CPA VS Accountant: What can a CPA do that an accountant can't?

Often, people use the word CPA and accountant interchangeably. But is a CPA and an accountant the same thing? Of course not! This article will provide you with the inside scoop of the difference between a CPA vs Accountant. 

One thing is for sure, though, an accountant is not a CPA, but a CPA is an accountant. This means that you have to be an accountant to be a CPA. But if you’re an accountant, you don’t have to be a CPA as well. 

Does this even make sense? Continue reading to understand!

What Is the Difference Between a CPA VS Accountant?

Both an accountant and a CPA are professionals, but their level of experience and knowledge is what sets them apart. An accountant is a professional with a degree in accounting. 

CPA is a short form for Certified Public Accountants. Certified means that a CPA has earned a certification to practice accounting through different stages of education, examination, and experience. Because of the certification, a CPA can perform different duties that accountants aren’t allowed to perform.

So, if you’re asking, “what can a CPA do that an accountant can’t?” Here are the things that set the two professionals apart.”

• A CPA holds a license from the governing body that allows them to perform different accounting roles.
• CPAs have gone through more advanced levels of education above an accounting degree, giving them the skill and knowledge to perform their duties.
• CPAs practice in adherence to certain codes of conduct and professional skills
• CPAs are tasked with the mandate to put the needs of their clients above their own personal interests.

What Can a CPA Do that an Accountant Can't?

While accountants are expected to behave professionally and follow the standard codes of ethics, they have no governing body to keep them in check. On the other hand, CPAs operate under strict ethical standards, thanks to their governing body.

Both a CPA and an accountant have viable career futures. They both perform similar tasks, the only difference being their level of involvement.

So, what is a CPA vs accountant? Here are the duties that set a CPA aside from an accountant.

What Can an Accountant Do?

Accountants are tasked with performing different financial-related tasks for their employers or clients. One of their main duties is to analyze and interpret financial data for a company and give a detailed financial report. Here are some of the responsibilities of accountants:

• Ensure Accuracy of Financial Documents: Accountants ensure the accuracy of all the financial documents of a company. They also ensure that tax documents are accurate and comply with the law.
• Recording Financial Transactions: Accountants also organize all the financial transactions ensuring they’re up-to-date and accurate.
• Reconciling Accounts: At the end of each financial year, accountants are tasked with reconciling accounts and ensuring all the transactions are consistent.
• Preparing Budgets: By preparing budgets, accountants help their companies control all the operational costs and ensure there’s no financial wastage.
• Preparing Financial Statements: Companies need to have financial statements from time to time, and accounts do that by calculating accounting ratios, examining cash flow, and making expense recommendations.

With all these duties, there’s no doubt that accountants are an integral part of any company. They ensure there are no disparities in the financial department and that a company can run all its operations with ease.

What Can a CPA Do?

Like accountants, CPAs play a crucial role in the operations of a given company as far as the financial sector is concerned. Because of their certifications and standards of ethics, CPAs earn government and organization recognition as experts in the field. They are trusted to perform duties that accountants can’t do, regardless of their experience.

So, what does a CPA license allow you to do? Here are the duties and responsibilities of a CPA:

• Conducting Audits: CPAs are tasked with conducting audits to reflect the financial position of the company. While accountants can carry out internal audits, CPAs carry out all external audits. They’re also the ones tasked with carrying out public audits to assess the financial position of a given company.
• Representing the IRS: CPAs can act on behalf of the Internal Revenue Service by representing the taxpayers. They can defend the tax returns of a company if the IRS raises questions.
• Preparing Financial Statements: A CPA is tasked with auditing and filing financial statement reports with the Securities and Exchange Commission (SEC). Public-held companies need to do this, and only a CPA can help with it.
• Investment Advice: CPAs can also help businesses manage capital investments and increase their financial capacity. They’ll advise on the amount of money the company should spend on such investments hence helping avoid bad financial decisions.
• General Financial Oversight: Almost every company needs the services of a CPA to help keep it financially healthy. The professionals help with everything from taxes to spending decisions.

With the help of a CPA, your company will not only achieve financial strength but also maintain compliance. So, when comparing CPA vs accountant, it’s evident that a CPA has more authority and trust. They’re not only trusted by the government but also by companies and the public at large.

Do you need a CPA to be an accountant?

You don’t need a CPA to be an accountant. In fact, according to The National Association of State Boards of Accountancy, only 50% of accountants in the U.S have CPA certifications. 

So, can you be an accountant without a CPA? The answer is simple; not all accountants are CPAs, but all CPAs are accountants.

Is a CPA an accountant?

It’s safe to call a CPA an accountant because they do everything accountants do. The only thing that differentiates an accountant from a CPA is the level of experience and certification. A CPA is more of a higher-level accountant who does the work that a typical accountant can’t do.

What is CPA accounting?

CPA stands for Certified Public Accountant. CPA accounting involves providing accounting services to companies and the public. CPAs deal with financial issues such as auditing, investment, taxes, etc. They help companies stay compliant and accountable for their financial decisions.

Bottom Line

Accountants and CPAs are both important people in the financial sector. Even though their scope of work differs, they play an important role in ensuring the business’s finances are in check, and the company is compliant. 

With the help of reliable software such as Basil Practice Management, accountants and CPAs can work more efficiently and diligently. The software is simple, efficient, and affordable. It’s indeed a practice management made simple. All accountants and CPAs should give Basil a try.