Do You Need To Hire A CPA Or An Accountant?
Are you curious about the differences between a Certified Public Accountant or CPA (certified public accountant) and an accountant professional resources? Although they might appear to share the same experience and qualifications, there is a lot more to them than that. Before you decide which one to hire, make sure to understand these differences.
What’s the difference?
This can be explained in two ways. Confused? It can be confusing knowing the difference between these two professions. CPA means a financial specialist who has passed the state licensing examination. Accounting professionals who fail to pass the exam are not licensed by the state.
Both do tax-related finances work. They both follow the Financial Accounting Standards Boards (FASB) and the Generally Accepted Accounting Praciess (GAAP). Both sets of professionals have likely received college degrees.
The term “accountant”, however, refers to someone who handles finances according to FASB regulations. CPA is not available to anyone who has passed the state licensing exam.
What makes CPAs special?
These professionals are so valuable because of the state licensing exam. Licensing is a long exam that covers many aspects in finance and tax. Professionals need to stay up-to date with tax laws in order for them to keep their license. Bookkeepers and financial professionals are not required to do this.
When should one be hired?
In certain situations, CPAs could be more valuable than accountants. CPAs might be more beneficial than accountants in these three areas.
Taxes. They will often be more familiar than finance professionals with tax law. The IRS considers them certified preparers. This is important, because certified preparers have more capabilities to represent clients to IRS if necessary.
Financial Analysis. Even though anyone can do basic financial work such as creating reports or entering records, it’s best to have an expert financial analyst analyze your financial situation. They can offer financial and tax advice that no one else can.