Roles of Accountants: Public Versus Private
Prof. S. Alabran, MBA
Introduction to Business 100
December 15, 2008
What is accounting? By definition it’s a comprehensive system for collecting, analyzing, and communicating financial information. It is said to be one of the best jobs in North America in terms of stress level (low), compensation (high), and career placement after graduation (fast). (Accounting Major) The recent increase in corporate malfeasance offers four constructive lessons of note for accountants and other financial professionals. First, honesty is the best policy. Accountants have both a professional and a moral duty to be honest in all of their dealings. Second, the costs of dishonesty must exceed the benefits derived from dishonest behavior. The time has come for the accounting profession to adopt a zero-tolerance policy for dishonest behavior by employees, clients, and others. Third, the good soldier defense does not excuse wrongful behavior. Even when pressured by others to act dishonestly, accountants can be held criminally or civilly responsible for their unethical behavior. Finally, when pressured to engage in unethical activity, accountants should carefully consider the legal ramifications of their response and consult with an attorney experienced with such situations. (Buckhoff T. &., 2008)
Beyond carrying out the fundamental tasks of the occupation- preparing, analyzing, and verifying financial document in order to provide information to clients- many accountants also offer budget analysis, financial and investment planning, information technology consulting, and limited legal services. Career opportunities in accounting fall most broadly into two categories: public and private. (Accounting Major)
Public accounting is the area of accounting specifically concerned with the preparation of financial statements in a fair and consistent manner for external use of investors, creditors, and analysts. Public accounting firms range from one-person operations to large multinational organizations that employ thousands of professionals and generally offers higher salaries, variety, and advancement based on merit. Public accountants perform a broad range of accounting, auditing, tax, and consulting activities for their clients, which may be corporations, governments, nonprofit organizations, or individuals. The types of services rendered vary according to firm size and orientation. Most often, career paths in public accounting are either in tax or audit. (Public accounting or private industry)
Normally a public accountant will get certification as a Certified Public Accountant (CPA) and work either independently or as a member of an accounting firm. They provide an equally wide range of services, including consulting on taxes, accounting, and auditing. Some might help businesses maximize profits by advising them on taxation, for example suggesting tax deductible expenditures or providing advice to help managements make better decisions. Others might help companies in evaluating employee benefits, insurance, compensation, developing programs for accounting or processing data, or safeguarding assets. Others might audit financial information and prepare statements for investors or officials to show that their financial activities have been properly conducted and reported. (Accounting and Auditing Careers, Jobs, Training and Employment Information, 2004) In the U.S., there are 425,000 certified public accountants (CPAs) who passed a certification exam. If you add in non-CPA accountants, that number is much higher: According to the Bureau of Labor Statistics, accountants and auditors held about 1.2 million jobs in 2004. (Formichelli, 2007) Government accountants work in the public sector, maintaining and examining the records of government agencies and auditing private businesses and individuals whose activities are subject to...