Learn the differences between a CPA and an accountant, and maximize your services in order to benefit your business.
Financial statements, payments, collections, budget, taxes and payroll are only some of the complex and interesting world of numbers and calculations. So what better than to seek the help of a financial expert to assist us in these matters.
If you are a business owner, it is important to know the difference between a Certified Public Accountant (CPA) and an accountant. This understanding will allow you to appreciate the importance of their work for the success of your company, as well as learn about the services that they offer and how you can use these to your advantage.
For this purpose, we interviewed financial expert and CPA, Lianabel Oliver Bigas, Chief Executive Officer of OBALearn, to offer guidance about what you should know on this topic.
Could you explain the difference between a CPA and an accountant?
A Certified Public Accountant (CPA) is a licensed professional in the state or country where s/he practices, who is authorized to issue reports on a company’s financial statements. The CPA must comply with certain professional standards and keep his or her license updated by taking continuing education courses. These requirements provide you with the assurance that your CPA is up to date in the profession and that your financial information is prepared according to the latest accounting standards.
On the other hand, an accountant has an Associate or Bachelor’s degree in Accounting. S/he works managing a company’s finances, such as registering accounting transactions, making and collecting payments, preparing the budget, managing the payroll process and preparing financial reports for internal use, among others.
What are the services only a CPA can offer?
The greatest difference between an accountant and a CPA are the types of services related to the financial statements, which can be prepared, compiled, revised, or audited. An accountant can provide preparation services, but only a CPA can provide compilation, revision, and audit services.
The following table will help you understand the different kinds of services related to financial statements provided by a CPA.
What factors should the business owner or entrepreneur evaluate before hiring a CPA?
At some point, as entrepreneur or business owner, you will need the services of an accountant or CPA to meet the requirements of banks, government agencies, or investors.
It is important to identify the purpose of the service you need and the type of report required by the person or entity requesting the financial statements. Each type of service offers a different level of reliability and assurance; therefore, each one has a different cost. The size of the business and the state of your financial records are factors that could affect the cost of these services. Also, during the hiring process, you should ensure that the CPA’s license is active.
In summary, when you hire the services of a CPA, make sure to request the appropriate service to maximize your investment and the benefits for your company.
Mrs. Lianabel Oliver Bigas, MBA, CPA, CMA, CGMA is Chief Executive Officer of OBALearn, online financial training company for business owners, and non-financial professionals.
Banco Popular de Puerto Rico (“Popular”) does not have any affiliation or relationship with OBA LLC and/or Lianabel Oliver Bigas. This article is purely informational and does not represent an endorsement or guarantee of its accuracy or the services offered by OBA LLC and/or Lianabel Oliver Bigas. Popular or any of its affiliates, subsidiaries or related companies, will not be held liable for any special damages directly, indirectly or incidentally or as a result, including but not limited to, loss of profit, arising or related to communications, articles or advise provided by OBA LLC and/or Lianabel Oliver Bigas. Popular is not in the business of providing tax or accounting consulting, in case you need tax or accounting services, you should consult the corresponding professional of your preference. Popular is not responsible in any way for the result of any related activity, in case you voluntarily contact OBA LLC and/or Lianabel Oliver Bigas.