting professionals, and positively related to job satisfaction and organizational commitment.
Synthesis
The skills of CPAs have great importance in many economic endeavors. All in all, any area in the business world that caters the information necessary for the whole business operations is a potential venue for an accounting career. Truly, finance, management, and all related aspects in accountancy are integrated altogether in order to materialize a successful business endeavor. Thus, accountancy serves its main purpose.
References
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