Difference between CPA vs. non-CPA - An Ultimate Guide
Admin 29 Dec, 2023 Difference between CPA vs. non-CPA
Both Certified Public Accountants (CPAs) and non-CPAs are qualified individuals that work in the accounting industry. But when comparing CPA vs. non-CPA, the main distinction between the two is that the former holds a license to practice the profession, whilst the latter does not. Because a license is not required to practice accounting, non-CPAs may also be referred to as accountants.
As a result, the word "accountant" is inclusive of both CPAs and non-CPAs. The CPA qualification, on the other hand, gives accountants more credibility and broadens their field of employment.
CPA vs. non-CPA Comparison Table
| Specifics | CPA | non-CPA |
| Definition | A state board-issued accounting certification obtained after passing the exam provided by the AICPA and meeting the prerequisites for education and experience | A position in entry-level accounting |
| Eligibility Criteria | Bachelor's degree (150 credit hours), 1-3 years of work experience, and the Uniform CPA Examination | Bachelor's degree in accounting or a closely related discipline |
| Salary | $119,000 | $73,560 (May 2020) |
| Career Options | Financial AdvisorRisk & Compliance ProfessionalAccounting software developerFinance DirectorSenior Financial AnalystCorporate ControllerCFO | Government accountantsManagement accountantsPublic accountantsExternal/Internal auditorsSenior staff accountant |
| Sectors they work for | Financial forensicsConsultingIT ConsultingGovernment agenciesNon-profit organizationsEducational institutions | Finance & InsuranceGovernment agenciesCorporate Educational institutionsHealthcare |
Before getting into the depth of CPA vs. non-CPA, we will understand the different aspects of both courses.
What is a CPA?
The American Institute of Certified Public Accountants offers the US Certified Professional Accountant (CPA) certificate to individuals to validate their knowledge and experience in the discipline of accounting. Because of their experience, CPA specialists are in great demand and accept lucrative positions with businesses and organizations that require accounting-related services. The CPA License may be utilized to get an accounting career in many countries and to be employed by your dream company, including the Big Four accounting firms.
Prerequisites for a CPA license
People wishing to start a career or those searching for a change or advancement in their employment can both obtain the US CPA certification. Candidates must complete three sorts of requirements to become a licensed Certified Public Accountant (CPA); 3 Es
1. Education Requirement
2. Experience Requirement
3. Examination Requirement
- Educational Requirement - Candidates for the CPA USA must have at least 120 credits in order to take the Uniform CPA test and 150 credits in order to obtain a CPA license. To even sit for the US CPA tests, applicants must have a Bachelor's degree in English.
- Experience Requirement -Candidates must have at least one or two years of regular work experience under a CPA in order to be considered for several state boards under the AICPA. You should verify with your particular Board of Accountancy for specifics as the experience requirement varies by state.
- Examination Requirement - To become a US CPA, individuals must pass the Uniform CPA Examination (CPA exam) and satisfy all other prerequisites.
Other than the US CPA certification exam, all other criteria differ depending on the state board. In addition to the standards listed above, you must also meet the Continuing Professional Education (CPE) requirements (120 every three years) to keep your license.
Uniform CPA exam
The most important stage in obtaining a license is passing the Uniform CPA test. With extensive participation and cooperation from NASBA and state boards of accountancy, the AICPA established the Uniform Certified Public Accountant (CPA) Examination. It is made to evaluate the abilities and knowledge that entry-level CPAs require to work in public accounting.
There are four components in the exam, and each one must be completed separately.
- Auditing and Attestation (AUD)
- Business Environment and Concepts (BEC)
- Financial Accounting and Reporting (FAR)
- Regulation (REG)
A variety of question patterns are used on the CPA test. It has both conventional multiple-choice questions and essays as well as incredibly creative simulations, which are questions that closely resemble working scenarios and call for the use of knowledge and abilities to find answers.
After passing the first portion, you must complete all four test sections within 18 months. Please keep in mind that passing requires at least a 75 on a scale of 0-99 in each section.
Roles & Responsibilities
CPAs develop a solid foundation of accounting and managerial skills as a result of rigorous licensing preparation. They effortlessly adjust to the modern requirements of the changing corporate environment thanks to their seasoned talents and distinctive judgment. The following are some of the primary duties of a CPA:
- Whenever necessary, arrange and update both digital and analog financial records.
- Conducts comprehensive audits on a regular basis to check the correctness of financial documents, expenditures, and investments.
