It’s all about the digits.
Numbers and mathematics are fundamental, in fact, for people preparing for a career in certified public accounting, which means they’re fundamental for lots of people on college campuses these days.
Accounting is a sexy new college major, much as marketing and computer science have been in the past.
Ever since the Enron scandal – as well as some other landmark fraud cases such as MCI and Adelphia– the numbers of those entering accounting have risen. Add to that new regulations that are a result of those scandals, and the number of jobs, especially for auditors, has skyrocketed.
With the growing demand, accountants’ starting pay is rising.
College seniors majoring in accounting are being offered jobs with average starting salaries of $43,809, a 3.9 percent increase from last year’s pay level, according to a new survey by the National Association of Colleges and Employers.
At the graduate level, master’s degrees in accounting are increasingly popular, according to a survey by the American Institute of Certified Public Accountants. While the number of overall master’s degrees awarded nationwide has increased by 11 percent since 2001, enrollment in master’s level accounting programs increased 21 percent.
Companies are especially interested in hiring accountants with graduate degrees. The institute’s survey found that the number of new recruits with master’s degrees rose by 9 percent, while recruits with bachelor’s degrees decreased by 5 percent. Women comprise 61 percent of new graduates hired by public accounting firms.
“Student interest in accounting is as strong as I have ever seen it,” said Betty Chavis, chairwoman of the accounting department at Cal State Fullerton. “With the demand for accountants at an all-time high and the media coverage of accounting, students are well aware of job opportunities in this profession. However, the accounting program remains one of the most difficult, if not the most difficult, at the university level.”
Cal State Fullerton has about 900 undergraduate accounting majors and 150 graduate students. Those numbers have increased slightly since 1998.
Accounting firms and private companies are scrambling for trained accountants, she said.
“Many prefer experienced accountants; however, the demand for our students with little or no experience is also the greatest that we have experienced recently,” she said.
The students who take accounting tend to have above-average intellectual ability because of the field’s reputation for difficulty, she said. Students expect they’ll have to devote many hours of study in order to complete the degree requirements successfully.
“Someone who chooses this field likes to work with numbers and enjoys the challenge of a math-related profession that offers a chance to rise to the top of an organization quickly, as well as a position that is respected by all (even with the scandals), and one that offers a good working environment with the chance to do a variety of tasks and interact with top executives in all types of businesses,” she said.
A CPA herself, Chavis grew up in an accounting environment, working with her father when she was in junior high and high school.
Chavis said she has asked employers whether demand for accountants will remain strong after memories of Enron fade.
“All believe that the demand will remain constant at this higher level. Accounting has always enjoyed a constant demand rather than cyclical,” she said.
THE OLD PRO
Wayne R. Pinnell, CPA, a managing partner with Haskell & White LLP in Irvine, has witnessed the increased interest in his profession.
The supply of accountants and auditors hasn’t kept up with increasing demand in the post-Enron world of tightened Sarbanes-Oxley regulations and demands from the new Public Company Accounting Oversight Board.
“Some might look at being a CPA as intriguing because there are a lot of problems that need to be addressed,” Pinnell said.
The new work requires a higher level of skills than recent college graduates can provide, he said. That increases the demand for experienced accountants – and increases the risk of burn-out.
Pinnell has been in public accounting for almost 20 years, since earning his license in 1987. A graduate of Seton Hall University in South Orange, N.J., with a bachelor’s in accounting, he also is a part-time professor for the Fullerton department of accounting.
Pinnell said he became a CPA because he enjoys mathematics.
“I took an aptitude test offered by the New Jersey Institute of Internal Auditors before I had any accounting training and won an award. After that, I had the opportunity to have a class in accounting in my high school curriculum. I really knew very few people in the profession but just had an idea that I was suited for it.”
And while CPAs are often depicted as the nerdy type, Pinnell said nothing could be further from the truth. That image, he said, developed from years of “comical pictures of accountants slumped over paperwork with green eye shades, little green lamps and a 10-key calculator.”
To be a successful CPA, Pinnell said, English, along with mathematics, is very important. Problem-solving skills, organizational ability, speaking and writing and other communication skills are also important, he said.
Pinnell said a typical starting salary is about $48,000 to $50,000, and keeps going up.
“CPAs are still very respected, despite Enron et al., and it is still true that public accounting is a great training ground for business, generally.”
THE NEW CPA
In contrast to Pinnell, who is an old pro in the business, Andrew C. Jordan, 24, has been in the industry for a year and a half.
He is presently at Starr & Walters Accountancy Corp. in Santa Ana, a position which is his first job at a CPA firm as well as his first job out of college. He graduated with an undergraduate degree in accounting from Cal Poly San Luis Obispo and earns around $40,000.
“I have heard about the increase in enrollment for accounting students subsequent to Enron. I believe a good part of it is due to students thinking they can do a better job of serving the public’s best interest.
“From what I can tell, a career as a CPA is far from limited. A CPA can also get into financial planning, sell insurance, investigate fraud, work for the FBI and IRS, work internationally and travel. Tax and audit are just the start.”
So, what’s it like being new to the business?
Pretty exciting, Jordan said, but demanding.
“All of the prep work done in school only goes so far on the job. It’s important to remind yourself that the career and the specific job duties can be frustrating in the beginning. Patience is necessary. As anyone will tell you though, the learning curve is fast, and I find it to be extremely rewarding to see myself improve,” he said.
“I went to school with no intention of becoming an accountant but took an accounting class at the urging of an economics professor of mine. I did well, so I took more at her suggestion. Also, both my parents are CPAs,” he said.
Jordan said his new career has gone better than he expected. “My bosses are flexible with our hours, they were supportive of my time requirements for taking the CPA test, my job duties are not restricted to one specific area of accounting.”
Jordan said he might eventually want to start his own practice or become a partner in an existing firm. “I have no plans at the moment to start on that track, but the nice thing about being a CPA is that the option is always out there,” he said.
“Professionally, the market is quickly expanding for CPAs throughout California and elsewhere. Add in the growing population and it looks like job opportunities are available and should remain.
“Personally, if I can help provide for a family in the future and maintain interest in my work, I’ll stay where I am,” he said.
“CPAs as nerds? Never heard of it,” he insisted. “Times do change, and so have the old stereotypes.”
WHAT THE CPA DESIGNATION MEANS
What’s a CPA?
A CPA is a certified public accountant, a profession that requires a state license.
What’s required to become a CPA?
CPA candidates need general accounting experience and must demonstrate their knowledge and competence by passing an exam. In order to sit for the exam, a CPA candidate must have a bachelor’s degree from an accredited university, including a core of required business-related subjects and 24 semester units in accounting.
How much experience is needed?
Before practicing as a CPA, an accountant must work under the supervision of a CPA – for 12 months if one has completed 150 semester units; otherwise, 24 months. In order to practice as an auditor, 500 hours of experience are required.