A study on the evolution and importance of accounting


Accounting is one of the oldest professions in world with evidence that suggests that it may be linked to early Mesopotamia, in the Fertile Crescent, during the time period of the Bronze Age. This occupation has since evolved to the top of the list of the most profound, intricate, and high paying jobs, both internationally and locally throughout the United States. Accounting may be referred to the backbone of a business because it determines the financial stability and helps to decide the direction of the next step in the line of business to produce a profit. An accountant is responsible for recording, reporting, and examining financial transactions of a business (WebFinance, Inc., Par 1). While fulfilling these responsibilities, one must follow GAAP, or the Generally Accepted Accounting Principles. There are numerous job fields a person with an accounting degree can enter, which encompass multiple tasks, such as preparing financial statements, recording business transactions, computing costs and gains from new technologies, tracking financial performance, composing cost strategies, managing health care benefits, and much more. With this being said, it is important to discover which type of accounting job fits best with one's interests.

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In order to reap the fruit of one's labor, the first step to becoming a successful accountant would be to get professional recognition as a Certified Public Account, or CPA. With this certification, job opportunities become more favorable and generally receive a salary increase. However, the road to becoming a CPA is not simple. A list of requirements must first be met before one can claim this glorious title; which entails a Bachelors Degree in Accounting or related field, a CPA Exam, one year of accounting experience with a licensed CPA, passing an Ethics Course, and 150 credits of education. This lengthy list may vary from state to state, but juice is by far worth the squeeze. After achieving such high honors in accounting, various doors open for career opportunities such as Forensic Accounting, Consultant Services, Information Technology, and International Accounting. A CPA may on the other hand, choose a standard job in this field as well.

Day to day jobs in accounting are endless, but the most popular include becoming an Auditor, Budget Analyst, Financial Accountant, Management Accountant, Tax Accountant, or Cost Accountant.

An Auditor is an independent third party who evaluates a business's financial records and reports to determine if the company is operating fairly. This vigilant evaluation ensures that the business is practicing fair financial recording and trading, as well as presenting correct information to the public and shareholders. The starting median salary of an auditor reaches limits of $55,000 a year with potential to grow. (Accounting, Auditing and Tax Services, Pg 1).

A Budget Analyst is vital to a corporation because he/she is responsible for organizing resources in order to execute budgets, estimate future needs, improve efficiency, and increase profits. This is a booming field in accounting because in this time of economic turmoil, the government is in need of Budget Analysts to limit the wasteful actions of our countries resources. In fact, 41% of all Budget Analysts work for the government (Budget Analyst, Par 3). This career path is not necessary for a business, however, a Financial Accountant is.

A Financial Accountant's purpose is to prepare financial reports about a business performance to outside parties such as creditors and investors. These financial reports show the profits and financial health of the company using the rules of accounting (GAAP), and help to provide balance sheets. If one has the opportunity to work as a Financial Account in a government position, they can make upwards to $90,000 a year.

Another optional, yet valuable, job position within a company is a Management Accountant. They provide data to managers inside a business to assist in running the day to day operations. Also, they are responsible for keeping and maintaining all of the business financial data such as income, expenses, and taxes. Not only does a Management Accountant provide data to mangers, they take charge of departments that are in control of bookkeeping and data processing. Generally, this specific type of account works on a salary of close to $80,000 a year (Accounting, Auditing and Tax Services, Pg 1).

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In order to prepare taxes properly, a company most often hires a Tax Accountant. A Tax Accountant handles how much tax a company or individual owes on all levels of government; local, state, and federal. Their main purpose is to find alternatives to save money on taxes through deductions and tax shelters. At the start of every year, they also file for returns after gathering the tax records from the year before.

Of the list of popular jobs in the field of accounting, a Cost Accountant is most closely related to actual manufacturing and selling of the goods or services. They are responsible for tracking costs and suggesting a selling price that will provide a profit and cover the expenses to produce such a profit. In addition to suggesting a price, they are also used to figure out ways to keep cost production to a minimum.

Aside from finding a specific job in the field of accounting, it is important to land a position at a major accounting firm to ensure one's success. Out of the top four major accounting, three are located in New York, the epicenter of accounting. PriceWaterhouse-Coopers is headquartered in New York City, and makes an annual revenue of $28.1 million and employees 155,000 people worldwide. Deloitte is also located in New York and makes an annual revenue of $24.5 billion, employing 165,000 people. The third major accounting firm in New York and third firm of the Big Four is Ernst & Young. They make a combined $24.5 million as well, and employs 135,000 people globally. The fourth major firm is located in Amsterdam, Netherlands, making $22.69 million annually and employing 136,896 people globally (Nation's Largest Accounting Firms, Pg 1).