- Maintains ledger reconciliation and handles accounts payable and receivable.
- Regularly updates top management on the business's financial situation.
- Keeps track of tax payments and returns by corresponding with tax accountants.
- Keeps knowledge of market developments and legislative changes.
- Performs transaction analysis and report creation.
- Assessing profit margins and estimating revenue.
- Maintain the privacy of the firm financial information.
The advisory function played by CPAs is highly recognized. They are the best people to lead you through all of your growth goals due to their broad understanding of all facets of money.
Career Prospects
CPAs are eligible for larger compensation packages due to their unique talents and extensive area of work. Because the scope of a US CPA is not confined to India or the United States but extends to the rest of the world, a Certified Public Accountant is being engaged by various divisions of US-based multinational corporations (MNCs) in India. CPAs make 10% to 15% more money than non-certified accounting professionals. In addition, they have a steady career, a wide range of employment options, great respect, and a competitive advantage over non-CPAs.
In addition, the Accountancy Licensee Database (ALD) reports that there are 658,267 CPAs who are currently licensed across the country. In the ensuing years, this number is anticipated to increase even more. According to the US Bureau of Labor Statistics (BLS), the number of CPAs employed will increase by 22% between 2021 and 2028. Additionally, CPAs are capable of managing corporate governance and global financial accounting. Hence, CPAs are employed in a wide range of positions within the financial services industry. There are several career choices available to CPAs, some of which include:
- Financial Accounting
- Corporate Finance
- Information Technology
- Assurance and Attest Services
- Tax Preparation and Planning
- Management Reporting
- Internal Auditing
Exclusive Rights of CPA vs. non-CPAs
All company sectors frequently have a high need for CPAs. Large enterprises and public limited companies, however, are especially interested in them. This is a result of certain exclusive rights they have as a result of their licensing. Public limited corporations (PLCs) are required by federal law to provide audited financial statements to their stakeholders. They are also frequently confronted with significant financial and tax issues, as well as negotiations with the Internal Revenue Service (IRS).
The following are the specialized services that CPAs provide to them:
- Filing a report with the Securities and Exchange Commission of the United States.
- Issuing a judgment on financial statements that have been examined, prepared, or audited.
- Producing certified financial accounts.
- Signing their income tax return as a hired preparer
If we are comparing CPA vs. non-CPA, becoming an accountant is a nice thing, but being a CPA is much better. Despite the fact that it requires endless hours of concentrated learning and training, the satisfying conclusion is worth every drop of sweat on your brow.
What is a Non-CPA (General Accountant)?
A general accountant is a qualified accountant who has the authority to document, review, examine, and report financial transactions. Their primary role is to guarantee that financial records are accurate and that accounting rules are followed. Furthermore, they work hard to identify and remove as many risks as possible in order to assist the organization's functioning smoothly.
Educational Requirements
A bachelor's degree in accounting or a closely related discipline, such as business or finance, is a minimum requirement for becoming an accountant. However, applicants with an associate's degree and suitable experience may also be employed as junior accountants. To enhance their employment chances, accountants might also choose to specialize in management, public, or government accounting.
Duties & Responsibilities
The following are some of the duties performed by non-CPAs:
- Informing managers or other senior authorities of findings.
- Control every aspect of accounting
- Make financial reports, budgets, or other documentation
- Maintain the confidentiality of financial data and backup databases as needed.
- Talking with management about company policies and possibilities.
- Maintain compliance with financial rules and laws.
- A description of the firm's liquidity and financial health
- It's important to monitor balance sheets and profit/loss statements.
- Calculate taxes and file tax returns.
- Take care of the monthly, quarterly, and yearly closings.
In recent years, public accountants have begun to use modern technology like robotic process automation and artificial intelligence to help them in their work.
Career Prospects
Accountants are employed by nearly every type of company, including major government institutions, non-profits, and companies, as well as emerging start-ups. The BLS projects that employment in the accounting industry will increase by 4% between 2019 and 2029. Thus, it is anticipated that it will continue to have a respectable market demand in the future. It is difficult to achieve career stability in this sector, nevertheless, because of the average compensation and poor status compared to CPAs.
CPA vs. non-CPA Choice
Due to their lack of comprehensive knowledge, formal education, and pertinent experience, accountants remain behind CPAs in comparing "CPA vs. non-CPA" despite having a comparable job description. They are also at a disadvantage since they lack qualifications. Their licenses do not allow them to sign tax filings or audited financial statements, engage directly with the SEC and IRS, or deal with other government entities.
