S.

Olayan School of Business Spring 2011-2012

Acct 210

Research Assignment 1 Project Topic: Misperceptions about Accounting

Lana Bilani, Hind Kaddoura, Ramzi Chehab, Omar Nouria, Hussein Hassoun

Introduction:
When someone thinks about a career in accounting the first misconception and stereotype they would think of is an old man in a suit at a computer calculating and writing up financial statements all day. However there is so much more to accounting than meets the senses. Misperceptions of accounting have always been present among numerous individuals especially in developing countries. Lots of people are not sure about what the accounting profession is and the probable career choices an accounting degree may acquire. Accounting is very different than what people think it is, it is more than just recording and analyzing clients records. In this report we will start off by analyzing and discussing the importance of accounting and what it actually is and then we will move on to discuss possible work opportunities that a degree in accounting may offer. We will also discuss and describe the characteristics of employment in different accounting fields and the work environment in each sector or accounting and we will finally give examples of successful, individuals in accounting. An accountant is an individual who is responsible of monitoring and recording the flow of money that passes through a business, agency or organization. The accountant also verifies and checks how accurate transactions are according to local current state and federal guidelines. Some accountants work directly for the business and some accountants work privately and are contacted when in need by specific agencies. While a majority of accountants are employed to work for companies, some accountants may well work directly for private individuals to aid them with financial decisions, tax returns, investments or other money related quarries.1 In fact, lots of of the most triumphant businessmen were previously accountants who decided to branch out into the business field. Why is this? You may ask? It is because accounting is the language of business. Accounting is a
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process that quantifies business activities, changes these activities into statements and reports and communicates the output to heir-level of management.2 Another reason why all students should have a background in accounting is because in recent years people in the business world are held more accountable for their financial practices. The Enron and WorldCom crisis is an incident where the auditor, Arthur Anderson failed to report illegal accounting practices therefore leading to the SEC monitoring public businesses more strictly. This shows that companies need to acquire the basic skills of accounting in order to shun these problems. There are many possible work opportunities in accounting.

Accounting jobs are classified into four categories:

Bookkeeper Accounting Clerk Accountant Certified Public Accountant

The Bookkeeper:
Bookkeepers are financial record/statement keepers. They constantly keep records up to date and calculate expenditures, accounts payable, accounts receivable and receipts. The also keep up to date profit and loss accounts. In order for a person to pursue this vocation they need to obtain a wide range of skills, they need to be dedicated and devoted to the occupation because it is a job with a lot of repetition and the same work needs to be done and maintained everyday. Bookkeepers work in an office environment.3 Many bookkeeping, accounting, and auditing clerks work regular business hours and a standard 40hour week, although some may work occasional evenings and weekends. About 1 out of 4 clerks worked part time in 2008.4

http://ezinearticles.com/?Career-Opportunities-in-Accounting&id=456985 http://www.accountantnextdoor.com/importance-of-accounting-accountancy/ 4 http://www.bls.gov/oco/ocos144.htm

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Annual Salary Range Full time: $18,000 to $40,000+ Educational Requirements/ Skills A bookkeeper may feel it is beneficial to get a certificate in bookkeeping (The Certified Bookkeeper (CB) designation awarded by the American Institute of Professional Bookkeepers) that requires you to have at least 2 years of experience in bookkeeping.5 A high school diploma is necessary as well as onthe-job training, which is not necessary but very beneficial.

The Accounting Clerk:

An accounting clerk is another job opportunity that a degree in accounting offers. It is very similar to a job in the bookkeeping field. They work by keeping records and statements up to date and regular. As an accounts clerk your duties would typically include: 1) Balancing accounts (often known as double entry bookkeeping) 2) Processing accounts 3) Processing Sales invoices, income, receipts and payments 4) Raising purchase orders 5) Preparing statements showing the company or departments income and outgoings 6) Completing VAT returns 7) Checking that accounts are accurate 8) Preparing wages and processing expenses claims, if you deal with payroll 9) Helping to prepare final accounts, such as profit and loss accounts and balance
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sheets 10) Using computerized accounting systems and maintaining accurate records 11) Giving administrative support to accountants.6 When you are working in a larger corporation, you usually would work as part of an accounting group, sometimes you even might specialize in a specific area, e.g. sales or purchase ledger, credit control or patrol. Whereas if you work in a small business, you probably would do all of the above tasks as well as handle cash and confirm banking transactions.7 Annual Salary Range Full-time: $18,000 to $40,000+

Educational Requirements/ skills A two-year associate degree in accounting is what some accounting clerks enter the job with whereas some other accounting clerks enter the force with a high school diploma. Accounting clerks are not expected to have a four-year degree in accounting.

