In the finance and accounting sectors, both Accountant vs Chartered Accountant terms are used interchangeably. People generally think that both of them are the same but actually the facts are different. They both offer distinct job roles, and career trajectories altogether based on their educational qualification.
Whether you are a financial professional, want to become one, or an entrepreneur hiring a finance professional, knowing the difference between a chartered accountant and an accountant is crucial.
So, this article will take you through a journey explaining both the terms in detail and their key differences to make a smart choice between a chartered accountant or accountant.
Table of Contents:
Accountant vs CA: An Overview
Both accounting vs CA work responsibilities differ from each other. As in the realm of accounting and finance, both of them are significantly different in the scope of work, and the level of expertise required to perform various financial tasks.
For an overview of accounting vs CA, you must understand that an accountant is not a specialized person. Rather an individual who knows the fundamentals of accounting either through academic studies or has learned it via work experience. However, a CA is a professional who has completed a rigorous course of studies to earn the credential by fulfilling all its eligibility criteria.
About Chartered Accountant
A Chartered Accountant as you now know is a professional. The Chartered Accountants are equipped with specialized education and training in accounting and finance in their course of study. It helps them conduct audits, offer assurance services, manage financial accounts, and provide tax consulting.
CA professionals have a broader understanding of business. They are very well-equipped to provide well-rounded advice for business and its growth. These experts are hired in various sectors for their finance and accounting expertise in public practice, corporate finance, and general management. The profession is regulated by the Institute of Chartered Accountants, which is established under the Chartered Accountants Act in India.
Chartered accountants are most valuable in more complicated scenarios where you need more knowledge on effectively managing the red tape involved in handling personal and corporate finances. For CA professionals looking to expand their expertise, ACCA after CA or CFA after CA can offer valuable global perspectives and open doors to international career opportunities. Want to know more about the complex situations where CAs are valued? Read further and see what they do.
What does a Chartered Accountant do?
Having a chartered accountant in your business is more like a dedicated financial business partner. Following are some of the responsibilities fulfilled by a chartered accountant.
- Along with regular accounting services, chartered accountants offer specialized business and financial services.
- They advise in securing finance for mergers and acquisitions, and capital restructuring as a corporate finance consultant.
- CAs also act as financial management taking care of in-depth cash flow, forecasting or managing funds helps businesses streamline their financial operations and make informed decisions for sustainable growth.
- They also provide personal financial advice to both individuals and companies seeking to optimize their tax strategies, manage investments, and achieve long-term financial goals.
- They also do forensic accounting to support legal investigations, uncover financial fraud, and provide expert testimony in court cases against any commercial fraud.
The CA will help you manage all your business finances efficiently resulting in your peace of mind. Thus, you can focus on growing your business without any headaches.
Read our related post to learn more about CA https://www.edzeb.com/blog/ca-vs-cma/
About Accountant
An accountant is an individual specializing in a single field of business. They are experts at only a fundamental level in handling small business financial overheads. An accountant can also help minimize business tax up to an extent within the accountancy firm or a large corporation but just within an internal finance department.
After completing your academic qualification in accounting, you can take up a job and learn many practicalities to become an expert. If you learn to interpret and maintain financial records, then you can work as an accountant. Moreover, if you are adept with numbers and have a strong sense of business, then you can become an accounting expert.
What does an Accountant do?
An accountant is in charge of handling day-to-day bookkeeping activities for businesses or individuals. Mostly they handle a variety of financial activities for individual customers, enterprises, and organizations.
- Accountants can save you from underpaying taxes which can lead to issues. So it’s crucial to calculate expenses and allowances.
- Accounting Experts ensure strong cash flow, guard against risks, and handle extra funds with care. So, when the director needs to take funds from the business, it requires expert accounting for proper documentation, tax implications, and maintaining financial stability.
- An accountant can help establish solid foundations for business ventures by providing expert second opinions and constructive input. They can offer unbiased opinions and make a business plan more attractive to investors.
- An accountant can also advise on the best business structure, such as sole trader or limited company, with different financial implications, making it more suitable for the business.
Thus, an accountant having knowledge and expertise can be of great importance to an organization in its internal work.
Difference Between a Chartered Accountant and an Accountant
Understanding the difference between a Chartered Accountant and an Accountant is crucial for both individuals pursuing a career in finance, and businesses looking to hire the right professional for their financial needs. Here is a table providing a brief of accountant vs chartered accountant.
