Choosing a career path is not a piece of cake. It is even more challenging when you are a business student. Because business degrees tend to have all these different yet similar options and it is pretty easy to get lost and confused. Many people face a dilemma when they narrow down their career options to Accounting and Finance.
You have to consider several things depending on your capabilities and preferences to choose either of these two career paths. So, if you are struggling to choose between accounting and Finance, here are some essential key points that will help you figure out which one will suit your preferences best.
The main goal of any person involved in an accounting-related job is gathering the transaction of a business and creating financial statements. An accountant’s work is related to historical data, events that have already happened. Their motto is to gather past data and information and summarize them into financial statements.
On the contrary, a financial analyst’s job is to analyze the data and forecast its future condition to find better investment opportunities. A financial analyst is concerned with the future, and they have to determine the company’s performance by analyzing the presently available data. However, if you are someone who is constantly looking for growth and doesn’t mind being on a rocky boat, Finance would be an excellent career path for you.
Nature of work
Accounting is a rule-based subject. As long as you are implementing those rules correctly, you are good to go. The standard practice is known as GAAP, i.e., Generally Accepted Accounting Principles. The GAAP specifies the standard for financial reporting, how transactions and other business events should be recognized.
On the other hand, Finance is half and half, where both rules and personal judgment matter. As a financial manager, you will have to figure out where the company will stand two or three years from now. You will be responsible for making financial decisions based on accurate forecasts. Hence, there is always a risk that factual assumptions might be wrong.
However, everything is black and white in accounting; whatever you do, it is either right or wrong. Finance does not come with set rules that will help you know if you are in the right direction. Therefore, It requires more knowledge and experience to excel in this career. So, if you are someone who likes to play by the rules, you should consider accounting. But if you are open to risks and willing to acquire analytical skills, you should go for Finance.
Personality plays a massive role in determining what career path will suit you best. If you choose to be an accountant, you will be spending most of your work time interacting with a small team of accountants. You might have to sit in meetings where you will be interacting with larger groups of a company, but relatively less than a financial manager.
However, a financial analyst has to deal with large groups of people from all around the company. You will be dealing with the sales team for revenue assumptions and the operation team to forecast expenses. Hence, if you’re an introverted person, Accounting might be a better option for you. Otherwise, you can go for Finance if you have an extroverted personality.
Professional accreditation and Job Opportunities
The field of Finance is more flexible and broader, which means you will have many options if you want to shift careers. But Accounting is more limited and narrower. There aren’t many options for switching, and accounting has limited choices for specialization.
The professional accreditations that you can acquire studying Finance are CFA, CTP, CPRM, and CF. You can become a financial analyst, Financial trader, budget analyst, financial manager, and personal financial advisor with a finance degree. On the flip side, Professional accreditations for Accounting include CPA, CA/ACA, and ACCA. An Accounting major can become an Auditor, tax accountant, or forensic accountant.
All things considered, there is no clear winner between Accounting and Finance. But knowing how these two differ from each other can give you a lead in your career hunting quest. Both have their ups and downs, but only you can make the best out of it if you are determined.