Accounting is the process of recording financial transactions pertaining to a business. When looking at careers in accounting, it’s standard to divide them between public and private. The terms “public” and “private” have to do with the perceived allegiance of the accountant. While public accountants are for-hire for many clients, a private accountant works as an employee who serves the private interests of a singular business.
Public accounting is the branch of accounting that offers financial services such as audits, tax consultancy, and advisory services to external clients.
Public accountants work for accounting firms and serve a variety of clients, including businesses, government entities, and non-profit organizations. Due to this more diverse clientele, those in the field, especially auditors, may be required to travel their clients often.
In public accounting, career advancement typically follows a structured path, offering consistent opportunities to advance to the next senior level. The goal of many public accountants is to reach partnership, which means obtaining equity ownership of the firm. Hours can be longer in this field, as deadlines are tighter due to the regulatory requirements, investor expectations, competition, complexity, public scrutiny, and legal liabilities associated with serving publicly traded companies.
The Certified Public Accountant (CPA) certification is a requirement for career progression, due to the high-standard nature of rigorous audits and services provided.
Audit associates are primarily responsible for assisting in the planning, execution, and completion of audits. They examine an organization's financial statements and records independently to assess accuracy, reliability, and compliance with relevant standards and regulations.
Audit work involves reviewing financial statements, conducting testing, and providing assurance on the fairness of financial reporting. It aims to ensure transparency and accuracy in financial information.
Audit associates often have a wider range of exit opportunities, including transitioning into roles in the private industry, as audit experience can provide a strong foundation in accounting and financial analysis.
While audit work can be demanding during peak audit seasons, such as fiscal year-end audits, some auditors find a good work-life balance, especially in the private sector.
Tax associates play a key role in helping clients understand and comply with tax laws and regulations. They prepare and review tax returns for individuals, businesses, and organizations and provide tax planning and compliance advice.
Tax work focuses on taxation laws and regulations, with an emphasis on minimizing tax liabilities for clients. Tax associates help clients navigate complex tax codes and identify opportunities for tax savings.
Tax associates may receive higher salaries compared to audit associates at the entry level. The complexity and specialized knowledge required in tax can contribute to higher compensation.
Tax associates often experience a distinct seasonality in their work. They tend to be extremely busy from January through March or April due to tax filing deadlines, while the rest of the year may be less hectic.