Criteria | Chartered Accountant (CA) | Accountant |
Qualifications | CA exams and articleship | A degree in accounting or finance |
Certification | CA certification issued by ICAI | Tally, QuickBooks |
Scope of Work | Handles advanced financial tasks | bookkeeping, & basic tax preparation |
Expertise | complex financial issues | basic accounting functions |
Career Opportunities | High-level positions in finance, auditing, and management | Internal finance teams in small to mid-sized businesses |
Decision-Making | Active in strategic financial decision-making for business growth | Provides financial data, but is not typically involved in strategic planning |
Legal Knowledge | Deep understanding of tax laws, corporate laws, and financial regulations | Knowledge of compliance with reporting standards |
Time and Effort to Qualify | Takes several years due to exams, training, and certification requirements | Requires an undergraduate degree |
Now let us have a detailed look at the key differences between a Chartered Accountant and an Accountant:
Qualification
What is less intense and rigorous qualification is accounting vs chartered accountancy, which is more demanding. An accountant requires a bachelor’s degree be it B.Com or a relevant degree in accounting. However, to become a CA, you must pass all exams conducted by the ICAI (Institute of Chartered Accountants of India) with an articleship. So, becoming a CA consumes more time and is a more intensive credential to earn.
Certification
No certification is compulsory for an accountant. They can learn tally and QuickBooks to improve their profile in accounting vs CA. Chartered accountants must obtain a professional certification to work and handle complex financial situations.
Scope of Work
Accountants work at the foundation level of business, like handling bookkeeping, ledger and payroll, etc. However, a CA handles more complex financial tasks involved in high-level decision-making. They also have the authority to conduct statutory audits and certify financial statements, unlike general accountants.
Legal Authority
CAs are legally authorized to audit financial statements. They are also allowed to provide certifications required by law. CA professionals ensure that companies comply with regulations, tax laws, and financial reporting standards, unlike an Accountant. They only manage financial records and prepare reports.
Expertise and Specialization
CAs are experts in auditing, taxation, corporate law, and financial management. They offer advice on complex financial matters, including forensic accounting and business restructuring. While the accountants do not possess the same level of specialization.
Career Opportunities
Chartered Accountants find jobs in multinational corporations, auditing firms, and financial institutions, or setting up their own practice. They can advance to senior positions like CFO, financial advisor, or tax consultant. On the other hand, accountants work in smaller firms or as part of an internal finance department in larger companies.
Accountant vs Chartered Accountant Salary Range
CAs possess advanced qualifications and responsibilities, so they earn higher salaries compared to Accountants. So, accountant vs chartered accountant salary difference is significant. The average salary of a CA in India is between INR 6–7 lakh which increases to INR 40 lakh per year depending on experience, company, and the job profile.
Time and Effort to Qualify
To become a chartered accountant, you need to pass various exams devoting years of study, and practical training. It is a lengthy and demanding process. Whereas, an accountant starts working soon after completing an undergraduate degree in accounting or finance.
Conclusion
Whether Chartered Accountant or Accountant, both are important to an organization as per their roles. So choosing between them depends on the complexity of the financial needs. So, if you know its key differences an accountant will suffice for basic financial management otherwise a CA is the better choice requiring strategic financial planning, audits, or compliance with the regulatory framework. This understanding of both distinctions will help businesses make informed decisions about their financial resources. On the contrary, the knowledge of certain factors like accountant vs chartered accountant salary difference will help individuals choose the right career path.
FAQ’s
Who earns more CA or Accountant?
Chartered accountants earn more as they play a crucial role in the strategic financial planning of businesses. Their job roles at a higher level in the organization make them more responsible.
Is a Chartered Accountant higher than an Accountant?
Yes, a CA works at a higher job role in the hierarchy as compared to accountants. They are hired by small-scale businesses or work within the financial department of a company.
What makes an Accountant a Chartered Accountant?
For an accountant to be a chartered accountant, one needs to pass all exams in the CA certification issued by ICAI.
What is the role of an accountant?
The accountant's job role includes tracking, and correcting the financial information of the company to make financial decisions. They perform financial audits, reconcile bank statements, and ensure the accuracy of the financial records.
