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The Different Types Of Accounting
Accountants are a much-needed component within businesses. For the economy to run smoothly, numbers need to be accurate, and the value of a dollar needs to steadily increase. It is for that reason that accountants are needed.
For the many duties that accountants are required to fulfill, there are a variety of different accounting roles. This means that instead of having one person fulfill all the possible duties required from an accountant, there are many subfields that an individual may choose to focus on so that they may provide the highest standard when fulfilling those duties.
There are many different types of accounting subfields, but these can most commonly be broken up into tax accounting, financial accounting, and management accounting.
Tax accountants truly shine during tax season. But their duties are required throughout the year. Planning your tax return is something that needs to be thought of consistently to make sure that it is submitted accurately when tax season rolls around.
Taxes and finances are harder to control when it is for a large business. Tax accountants, therefore, offer their services, advice, and expertise year-round but provide hands-on services during tax season.
Financial accounting is one of the most common forms of accounting and seeks to focus primarily on organizing, assessing, and compiling the financial data and financial transactions of a business. They draft up the financial statements for a company and produce statements that are considered true and accurate for stakeholder consideration.
One of the many roles of a financial accountant is to ensure that a company conforms to statutory and federal financial rules and that these businesses or enterprises are not performing any illegal financial acts such as money laundering and tax evasion.
Management accounting refers to the internal accounting processes of a company that presents the company's financial data to the internal management of a company. It is through the jobs of these accountants that the management of a company will determine if it is safe for expansion and investment, or if overheads need to be reduced and costs need to be cut.
Considering how much is riding on the work that management accountants produce, their work needs to be extremely accurate, and their representation and interpretation of a company's finances need to be unparalleled.
Over and above these overarching fields of accounting, further subfields have been developed as the need for such accounting services arose and as industries developed leading to a greater need for specialized accounting services. Let us take a look at these other types of accounting.
As the Jack of all trades in the field of accounting, public accounting refers to accounting businesses or firms that offer accounting advice and services that are specific to the client's needs. Whether this is tax advice, auditing services or even working with clients through the installation and use of digital accounting programs, public accountants do it all.
As a staff accountant, you will be employed in the accounting or finance division of a company. You will work with and report to a certified public accountant (CPA), and you complete the duties of managing, overseeing, and creating financial reports and compiling financial data.
You will also manage accounts payable and receivable, carrying a great responsibility in ensuring that a company has received the money that is owed to them, as well as paid the money that is owed to others. You may also be responsible for overseeing budget implementation.
A project accountant may be employed by a company, or their services may be outsourced, and their purpose is to oversee and manage all finances pertaining to a specific project within an organization.
They will plan the budget of the specific project to make sure it fits into the overall finances of the organization and that it is affordable to the organization. These accountants will also make sure that all vendors used in this project are paid on time and that all income that is expected to be generated from these projects meet or exceed projections and expectations.
A cost accountant is usually hired by a company or organization when the financial margins are not looking too great. They are hired to analyze the cost of production, the markup that is placed on these products and services, and the rate at which it is sold.
They then provide advice to devise and implement cost-saving tactics and they help the organization in making accounting decisions. Every cost that is incurred in the production of a single product item is analyzed and they then compile, analyze, and assess these findings and present them to management with viable solutions or configurations.
They help companies create and implement healthy supply chain processes.
As a company grows and they expand beyond the boundaries of a single country, its finances expand too. This means that their financials are no longer governed by one country, but rather by all the countries in which the company has a presence and in which they are operating.
Chartered accountants are therefore called in as they have an understanding and expertise in cross-border financial and accounting practices, and they make sure that companies adhere to all accounting practices and laws in all the countries in which they are actively operating.
Governmental accountants are active in the state, federal, and local government sectors instead of working with private companies or individuals. Governmental accountants execute budgets and manage governmental funds that are available for a financial year. This ensures that public funds are available for public use.
How Much Does An Accountant Earn?
According to the U.S. Bureau of Labor Statistics (BLS), accountants and auditors earned a median annual salary of $77,250.
How Many Different Types of Accounting Services Are There?
Many different types of accounting services exist, and they cover a wide array of different yet very specific needs that individuals and businesses may require. But these multiple subfields can often be divided into three main types of accounting namely tax accounting, financial accounting, and management accounting.
What Is The Job Outlook For Accountants?
The BLS states that there is an expected 6% forecasted growth in the field of accounting and auditing.
If you are hoping to pursue a career in accounting, there are a variety of options for you to choose from. Depending on the role you are hoping to fulfill and the desired field in which you are hoping to work, this may be a viable field of study for you.
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