Corporate accounting handles most accounting functions within a business. Since the early 2000’s, it has become an indispensable position for large corporations. To ensure success and continual growth, they are required to have accurate financial statements and documents
Types of Accounting
Accounting is a necessary aspect of any organization which deals with money. Even non-profit organizations which do not consider profit to be a primary business objective need strong accounting practices. However, there are different types of accounting that people are able to specialize in. The type of accounting will be determined by the information which is being handled. For example, tax accounting will be dealing with federal and local taxes and payroll accounting will deal with employee salaries. Other types of accounting include:
- Financial accounting
- Managerial accounting
- Non-for-profit accounting
- Cost accounting
- Corporate accounting
- Governmental accounting
What is Corporate Accounting?
Corporate accounting specifically deals with the internal accounting for corporations. More specifically, this type of accounting will develop and prepare the company’s financial statements, cash flow statements and will analyze and interpret the overall financial results for the company. Corporate accountants can also expect to work on:
- Performing financial calculations
- Preparing budgets
- Serve in a advisory role
- Supervising bookkeepers and accounting assistants
Why is accounting important?
Accounting is one of the most important aspects to running a business. It is the tracking of income, expenditures, and cash flow. Further, it provides quantitative data to answer one of the biggest questions in business. That is: Are you making money or losing it? Beyond that, it also helps ensure that firms meet statutory regulations. Most large corporations are publicly traded on financial stock markets. It is a requirement to present financial statements to their shareholders, who expect 100% financial transparency and disclosure.
It also helps reduce the possibility and opportunity of accounting fraud taking place. After the Enron scandal of 2001, accounting laws became even more strict. Especially with the passing of the Sarbanes-Oxley Act which put corporate accounting in the spotlight. There were clear rules established in order to prevent another Enron scandal. Subsequently, accountants who understood these rules were, and still are highly sought after. Large corporations cannot afford to make accounting mistakes which has made accounting a very indispensable business career.
Corporate accountant qualifications
To become an accountant, many corporations require that you have at least a bachelor’s degree in finance or accounting. Many large corporations will also prefer or even require that you have a Masters in Business Administration (MBA) with a concentration in accounting. According to the Bureau of Labor Statistics (BLS), the average 2019 pay for accountants and auditors was $71,550 a year and jobs in the industry are expected to grow 6% over the next 8 years. Furthermore, a senior financial accountant can expect to make $70k-160k a year. Corporate accountants have numerous career advancement opportunities. They can even become the Chief Financial Officer (CFO) of an organization and can expect to make from $281,00 to $702,000 a year.
MBA in Accounting
An MBA in Accounting will educate you in a variety of accounting functions. Including: financial accounting, public accounting, government accounting, management accounting, tax accounting and internal auditing. It is a specialization available within most MBA programs. This helps give students a general understanding of all accounting principles and also provides them with general business knowledge. Once a student understands the basics of accounting, most specializations such as tax accounting will only have small discrepancies in the laws and regulations surrounding the accounts. In other words, most accounting principles are the same regardless of the type of information accountants handle.
Becoming a corporate accountant can be a very stable and rewarding career to have. Some companies require little to no experience and provide numerous opportunities for career advancement. Want to learn more about accounting and all things MBA? Check out our blog!