The Key Characteristics And Skills Required For Accountant

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The focus of this essay is to identify and explain the definitions and differences between Accounting and Bookkeeping, role of accountants in business, professional and personal characteristics of accountants and the need for professionalism and ethics.

"The typical accountant is a man past middle age, spare, wrinkled, intelligent, cold, passive, noncommittal, with eyes like a codfish, polite in contact, but at the same time unresponsive, cool, calm, and as damnably composed as a concrete post…" (Benson (1989)

Accounting is the process of recording, preparing, and summarising transactions of a business e.g. sales and purchases of goods, payments and expenses etc., in order to prepare summary reports and financial statements that can provide useful and reliable records and can be analysed to make decisions by managers and shareholders. Accountants provide a summary for a business's financial transactions, which are also commonly known as financial statements. They are needed for a number of things, to qualify for a loan from bank or an overdraft, to see how well a business is doing, for insurance, claiming tax return, to sell your business or to find out how much it is worth. They can also be used to see a share of two partners in a business. A very large business will need to have their accounts audited at least once a year by an independent auditor. The principles of accounting are divided in three main areas, accounting, auditing and bookkeeping.

Auditing is also a very vital part in accounting. They are mainly performed to check the validity and accuracy of information, and to verify the facts provided. The accounts of the company are audited (checked) every year by an independent internal or external auditor. An auditor gives a 'true and fair' opinion on whether a company's accounts and financial statements are free of any errors or frauds.

Bookkeeping is an act of recording financial transactions of an organisation. It includes purchases and sales, dates, sources etc. It is usually done by a junior accountant or a book keeper, and are also knows as accounting clerks. They are supervised by an accountant. Any process involving day to day recording of only the financial transactions of a business is called a book keeping process, but the two most commonly used methods of book keeping are single entry book keeping and double entry bookkeeping. In the single entry bookkeeping system, the transactions are recorded only once and it uses income and expenses accounts only. The double entry bookkeeping system records each transaction as both credit and debit. Credit entry represents the source of finance and for each credit entry there is one or more corresponding debit entry, which then leads to balanced nominal ledger accounts and trail balance. It reduces the risk of errors and mistakes. Bookkeeping shows where your business is standing financially. It can help you make important financial decisions about your business and it can also help make your financial position clear to other people e.g. banks and customers. Taylor (2003) says that bookkeeping can sometimes seem like a chore.

Accounting and bookkeeping is considered to be the same thing by many people. Bookkeeping is just one and first part of preparing accounts. A book keeper records all the routine transaction that takes place in a business in the correct daybooks, sales, purchases and nominal ledgers and brings it all to trail balance. Bookkeepers are also responsible for preparing invoices, receipts, checks and payroll. Whereas an accountant then makes a few adjustments and changes and is responsible of preparing reports, profit/loss accounts, cash flow statements using the trail balance sheet and the ledgers created by the book keeper. An accountant takes over when the book keeper finishes.

There are several different roles of accountant in all kinds of organisations. "Accountants are just as important as any other aspect of a business, and can be crucial to its prosperity and even survival" (Taylor 2003, P11). An accountant plays a vital role, provides advice and service and has an input in all areas of a business. They can calculate breakeven point for a business to help them reach targets. The information prepared by an accountant is very useful and it is of interest to both external and internal parties; it enables managers to make important decisions and to predict what is likely to happen when a certain action is taken. It also gives a full picture of how an organisation is doing and how it is likely to perform in the future. The shareholders of the company can find out how efficiently the company is running and how much profit it is making. It will also enable HMRC calculate tax payable by the company.

The public, financial advisers and trade contacts might also be interested in the information provided by the accountants. Some accountants choose to work in audit, financial or the non-financial side of the business. The role of a finance accountant is to work with budgets and meet targets. Forensics accountant would be responsible of uncovering any errors or fraud activity and examining the accounts.

Successful accountants have skills, integrity and strong education. Accountants must always work independently. They should be able to make decisions by comparing and analysing the facts and figures. They should have excellent communication skills both written and spoken to be able to explain and discuss financial matters with fellow colleagues, clients or people with little or no accounting background. Good computer skills are also very important in order to use different accounting software programmes efficiently. Accountants need knowledge of current economic growth and environment in which they operate. They must work with accuracy and consistency. Accountants must have personal values like confidentiality, honestly, trustworthiness and reliability. The best accountants will have the ability to interact with people and keep themselves up to date with the changes in rules and regulations because there have been constant changes in the field of accounting in the last few decades. "Like so many things the world of accountancy and finance is ever changing" (Taylor 2003, p11). Accountants have to handle all the financial operations and provide advice and information therefore working accurately under pressure is also one of the important personal skills an accountant must have.

