Are you wondering, “what does a CPA do?” We’re here to clarify any questions you have in this guide.
Most people have heard the term CPA but not many know that it stands for Certified Public Accountant. And even fewer people know what a CPA does. So if you are one of the people asking, what does a CPA do, you came to the right place.
Keep reading to learn about the role of a CPA and how they might be able to help you.
What Is a CPA?
A Certified Public Accountant (CPA) is a financial advisor. They help individuals, families, businesses, and other organizations handle everything related to their finances.
CPAs must pass the Uniform Certified Public Accountant Examination to become certified. Some of them have master’s degrees but it is not required to take the exam. Instead, 150 hours of credit hours are required. Most CPAs have experience in accounting, financial planning, or business.
Not all accountants are also CPAs. So, what can a CPA do that an accountant can’t? Keep reading to find out.
Typically CPAs work at CPA firms in one of three areas:
CPAs work to satisfy their clients in business needs. CPA services help the individual and business to develop the financial plan to assist financial statement analysis, tax planning, and analyzing typical financial transactions for decision making.
What Does a CPA or a CPA firm Do?
Often, CPAs works under a CPA firm to conduct client-based work in the following areas:
2. A CPA can also help with financial planning. They can help a business manage its cash flow or set goals for future earnings and savings.
3. They can serve as a general bookkeeper and offer accounting solutions.
4. The same principles apply to helping an individual. A CPA can help a person save for retirement or a child’s college fund and they can also help with everyday budgeting.
5. Businesses may also hire a CPA for auditing purposes. This is not the same as being audited by the IRS. When a CPA completes an audit they are looking for anything out of the ordinary that could be an issue for the business. However, in the event that the IRS does get involved, a CPA can still be of service. They can even represent you in conversations with the tax board or IRS. They will help alleviate some of the stress for you and your business.
6. CPAs can execute audits for publicly traded companies in the United States while accountants or bookkeepers cannot. They are considered the most experienced and knowledgeable form of an accountant.
7. A CPA is also qualified to help a person or group apply for a business and consult on the best way to structure the company. For example, a CPA may recommend an LLC over applying as an S-Corp or a C-corp.
Consider Hiring a CPA
As you can see, a CPA can perform a number of essential services for individuals and businesses.
Essentially, they alleviate the stress of filing taxes and managing every aspect of your finances.
A CPA can add tremendous value to your company and reduce the risk of any mistakes in your financial planning. They can also serve as a trusted consultant and bookkeeper.
If you’re looking for a reputable CPA firm to handle your finances, contact us today for more information.