Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Certified Public Accountant (CPA)

What it is:

A Certified Public Accountant (CPA) is an accounting professional who has passed the Uniform CPA examination and has also met additional state certification and experience requirements. 

How it works (Example):

To become a CPA, a person must: A) complete a college-level accounting program, B) pass the Uniform CPA Examination, and C) have a certain amount of professional work experience in accounting -- typically one year

The CPA examination is developed and graded by the American Institute of Certified Public Accountants. The exam has four sections: auditing and attestation, financial accounting and reporting, regulation, and business environment and concepts. Nearly 14 hours long in total, the CPA examination also includes a writing skills exercise, multiple choice questions and case studies.

Once a person becomes a CPA, they can specialize in one specific area of finance or a wide range of services, including:

  • Corporate Finance
  • Corporate Business
  • Estate Planning
  • Financial Accounting
  • Financial Analysis
  • Financial Planning
  • Forensic Accounting
  • Income Tax
  • Information Technology
  • Management Consulting
  • Performance Management
  • Tax Preparation and Planning
  • Venture Capital

CPAs are required to complete a minimum number of continuing professional education (CPE) courses in order to retain the CPA designation.

Other countries have different designations for the CPA qualification. The Canadian equivalent to a CPA is a Chartered Accountant (CA).

Why it Matters:

The CPA designation is granted by the American Institute of Certified Public Accountants in order to maintain industry-wide, professional standards.

A CPA designation is a certification of expertise in the field of accounting. Only a CPA can provide an opinion to the public regarding publicly distributed financial statements.

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