Accountants should be very creative and full of ideas, they should have an ability to steer a business away from potential financial hazards. He/she must be a valuable team player and flexible with people. An accountant should get along with everyone including difficult personalities. Putting as much effort in as possible in every task is vital to achieve the best possible results. Listening skills is also important to listen to others. Time management skills are absolutely essential.

Education requirement for accountants depends on the specific job. There are no shortcuts to becoming an accountant. A bachelor degree in accountancy, business or economics is required. An interest in maths is also very important. However it is possible to become a book keeper or accounting clerk with a diploma or school qualifications with significant experience. Accounting education back ground is important as it provides knowledge, a range of skills and expertise to perform required tasks. Without education and experience accountants will most likely make mistakes caused by lack of understanding, and will not be able to provide excellent service to their clients. Successful accountant will have knowledge of taxation and accounting procedures and principles as well as principles of business and management.

The importance of professionalism and ethics has increased in the last few decades due to the frauds and accounting scandals. Special knowledge and expertise about a specific subject which is obtained through higher education and skills is known as professionalism. Accountant deals with the finances of an organisation, they have a duty to act professionally. There are strict guidelines for professionalism and ethics. It is vital to understand the basics of professionalism in accounting field.

"Professionalism is a number of things. It is an attitude. It is the way you communicate. It is the way you work. It is the way you view yourself and the people you work with. It is the way you do business. First and foremost, however, professionalism is an attitude." (leslie, 2010)

It's important for accountants to gain training in a professional environment. A professional accountant follows principles. He/she is independent and they are responsible for their own actions. Black (2000) says that there are many accounting concepts but four of them which have been identified as fundamentals are going concern, accruals, consistency and prudence. To prevent accounting scandals, Statements of Standard Accounting practice (SSAPs) was formed in 1970s.

Ethics are important throughout the business and finance field. As a professional accountant, honesty is very important to work ethic. A company will lose profitability and customers if it doesn't value ethics. Trust, sincerity, confidentiality and morals are essential in business and they are the key to having loyal customers. Ethical environment creates a comfort zone for customers and suppliers as they know they will be fairly treated. Businesses can lose customers and suppliers due to their unethical behaviour. Nobody wants to employ and deal with an unethical individual. Keeping financial matters confidential is also a key ethical concept. A company's or an individual's financial matters and situation should never be disclosed.

In an ethical environment, accountants should be able to share and discuss their ideas without worrying about someone else stealing or misusing them. Good decisions will be made as a result of collaborating. Treating people with respect is another ethical practice. Having ethics is what allows clients to trust you. If you are true to your policies and ensure customer satisfaction, it will create strong and loyal relations with others and this will result in more sales and business. It will also help create good reputation; people will recommend you to others. That can be the difference between failure and a successful business. Without ethics you will develop a negative reputation. Ethics have an impact of decision making because greed can easily come in the way where money is involved. Making ethical decisions shows that are morally correct. Unethical decisions can lead to scandals; they can destroy companies and careers.

Practicing ethics will give you an edge over your competitors. Satisfied customers, receiving positive feedback will prove very good for your business. Therefore it is necessary to have a code of ethics for all the employees. In order to make your business flourish, the need for ethics is absolutely vital. "As a professional you know your ethic will reassure people of you wanting what is best for all involved in any business dealing" (leslie, 2010)

Every business needs a professional, skilled and well qualified accountant. Without accountants a business will never know its financial position. The more control you have over its accounts, the better you will be able to control the business.


AOP, Leslie G (2010) How do you define professionalism = Attitude! [Online] Available URL: [Accessed 4th November 2012]

Benson H (1989) Accounting for life. London. Kogan page

Black G (2000) Introduction to accounting. Pearson publishers. UK. P 3

Taylor, J (2003) Book-keeping & Accounting for the Small Business. 7th Ed. Oxford, United kingdom. Pp 11-38