Many professions offer various levels of professional skill, ranging from novice to expert and many places in between. There are part time plumbers, and there are master-plumbers. Part time electricians and master electricians. Stock brokers and Chartered Financial Analysts. CNA’s and MD’s. And finally, tax preparers and CPA’s. Not to take anything away from stock brokers, CNA’s and tax preparers, but for every who decided to not invest in their careers any further, there are those that kept acquiring knowledge and credentials in their field of study. And generally, consumers are rewarded by a better product or service from those who did go farther.
CPA’s Passed A Killer Exam
The CPA exam is legendary for its difficulty level. There are a couple of other lesser-known entrance exams that are probably more difficult – notably the CFA (Chartered Financial Consultant) and the Actuarial Accrediting Exams. And then there is the BAR, the state entrance exam for attorneys. Many professionals have both a CPA license and have passed the bar exam in their state. For most of the individuals who have experienced both of these exams, they will tell you that the CPA is generally more difficult than the Bar. The reason given is the breadth and depth of information learned. As my accounting teacher used to tell us, Accounting is an inch deep, but a mile wide.
Tax preparers with no designation means at minimum, that they chose not to go further with their education in their field. It doesn’t really mean any more than that, but it does mean that. In fact, the IRS requires zero requirements to do tax work. It should be noted that there are thousands of highly capable, non-CPA tax preparers that do wonderful work for American citizens all over the country. That point should be obvious.
The hardest thing in the world to understand is income tax. -Albert Einstein
Ongoing Commitment To Continuing Education
CPA’s understand that their license, acquired via the above CPA exam, is held active by achieving a set amount of continuing education credits every year. That number depends on the state in which the license is held, but all states do require some minimum annual education. The average continuing education is roughly 40 hours per year.
Everyone knows that they are likely to learn far more in the course of their work than they are at some seminar. That goes without saying. But it’s also true that the additional commitment to excellence is further evidence that CPA’s are generally also committed to a higher level of work for their clients.
CPA’s Have More To Lose
I am the first to admit, many licenses are a state money grab. There are too many licenses requirements, and too much burden placed on Americans who would like to license and master their field, whatever that may be. But once licneses are obtained by individuals who have put in the effort to obtain it, they are not likely to let go. The same is true for the CPA license. A five-year degree in accounting, followed by 200-300 hours of CPA exam study, followed by an exam that takes about 16 hours to complete, with less than a 50% passing rate. Yeah, once you get something like that, you don’t want to let it go.
So, what does that mean? It means that CPA’s have invested deeply into a career that works for them, and they’ll do whatever it takes to abide by licensing requirements, and keep it. Which means the consumer is the winner.
Many accountants often go behind other accountant’s work for clients who have moved clients for one reason or another. I can tell you this, CPA’s do better work. Again, I don’t want to generalize this point too much, but it consumers should know that CPA’s generally speaking are better preparers on the whole than their non-CPA counterparts. Whether it’s the education, the exam, the continuing education or the fact that CPA’s just try harder because they have more at stake, they generally provide a better service for the consumer.
Disclaimer, all of Smartsource writers are Certified Public Accountants.