What is a Chartered Accountant?

The Difference Between An Accountant And A Chartered Accountant

Financial matters are among the most confusing and convoluted subjects that you will encounter at one point in time. Nonetheless, accurate bookkeeping and filing, correct record keeping and adhering to the local and federal law are all crucial in being able to secure economic well-being. With regard to this, an accountant becomes the best choice to manage financial matters in an effective and efficient manner. An accountant is well-versed with all nuances of the financial laws and will help provide solutions to some of the most difficult financial aspect. Better yet, they’ll offer transparency and clarity when handling any personal financial management issues. While the rules and regulations prove to be challenging, to say the least, it’s still essential that we understand the two different types of accountants and the purpose each of them serves.

An Accountant

The main role of an accountant is to give a real-time and accurate record of all the financial transactions of an organization or individual. The accountant must be conversant with all the necessary compliance guidelines that come into play when financial transactions are being conducted. An accountant also has a choice of where they would like to practice. Some of them will work directly for a large firm on a full-time basis whereas others may decide to serve the needs of private individuals. The most recognized type of accountants are those who help individuals accurately compile and file their tax returns on an annual basis. There are also accountants who can choose to venture into some more discrete fields like estate planning, fund management, investment options or retirement packages. As a result, a robust amount of experience is required to fit this role effectively.

While an accountant may be responsible for other functions that are beyond finances, there are four main areas that remain to be the responsibility of an accountant.

Financial Accounting
This involves the management of the financial records for an individual or business in addition to providing reports on the same records.

Management Accounting
This typically involves analyzing a business’ financial reports and results. The main focus of this is to report to the management team for preparation of budgets.

Auditing
Auditing accountants check financial reports, gather evidence to support the figures in their reports and offer an informed opinion on their results.

Tax Accounting
This involves the preparation of documents for purposes of tax legislation, either for individual or business tax returns.

What Is a Chartered Accountant

It is important to note that a chartered accountant has gone through a more intense and broader training as compared to a normal accountant. A chartered accountant must have successfully completed an academic postgraduate program and worked under a mentorship program for not less than three years. Most importantly, a chartered accountant must be certified with ICAA which is the Institute of Chartered Accountants of Australia. Instead of specializing in tax returns and other real-time financial aspects, chartered accountants focus on offering accurate financial records of all transactions for a business or individual. As a result, these accountants are likely to be found in a more commercial capacity.

Another notable difference between the two is that while accountant might have their own practice for several years, chartered accountants are considered to be accountants for hire. Since most of their expertise revolves more around business-related functions, chartered accountants are viewed to have more opportunities for progress and their salaries are a reflection of this fact since their demand is quite high. Chartered accountants offer a high standard of experience and professionalism, one that cannot be seen with normal accountants.

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