Accounting and finance may be closely related fields, but they focus on different parts of an organization’s fiscal operations and well-being.
Essentially, accounting is concerned with tracking and reporting the financial transactions of a business or organization, according to Salary.com. A company’s finance department, on the other hand, would focus on the importance of investments and asset allocation.
“Broadly speaking, finance revolves around planning future financial transactions while accounting revolves around reporting past financial transactions,” Salary.com notes. “While these are two separate functions that require different skill sets, they do both revolve around the management of assets.”
When deciding whether to pursue an accounting degree or a finance degree, prospective students should understand the differences in the programs and the eventual career paths. They also should take into account which financial function interests them most, as well as such factors as their personality, skills and career goals.
Professionals seeking a future that zeroes in on financial theory, investment and financial analysis may find a master’s in finance degree more applicable to their goals.
For those interested in the detailed work of maintaining budgets and financial records, or who aspire to earn their Certified Public Accountant (CPA) license, an advanced degree in accounting can be a satisfying choice. A Master’s in Accountancy online from the University of North Dakota can prepare graduates for a variety of career options in the field.
The Role of Accountants
The essential responsibility of an accountant is to keep track of every dollar a company spends and why. As part of the position, accountants prepare financial records, including internal corporate statements regarding income, balance and cash flow. They also do reports for tax purposes and may also perform audits.
“Accuracy, precision and specificity is key to the field, since companies are often required to produce accounting reports in specific formats and even internal reports need to be correct and specific to be useful,” PocketSense.com notes.
Accountants, particularly CPAs, also have a legal responsibility to be ethical in their work, which can affect not just their clients but entire companies and their boards and investors as well.
Investopedia cites the Enron scandal in the early 2000s as an example of CPAs failing to adhere to an ethical code. “While consulting at Enron, Arthur Andersen (Company) CPAs did not maintain independence and performed both consulting services and auditing services, which violates the CPA code of ethics,” Investopedia writes. Company executives and CPAs faced charges as a result.
Accountants and CPAs may work for a wide variety of employers ranging from local accounting practices to multinational CPA firms. CPAs also may opt to set up an independent practice.
According to the American Institute of CPAs (AICPA), a membership association for the accounting profession, accountants may work in areas as diverse as financial accounting and reporting, management accounting, financial analysis and treasury/cash management. They may also specialize in fields such as financial forensics, business valuation, IT consulting or personal financial planning. Other accountants may choose to work in government at the local, state or federal level.
CPAs – accountants who have at least two years of accounting experience and 150 hours of education and who pass the demanding CPA exam – often move into executive positions such as controller or chief financial officer.
The median annual salary for accountants and auditors as of 2018 is $70,500, according to the Bureau of Labor Statistics (BLS). The job outlook is good: Employment in the field is expected to increase 10 percent between 2016 and 2026, faster than the average for all occupations, the BLS notes.
The Role of a Finance Professional
Where an accounting education is very specific, coursework for a master’s in finance might include financial theory, math, quantitative finance, investment and financial reporting and analysis, according to Investopedia.
And though finance professionals might also sit for the CPA exam, most opt to obtain the chartered financial analyst (CFA) designation instead. The CFA, a crucial certification for investment professionals, requires at least 48 months of relevant work experience as well as passing a rigorous exam.
Those with a graduate degree in finance might work as actuaries, budget analysts, credit analysts, financial planners or investor relations associates. In most capacities, they provide individuals and companies the in-depth knowledge necessary to make financial decisions.
Salaries vary based on job titles, locations and years of experience. For one typical career path – financial analysts – the median salary as of May 2018 was $85,660, according to the BLS. Employment in this segment of the job market is expected to grow 11 percent from 2016 to 2026, faster than average for other occupations.
An advanced degree in either accountancy or finance can provide a foundation for a successful career in the financial field. Prospective students should consider their skills, interests and preferred career path when deciding on a graduate program.
University of North Dakota’s Master of Accountancy Online Degree
The University of North Dakota’s Master of Accountancy (M.Acc.) online program helps prepare graduates to sit for the CPA exam and position themselves for a variety of roles in the accounting field.
The program offers practitioner and fundamentals tracks. The practitioner track is designed for professionals with a background in accounting who are ready to advance their roles in the industry. The fundamentals track caters to individuals who are new to accounting and would like to establish their careers. All coursework is done online, which lets busy professionals earn their degree without disrupting their work or personal lives.
The program is accredited by the Association to Advance Collegiate Schools of Business International, which only recognizes about 30 percent of business programs in the United States. For more information, contact UND today.
The Difference Between Finance and Accounting: Salary.com
Accuracy and precision: Pocket Sense
Salary and job outlook: Bureau of Labor Statistics
Role of financial professional: Investopedia