Ultimate Guide to Accounting Certifications: Requirements, Resources & Tips

Ultimate Guide to Accounting Certifications: Requirements, Resources & Tips

Female accountant looks at accounting certification requirements on paper

Earning an advanced degree in accounting, such as Rider University’s online Master of Accountancy, can likely serve as a fundamental steppingstone in any accountant’s career. But as accounting professionals grow and seek to work in different fields, they will need to pursue additional accounting certifications; professional designations that indicate an accountant is verified and trusted to practice in a certain role or within a certain business or financial area.

When pursuing accounting certifications, accountants usually study and prepare well before taking an examination. Obtaining some accounting certifications may be more complex or time intensive than others. Examinations for the certifications themselves can be very difficult, with many test-takers not passing on the first try. This guide is designed to prepare current and aspiring accountants as they learn about, and pursue, certifications within accounting.

Facts and Statistics about Accounting Certifications

Accounting certifications can lead to a higher salary

One of the most common accounting certifications is the CPA designation, or Certified Public Accountant. According to Payscale, the average accountant salary is $50,588 per year. However, the average certified public accountant (CPA) salary is $64,644 a year. Another certification is Certified Internal Auditor (CIA). These professionals earn an average salary of $85,000.

Pay range for accountants is different, depending on the specific certification and how many certifications one may hold. But in general, accounting certifications are tightly associated with higher salaries.

Accounting certifications can lead to more competitive jobs

According to the Bureau of Labor Statistics (BLS), the employment of accountants and auditors is expected to grow 10 percent through 2026. This is due to many factors including economic globalization and tax codes and regulations becoming more complex. This job and economic climate may require businesses and industries to seek out accountants who possess more skills or expertise in certain areas, and may also make competition for jobs at elite firms much more advantageous.

“Accountants and auditors who have earned professional recognition, especially as Certified Public Accountants (CPAs), should have the best prospects,” the BLS notes.

Accounting certifications can help professionals branch out into new fields

Just by having a CPA designation, accountants may be better positioned to pursue a broader range of opportunities. For example, they may branch into writing auditing reports or even providing services as a representative for clients in front of the IRS, according to the CPA Accounting Institute for Success (CPA-AIS). Other certifications, like Certified Financial Analyst, can increase finance and investment work opportunities for accountants in foreign countries and regions such as Europe and China.

The CPA-AIS also notes that accounting certifications like Certified Management Accountant (CMA) Agent (EA) can lead to work opportunities with Fortune 500 companies in executive-level roles.

Accounting certifications can help professionals expand their network

In addition to the career and salary opportunities that may come from obtaining accounting certifications, these designations can also enable accountants to expand their professional network. The American Institute of Certified Public Accountants has chapters in each state, where CPAs can connect with one another and share knowledge, resources, and career tips and opportunities.

Types of Accounting Certifications

Accounting designations are a powerful tool for furthering one’s career in the field. But many current and aspiring accountants may be uncertain about which certifications are right for their goals.

Chartered Alternative Investment Analyst (CAIA)

This accounting certification is ideal for professionals who are currently in, or seeking to work in, alternative investments. According to the CAIA Association, most accounting professionals who earn a CAIA charter do so in 12-18 months. To earn the charter, candidates must past two exams, according to the CAIA Association website:

Level I:  Assesses your understanding of various alternative asset classes and your knowledge of the tools and techniques used to evaluate the risk-return attributes of each one.

Level II: Assesses how you would apply the knowledge and analytics learned in Level I within a portfolio management context. Both exams include segments on ethics and professional conduct.

The CAIA Association recommends at least 200 hours of study, and also provides extended study resources like planning guides, exam policies and dates for orientations sessions.

Certified Bank Auditor (CBA)

According to the Asian Institute of Chartered Bankers, the certification for Bank Auditors, or CBA, is “a qualification intended for bankers who aspire to attain further standing and authority in internal auditing.” CBAs ensure that a bank is compliant with laws and regulations and isn’t committing fraud. They can also perform occasional audits if necessary.

Investopedia writer Julia Kagan says that to become a CBA, candidates must complete an extensive multiple choice exam, hold at least a bachelor’s degree in accounting and possess two years of professional experience in bank auditing.

Certified Fraud Examiner (CFE)

This accounting certification establishes that an accountant is extensively trained in the methods and procedures for identifying, resolving and reducing incidents of fraud worldwide. The certification is given by the Association of Certified Fraud Examiners (ACFE).

To earn a CFE designation, accountants first join the ACFE and meet the organization’s eligibility requirements. Eligibility is based on a point system, with points distributed for “education, professional affiliations, and experience.” Applicants typically have a bachelor’s degree in any field, although two years of fraud-related professional experience can be substituted in place of a degree. “At the time you are certified, you must have at least two years of professional experience in a field either directly or indirectly related to the detection or deterrence of fraud,” the ACFE notes.

The ACFE also offers preparation tools, as well as resources for applying, on their website.

Certified Global Management Accountant (CGMA)

The American Institute of Certified Public Accountants notes that the CGMA designation is open to professionals who yearn to be ethical leaders in business, finance and accounting. The CGMA program itself is based on the current needs and demands of financial and business leaders across the globe.

