Accounting will always be an important element of business. Its practice can vary in size and scope, but whether it’s associated with a Fortune 500 company or a small business, accounting’s primary charge is to track financial transactions. This main task lays a foundation that allows a business’s growth and stability strategies to develop in an effective and legally compliant manner.
Monitoring a company’s finances, from taxes to business operations, requires knowledge, training and skills. Certified public accountants, or CPAs, have that knowledge and training. They can turn raw numbers and financial data into economic strategies that can lead to an economically stronger business. Because CPAs play such a critical role, they are well compensated for their work.
Those who are interested in pursuing a career as a CPA should consider the education and licensing required, as well as the roles and salaries that may be available to them after earning an advanced degree in accounting. Understanding these elements can help clarify how much a CPA can make with a master’s degree.
The path to becoming a CPA entails satisfying specific education and licensing requirements. Accounting roles typically require a minimum of a bachelor’s degree. To become a CPA, however, states require individuals to be licensed, which includes sitting for and passing the state’s CPA exam.
While specific state requirements vary, all require 150 credit hours of academic education. Typically, undergraduate programs consist of just 120 credit hours. While some states allow graduates to sit for the CPA exam after completing 120 hours, they won’t accept applications for a license until candidates have accrued the remaining hours.
The credit-hours requirement means that most aspiring CPAs earn an advanced accounting degree, even if it is technically optional. However, a Master of Accountancy (MAcc) program, for example, offers far more than merely the opportunity to fill a certification requirement; it helps students deepen the knowledge and skills needed to be effective as a CPA. Polishing their leadership, analysis and critical-thinking skills in a MAcc program can make graduates more appealing to prospective employers.
How Much Does a CPA Make?
According to PayScale, the median annual salary for CPAs as of May 2021 was approximately $68,500. Many factors, such as experience, can influence salaries. PayScale reports that individuals with 10 to 19 years of experience earned a median annual salary of around $83,000, while those with over 20 years of experience earned a median annual salary of about $96,000.
Location can also influence compensation. Cities with a higher cost of living usually pay more; for example, in New York City — famous for its high cost of living — the median annual pay for a CPA is 17% higher than the national average.
Education level can also be an influencing factor. Not only will earning a master’s degree in accounting enable professionals to apply for CPA licensure, but it can also help prepare them for a wide range of well-paying, high-level accounting roles. For example, PayScale lists the median annual salary for individuals with a bachelor’s degree in accounting as roughly $63,000 as of May 2021, while those with a master’s in accountancy made a median salary of about $72,000.
CPA Careers and Salaries
Another major factor in how much a CPA can make with a master’s degree involves the career they pursue. Different career paths offer different opportunities, and salaries can vary based on responsibility level.
Auditors gather and analyze a wide range of financial records to determine an organization’s economic trajectory. They identify strong and weak points in a company’s finances and make recommendations to optimize strengths and minimize weaknesses. They also apply their analytical and math skills to ensure a company’s financial records are accurate, its taxes are paid properly and its economic structure complies with government regulations. Auditors can work either internally as part of a company or externally as a part of private practice or a consulting firm.
According to the U.S. Bureau of Labor Statistics (BLS), the 2020 median annual salary for an auditor was $73,560. The BLS projects 4% job growth for auditors between 2019 and 2029.
Bank examiners review financial documents, such as balance sheets, expense accounts and loan documents, to ensure compliance for a wide range of industries, focusing on one of two areas. Those who work in risk assessment evaluate documents and review new policies to ensure an institution’s financial health. Those in consumer compliance, on the other hand, keep an eye on various lending activities to ensure borrowers are being treated equitably. Bank examiners typically work in the financial sector, but they can also work in federal and state government roles.
The BLS categorizes these professionals as financial examiners, whose 2020 median annual pay was $81,430. It projects 7% growth for this job category between 2019 and 2029.
Financial managers oversee a company’s financial health by developing strategies that establish long-term growth and stability goals. They often take on advisory roles to top executives, providing recommendations for growth initiatives through reports and forecasts. Financial managers also track financial reports to spot cost-reduction opportunities and monitor financial details to ensure legal compliance.
Those in the role can work in a wide range of fields, including health care and government agencies. As such, they need to have a strong understanding of the tax laws, topics and regulations associated with their particular industry.
The BLS lists the 2020 median annual salary of financial managers at $134,180 and projects 15% growth for the profession between 2019 and 2029.
Chief Financial Officer (CFO)
CFOs are the C-suite executives charged with overseeing all of a business’s financial activities, from monitoring cash flow and engaging in financial planning to analyzing financial strengths and vulnerabilities.
CFOs typically oversee other departments associated with finance and accounting. They also integrate their financial strategies into the strategies of other executives in a company’s C-suite to develop a cohesive plan for business optimization and growth.
The BLS classifies CFOs as chief executives, who had a 2020 median annual salary of $185,950. It projects 4% job growth for this category between 2019 and 2029.
Be a Foundation for Business
Becoming a CPA offers the opportunity to make a substantial impact in how a company operates, grows and succeeds. While the role offers high salaries, it also delivers the kind of satisfaction that can come from helping a business operate effectively and ethically. Find out more about how the University of North Dakota’s online Master of Accountancy program can help you develop the knowledge and skills to pursue a career that can reward you in more ways than one — even if you don’t have any experience or a bachelor’s degree in accounting.