Almost everyone has heard of a certified public accountant (CPA). Not everyone, however, has heard of a certified financial planner (CFP) or charted financial analyst (CFA). Entering into any of these professions will require a person to obtain an accounting degree as well as pass the appropriate type of licensure exam. The duties carried out between each of the occupations do differ, meaning a person needs to decide which title he or she would like to hold before diving into the accounting industry. To understand the differences between each title, it is important to take a close look at the duties found within each occupation as well as their accompanying career paths.
What Does a CPA Do?
A CPA spends his or her time helping individuals and businesses with a number of tax related tasks. From tax preparation to the carrying out of audits to the preparation of numerous types of financial records, a CPA has a large amount of responsibilities. There are many fields in which a CPA can specialize in, including analysis and planning, corporate finance, assurances, tax preparation and more. For the most part, a CPA will specialize in one of these fields; however, sometimes, he or she will have two to three areas of specialization.
Becoming a CPA
To become a CPA, a person will need to obtain an accounting degree and pass the CPA exam. When becoming a CPA in the United States, the CPA exam is referred to as the Uniform Certified Public Accountant Examination. A CPA will benefit the most from earning a bachelor’s degree in accounting rather than an associate’s.
What Does a CFA Do?
A CFA is different than a CPA in that the CFA spends his or her time delving more into the financial side of accounting by examining his or her clients’ flow of money as well as any stocks that they own. A CFA usually holds a master’s degree, whereas a CPA tends to hold a bachelor’s. A CFA also tends to have two or more areas of specialization.
Becoming a CFA
A CFA has to travel a different road than a CPA. One way in which the road is different is that a CFA has to take and pass three different exams that last six hours a piece. A CFA also has to go through special training and obtain much experience in particular investment fields.
What Does a CFP Do?
A CFP does just as the title implies; he or she creates financial plans for his or her clients. Sometimes, a CFP will work for a business entity; however, it is not at all uncommon for him or her to work for individual entities as well. When working for a large client, the CFP will usually work solely for this one entity. The main focus of a CFP tends to be investing and estate planning.
Becoming a CFP
To become a CFP, a person will need a bachelor’s degree as well as finish a particular set of six courses. In addition, a person will need three years of experience working in the financial planning industry, followed then by taking and passing a ten hour exam.
Choosing to work in the accounting industry is an excellent choice to make. In fact, as a CFP, CPA or CFA, a person can find employment in almost any industry, performing a wide range of financial and accounting related tasks. Before entering into any of these professions, however, it is very important to understand the differences, as this will help a person to determine which title he or she should work under.