What can a CPA do that an accountant can't?

What can a cpa do that an accountant can't? Image of two peoples' hands holding documents

If you're an accounting major in college or exploring accounting career paths, a professor, advisor, or even articles you've read have told you that earning your Certified Public Accounting (CPA) license is essential to your career. Now you want to know why - specifically, what can a CPA do that an accountant can't? And is earning your CPA license worth the effort? We're providing the answers to these questions so you can make informed decisions about your future.

Before you dive in, hear from Becker National Instructor, James Wiley, talk about his experience as a CPA and how it's benefitted him!



What can a CPA do that an accountant can't?

Both CPAs and accountants can prepare tax returns, analyze financial statements, improve accounting systems, and perform similar tasks. The most significant distinction between what a CPA can do and what an accountant can't is in a CPA's legal authority to execute specific duties or fulfill specific roles. 

Representing clients in IRS proceedings 

While an accountant can offer tax-related advice or prepare tax returns, only Enrolled Agents and CPAs can represent clients in front of the state tax office or the IRS in case of an audit or other issue. 

Companies and individuals with complex tax needs will often seek a CPA from the start because they can intercede with the IRS if questions or concerns arise. This minimizes the need to bring in a CPA at a later date if the IRS audits them or has concerns about their tax returns prepared by a non-licensed accountant.

External and SOC audits

Non-CPAs can perform internal audits used by the organization but are not authorized beyond that. Only a CPA (or CPA firm) can perform external audits, audits of publicly traded companies, and Service Organization Control (SOC) audits which assess a service organization's internal controls. 

SEC reporting

All publicly held companies must file financial statements with the Securities and Exchange Commission (SEC). Only CPAs have the legal authority to prepare and certify audited financial statements with the SEC. 

CPAs vs Accountants: Reasons to pursue licensure

If you don't plan on going toe-to-toe with the IRS or performing external audits in your future, should you still earn your CPA license? Absolutely! 

Improved credibility and trust

Becoming a CPA demonstrates your commitment to professionalism, ethics, and excellence in the accounting profession. The CPA designation is widely recognized as a mark of credibility and trustworthiness by clients, employers, and peers. Clients are more likely to trust your expertise and rely on your services when they know you are a licensed CPA. Moreover, the rigorous requirements for obtaining and maintaining the CPA license reflect your dedication to upholding high standards of integrity and competency in your work.

Increased career opportunities

Many employers in public accounting firms, financial services, and corporate finance departments prefer or even require candidates hold a CPA license, especially for senior-level positions. Having your CPA license opens the door to more career options, including financial analysis, consulting, and management accounting as well as tax accounting and auditing. 

Increased earning potential

The average CPA salary is around $96,0001 while the average salary for non-CPAs is around $62,0002 per year. Of course, several factors affect salary, including experience, location, and area of practice, but no matter where you compare, CPAs do tend to earn significantly more than non-CPAs. 

CPAs' specialized knowledge, skills, and credibility make them a greater asset to employers and also offers more senior positions, like partnerships in accounting firms or leadership roles in corporations which command a higher salary. 

Get our Free CPA Exam Guide

Yes, obtaining your CPA license is hard. You'll need, at minimum, 150 hours of college credit, a year of relevant work experience, and a passing score on four sections of the CPA Exam. But pursuing your CPA license offers benefits that will carry through your entire career and offer long-term rewards and opportunities.

Get a comprehensive look at the CPA Exam, including what it covers and the CPA Exam format plus study tips and practice questions in our free CPA Exam Guide. 

Download the CPA Exam Guide


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