No matter what the company is, whether it falls under the public or private sector, for-profit or non-profit, a mom-and-pop, or a large international corporation, a strong accounting team is essential for meeting business compliance requirements and for providing accurate data to achieve business success and growth.
If you’re looking to pursue or further your accounting career, check out these six skills that will help you succeed in an accounting position.
Strong attention to detail – pennies matter!
There are no grey areas in accounting. You must be precise, 1.1+1.1=2.2 not 2. Accountants need to be very detail-oriented, as they are responsible for ensuring the accuracy of all financial information. Most companies are required to be audited yearly by a CPA firm. CPA firms are rigid in their requirement of GAAP (Generally Accepted Accounting Principles). GAAP allows investors to easily evaluate companies by simply reviewing their financial statements. If you want a bank to lend you money or investors to take an interest in your company, then every cent needs to be accounted for. This applies even more so to the non-profit or government sector when being awarded a grant. Federal final reports will be rejected simply because of a 35-cent overage. Paying close attention and avoiding any errors is vital.
Basic math skills are a must – but simple algebra at the most
It seems obvious, but to successfully work in accounting, you need to be a numbers person. Most of the time basic math skills are needed but, there are times where algebra (and more) is used. For example, algebra is used to determine how leveraged a company is (how much debt they owe compared to assets). A bank will also use this to determine whether or not they will lend to a company. You need to be able to forecast your budgets, so you know when your cash runs out. Depreciation uses a percentage to say when the capital will no longer have value. So, if you know you want to depreciate it over 36 months, you need to be able to figure out how much money that is, at what percentage.
Basic T-Accounts understanding – know both sides of your entry
T-Accounts are a visual representation of individual accounts that look like a “T”, making it so that all additions and subtractions (debits and credits) to the account can easily be tracked and represented visually. Knowing that for every debit to one side of the chart adds a credit to the other side is imperative to keeping accurate books.
Organization – there are a lot of moving parts
In accounting, you have to be able to keep track of sales and revenue, cash receipts, aging accounts receivable and accounts payable, cash disbursements, monthly allocations, account reconciliations, and budget forecasts. Most accountants work with insurance companies, banks, and auditors. And you have to make sure government deadlines and tax deadlines are met. The accounting department is sometimes also responsible for payroll, and we all know how important it is to be paid on time and accurately. Creating a system and using organization tools will help you keep track of all these responsibilities and different relationships.
Humility – it’s not a glamorous job but it’s key for the company’s success
Accounting personnel are not typically in the limelight. They are behind the scenes, making sure the information that other departments need in order to make presentations to banks or investors or to help the sales department seal the deal is accurate. Accountants keep the company running by paying the bills so the lights don’t get turned off and vendors will still want to work with you. Accountants file the tax reports to keep businesses in good standing with the government, and they make sure there is cash in the bank account for payroll to hit each week. Basically, they are the glue that keeps the business together.
Patience – Persistence – Perseverance
Sometimes it can take a long time to figure out a reconciliation. It’s like a 5,000-piece puzzle or untangling a pack of headphones. If you get frustrated and quit, the problem will never get fixed. When you’re working with a whole lot of numbers and your balance sheet doesn’t balance or your bank statement doesn’t reconcile to what the bank is reporting, it takes a cool mind to follow through each transaction until 1+1=2.
The accounting field is a large one. In the USA alone there are about 1.3 million accountants. The number is even larger when you include all other accounting positions. There are many different types of accounting roles and different types of accountants that exist in every organization. If you possess these top skills, you will stand out as a qualified candidate and will be successful in an accounting role.
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