One career path that consistently has a positive job outlook and excellent salary potential is certified public accountant (CPA). This licensed accounting professional is in high demand and can earn a great deal more money than accountants without the credential, even if their job duties are similar. Exactly how long you will need to spend in school if you want to become a CPA varies from one state to another, but generally, students should plan on five years of a college education.
Degree and Semester Hour Requirements
Becoming a CPA requires you to meet education and experience requirements as well as passing a difficult professional exam. Technically, you need only a bachelor’s degree to become a CPA. You could start off with a Bachelor of Accounting or Bachelor of Accountancy (BAC) degree, a Bachelor of Science in Accounting (BSACC) degree or a Bachelor of Business Administration (BBA) degree or Bachelor of Science in Business Administration (BSBA) degree with a concentration in accounting. Any of these options could typically be completed in four years, if you study full-time.
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However, aspiring CPAs in most states will need to go to school longer. “Almost all” states in the U.S. require CPA candidates to complete 150 semester hours of college studies, the United States Bureau of Labor Statistics (BLS) reported. That requirement adds an extra 30 semester hours – essentially, another year of full-time study – on top of how long a traditional 120-credit bachelor’s degree would take.
To maximize that extra year of college education, some students look for five-year dual degree programs that award both a bachelor’s degree and a master’s degree.
Why Do CPAs Need 150 Hours of Study?
If you’re wondering what the point of an extra year of accounting study is, you’re not alone. Many students wonder why there is a gap between the actual degree required to become a CPA and the number of semester hours students must complete. The reasons for the 150-hour requirement are changing needs in the accounting industry, according to the Association of International Certified Public Accountants (AICPA).
Tax laws and regulations have become more numerous and more complex, requiring CPAs to study the topic in greater depth than was necessary in the past. Business methods, too, have grown in complexity, in part because of more regulations at every level of government. Changes in technology have altered how accounting professionals work with auditing methods, internal control procedures and information systems design. This means not only that accountants need further study to learn to use this technology, but also that some of the work once done by individuals is now performed by software. Today’s accountants need more problem-solving skills and conceptual knowledge than did accountants in the past, whose focus might be more technical in nature. As a result of all of these changes, the amount of knowledge and practical skills students can gain in just 120 semester hours is “is no longer adequate” to work as a CPA, the AICPA reported.
The next question prospective CPAs often ask is how to get 150 semester hours. Earning their bachelor’s degree is a given, but students have a decision to make about how to complete those extra 30 hours. Fortunately, students have several options here, the AICPA reported. You can cut tuition costs by taking the extra classes at your local community college. If you have another subject of interest, such as finance or economics, you might benefit from using your extra year to double major in a second undergraduate program of study. Many aspiring CPAs who want to ultimately work in senior-level roles such as partner of an accounting firm choose to use that additional year to work toward a Master of Accountancy or similar graduate degree.
In some states, like Massachusetts, CPA candidates can sit for the exam once they have attained the 120 semester hours needed to earn a bachelor’s degree, but they still need to complete 150 semester hours of study in fully become a CPA.
Is Becoming a CPA Worth It?
If you are going to spend an additional year in school – and incur a year of extra tuition costs – you want to know that the investment you’re making is worthwhile. There are many reasons why CPA licensure is valuable.
For one thing, becoming a CPA opens up new opportunities. Not only do you need the certification to work in auditing and assurance services, but having a CPA license also expected for candidates who want to attain management roles such as controller, senior manager or partner in an accounting firm.
Having the credential can also bolster the reputation of self-employed accountants, helping them stand out from the competition and bring in new clients. Finally, CPAs typically make 10 to 15 percent more than accountants without the credential, the AICPA reported.
The pay boost from becoming a CPA is so large that CPAs make $1 million more than accountants who are not CPAs over the course of their working years.