<p>It's hard to outsource things when you need to go to the client's site to look over their operations, books, processes, etc. It's a lot easier to fool someone remotely. I spoke to someone about a company where a spouse works and apparently there are all sorts of irregularities there and it's not so secret in the company. Even the new CFO knows about it. Sounded like stuff that people can go to jail over. Going through the books of a place like that would require local people.</p>
<p>I wanted to address a question that keep getting asked of me:</p>
<ol>
<li>Can I major in liberal arts and get a graduate degree in accounting for CPA requirements? </li>
</ol>
<p>Answer: The answer is YES! However, I really recommend that you major in accounting as an undergraduate. There are several reasons for this. Many states mandate certain courses outside of the 24-36 credit accounting requirement. Some require economics. Some require a finance course and marketing. Some require a course in ethics. Majoring in accounting as an undergrad usually meets all of the requirements for most states. This isn't necessary true for getting a masters in accounting,which might require you to take additional courses.</p>
<p>In addition , majoring in accounting as an undergrad will enable you to take more advanced courses in accounting concentrations such as Tax, Forensics, Financial Planning, and Auditing.</p>
<p>Finally, by majoring in accounting, you can still take some liberal arts courses if you wish. This is particularly true if you place out of some course with AP/transfer credit.</p>
<p>I wish this thread was around four years ago, lol. Thanks for all the helpful info taxguy.</p>
<p>the joker,
Since I only teach students in the two introductory courses (financial and managerial), I'm not an expert in commenting on who will "like" accounting as the real exposure to the breadth of the profession comes in upper level classes. I can comment on the type of student who typically does well. Many students think that they need to be highly gifted math students- not true. However, a strong analytical ability is essential. Those who enjoyed reading problems in middle school are good candidates for success. You need to read well to identify essential information and then have an interest in "connecting the dots" by applying accounting concepts and being persistent.</p>
<p>taxguy,</p>
<p>Thanks for this thread--I like how you incorporated so much into just a few posts (although the thread is now on page 9, so maybe not that few).</p>
<p>Anyway, just a clarification on an earlier post:</p>
<p>It is true that moving into a specialty field is the way to make more money in accounting--and there are many of these to move into. It should be realized, however, that the demand for these specialties will also ebb and flow over time. For example, in today's world, forensic accounting is fairly slow while auditing and controls testing (specifically if you can do IT general controls testing as well as financial controls testing) is booming. If the PCAOB and SEC decide that small companies don't need to do audit attest (after they finish their survey of the area this year) and that only management attest is needed (as currently required by AS5), then this area might slow down a little bit--or more likely just not be in the same "boom" that it has been for the past 5 years.</p>
<p>Similarly, tax work has been very steady (and quite profitable for those in it) for many, many years--and the shortage in this area is not likely to abate anytime soon. On the other hand, financial planning--which everyone said would be the major area when the baby-boomers started retiring--has simply stayed slow for many years--and probably will continue to do so since most baby-boomers will need to work (and most want to work) for many more years than originally projected.</p>
<p>Financial consulting is also an interesting area. You might expect it to contract during downturns, but it tends to stay fairly stable since companies that are having hard times need advice during downturns just as much as when the economy is booming.</p>
<p>The point I'm making is that picking your specialty is important if you want to be in the "hot" field--and that knowing what will be "hot" is fairly easy to see short-term, but not so clear on a longer-term basis.</p>
<p>P.S. You also my point out that getting certifications in these areas do help with your credibility--thus the reason for my CPA, CISA, CFE (Certified Forensics Examiner, not Certified Fraud Examiner), and PMP designations (although I'm going to let this last one expire now that I'm not doing many large projects).</p>
<p>Taxguy, </p>
<p>in public accounting, I realize a CPA is very valuable.</p>
<p>However, is someone with a MS Accounting Degree + CPA going to be making more then someone with a BS Accounting +CPA?</p>
<p>Melon390, this question was answered in one of the prior posts. Generally, you won't make more with an MS/CPA than y ou would with a BS in Accounting and a CPA. HOWEVER, if you have both an undergrad in accounting and a MS is a specialized area such as tax, forensics, auditing etc., you might make a bit more and certainly you would increase your chance of being hired.</p>
<p>One thing I really wonder about is making the 6 figures. taxguy makes it seem so easy to make $100k a year if you're an accountant. However, let's remember that less than 5% of the US makes over $100k a year. And for all those young people on this board, I recently read an article on Yahoo Finance that had an interesting survey study. They asked boys and girls in high school what they thought their salaries would be at the peak of their careers. The avg boy said $178k while the avg girl said $112k. So let's be realistic. Most people on here will not make $100k in today's dollars so easily and will not make partner and all the such. There is a reason only a few people make CEO/CFO/partner and that's because they're the best and stand out from the competition. taxguy graduated with a 3.7 then went to law school so I'm not surprised he makes that much b/c those stats probably put him at least in the top 10% of his class. But for all those people out there reading these posts and dreaming of making partner/CEO/CFO and making $100k a year fast just because you have a CPA, think again because most of you probably won't get that far. Sorry to sound negative but I like to be realistic. And btw, if I'm making $100k in real dollars when I'm 40, I'll be pretty happy haha.</p>
