The accounting field can be roughly divided into four categories: government accounting, public accounting, management (private) accounting, and internal auditing. The classes are relatively self-explanatory, with accountants in every subfield having a particular set of responsibilities in keeping records of their clients’ financial history. Slightly more than 1/3rd of accountants in the U.S. work in public accounting, with many opting to become certified public accountants or CPAs.
What Does a CPA Do?
CPAs or certified public accountants, check and prepare tax returns and financial records for individuals and organizations, certifying the accuracy of the information. This critical job requires a minimum of a bachelor’s degree in accounting or a relevant major. To earn the CPA designation, graduates should also pass national exams and meet state requirements. CPAs earn top salaries on average, but the amount depends on various factors, including the type of job and your experience.
Training for CPAs
Accountants are basically required to have a minimum of a bachelor’s degree in accounting. Many universities and colleges are now offering 5-year accounting undergraduate programs. Many states now mandate that candidates for the 4-part CPA exam must have at least 150 credit hours to take the exam. Around 50 percent of the accountants practicing in the United States are certified, public accountants.
How Much Do CPAs Make
Median Accountant Salaries
As reported by the U.S. BLS, the median annual salary for accountants was $71,550 in 2019. The bottom ten percent of accountants made under $44,480 per annum, and the top ten percent had a yearly salary greater than $124,450(1).
Average Accountant Salaries by Industry
Not surprisingly, accountants working at the School and Employee Bus Transportation are among the top paid in the country, with an average annual pay of $104,110 as of May 2019. Accountants working in the Federal Executive Branch (OES Designation) are also in the upper echelon of compensation, with an average annual salary of $100,260. Accountants employed in the Inland Water Transportation industry even do very well relative to their peers, bringing in an average annual salary of $100,020.
Importance of Experience
Certified public accountant’s salaries generally improve as the worker puts on experience. For instance, in public accounting in a mini firm, an auditor with 1 to 3 years of experience made $48,750 to $93,000 per year in 2020, according to the Robert Half 2020 Salary Guide. A senior auditor received $58,750 to $103,000. In major company corporate accounting, an internal auditor with 1 to 3 years experience earned between $60,000 per year and $97,750 per year in 2020, and a senior internal auditor earned from $77,250 to $123,750. These are only some of the many positions recorded in the RHS (Robert Half survey).
Certified public accountants who rise to administrative positions often bring home much substantial paychecks, according to the Robert Half survey. As of 2020, a corporate controller of a firm with more than $500 million in annual sales earned between $147,000 and $211,000 per annum, while a corporate chief audit executive at a similar firm received between $185,250 and $290,750. In public accounting jobs, a large firm’s senior manager earned $110,750 to $178,750 in 2020, working in audit and assurance services and between $134,000 and $211,000 employed in tax services.
The Lifetime Advantage
According to BPE Becker Professional Education, CPAs earn up to $1 million more over forty years than accountants without certification, based on a ten percent higher salary. For instance, a senior accountant in a large public firm can expect $101,750 per annum without the credential or $111,925 with it, based on Robert Half’s 2020 survey. Accountants with the CPA designation also receive more promotions, so they may gradually earn up to $50,000 annually more than those without it. At the top level, a chief financial officer earns as much as $449,000 per annum, and in most cases, has both a CPA and a master’s degree, according to Becker.
Careers in Europe:
An entry-level Accountant with less than one year experience can expect to earn an average total remuneration (includes bonus, tips, and overtime pay) of €36,061. An early career Accountant with 1-5 years of experience makes an average total compensation of €38,947. A mid-career Accountant with 5-10 years of experience earns an average total compensation of €40,001. An experienced Accountant with 10-20 years of experience makes an average total compensation of €39,153. In their late-career (20-plus years), employees make an average total compensation of €50,248.
Careers in Asia:
An entry-level Accountant with less than one year experience can expect to make an average total compensation (includes bonus, tips, and overtime pay) of RM 25,163. An early career Accountant with 1-5 years of experience makes an average total compensation of RM 45,757. A mid-career Accountant with 5-10 years of experience makes an average total compensation of RM 61,752. An experienced Accountant with 10-20 years of experience earns an average total compensation of RM 80,510. In their late-career (20-plus years), employees make an average total compensation of RM 84,401.
Job Prospects for CPAs
Job prospects are excellent for accountants of all kinds for the next several years. Employment prospects are especially great for certified accountants, given the increased regulation of the financial industry. The number of positions for accountants will grow by sixteen percent between 2010 and 2020, as projected by the BLS.
2020 Salary Information for Accountants and Auditors
According to the U.S. BLS, accountants and auditors earned a median annual salary of $79,520 in 2019. On the low end, accountants and auditors earned a 25th percentile salary of $55,900, meaning 75 percent earned more than this amount. The 75th percentile salary is $94,340, meaning 25 percent earn more. In 2019, 1,424,000 people were employed in the U.S. as accountants and auditors.