Maybe you’ve heard this math truism before: every square is a rectangle, but not every rectangle is a square. The same is true of CPAs and accountants, and since we often get asked the difference between the two, Tyler explains why all CPAs are accountants but not all accountants are CPAs.
What is a CPA?
When someone sets out to become an accountant, they’ll inevitably find a discipline that interests them more than others – tax, mergers, and auditing among them. CPAs, or Certified Public Accountants, have a specialized set of skills that are hard won through passing an exam that’s about as difficult as passing the bar.
An accountant can only earn their CPA certificate after completing a specific set of course requirements and completing four parts of the CPA exam: Auditing and Attestation, Business Environment and Concepts, Financial Accounting and Reporting, and Regulation. Each section is scored out of 99, and an accountant must score at least a 75 to pass the section. Only about 10% of examinees pass all four parts on the first try.
Accountants vs. CPAs
If an accountant decides they don’t want to become a CPA, they can still work in the accounting field. Most accountants have a degree in Accounting, but just like not all marketers have Marketing degrees and not all business owners have MBAs, occasionally a small business might have an in-house employee who acts as their accountant without formal training.
When it comes down to it, whether or not an accountant chooses to become a CPA relies on their intended career path. If you’re not planning to become a tax accountant, you don’t really need the specialized knowledge a CPA would have about tax law. If you don’t plan to run audits or do the accounting for a major corporation, you won’t need to worry about passing the Auditing exam or understanding the regulations of corporate accounting.
While CPAs have a wide breadth of knowledge, most of them will choose a niche within the sphere of accounting that interests them. As a business owner and private citizen, your primary contact with a CPA will most likely be during tax season.
Seller Accountant is not a CPA firm, but we do refer our clients to several CPA partners when they’re looking for help filing their taxes. Most tax CPAs we partner with don’t enjoy bookkeeping or e-commerce, so they partner with a firm like Seller Accountant to handle those tasks for their clients.
Does your business need a CPA?
Financially speaking, every business looking to grow needs to focus on three partnerships: a tax partner, a bookkeeper (or bookkeeping team), and a CFO-level advisor.
You might decide that you can meet all of these needs with your existing staff or that you’d like to hire someone to handle one of those areas in-house – great! Or you might decide you want to outsource to a single CPA that can handle your taxes and also understands bookkeeping for e-commerce – if you can manage this, you’ve found a unicorn!
However, if you’re interested in choosing partners who specialize in one area and do that extremely well, you’ll most likely end up with a separate outsourced partner for each branch of your finances. Luckily, Seller Accountant is full of e-commerce bookkeeping experts AND a killer CFO advisory service – and for the things we don’t handle, like your tax filing, we can recommend a trusted partner.
Ready to learn how Seller Accountant can help you get your books in order? Schedule a free 15-minute discovery call today.