CPAs are well-equipped to provide significant financial insights, contribute to budgeting processes, and build successful strategies due to their specialized knowledge and experience. Non-CPAs, with expertise, can perform things as well. Their competence and credibility, on the other hand, are questionable. Accountants are often better qualified to conduct fundamental accounting activities such as bookkeeping, dealing with frequent tax difficulties, and keeping business accounts up to date.
Furthermore, the caliber and integrity of a CPA's work are ensured by the regulating organization that will soon be in charge of monitoring their activity. Non-CPAs are not governed by any professional organizations, though. Therefore, it is the client's responsibility to select the best accountant.
Finally, the decision in CPA vs. non-CPA comes down to the client's circumstances or position. Non-CPAs are generally preferred by small enterprises with fewer budgets and less sophisticated financial and tax difficulties. CPAs, on the other hand, are preferred by major firms or PLCs since they provide specialized and dependable accounting services.
CPA vs. non-CPA salary Comparison Table
Now, let's look at the compensation differences between CPA vs. non-CPA based on designation, region, industry, seniority level, business size, and years of experience. Please do not consider these values to be a set range because they change depending on the employee, employer, and underlying circumstance.
| Basis of Salary Comparison | CPA Salary | Non-CPA Salary |
| Size of the Company | Small Firms- $45,000 � $81,500 | Small Firms- $42,000 � $97,000 |
| Medium Firms- $49,250 � $90,000 | Medium Firms- $46,000 � $1,06,000 | |
| Large Firms- $53,750 � $106,500 | Large Firms- $50,000 � 1,28,000 | |
| Designation | Chief Financial Officer$1,05,250 � $4,65,750 | Government Accountant $36,000 � $84,000 |
| Corporate Controller $92,000 � $2,24,750 | Management Accountant $45,000 � $86,000 | |
| Tax Manager $88,000 � $1,58,250 | External Auditor $42,000 � $89,000 | |
| Financial Advisor $30,000 � $1,10,000 | Tax Accountant $44,000 � $90,000 | |
| Experience | 0-3 years- $45,000 � $83,250 | 0-3 years- $31,000 � $66,000 |
| 4-6 years- $57,000 � $1,06,500 | 4-6 years- $59,000 � $98,000 | |
| 6+ years- $68,000 � $1,49,000 | 6+ Years- $72,000 � $1,52,000 | |
| Industry | Public Accounting- $51,500 � $106,500 | Finance- $40,000 � $80,000 |
| Corporate Accounting- $45,000 � $87,750 | Corporate Accounting- $44,000 � $84,000 | |
| Tech Firms- $36,000 � $84,000 |
Conclusion
So, what would be a better choice in CPA vs. non-CPA? While a Non-CPA may be able to meet your basic needs, the government regards a CPA as a credible specialist in accounting and a more competent professional to execute accounting obligations than an accountant. A CPA is more competent than an accountant in handling some accounting activities, and the government recognizes him or her as credible and knowledgeable in the subject. Depending on your preferences, budget, and time constraints, one of the two may be preferable. You will uphold global laws, beliefs, and standards if you pick CPA.
To pass any test, particularly one as comprehensive as the CPA USA, you must rely on well-organized CPA study books and other study tools. You may do this by enrolling in NorthStar Academy's US CPA course to study the content completely and effectively organized. NSA is the premier institute in this field, delivering the appropriate path to thousands of individuals and professionals with the support of top mentors such as M. Irfat Sir.
If you require any further information, please contact the NSA. Our counselors will answer all of your inquiries and provide the necessary help.
FAQs
1. What distinguishes a non-CPA from a CPA in particular?
Non-CPAs often have a bachelor's degree in accounting. A Certified Public Accountant, or CPA, is a professional that has obtained their CPA license through a combination of education, experience, and examination.
2. Which is better - CPA vs. non-CPA?
Due to the demanding CPA licensure exams and ongoing education requirements, many CPAs are better educated about tax rules. A non-CPA accountant is not qualified to represent clients before the IRS if audit help is needed.
3. Which has more value - CPA vs. non-CPA?
In India, the typical compensation for a non-CPA is between 6.5 and 7.8 lakh rupees per year, while the median salary for a CPA in the United States is $62,410. However, India only has a small number of companies that use US accounting standards, making it difficult to get a suitable job there.