Accounting is the process by which businesses record, organize, and summarize their financial activities for easy evaluation and analysis. The Financial Accounting career path creates jobs related to collating information and preparing reports on the financial status of a company.
Becoming a Financial Accountant
This field of accounting deals with monitoring and recording the financial activities of a business. Auditors carry out an independent analysis of the financial records and reports of a business to ensure it complies with specific government standards. Other career paths in accounting are Tax Accounting, Forensic Accounting, Fiduciary Accounting, Banking, Cost Accounting, Actuarial Accounting, etc.
Financial Accounting as a Career Path
Financial accounting experts are responsible for collating information and preparing reports on the financial status of a company or an organization. They prepare documents that include but are not limited to balance sheets and income statements, cash flow statements, and monthly, quarterly, and annual reports.
Expected responsibilities:
- Preparation of income sheets and balance sheet reports.
- Recommendation of informed financial actions to stakeholders.
- Conducting internal and external audits.
- Effective communication with business stakeholders as well as clients.
- Examination of financial records to check for accuracy and eliminate inconsistencies
- Gathering and interpreting the company’s financial data and summarizing financial status.
- Monitoring the company’s tax payments to ensure they comply with regulations
Financial Accounting Career Salary
A Financial Accountant plays a vital role in the success (or failure) of a business, and this is likely one of the factors that influence the high salary of experts in the field. According to a survey carried out by PayScale on the annual salary of Financial Accounting Career Path – Financial Accountants in the United States, the annual salary ranges from $40,000 to $71,000 (PayScale., 2020) depending on the location and years of experience of the accountant.
Accountants with 1-10 years of experience earn between $46722 and $55,407 per annum while those with 10-19 years of experience earn $55,407 to $56,435, and accountants with experience of 20 years and above earn around $58,305and higher (Financial Accountant Salary | PayScale., 2020)
Growth Rate
The growth rate of the Financial Accounting Career Path is defined as how much or how fast an entity has changed during a specific period. According to Investopedia, in earlier years, accountants were mostly bookkeepers who recorded agreements regarding exchanging goods and services. In 1494, Luca Pacioli (the Father of Accounting) described the systems of double-entry, which are similar to balance sheets used in accounting today.
Accounting was not recognized as a profession until 1896, when the Certified Public Accountant (CPA) became a title for accounting professionals. With the advent of World War I, the demand for accountants in the U.S.A. increased as the government needed funds to fight the war.
Over the years, as the role and responsibilities of accountants evolved, there has also been an increase in the demand for financial accountants. According to the U.S. Bureau of Labor Statistics, a 4% increase is expected in the employment rate of accountants from 2019 to 2029.
Future Job Outlook
From 2019 to 2029, the employment of accountants and auditors is expected to increase by 4%, which is about the same average increase in other occupations.
A survey by the US Bureau of Labor Statistics also suggested a 10% increase in the demand for Financial Accountants until 2026, which is said to be well above the average profession in the country. So, despite technological advancement, especially in Artificial Intelligence, Financial Accountants are guaranteed the security of their job for the next couple of years.
Why is Financial Accounting a Good Choice?
While the salary of Financial Accountants might be a significant factor that influences choosing it as a profession, there are other reasons why choosing a career in Financial Accounting would be a good decision.
- High Employment Opportunity: Accounting jobs are required in every industry because companies and businesses must hire experts to monitor their financial activities. There will always be a high market demand for accounting professionals.
- High Salary Expectation: The salary of an average accountant is mouthwatering, and as you progress on the job, there is likely to be an increase in remuneration.
- Challenging and Engaging: Managing the financial activities of a business or a company can be intellectually challenging – it involves the real-life application of concepts and theories.
- The basis for Entrepreneurship: With a degree in accounting and a good understanding of the underlying concept, one can set out to be an entrepreneur and manage their own business.
- Growth Opportunities: Financial accountants can take professional exams after a first degree to advance to higher ranks in their chosen career path. An accountant with the proper certificates and years of experience can rise to an executive level in a company.
- Better Management of Personal Finances: With background knowledge of finance management, accountants are more likely to manage their finances better than the average individual with no accounting knowledge.
Strengths of Financial Accounting Career
The pros of being an accountant can also be found in why choosing a career path in accounting would be a good choice. The advantages that come with a career in accounting include:
- Stability: Accounting is currently a stable and progressing career path that promises to be relevant for the next couple of years, as there will be a need to employ an accountant occasionally.
- Defined Career Path: The career path in financial accounting is well defined because the necessary steps, including examinations and certification required to move to a higher position, have been mapped out.
- Job Flexibility: Accountants can work in any industry since their roles are vital to advancing any business.
Weaknesses of Financial Accounting Career
A career in accounting is exciting, but like every other job, it has its areas of weaknesses, and some of them are discussed below.
- Life-long Education: While it is an exciting experience to learn on the job as an accountant, a University degree might not be enough to get you where you want to be as a professional. Certification exams would be taken at intervals to keep up with the changes in the industry.
- Long Working Hours: Accountants usually spend more time than other workers preparing income sheets, balance sheets, and other documents required for periodic evaluation of their firms.
- High Level of Stress: A typical accountant job is a regular 9-5 job, which may also require putting in extra hours at work to meet deadlines and prepare reports.
- Repetitive Work: After years of routine and doing the same thing over and over, the job may become less exciting as there are no new challenges to overcome.
Seeking a professional career in Financial Accounting will be an excellent choice for individuals looking to be involved in the day-to-day financial activities of a business. With a college degree and the right amount of enthusiasm and dedication, one can succeed significantly in this field.
Check the following articles to read more about Financial Accounting Career Path:
- Flavin, B. (2019, March 18). 10 Must-Know Pros and Cons of an Accounting Career. Rasmussen College. Retrieved 16 November 2020. (URL)
- Read Accountant Salary and Job Growth Data. (2020, June 17). All Business Schools. Retrieved 16 November 2020. (URL)
- The 8 Branches of Accounting: Their Uses and How They Work. (2020, July 20). FreshBooks. Retrieved 16 November 2020. (URL)
- Tuovila, A. (2020, January 28). Accounting Definition. Investopedia. Retrieved 16 November 2020. (URL)
- Lowe, S. (2020). Retrieved 16 November 2020. (URL)
- Financial Accountant Salary | PayScale. (2020). Retrieved 16 November 2020 (URL)
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