<p>Hi taxguy...thanks for your posts...I had an epiphany last night and finally decided to major in accounting as opposed to finance. I am just wondering, is it terribly hard to get into U of Texas at Austin once I declared that I am going to major in accounting? I am interning at one of the Big 4 now and I don't know how much it will help me when it comes to college acceptances into their accounting programs...=(and do you mind giving me your e-mail so that I can ask a few more personal questions?)</p>
<p>Question...can aspiring CPAs use general CLEP courses as a requirement and save a semester's worth of time (graduate in 4.5 years instead of 5 to get the 150 credits)? </p>
<p>msl - There's nothing wrong with dreaming and accounting is probably one of the more realistic paths out there to reach "the 6 figures". I think that message is better suited to the Investment Banking sub-forum, lol.</p>
<p>meeshellee, just PM me on these boards. I have been answering folks inquiries as long as I don't get overloaded with question. Also, I don't answer questions regarding chances for a school since I really don't know you or most schools. Thus, don't ask me about that.</p>
<p>MSL2008, please reread my posts especially post number one! I give actual statistics of the earnings of accountants after a number of years of practice. I did NOT make these number up.</p>
<p>Notice that the average salary of accountants with accounting firms after 7 years was over $100,000, and that survey was almost two years old! However this survey involved folks who work in a public accounting firm.</p>
<p>You note that the average American isn't earning over $100,000 per year. However, lawyers, doctors, CPA's, investment bankers and State Farm Agents aren't your average American when it comes to earnings!</p>
<p>I also noted in several of my posts that making partner is tough. I don't deny this. Also, folks may not average over $100,000 a year working outside of public accounting firms such as working with the government. However, government work has its perks such as job security, very decent pay and benefits etc.</p>
<p>The key is that you NEED to like accounting. If you hate it, you won't do well. If you like the field, you can make very good money, work hours that are manageable ( except for certain parts of the year such as tax season) , have a very respected occupation, have a lot of mental challenge, and have a good life.</p>
<p>
[quote]
tax guy, i know for public accounting you jsut need to major in accounting and local partners will recruit at your schools. Now, if you are an accounting+finance major at a top 50 school. Hypothetically, if Deloitte recruits you for auditing, after a year or two how hard would it be to make the switch to the consulting branch of deloitte? Would that be hard to get, and would you have to be from a "target school?"
[/quote]
</p>
<p>This happens, but it is not the normal route. It is easier to move from ERS into a consulting role. Deloitte consulting is more selective, hence the difference in starting salary and bonus (especially signing which can go upwards of 15k for consulting and only 3k for tax and AERS)</p>
<p>Internal Audit is slowing down in public accounting, your fall back however would be the boom in the private sector. There is a reason a lot of auditors are being asked to join industry for IA. </p>
<p>And specialty practices do make more money. In deloitte, AERS is a combined division of audits and enterpise risk services. ERS will make at least a few thousand more than audit. And some speciality skills are billed out at higher rates. I was told yesterday a manager (not even a partner) at one of the big 4 who has extensive ACL and other IT experience routinely gets billed out at $700/hr (obviously i cannot verify this).</p>
<p>Secondly, my firm currently has no problem staffing me on IA/IT assignments even though i am interning as an auditor because if I am an auditor with that knowledge, it helps with budgeting because IA/IT have higher hourly rates than audit.</p>
<p>"like readings problems in middle school"-what's that supposed to mean</p>
<p>On another note, I'd like to hear some honest feedback about the cutthroat hierarchal nature that comes with the big accounting firms. I was advised by a few former accountants to not pursue accounting because of this very fact, and the fact that whoever gets the most coffee for the boss gets promoted.</p>
<p>joker,
Here's a common example of a "reading type problem" from managerial accounting:
XYZ CO. has sales of xxx, 20% of which are cash, 80% of which are on credit. Credit sales are collected 25% in the month of sale, 60% in the month following sale, 12% in the second month following the sale, and the rest are uncollectible. Cost of goods sold is 60% of retail. Purchases are paid for in the following pattern: 40% in the month of purchase, 60% in the month following purchase. XYZ also has the following operating expenses: xxx depreciation, xxx advertising expense, xxx gen. & admin. expense. XYZ must maintain a minimum balance of xxx in their checking accounting. All borrowing is done at the beginning of the quarter, while interest payments are due at the end of the quarter, as are principal repayments. XYZ's beginning cash balance is xxx; what will be the ending cash balance for the first calendar quarter?