Accountant:
Some other accountants might enjoy educating and would rather work in the teaching force instead of being a CPA, bookkeeping, or becoming an accounting manager. Accountants possibly will work as investigators, professors or reviewers. These individuals make sure that there is steady growth of the

https://nextstep.direct.gov.uk/PlanningYourCareer/JobProfiles/JobProfile0288/Pages/default.a spx
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https://nextstep.direct.gov.uk/PlanningYourCareer/JobProfiles/JobProfile0288 /Pages/default.aspx

profession by attempting to clear out and tackle future problems through research. When the research is done, the results are dispersed to all. 89 Accountants whose focal point is the education parts of accounting do not only educate students about the vocation, they also research. They produce eminence research and it is a very demanding activity that needs consistency in the thinking process of the scientist. So along side making a change in the world, engaging in research changes the researcher making him/her a more careful thinker, therefore making them an influential decision maker.10 Annual Salary Range Full-time: $113,800-$127,400 (on average)

Educational Requirements/skills Accountants are expected and mostly required to have a bachelors degree in accounting from a four-year college or university.

Certified Public Accountant:

One of the mainstream jobs that an accounting degree offers is Public Practice. Public practice accountants are accountants who create a service with a fee as well as a staff of accountants functioning for them. Public accountants arrange, control, supervise or work in partnerships, which present their accounting services to individuals, governments and corporations.11 There are a few things that need to be done before a public accountant is hired; he/she needs to be certified to work for public practices. The work of public accountants includes auditing, taxation and management advisory services.12 Annual Salary Range
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http://www.byuaccounting.net/mediawiki/index.php?title=Life_as_a_Professor http://ezinearticles.com/?Career-Opportunities-in-Accounting&id=456985 12 http://umaine.edu/business/undergraduate-programs/accounting/

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Full-time entry level: $50,000 to $60,000 Full-time with several years of progressive experience: $100,000+ Educational Requirement/skills A main requirement for CPAs is passing the Uniform CPA Examination, which is a meticulous exam, after passing the exam; most state boards require you to have a year of experience as well as passing an ethics test before receiving a license.13 The time CPAs work depends on where they work and what they do, time spent ranges from 40 hours a week to 50 or 60 hours.14 Major employers of CPAs include: CPA firms. From the small firms with one office, to multi-national firms.15 Manufacturers, insurance companies, non- profit organizations, banks, government agencies, e-commerce, and many more.16

Recent Salary ranges in accounting are as follows: Big four firm Entry Level Junior Staff Accountant Senior Staff Accountant Manager Senior Manager Partner $55,000 $46,000-63,000 $65,000-95,000 Overall $50,00070,000 $40,00080,000 $70,000 Typical Experience First Year 1-2 Years 3-5 Years 5-7 Years 7 Years Plus 10 Years Plus

$65,000-140,000 $85,000 $72,000-160,000 $115,000 $200,000$150,000 3,000,000

Work Environment & Training:

Many accountants work in the office environment, where they use high-tech softwares and hardware to calculate and evaluate transactions of a business.
http://www.accountingcoach.com/careers/accounting-jobs.html http://www.startheregoplaces.com/why-accounting/ask-a-cpa/average-work-hours/ 15 http://www.accountingcoach.com/careers/accounting-jobs.html 16 http://www.accountingcoach.com/careers/accounting-jobs.html
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As we have discussed the number of hours each sector of the accounting profession works, we can conclude that the average hours spent is forty hours per week; this is very similar to any other business profession. However towards the end of a financial year they may need to add bonus hours because there are audits and tax collection due. Because of the large amount of time that they spend at a computer on a desk a lot of accountants suffer from muscle and eyestrain, back pain and headaches. As stated above, accountants are expected to have ATLEAST a high school diploma and work experience. However nowadays as technology and jobs become more modern and technical in order to have a job in accounting employers are looking for individuals with post-secondary education such as a degree in the field. On the job training is usually done for bookkeepers and accounting clerks in order for them to get used to the companys softwares and routines.

