CERTIFIED PUBLIC ACCOUNTANT (CPA)
Back to GlossaryDefinition
A state-licensed accounting professional who meets education, exam, and experience requirements and upholds ethical standards.
Summary
A Certified Public Accountant (CPA) is a highly qualified accounting professional who has earned the right to provide certain financial services to the public. To become a CPA, individuals must complete specific educational requirements (typically 150 credit hours), pass a rigorous four-part examination, gain relevant work experience under a licensed CPA, and maintain continuing education. CPAs can perform services that other accountants cannot, such as auditing publicly traded companies and signing off on audited financial statements. They are held to strict ethical standards and are regulated by state boards of accountancy.
Usage Context
Understanding CPAs is crucial when studying professional accounting careers, audit procedures, financial statement preparation, and the regulatory environment of accounting. This term is particularly important when discussing who can perform certain accounting functions and the credibility that professional certification brings to financial services.
Common Confusions
- Thinking all accountants are CPAs (many are not licensed)
- Believing CPA licenses are universal across all states (they're state-specific)
- Confusing CPAs with tax preparers (CPAs can do more than just taxes)
- Assuming the CPA exam is the only requirement (education and experience are also needed)
