Nature of Accounting and Auditing Jobs

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Accountants and auditors help to ensure that the Nation's firms are
run efficiently, its public records kept accurately, and its taxes
paid properly and on time. They perform these vital functions by
offering an increasingly wide array of business and accounting
services, including public, management, and government accounting, as
well as internal auditing, to their clients. Beyond carrying out the
fundamental tasks of the occupation—preparing, analyzing, and
verifying financial documents in order to provide information to
clients—many accountants now are required to possess a wide range of
knowledge and skills. Accountants and auditors are broadening the
services they offer to include budget analysis, financial and
investment planning, information technology consulting, and limited
legal services.

Specific job duties vary widely among the four major fields of
accounting: public, management, and government accounting and internal
auditing.

Public accountants perform a broad range of accounting, auditing, tax,
and consulting activities for their clients, which may be
corporations, governments, nonprofit organizations, or individuals.
For example, some public accountants concentrate on tax matters, such
as advising companies about the tax advantages and disadvantages of
certain business decisions and preparing individual income tax
returns.


Others offer advice in areas such as compensation or employee health
care benefits, the design of accounting and data-processing systems,
and the selection of controls to safeguard assets.

Still others audit clients' financial statements and inform investors
and authorities that the statements have been correctly prepared and
reported. Public accountants, many of whom are Certified Public
Accountants (CPAs), generally have their own businesses or work for
public accounting firms.

Some public accountants specialize in forensic accounting—
investigating and interpreting white-collar crimes such as securities
fraud and embezzlement, bankruptcies and contract disputes, and other
complex and possibly criminal financial transactions, including money
laundering by organized criminals. Forensic accountants combine their
knowledge of accounting and finance with law and investigative
techniques in order to determine whether an activity is illegal. Many
forensic accountants work closely with law enforcement personnel and
lawyers during investigations and often appear as expert witnesses
during trials.

In response to recent accounting scandals, new Federal legislation
restricts the nonauditing services that public accountants can provide
to clients. If an accounting firm audits a client's financial
statements, that same firm cannot provide advice on human resources,
technology, investment banking, or legal matters, although accountants
may still advise on tax issues, such as establishing a tax shelter.
Accountants may still advise other clients in these areas or may
provide advice within their own firm.

Management accountants — also called cost, managerial, industrial,
corporate, or private accountants—record and analyze the financial
information of the companies for which they work. Among their other
responsibilities are budgeting, performance evaluation, cost
management, and asset management. Usually, management accountants are
part of executive teams involved in strategic planning or the
development of new products. They analyze and interpret the financial
information that corporate executives need in order to make sound
business decisions. They also prepare financial reports for other
groups, including stockholders, creditors, regulatory agencies, and
tax authorities. Within accounting departments, management accountants
may work in various areas, including financial analysis, planning and
budgeting, and cost accounting.

Government accountants and auditors work in the public sector,
maintaining and examining the records of government agencies and
auditing private businesses and individuals whose activities are
subject to government regulations or taxation. Accountants employed by
Federal, State, and local governments guarantee that revenues are
received and expenditures are made in accordance with laws and
regulations. Those employed by the Federal Government may work as
Internal Revenue Service agents or in financial management, financial
institution examination, or budget analysis and administration.

Internal auditors verify the accuracy of their organization's internal
records and check for mismanagement, waste, or fraud. Internal
auditing is an increasingly important area of accounting and auditing.
Internal auditors examine and evaluate their firms' financial and
information systems, management procedures, and internal controls to
ensure that records are accurate and controls are adequate to protect
against fraud and waste. They also review company operations,
evaluating their efficiency, effectiveness, and compliance with
corporate policies and procedures, laws, and government regulations.
There are many types of highly specialized auditors, such as
electronic data-processing, environmental, engineering, legal,
insurance premium, bank, and health care auditors. As computer systems
make information timelier, internal auditors help managers to base
their decisions on actual data, rather than personal observation.
Internal auditors also may recommend controls for their organization's
computer system, to ensure the reliability of the system and the
integrity of the data.

Computers are rapidly changing the nature of the work of most
accountants and auditors. With the aid of special software packages,
accountants summarize transactions in standard formats used by
financial records and organize data in special formats employed in
financial analysis. These accounting packages greatly reduce the
amount of tedious manual work associated with data management and
recordkeeping. Computers enable accountants and auditors to be more
mobile and to use their clients' computer systems to extract
information from databases and the Internet. As a result, a growing
number of accountants and auditors with extensive computer skills are
specializing in correcting problems with software or in developing
software to meet unique data management and analytical needs.
Accountants also are beginning to perform more technical duties, such
as implementing, controlling, and auditing systems and networks,
developing technology plans, and analyzing and devising budgets.

Increasingly, accountants also are assuming the role of a personal
financial advisor. They not only provide clients with accounting and
tax help, but also help them develop personal budgets, manage assets
and investments, plan for retirement, and recognize and reduce their
exposure to risks. This role is a response to clients' demands for a
single trustworthy individual or firm to meet all of their financial
needs. However, accountants are restricted from providing these
services to clients whose financial statements they also prepare.

Source:
Bureau of Labor Statistics, U.S. Department of Labor, Occupational
Outlook Handbook, 2006-07 Edition, Accountants and Auditors, on the
internet at http://www.bls.gov/oco/ocos001.htm (visited November 15,
2006).

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