Highest Paid Jobs for an Accountant:

In corporate accounting one of the highest positions an accountant can attain is Chief Financial Officer. The salary of a CFO ranges between $100,000.00 to $200,000.00, depending on the corporation, at times sometimes reaching $200,000+. Becoming a CFO in a business is different and harder than any other accounting profession because it can require a vast amount of practice, technological knowledge and at times sophisticated degrees/ Diplomas. Another high paid job an accountant can acquire is accounting director. The accounting director supervises an assemblage of accountants earning around $112,000 per year, and treasurer who is in accuse of a company or an individual's financial budget, liabilities, assets. Treasurers can earn up to $98,000 per year.17 There are many famous accountants worldwide, some include Arthur Blank who started his career in founding for his own hardware store and then became a
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billionaire who presently owns The Atlanta Falcons football team. Alexander Jobson is another famous accountant who was educated in the public system and at the age of 14 started working as an assistant clerk. He then went on to study accounting and qualified as an Associate of the Institute of Actuaries and a Fellow of the Australian Corporation of Public Accountants. In 1906 he launched his own business and was the director accountant. An additional famed accountant is Walter Dimmer who started as an accountant employed for the Fleer Corporation and in his additional time fiddled with recipes and finally came up with the bubble gum. Some other well-known names in the accounting/ business world are: Adrian Raine who was an accountant and psychologist, Kenny G who worked as an accountant and eminent soprano saxophone player, and lastly Gibby Haynes who was an accountant and head singer of the band The Butthole Surfers .
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Interview:
An interview was conducted with a public practicing accountant. The interview was done with Wadih Barbara: a managing partner in Barbara & co. Question: What are the possible career opportunities an accounting degree offered? Answer: The degree in accounting offers the jobs of being an accountant, external or internal auditor, as well as many other jobs. Question: What degree did you have to receive in order to acquire this accounting position? Answer: I had to get a degree in post-secondary studies and a diploma, I also had to qualify and pass a few examinations. Question: What is it like to work as an accountant? How is the work environment for each of the jobs you mentioned in the first answer? Answer: An accountant is usually a fulltime employer and he/she is responsible for issuing the financial statements. In Lebanon the range in salary is $1,000- 2,000. However as you advance in your job and receive experience you will be offered higher positions such as senior accountant and the salary would be much higher, around $5,000+ per month. External auditors work independently and have their own office. They are employed by shareholders of a corporation to issue a report where they would express their opinion of the statements at the end of a fiscal year. Minimum salary is around $4,000 a year for each company the auditor works for. The average they would receive for a medium sized company is $10,000 per year and for a larger company,

$20,000 per year. So you can see for each job there is a wide range of positions and a large scale of salaries for each position. There are many factors that contribute to salary such as the country employed in, the size of the business and how much experience you have. The internal auditor is similar to the external auditor however he/she is a full time employer in large companies instead of working alone. The duties of an internal auditor are that they have to monitor and develop a system that controls the work stream of each department in the business. Salary ranges from $2,000 to $4,000 a month.

Conclusion:
So there you go, those are some of the opportunities in the accounting profession. Over the years the demand for accountants is increasing, especially nowadays where people in the business world are held more responsible for their financial preparations. Since the Enron and WorldCom crisis when selfdirected auditor Arthur Anderson failed to report illegal accounting practices, the SEC have been more harsh by observing public corporations more directly. Therefore businesses need to have some basic knowledge and understanding of accounting to shun any prospect misstatements accidentally occurring.20 Businesses require accountants to make decisions, measure risks of the decisions made, to prevent deception, to keep current and regular records, and lastly to keep the businesses reputation unsoiled by administrating it well and having appropriate accounting statements. Clearly the accounting field is a very important field, which is high in demand, and pay that should be considered by university students.

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Johnson, Steve. "The Top 10 Highest Paid Jobs in Accounting." Ehow. N.p., 26 jul 2011. Web. 25 Mar 2012. <http://www.ehow.com/info_8788357_top-highestpaid-jobs-accounting.html>. Russell, Michael. "Career Opportunities in Accounting." ezinearticles. N.p., 16 Feb 2007. Web. 25 Mar 2012. <http://ezinearticles.com/?Career-Opportunities-inAccounting&id=456985>. Smith, Dee. The Highest Paying Accounting Jobs .Manager50.3(2005) Tracy, John. Accounting for Dummies. 4. 2008. Print. United States. Department of Labour. Occupational Outlook Handbook, 2010-11 Edition . 2009. Web