If you’re considering a career in accounting, you may wonder if you should pursue a public or private accounting position. While both types of accounting have their unique benefits and drawbacks, there are some critical differences between them that you should be aware of before making your decision. Working with a public accounting firm, you meet lots of professionals both within the accounting industry and across the board through your clientele.
A CPA license is required to advance
WGU’s affordability, combined with our focus on competence over credit hours, means you not only get a high-quality education but also gain the ability to tailor your learning experience according to your career goals. Based on data submitted to Glassdoor and ZipRecruiter, the average salary for a CPA in the non-profit sector ranges from around $61,370 to $63,850. Public accounting offers the opportunity to work with various accounting systems and for an array of companies operating all over the world. Public accountants often have to build rapport with their clients, so strong social skills are a significant advantage.
- Actual outcomes vary based on multiple factors, including prior work experience, geographic location and other factors specific to the individual.
- Private accountants and Public Accountants must hold an undergraduate degree in accounting or finance from an accredited institution.
- This versatile professional oversees a wide range of accounting, auditing, tax, and consulting tasks.
- This personalized approach allows clients access to professional service providers who understand their individual goals creating efficient plans aimed at helping them reach those objectives quickly.
Which path offers better career advancement opportunities?
Moreover, aspiring public accountants must pass the Certified Public Accountant (CPA) certificate exam to practice. The focus on managerial reports makes the role more predictable, as private accountants’ work may also include account reconciliations and manual journal entries. That also means the Controller is not going to have enough time to review in much detail.
Because you’re internal to a single company, your advancement opportunities are limited to the positions that the company has to offer. The Chief Financial Officer is at the top of the food chain, and there’s only one of those. The same usually goes for upper management positions in private accounting like controller.
If you’re looking for a career path that doesn’t require earning a CPA license, private accounting is the right path for you. According to EMSI, in 2021 there were 170,481 job postings for accountants and auditors with a bachelor’s degree and no CPA license. Expected salaries for accountants without a CPA are heavily influenced by years of experience.
Lower Level Of Expertise- The Drawbacks of Private Accounting
- This method would show a prospective lender a much more complete picture of the company’s revenue pipeline.
- That also means the Controller is not going to have enough time to review in much detail.
- In addition to building your accounting capabilities, Franklin gives you a jump-start on pursuing a professional certification, saving you both time and money.
- Public accountants can help individuals and businesses save money by providing tax planning advice and preparation services.
This networking can help you advance professionally, as well as expose you to new areas of specializations that may interest you and which you may choose to pursue as you grow your career. In private vs. public accounting, individuals do not work for a firm, but rather, directly within the structure of a single organization. Likewise, their work is used for internal purposes only, rather than public reporting and diligence. Let’s take a closer look at what it means to be an accountant in the public versus private sector. Even still, a CPA license can give any accountant a leg up in their career—even those in the private industry.
However, owing to the nature and scope of the work, the knowledge of a private accountant may remain limited to certain areas of accounting only. Public accounting is the type of accounting where an accountant acts as an independent third party with various client companies to examine the financial statements that a company is required to disclose to the public. The public accountant also supports the preparation of the financial statements to ensure fair representation of the client companies’ results, financial position, and cash flows. Payscale reports that, on average, public accountants make $76,165, with salaries ranging from $54,000 to $123,000 depending on experience, location, and industry influences.
On the other hand, if you prefer a more stable and consistent workload, value work-life balance, and are interested in developing in-depth industry knowledge, private accounting could be the better choice. No matter which type of accounting is the job of your dreams, there’s a degree program to help get you there. If you’re ready to take the next step, visit the Accounting degree page to learn more about what Rasmussen College has to offer. Now that you know more about the ins and outs of public versus private accounting, you should be able to determine which path is best for your future.
However, the distinctions can be seen in the skill developed after the fresh graduates join either career path. Public and private accounting can be seen as “external” accountants and “internal” accountants of a company, respectively. It is important to understand the various facets of the two in the pursuit of either career option. The Bureau of Labor Statistics (BLS) reports that the top three paying states for accountants and auditors are the District of Columbia, with a mean wage of $110,750, New York, with $110,320 and New Jersey, $102,040. Yes, many accountants successfully transition between public and private accounting at various stages in their careers.
Skills
If you are considering entering this field, then it’s essential to understand the difference. They may hold high-level jobs such as CEO or entry-level positions as a member of the accounting department. By having an accountant do the tax return forms, the business gets some protection in an audit. Embracing the diverse clientele and collaborative spirit of public accounting not only cultivates expertise but also enriches one’s professional journey. As practitioners navigate various engagements, they continuously refine their skills, broaden their knowledge base, and expand their network, paving the way for long-term success in the dynamic world of accounting. CPAs should thoroughly research and consider their options when deciding between public or private accounting to choose the path that best suits their professional objectives.
A CPA license is not required
Private and public accounting both involve accounting work, but the two differ in the types of services they offer. If you’re working in one area and it’s not right for you, you can switch to the other. Every professional experience you gain is valuable to strengthen your skillsets and build your career. This exciting field merges elements of accounting with investigative work and financial crime prevention. According to ZipRecruiter, the national average salary for forensic accountants is over $90,900 per year Learn more about what a forensic accountant does and how to become one.
Despite these challenges, many professionals find fulfillment and opportunity in private accounting. Public accounting provides growth opportunities, such as moving from an entry-level position to more senior roles like partner or manager within the same firm or organization where one is employed. Alternatively, one may switch firms for higher pay or remain with the same firm for career development opportunities and gain experience in different areas, such as forensic accounting and tax planning. Public accounting firms provide detailed financial reporting services to ensure accurate and up-to-date information is available for decision-making. It is significant for larger companies that must comply with regulatory requirements such as the Sarbanes-Oxley Act of 2002. Accountants advise public vs private accounting on areas such as implementing business strategies, developing a business plan, or expanding an existing business.
Clients- The Key Differences Between Private And Public
Third, there is limited descriptive evidence on many fundamental accounting choices, including the extent to which private firms follow US GAAP, obtain an audit, or use various managerial accounting practices. Fourth, private and public firms differ on many central dimensions, which raises difficulties related to conducting empirical analysis and assessing generalizability. Another consideration is that many accountants choose to launch their accounting careers in the public accounting space to gain experience before moving into private accounting.
