Get to know the 4 different types of accounting, all of which are further discussed in a Masters in Accounting degree program.
Accountants are some of the best thinkers in the corporate world. They create, analyze and develop reports that involve the most tedious processes and the most detailed contents reflecting numbers, performances and activities. There are four types of accounting professions – public accountants, cost accountants, financial accountants, and forensic accountants – and students taking up a Masters in Accounting degree are equipped for pursuing one or two of these job types.
A public accountant provides a broad range of accounting, auditing, tax and consulting services for a fee to individuals, companies, governments or charitable institutions. Businesses and legal entities are mandated by law to file accounting reports with the government such as tax statements. Businesses, therefore, are in constant need of public accountants.
Public accountants are the most qualified and confident professionals in preparing and filing such reports. A number of certified public accountants put up their own private practice, confident with the fact that they will never run out of clients. They are also skilled and qualified in performing external audits and examining an organization’s financial statements.
The job of a certified public accountant (CPA) is an entry-level position. Certification is necessary, and this is obtained after passing the licensure exam for accountants. The CPA licensure exam is intimidating and tedious, which is why students decide to first go through a Masters of Accounting course to prepare themselves and brush up on what they may have already forgotten from university.
The second type of accounting is cost accounting. Cost accountants are basically concerned with costs incurred by corporations from all the purchases they have made within a given period. This is a specialized, management-level accounting that understands the costs of merchandise and the implications of such purchases to the financial health of an organization.
Inputs from cost accountants play a crucial role in determining how much a product would be sold in the market. The accountant factors in all expenses that go into the production of a product. Top management, marketing executives and other leaders within an organization largely depend on the cost analysis to be prepared by the cost accountant.
A financial accountant, on the other hand, prepares financial reports that shall be specifically viewed by external entities. External relationships such as investors, suppliers and stakeholders would like to know the financial status of a company before engaging with the company in any form of business relationship. It is the financial accountant, aka corporate accountant, who will prepare such reports.
This is also a high-level accounting activity since the reports will significantly determine an organization’s external networks.
Suppliers or investors could decide to disengage based on the report. Financial accountants also prepare company documents to be submitted to tax authorities.
Finally, perhaps the most exciting branch of accounting is forensic accounting. Forensic accountants act as detectives in search of possible accounts-related crimes. This kind of accounting requires highly perceptive, analytical and insightful individuals with a degree in Master of Accounting or higher.
Forensic accountants are people who have gone through training in behavioral science, research methods, and management courses. These are offered in a Masters in Accounting program. This graduate-level course trains students for becoming the best accountants that could take on one or two of the above accounting types.