Public accounting offers services such as tax preparation, auditing, general accounting, and consulting to businesses. Accountants typically have a professional license, such as a CPA, and must stay up to date with current tax laws. Audits are a common service, while general ledger services allow businesses to outsource financial reporting. Consulting services are also offered, but may be limited due to regulations.
Public accounting represents accounting services offered to small or large business clients. Common services offered include tax, auditing, general accounting, and consulting services. Accounting firms may offer other services to their clients depending on their needs. Most accountants who work under the umbrella of public accounting have a professional license, such as the Certified Public Accountant (CPA) certification. This is a universal worldwide license indicating that an accountant has gone through rigorous testing to achieve this standard.
The tax services of the public accounting industry generally include the preparation of personal or corporate annual returns. CPAs in this field spend a lot of time learning and keeping up with current tax law. This often involves attending seminars or other training to ensure they offer the best possible services. Tax planning offered throughout the year allows tax accountants to help businesses find ways to reduce their tax liabilities. Specific tax planning may also be required when a company makes a major move or decision regarding its operations, such as spinning off a division.
The audit is perhaps the best known public accounting service. Accounting firms will offer to go in and test a client’s ledgers for accuracy, validity, and timeliness. Publicly traded companies generally need to undergo audits to comply with government reporting guidelines. Audits involve planning and field testing to determine the scope of a client audit. After the review, the company will issue an official opinion containing the auditor’s opinion on the company’s financial reports.
General ledger services offered by public accounting firms basically allow a business to outsource its financial reporting. A client will pay professional accountants to maintain its general ledger and prepare financial statements. The client will simply submit all financial information to the accounting firm and allow the accountants to prepare it. This service works well for small businesses or those that cannot spend the appropriate amount of time completing accounting processes.
Consulting services are often powerful in public accounting. Professional accountants can consult with clients on a range of issues, from taxes and mergers to purchases and general ledger and even employee benefit plans. Under current laws and regulations, accounting firms often cannot offer consulting services to a client in addition to auditing or general accounting services. This blurs the line between segregation of duties. A company that offers specific tax advice may be unable to prepare accounting information as it completes too many services for its client.
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