If you’re looking for a career in the field of business, then perhaps accounting should be on your radar. The U.S. Bureau of Labor Statistics lists the vocations of accountants and auditors as careers that offer full time work—with some in the field working more than 40 hours a week—and a stable job growth of 4 percent between 2019-2029 (as fast as the average for all occupations). As of 2019, the median pay for accountants and auditors was $71,550 per year (or $34.40 per hour), and there were 1,436,100 people working as accountants or auditors.
If one is excited about dealing in finances and measuring the health of a company, then how does one become an accountant or auditor? And what does it take to get such a job?
Kyle Allen is a managing partner at Vaco Nashville, overseeing the office operations including the company’s Accounting and Corporate Finance projects. He discusses with Launch Engine what got him into accounting.
“I wanted to be in a business-related field of some sort,” Kyle recalls. “I was talking to some of my mentors and asking what I should do. They told me if they could do it all over again, that they would major in accounting.”
From his mentors, Kyle learned that accounting was “a foreign language of business.” However, if one embraced the front-end headaches of trying to learn accounting, they could learn other aspects of business as well.
Before this, Kyle had always had an interest in business, including a curiosity about the stock market at an early age. He also wanted to get a degree that allowed him some level of comfort in virtually any industry. On the advice that he was given, Kyle majored in accounting at the University of Tennessee, Knoxville. After graduation, he got a job with Ernst & Young (EY), one of the Big 4 accounting firms for about 18 months before going to a boutique recruiting firm in Nashville, and later joining Vaco in 2012.
While his position at Vaco Nashville is more related to management and sales, Kyle says that much of his accounting knowledge gets put to use. He attributes this to the fact that accounting is the study of business itself.
Kyle explains, “In business, there are certain responsibilities that go across everything. One of those is communication and being able to communicate financial details is part of what an accountant does. Another is becoming familiar with the operations of a business. Accounting lets you do both.”
Colleges and universities offer degrees specifically related to accounting, that usually require a 3.0 GPA or higher to be admitted. Aspiring accountants will have to go back to school if they get a degree in other business majors, as making this vocational change will demand it.
In terms of what accountants do, Kyle offers the following summary: “Accounting is always looking backwards. It’s kind of keeping score of what’s going on for a company. Whereas the financial planning and analysis (FP&A) projects what’s going to happen.”
Kyle says that there are functions performed within the field of accounting, such as a controller, that might have a person oversee the entire accounting and financial operations for a company. Under that leadership pyramid, there are individual accountants who might handle only certain parts of a company’s financial operations, such as accounts receivable, payroll, or day-to-day accounting. Kyle also explains that accountants can shift over to the financial side of the business, so they can handle responsibilities related to budgeting and forecasting. For those on the financial side, Kyle says, “They’re basically taking what the accountants do, and analyze it to see if there are trends in the business. This could be related to segments of the revenue, or comparing it to the budget over a certain period of time.”
For those working at a Big 4 or large regional accounting firm, there are two paths you can take: tax or audit. If you are working for a smaller firm then you may do a little bit of both in a team-based format. As a Tax accountant, you will learn everything related to tax and will get very familiar with the ever-changing U.S tax code. There are individual, corporation, and partnership taxes—and many variations within all three.
In terms of audit, Kyle states that when a client hires an accounting firm they would be expected to give an opinion about whether or not the financial statements present an accurate reflection of the organization’s financial condition. Audits are performed on all areas of the company’s financial processes, with more attention paid to analyzing high risk areas that will vary by industry. Kyle says that such audits provided by an external accounting firm are done for various reasons. This includes when companies are publicly traded, have outstanding loans to banks, and when a proprietor wants to sell their business.
It should be noted that audits typically aren’t forensic in nature. “You’re not necessarily looking for fraud per se, because most companies don’t have outright fraud,” Kyle clarifies. “But there’s ways in which a company can potentially manipulate or misclassify their revenues or expenses to make it look like they’re more profitable than they really are.”
Kyle says that much of the world of public accounting changed with the passage of the Sarbanes-Oxley (SOX) Act of 2002, which was written in response to corporate scandals such as those involving Enron and Worldcom. For companies that are publicly traded—in addition to giving an audit opinion on the financial statements—auditors now have to document and test how the accounting functions are completed within the organization. This ensures accountability for how these procedures are performed and reviewed properly throughout the organization.
According to Kyle, one of the biggest myths related to jobs in accounting is that accounting relies on complicated math. “If you can add, subtract, multiply, and divide, then you can do accounting. It’s all figure-based,” he explains. “It’s because there’s a lot of numbers, and people equate numbers to math that people think that. But it’s really more theory-based, like where the numbers go, what the numbers affect.
Depending on their role, accountants may be working by themselves, or within a team. Public Accounting is more team-based, where working in an Accounting Dept for a specific company would be more individual type work. Whatever their job description is within a company or firm, an accountant will be doing most of the same tasks every month.
Regarding first jobs outside of college, Kyle says that many new accountants stress that their first employer must be one of the Big 4 accounting firms. He says that people who don’t get selected by one of those firms may feel invisible and devalue their career, which shouldn’t be the case. Additionally, Kyle says that a number of people come to their first job with a sense of entitlement. He advises against making either of these mistakes. Whether you start with a Big 4 accounting firm, a large regional CPA firm or within a corporate accounting department, the important thing to keep in mind is the place of employer you choose where you can learn and grow in your career.
“You need to make your own career path,” Kyle states. “Don’t sit back and wait for someone to help you along. If you want to do something different, go do it.”
That philosophy applies to networking, too. There are some groups in which young accountants may network. But according to Kyle, the real lesson in networking for accountants may be to make your own network. He points incoming accountants toward volunteering with a nonprofit, as it’s both a way to give back and a great tool to network and develop your accounting skills.
Kyle says entry level accounting jobs have enticing starting salaries, around $50-60k, with the pay depending on internship experience and whether you start your career inside or outside of public accounting. “Accounting in general is a pretty in-demand job,” Kyle declares. “If you’re looking for some stability, good growth, and a lot of opportunity to move out in different facets of the business world, it’s a great starting point.”