What does an accountant do?

What does an accountant do?

What is an accountant?

Course link: Certificate IV in Accounting

Simply put, an accountant is a trained professional who is tasked with maintaining the accounts of a company.

The accounts of a company are very important, since they are meant to be a reflection of the financial state of the organisation. They also have a number of different uses in reporting, planning and decision making which can have long term effects on the success of the organisation.

For instance, the accounts of a company can be used to showcase the profits or success of the company, which can attract investors. If the company looks like a sound investment, more people will be looking to put money into the organisation. This is especially important during an initial public offering of shares, but can have ramifications even after a company has been floated on the stock exchange. However, mis-reporting the finances of the company can have legal implications for the management and accounting staff of a company, so it is extremely important a full and accurate accounting of the company’s financial position is made.

The Role of the Accountant

An accountant’s role is to prepare reports such as the income statement, the statement of financial affairs, and the cash flow of a company. Depending upon the policies followed by the company, reporting of finances can occur on a quarterly basis, while others generate them on a semi-annual or annual basis. These can then be used by management in their strategy and decision making. If a company is publically listed, these are also released to the general public. There are legal requirements regarding how often publically traded companies have to disclose their financial affairs to the public.

Accountants are responsible for recording and reporting all the assets, liabilities and equity of the company.

This can include keeping track of things like:

  • Cash payments (aka disbursements) – Most businesses have to pay a lot of money throughout the year as a normal part of doing business. Keeping track of where money is paid, who is owed what and creating cheques to be signed are all part of the accounting departments duties.
  • Procurement and inventory – Accountants keep track of all the purchase orders that have been made for inventory (products the company will then sell), as well as other goods and services the company buys. A big responsibility for accountants is ensuring creditors get paid on time and keeping careful track of everything that is bought, sold or spoiled so that accurate cost-of-goods sold calculations can be made.
  • Property – Most businesses have a large collection of significant long-term assets called “property, plant and equipment”. This can include buildings, manufacturing equipment, land, machinery, tools, vehicles, cabinets, computers, retail display cabinets and more.
  • Cash collections – All the incoming money collected by a business needs to be identified and recorded, attributed to the correct source and placed in the correct account. Accountants perform these duties, while also ensuring the business keeps an adequate supply of currency on hand to day-to-day transactions. Balancing the business’s cheque book and controlling incoming receipts is done by accountants in smaller organisations, while in larger companies, the treasurer may be responsible for some of these functions.
  • Payroll – All the wages and salaries paid to employees throughout the year. This includes calculating PAYG tax for the employees, company payroll tax, leave, sick pay, superannuation, sick pay and other benefits and allowances.

Jobs for accountants

Beyond these functions, accountants are used for all sorts of reasons. For example, small businesses that do not keep regular records of all their accounts might need an accountant to come and clean up their systems in order to go through an audit or apply for a bank loan.

When a business shuts down (especially in the case of large companies) accountants are called in to break down the assets of the business and ensure that they are correctly distributed to creditors, customers and investors.

Some of the positions open to accountants include:

  • Chief Financial Officer
  • Accounting Risk Manager
  • Environmental Accountant
  • International Accounting Specialist
  • Forensic Accountant
  • Strategic Procurement Manager
  • Big 4 Associate

Accounting is a respected profession with a long history of practice. Accountants are capable of earning very good money depending upon their qualifications, experience and where they are employed. A course like the Certificate IV in Accounting can be useful for getting a foot in the door, while further training with a Bachelor’s or Master’s Degree can open up all sorts of opportunities. There are numerous professional accreditations available as well, such as CPA Australia and ICAA, which will also help you in getting a professional job as an accountant.

It’s probably safe to say if there is money, liabilities, assets or equity involved, there will be an accountant around!

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