Is a CPA the Same as an Accountant? There Is a Difference. (2024)

8 Min. Read

April 27, 2023

Not all accountants are CPAs (certified public accountants), but all CPAs are accountants. Typically, an accountant has achieved a bachelor’s degree in accounting. A certified public accountant earns this designation after completing specific educational and work requirements and passing a CPA exam.

These requirements are specific to each state. This means a CPA is likely to be more knowledgeable in the field of accounting than someone who has not earned the designation. A CPA is also allowed to perform certain duties that regular accountants are not permitted to do.

Here’s What We’ll Cover

What Does an Accountant Do?

What Does a CPA Do?

CPA vs Accountant: Which Is Better?

What Percentage of Accountants Are CPAs?

What Is the Average Salary of a CPA?

Can You Get a CPA Without an Accounting Degree?

How Long Does It Take to Become a CPA?

NOTE:FreshBooks Support team members are not certified income tax or accounting professionals and cannot provide advice in these areas, outside of supporting questions about FreshBooks. If you need income tax advice please contact an accountant.

What Does an Accountant Do?

Accountants analyze and interpret the financial data of a company and prepare financial reports. Accountants may perform a wide range of finance-related tasks for their employer or their clients.

Some common responsibilities of an accountant include:

• Ensuring a small business’s financial documents and tax returns are accurate and comply with relevant laws, regulations, and tax codes
• Recording and classifying financial transactions (if this work isn’t performed by a bookkeeper)
• Preparing financial statements and related schedules and disclosures
• Recommending internal controls and financial best practices
• Offering guidance to help small business owners overcome problems and reach their goals

What Does a CPA Do?

Certified Public Accountants analyze and report on financial data. Their duties can be broken down as follows:

• Establish, update or maintain a company’s accounting policies and procedures, including bookkeeping methods, monitoring and reporting.
• Oversee or participate in the creation of budgets.
• Oversee internal audits (to ensure accuracy of reporting).
• Prepare and create audit reports for government audits or for tax purposes.
• Prepare and present financial statements to the company’s management or Board of Directors.
• Review and provide consultation on compensation, benefits, assets and spending of company money.
• Manage accounts payable and accounts receivable.
• Stay up to date on changes in the finance industry, tax laws, and government regulation. Ensure the company updates policies or procedures to conform with best practices.

Although the above lists a number of duties of a CPA, it is important to note that CPAs should not offer services where they both audit and consult for the same business. The AICPA and the SEC consider this to be a conflict of interest.

The CPA, or Certified Public Accountant, is not an international designation, it is issued solely in the United States. For instance, in Canada a “CPA” designation exists, but it stands for “Chartered Professional Accountant”.

CPA vs Accountant: Which Is Better?

A CPA is better qualified than an accountant to perform some accounting duties, and recognized by the government as someone who is credible and an expert in the field.

Individuals who have received a CPA designation are trained in generally accepted accounting principles and best practices (including online tools). Typically, they also charge higher fees than non-certified accountants.

There are a few tasks that CPAs can do that non-CPA accountants cannot. Only a CPA can prepare an audited financial statement or reviewed financial statement and file reports with the Securities and Exchange Committee (SEC). CPAs can also represent clients in front of the IRS during a tax audit—something that Enrolled Agents and tax attorneys can do as well.

Other Jobs of Accountants and CPAs

It’s also important to note that not all accountants and CPAs perform all of the duties listed above.

Some accountants focus on business management accounting, which helps organizations leverage company performance metrics and other data to make business decisions. Others become a Certified Fraud Examiner (CFE) and help businesses and government agencies prevent, detect, and investigate fraud. Others prepare tax returns and offer tax planning services. Some work as financial advisors to help high-net-worth individuals manage their financial affairs. There’s really a wide variety of specializations for both accountants and CPAs.

Regardless of their line of work, all CPAs are held to a strict code of ethics by the American Institute of Certified Public Accountants, state boards of accountancy, state CPA societies, and other regulatory agencies. This code of ethics requires serving the public interest, integrity, objectivity, and taking due care when providing professional services.

What Percentage of Accountants Are CPAs?

According to the U.S. Bureau of Labor Statistics, there are roughly 1.3 million accountants in the U.S. The National Association of State Boards of Accountancy reports that there are approximately 669,000 actively licensed CPAs, meaning approximately 50% of accountants in the United States are CPAs.

Many in the profession are concerned about the growth rate of both accounting majors and CPAs.

The Bureau of Labor Statistics (BLS) projects the employment of accountants (not CPA specific) to grow 7% from 2020 to 2030. This disparity between supply and demand has resulted in accounting departments and CPA firms struggling to find qualified talent.

What Is the Average Salary of a CPA?

According to the Journal of Accountancy, the average salary of a CPA with 1-3 years of experience is $52,639. However, average CPA salaries go up for CPAs with more experience. For senior accountants—those with 8-10 years of experience—the average CPA salary is $94,951. For partners in a CPA firm, the average salary is $166,572. This figure does not include bonuses or other benefits.

Can You Get a CPA Without an Accounting Degree?

Although every state has different qualifications for licensing CPAs, all of them require a bachelor’s degree with a certain number of hours dedicated to the study of accounting and business core courses. Some states specifically require a degree in accounting and several upper level accounting courses. Along with the education and work experience, all Certified Public Accountants must pass rigorous testing.

CPA Examination Requirements

The Uniform CPA Examination is administered in four parts, broken down as follows:

• Auditing & Attestation
• Financial Accounting & Reporting (this is generally considered to be the hardest part of the exam)
• Regulation
• Business Environment & Concepts

CPA candidates have 18 months to complete all 4 parts, and applicants must score at least 75% in each section of the CPA exam. The CPA certification exam generally is considered difficult, and less than 20% of test-takers pass all four sections the first time they take them.

Usually, the CPA certification exam is the last step in the process of receiving a CPA certification. However, a handful of states, like Alabama, allow a candidate to find and obtain the necessary work experience after completing the exam. In those cases, the candidate receives a certificate, but not a CPA license, until they’ve completed the required work experience.

There are some states where candidates must be a United States citizen, a resident of the state, or both to take the exam. Many require candidates to have a social security number.

You can view the CPA requirements by state at ThisWayToCPA.com, which is maintained by the American Institute of Certified Public Accountants (AICPA).

Maintaining a CPA License

CPAs must complete continuing education classes every year to keep their license. All states require the equivalent of 40 hours of CPE every year, but some states have flexible requirements. For example, Alaska requires CPAs to get 80 hours of CPE every two years, with a minimum of 20 hours per year.

How Long Does It Take to Become a CPA?

The length of time it takes to become a CPA depends on the personal situation of the candidate, their level of education, the state they live in and the state’s qualifications. The difference between state requirements for obtaining the CPA credential can be considerable. For instance, some states only require one year of work experience while others require two.

Considering the average length of time it takes to achieve the required degree and work experience, it takes, on average, seven years to achieve the CPA certification if starting from scratch.

On the other hand, regular accountants may land jobs in small businesses or corporate accounting departments with just a bachelor’s degree and work their way up the ladder, gaining experience and general accounting skills via on-the-job training.

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