Your accounting career starts here. Here's the qualifications you need to become a qualified accountant in the next 3 or so years whether you want to specialise as a tax accountant or study for the Chartered Institute of accountants or the other bodies such as ACCA or CIMA.
What is an accountant ?
Most people think of a grey boring man or a glorified bookkeeper counting beans but in reality a good accountant will keep the cash flow positive and ensure the whole organisation understands profitability. Only qualified accountants can legally approve accounts (see below) and you can have a career as a finance director or an auditor. It depends on what excitement you want ! Other accountants specialise in tax planning, insolvency or small businesses.
Why Become an Accountant ?
Accountants are rarely unemployed as every business needs to have their accounts prepared and approved. Larger businesses employ a Finance Director (CFO - chief financial officer) to manage not only monthly account preparation but also longer term financial planning.
The role of an accountant
To become an accountant you'll generally need a reasonable degree although it's not essential but a degree will get you exemptions from some of the exams. The first part though is to choose which accounting body you wish to study towards and what type of accountant you want to be.
There are three main accounting bodies - The Institute of Chartered Accountants in England and Wales (ICAEW), the Chartered Institute of Management Accountants (CIMA) and Chartered Association of Certified Accountants (ACCA).
Which one you follow is dependent on where you wish to end up in life. ICAEW and ACCAs are allowed to sign off audited accounts so if you want to go into practice (eg: PriceWaterhouse etc) then these are for you. The ICAEW is always the preferred option and they have a higher standing.
CIMA folks can not sign off audited accounts and people studying for this generally target commerce (ie: a Finance Director in a company) but many people who are qualified for the others end up as Finance Directors as well.
- Institute of Chartered Accountants in
England and Wales (ICAEW) is the oldest and most well known accounting body. Generally
people who want to run their own accounting firms will study these exams. The institute was
incorporated in 1880 by royal charter and now has over 170,000 members around the world. Qualified
members have the initials ACA or FCA after their name. To achieve the ACA qualification you
must complete a training contract that runs between 3 and 5 years and pass the professional and
advanced state of the examinations. Additionally you must complete work experience requirements.
The ACA qualification is widely recognised globally as the accounting standard and 70% of FTSE 100 CEOs, FDs and company secretaries are ACAs.
Many students work with an accountancy practice with most firms employing less than 40 people. The training may be basic and you will likely be auditing small companies but this training will provide an excellent foundation in all of your future work. You can find more about the ICAEW at their website here
- Chartered Association of Certified Accountants (ACCA) is the second most widely known
accounting body representing 122,000 members and 325,000 students spanning over 100 years in existence.
The study route is similar to ICAEW in that it's a mix of exam and experience and you need to
pass 14 exams (nine of which are eligible for exemption) gain relevant practical experience, with
a minimum of three years and pass a Professional Ethics module.
Once qualified you'll get the initials ACCA after your name. You can get more information on this qualification on the ACCA website here
- Chartered Institute of Management Accountants (CIMA) is the third body of accountants
more aimed at people who want to work in commerce (or be finance directors in business rather
than accountants in practice). Even on their own website they say "By using finance skills to
focus on future success rather than past performance, they help to drive the world’s successful
organisations" so it's clear they see the accountant's role as more than a bookkeeper and focusing
on managing an organisation financial performance.
As with the other two above the qualification method is similar although the subjects are focused on business rather than numbers. The modules covered are management accounting, business management and financial management and you'll need three years relevant experience as well. You can get more information on this qualification on the CIMA website here
If you join one of the big auditing companies you'll generally be sponsored to take your exams, have time off to revise and get paid as well.
It's a hard slog and takes about 3 years to complete all the exams but worth it in the end.
Working as an accountant in your early years may seem boring but it will give you a thorough grounding in how accounts work, what's required for an audit and how to manage finances and how to interact with clients and how you inform clients how their accounts have been developed. Your work will evolve and before long you'll be managing your own junior and trainee accountants so they get to do the administration duties.
As you move up your career you will take on vast responsibilities. It's not unusual for a 30 year old to be a Finance Director of a fairly major organisation and upon qualification your salary should increase by 30% as most companies know you can move and demand more.
The great thing these days is many business people are doing their own accounts either using computer software by Sage or other accounting systems or using online small business accounting software such as Kashflow. This makes your job a little easier although many small business owners simply provide papers that you have to sort out and make sense of.
Good luck with your accounting career - it's one of the best and is recession proof and your earnings and professional standing will be far above average.