The market for accounting and finance is expected to grow at a pace of about 6% annually. For the next 10 years and so this is an exciting time for you. To get into accounting and finance and grow your career now.
Five difference
- The goal what’s the goal of a financial accountant versus the goal of financial analysts. The goal of the accountant is to get the data in and create financial statement. And so the accountant is concerned with gathering the transactions of the business. And creating financial statements as opposed to the goal of a financial analyst.
- The nature of the work so the accountants work by definition by nature is looking. The past at the history. And gathering the financial data and information and summarizing that into financial statements. Now the financial analyst is concerned with the future so they are always looking at this point in time going forward. And forecasting the performance of the business.
- The risk what risk is the accountant trying to mitigate all the time and concern with all the time and the risk here is a risk of material misstatement that is the financial statements that the accountant is producing has a material misstatement or error this is opposed to the risk that the financial analyst is dealing with which is the risk between the risk here is that some of these assumptions may be wrong. a variance between what they are projecting for the future and reality so our financial analyst is always making assumptions about the future.
- An accountant and a financial analyst have to do with the type of problems you’re trying to solve and so typically an accountant is trying to solve problems around accruals revenue recognition making sure the accrues for expenses that have not yet impacted the cash balance but the service has been incurred or booking revenue in the right period and just generally following the UK which is generally accepted accounting principles now the kind of problems the financial analyst will be dealing with the will to do with modeling and creating assumptions about the future such as seasonality customer behavior and customer loss or churn in the future the first.
- The gold standard for accountants is to become certified public accountant. CPA now I’m a CPA myself and for sure had a huge impact on my career. Increase my salary increase my credibility and just have been huge impact. On my life studying for and passing the CPA exam has been one of the most difficult.
Life of accountant vs finance
let’s look at the day in the life of an accountant versus day in life of financial analyst. And I think the best way is to look at a month in the life versus day. In the life because a month will give you a better view on what’s going on in each of their professions.
For the accountant their months usually begins with the first 7 days of trying to close the period. And so that will entail billing going over invoices from vendors making sure we’re booking all of the expenses. Even though we have not received the vendor invoice yet accruing for these expenses.
Things like that and that will entail having meetings with within the accountant team and the meetings. Probably you spend the 25% of your time in meetings trying to close the books. And trying to make sure you’re following all the rules comparing period over period in terms of expenses. And revenue to make sure you’re catching any anomalies now.