A certified public accounting, or CPA, firm must include at least one certified public accountant, licensed in the state where the firm operates. Typically, a CPA firm consists of individuals at various levels in their accounting and business careers. The firm can provide financial and consulting services to individuals, corporations, partnerships, not-for-profits and government agencies. Firm partners generally mentor junior employees while actively pursuing new business.
CPA firms provide tax services. For individuals, this means preparing federal and state returns, quarterly estimates if applicable and tax liability projections for future years. If an individual's tax picture is complex, the firm can also assist with comprehensive tax planning. For businesses, a CPA firm can file required annual tax returns whether basic or complex, assist with payroll tax calculations, as well as state and local tax requirements, and make recommendations to take full advantage of depreciation deductions. For companies doing business in foreign countries, a CPA firm can assist with international tax obligations and liabilities.
CPA firms often prepare auditing reports for companies, but their assurance services encompass much more. An audit of a company's financial statements ensures accuracy, assesses risks and searches for ways to improve operations of a business going forward. If a business does not want a full audit, a CPA firm can provide a review or a compilation. These are less in scope but still glean information that tests the integrity of the financial health of a business. Assurance services include tests to ensure the business is compliant in the reporting of financial information to taxing authorities and other government agencies. It will also flesh out possible fraudulent activity or transactions, followed up with suggested control procedures to prevent such activity in the future. CPA firms also review internal employee benefit plans such as 401k plans, pensions and health care plans.
Businesses can also rely on a CPA firm for more than annual tax work or an occasional audit. CPA firms can employ individuals with a broad range of expertise, including consultants. Consulting experts may or may not hold CPA status, but are professionally trained to work with a business in areas of valuation, investments, litigation support, mergers, acquisitions and cost segregation. A business looking to expand or grow its product line can benefit from the services of the consulting arm of a CPA firm. The consulting group can offer guidance in dealing with investment banks or other capital venture investment groups. Likewise, a business owner who wishes to plan for his retirement or exit can work with a CPA firm to create and implement a succession plan for the future.
The Bureau of Labor Statistics projects job growth at 16 percent through 2020 for accountants and auditors. With a down-turned economy and financial crises still fresh in the mind of regulators, the need for accountability of financial records remains strong. The mean annual wage of an accountant in 2010 was $61,690. A career path with a CPA firm typically starts with a bachelor's degree in accounting or a related field. Earning CPA designation is regulated by the state and typically includes a required number of working hours and the passing of all four parts of the CPA exam. Though becoming a CPA is not a requirement at all CPA firms, it is strongly recommended for candidates wishing to increase both income and career status.
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