As long as you're attentive to detail and know what the terms mean, you could have done this in middle school if you are a problem solving type. Unfortunately, many of my students (at a cc) become overwhelmed at the volume of information and can't solve this kind of problem without repeatedly solving variations of the problem in and out of class. Remember that this is from an introductory class.</p>
<p>I've been reading and skimming through the post, so I apologize in advance if the questions below are repetitive. </p>
<p>I am a bit confused on the best way to sit for the CPA exam. I am an accounting major. I know it requires 150 credit hour in most states. What is the best route to get there? I've known people who continued their 5th year as an undergrad to satisfy the 150 credit hour. Also, others apply to a MSA/MAcc program during their senior year to satisfy the other 30 credits to get a total of 150. My question is wouldn't getting a BSBA/BBA and a MSA/MAcc better in the long run than just doing a 5th year and getting only a BSBA/BBA even though both routes would satisfy the 150 hour requirement to sit for the CPA exam? I just read previous posts, but can people elaborate more on this for me? </p>
<p>People have also told me an MBA is not the best way to in satisfying the 150 credit hour because you need experience before applying to a MBA program. People who usually aim in getting the CPA wants to take the CPA exam right after their studies than waiting a few year and having a full time job. But aren't there MBA programs that specialize in Accounting? Like Wharton and Columbia? Can't you use the MBA in Accounting to satisfy the 150 requirement as well? But yet these school, when applying to the MBA programs want some experience. What is the difference then between a MSA/MAcc to the MBA in Accounting? </p>
<p>Say you got your CPA, how useful and helpful is it to go back and pursue the MBA? Should you get your MBA in something else or stick with getting a MBA in Accounting after you are certified? Is it just too extraneous and not required especially when you are working in an accounting firm like the Big 4? Do people with CPA and MBA get higher paid than just a MBA or just a CPA? Or do the firms just scorn on it, suggesting you might not be loyal to the firm since getting a MBA means changing paths other than accounting?</p>
<p>And one last thing, if anyone knows, what is the difference between a personal finanicl specialist (PFS) and a certified financial planner (CFP) besides the requirements to get the title? Do both actually do the same type of work, but just different titles and ways to get there? The benefits and cons of both? The money difference? Which one has the better job opportunity? Do most finance major go for the CFP? And accounting major go for the PFS since one has to also be a CPA? And any other differences? I would really appreciate the help. Thanks.</p>
<p>Great questions, Anita! I'd like to know the exact same things.</p>
<p>Anita, I noted some of your answer in post 1. You need a total of 150 credits for the CPA exam. The extra 30 credits can be taken in any way such as a double major, a graduate degree etc. Frankly, I do think that you are better off getting a graduate degree than to do a double major.</p>
<p>As for the MBA, you really don't need it if you have a undergraduate accounting degree. Much of the information will be repetitive. I don't think that CPA/MBA make more money.</p>
<p>As for Personal Financial Planning Specialist vs CFP question, my son had exactly the same issue. He wants to go into either financial planning or hedge fund management;thus, he got a graduate degree in Finanicial Planning from Bentley College, which I strongly recommend that you check out.</p>
<p>After conducting some research on the issue and asking a number of people about the worth of the PFS vs. CFP disignation, we found that the CFP is the more recognized and respected designation over the PFS. In addition the PFS requires you to get the CPA first,which is not the case for the CFP. Once you get the CPA, you can also get the CPS designation.</p>
<p>Hope I have answered your question.</p>
<p>My problem with accounting is that there isn't as much variation as other degrees. Accounting and engineering are very similar degrees. If you earn an accounting or engineering degree, you WILL have a job. In fact you will probably have your choice of jobs around the country. But what i've noticed about these to fields is that most new graduates make about 45-55k to start. This is a great starting salary, don't get me wrong. The thing that gets me is that these salaries don't go up much after that. I've known several engineering and accountants and very few make over 100k. Its like that other thread floating around here "dont major in engineering". </p>
<p>But it all depends on your views/goals. If you value job stability and security, then accounting is for you. But if you are more ambitious, more of a risk taker, I am a firm believe that Finance is a better degree. If you look at the statistics, both degrees make about the same to start. Once you get solid work experience, that finance degree goes way up in value. Especially if you get a CFA, your possibilities for jobs and income are really endless. Of course I am speaking very generally here. I know this doesn't apply to everyone, there are exceptions to every rule. From a general standpoint, this seems to be the case.</p>
<p>irocktheyellow, believe me, there are plenty of entrepreneural chances in accounting. You can set up your own firm, of which there are thousands of firms. You can make partner in an existing firm. You can do consulting. You can go into management or be a hedge fund manager with accounting. I promise you that an accounting degree will generally open more doors ( assuming similar personalities) than an undergraduate degree in finance.</p>
<p>I see what you are saying. But why major in accounting if you don't want to do accounting? That is the beauty of finance. Most finance curriculums incorporate enough accounting that one achieves a solid understanding of the principles. For example reading and interpreting financial statements and suggesting solutions/modifying numbers.</p>
<p>All of these jobs you mentioned are the same thing. ie consulting accountant, accounting manager, accounting partner. It just seems that with finance there are more possibilities because the degree is not as specialized as an accounting degree. Like I said, I have nothing against accounting, I just don't understand why someone would go through the trouble of majoring in something they may not like if they don't want to be an accountant. Lots of students on this board talk about how they want options, well finance provided more options;but not as much job security.</p>
<p>Sorry if this was jumbled.</p>