What is the Difference Between CPA and Accountant?

The main difference between a CPA (Certified Public Accountant) and an accountant lies in the certification, education, and experience required for each role. Here are the key distinctions between the two:

1. Education and certification: An accountant typically holds a bachelor's degree in accounting, while a CPA has earned their CPA license through a combination of education, experience, and passing a rigorous examination. To become a CPA, one must complete specific educational and work requirements, which vary by state.
2. Licensing: CPAs are licensed by a professional governing body, while accountants are not required to have a license. This licensing difference means that CPAs are recognized by the government as credible and expert in the field of accounting.
3. Responsibilities: Both CPAs and accountants perform similar tasks, such as managing day-to-day financial activities, organizing and recording financial transactions, and handling accounts payable, accounts receivable, depreciation, journal entries, and collections. However, CPAs are better qualified to perform certain tasks, such as preparing audited or reviewed financial statements, representing clients in front of the IRS during a tax audit, and providing attestation services.
4. Continuing education: CPAs are required to complete continuing education courses to maintain their licensure, ensuring they stay up-to-date on industry knowledge and best practices. Accountants, on the other hand, do not have this requirement.
5. Salary: The average salary for accountants is $61,480 per year, while the average salary for CPAs is $92,795 per year. This difference in salary may be attributed to the additional education, experience, and licensing requirements for CPAs.

In summary, while both CPAs and accountants play essential roles in business, the CPA designation entails more extensive education, experience, and licensing, which allows them to perform a broader range of tasks and command a higher salary.

Comparative Table: CPA vs Accountant

Here is a table outlining the main differences between a CPA (Certified Public Accountant) and an accountant:

In summary, all CPAs are accountants, but not all accountants are CPAs. The main differences between the two lie in the licensing, services provided, and consulting roles. A CPA has more authority and credibility due to their licensing and certification, whereas an accountant may not have the same level of standing with regulatory authorities.