The CGMA program covers three different levels: operational, strategic and management. To earn the CGMA license, candidates must meet several criteria:

  • Become an AICPA member
  • Pass all CGMA learning assessments
  • Possess three years of practical work experience that incorporates technical, business, people and leadership skills
  • Submit an application

Certified Internal Auditor (CIA)

Establishing that an accountant holds extensive auditing knowledge and skills, The Institute of Internal Auditors says that the Certified Internal Auditor (CIA) designation is “the only globally recognized internal audit certification.” Furthermore, the institute notes that it can help professionals earn nearly $40,000 more per year as compared to professionals who are not CIAs.

To obtain this accounting certification, candidates must apply to the CIA program, submit required documents including a character reference form and government issued photo identification, and then register for the exam. Candidates can then schedule the exam, often given at a testing center in a convenient location close to them.

Certified Management Accountant (CMA)

The Institute for Management Accountants (IMA) calls the CMA the “global benchmark for management accountants and professionals.” To earn the credential, candidates must be a member of the IMA, hold a bachelor’s degree and have two years of professional experience in management accounting or financial management.

Testing is conducted only in January/February, May/June, and September/October. The exam itself consists of two parts and can be taken in any order. The IMA offers on its websites several resources for testing, including an exam support package, study tips, content specification outlines and a CMA candidate handbook.

Certified Public Accountant (CPA)

Often referred to as the “gold standard” of accounting certifications, the CPA certification is awarded by each of the 50 states and reflects a level of trust and expertise in the professional who holds it.

The CPA exam covers four sections: auditing and attestation (AUD), business environment and concepts (BEC), financial accounting and reporting (FAR) and regulation (REG). Because CPA designations are given by each state, there may be different eligibility requirements depending on where a professional wishes to obtain the certification. AICPA provides an extensive booklet on tips and resources for taking the exam.

Enrolled Agent (EA)

This designation is helpful for professionals who are working, or seeking to work in, tax-related fields. To earn the certification, candidates must pass an EA exam covering three areas: individuals; businesses; and representation, practice and procedures. The exam itself is multiple choice and given at hundreds of testing sites across the U.S., according to the National Association of Enrolled Agents.

Tips and Resources When Pursuing Accounting Certifications

Each accounting certification has different steps and procedures, and serves specific needs and goals of professionals. Regardless of which certification an accountant pursues, the following tips can prove helpful.

Take the exam only when you’re fully prepared

Accountants may feel pressure from their peers to rush and obtain certain certifications when they first become eligible. But because of the high costs of testing, as well as the extensive amount of time it takes to prepare for a test, it may be better for current and aspiring accounting professionals to wait until they are fully confident they are prepared to pass their exam.

Writing for CPA Accounting Institute for Success, Kenneth Boyd suggests that CPA test-takers adopt steady study habits. “A study schedule is crucial to studying efficiently because it allows you to prepare mentally for the dump truck of CPA information to unload in your head. You know when you are supposed to study and you can prepare for it mentally.”

Carefully consider which certification is the best fit for you

The CPA may be considered the “gold standard” of accounting certifications, but it isn’t necessarily the right fit for each accountant, depending on their interests. While some certifications can lead to an immediate bump in pay, they might not be the right fit for the long term. Consider what your current and future career goals in accounting may be before deciding which certifications to pursue.

Don’t stress if you don’t pass the first time

For those who have taken the CPA exam so far in 2019, AICPA reports the cumulative pass rate as follows:

  • AUD: 48.56 percent
  • BEC: 58 percent
  • FAR: 44.43 percent
  • REG: 50.23 percent

That means for two sections of the CPA exam, less than half of test-takers passed. Even with hours upon hours of preparation, it’s possible, if not probable, that exam-takers won’t pass on their first try. Knowing that this is a possibility will help prevent accountants from being discouraged and help them stay motivated to pursue their career goals.

Continue to pursue additional accounting certifications

Certifications can play an important role in helping boost the careers of accountant’s and help them earn more money. There is a caveat, however. Each certification can take a long time to prepare for, causing some accountants to not pursue certifications that may be helpful. Taking time between certification processes can help accountants rest and recuperate before they pursue new credentials and continue their upward climb.

Sources:

American Institute of Certified Public AccountantsAICPA, “Become a CGMA Designation Holder”AICPA, “CPA Exam Pass Rates”

AICPA, “The Uniform CPA Examination”Asian Institute of Chartered Bankers, “Certification for Bank Auditors”ACFEACFE, “Become a Certified Fraud Examiner (CFE)”ACFE, “CFE Qualifications”ACFE, “Details and Benefits – “Associate Membership”Bureau of Labor Statistics, “Accountants and Auditors”CAIA Association, “Preparing”CAIA Association, “The CAIA Charter”CGMA, “Finance Leadership Program”

CPA Accounting Institute for Success, “6 Best CPA Exam Study Tips and Exam Prep Strategies”CPA Accounting Institute for Success, “Best Accounting Certifications: CPA, CFA, CMA, EA, CIA”Institute of Management Accountants

Institute of Management Accountants, “Taking The Exam”Investopedia, “Certified Bank Auditor – CBA”

National Association of Enrolled Agents, “Enrolled Agent (EA) Examination”Payscale, “Average Accountant Salary”Payscale, “Average Certified Public Accountant (CPA) Salary”Payscale, “Salary for Certification: Certified Internal Auditor (CIA)”

Rider University, “Online Masters of Accountancy”The Institute of Internal Auditors, “Prove Credibility & Proficiency”The Institute of Internal Auditors, “Steps to Certification”