The AICPA recently announced the creation of a new specialty credential in forensic accounting known as the Certified in Financial Forensics (CFF) credential. The trend in the field of accounting, much like other professional services, is that practitioners are becoming more specialized in various areas. In addition to the CFF, there are numerous professional designations available to accountants and many practitioners hold one or more of these.
Smart Business spoke to Semrawit Berhane, CPA, CVA, MPA, senior associate at Tauber & Balser, P.C. in the Forensic Accounting & Litigation Services Group, about the various designations available and why it is important to select credentialed practitioners.
What are some examples of credentials held by accountants?
- Certified Public Accountant (CPA) The CPA credential is a license conferred on a qualified accountant who has satisfied the education, experience and examination requirements of his or her jurisdiction necessary to be certified as a public accountant.
- Certified Valuation Analyst (CVA) The CVA is an accreditation awarded by the National Association of Certified Valuation Analysts to ascertain that a CPA has obtained a required level of knowledge in business valuations.
- Accredited in Business Valuation (ABV) The ABV is a business valuation credential similar to the CVA but is awarded by the American Institute of Certified Public Accountants (AICPA).
- Certified Fraud Examiner (CFE) The CFE credential established by the Association of Certified Fraud Examiners denotes expertise in fraud prevention, detection and deterrence.
- Certified Management Accountant (CME) The CME is an accreditation conferred by the Institute of Management Accountants that indicates that the designee has passed an examination and attained certain levels of education and experience in the practice of accounting in the private sector.
Why are credentials important?
Obtaining credentials has always been a critical avenue for professionals to distinguish themselves and highlight their qualifications in a particular area. The accounting field is no different. Selection of credentialed accountants for your accounting needs is essential for the following reasons:
- Credentials indicate that a practitioner has expertise and the required technical training in a particular field. This distinguishes accountants who have in depth knowledge of a specialized subject matter from those that may not have as thorough an understanding of the area.
- Designations denote that one is qualified either through formal education and/or on-the-job training. For example, the CVA business valuation credential indicates to the public that a holder of the designation has successfully completed a rigorous training and testing process. In addition, a requirement to becoming a CVA is that the applicant must be a CPA registered in his or her state. An accountant is granted a CPA license only after demonstrating the necessary education and work experience and passing a set of very difficult exams. This provides a user of the practitioner’s services the comfort of knowing that a certain level of standards set by a professional body has been met by the practitioner.
- Most professionals with credentials are required to continue their education even after obtaining their designation. Classes, seminars and conferences are offered year-round by various organizations focusing on many different topics affecting a practitioner’s practice areas. To maintain credentials, accountants usually take the required number of courses and are therefore up-to-date with current developments and trends in the industry.
- Finally, most certifications require that the individual be ethical and of good character. CPAs, for example, are bound to a code of professional conduct and subject to discipline by both their state board of accountancy and the AICPA for ethics violations.
How many is too many?
I recently attended a conference where one of the speakers had 13 credentials, most of which I had never heard of. The designations noted above are just a few of the numerous designations available. While credentialing verifies expertise in an area and demonstrates a commitment to one’s profession, it is important to understand what a practitioner’s various designations represent and determine if they are relevant to your needs.
SEMRAWIT BERHANE CPA, CVA, MPA, is a senior associate at Tauber & Balser, P.C. in the Forensic Accounting & Litigation Services Group. She has experience in various matters including financial investigations, damages and business valuations. Reach her at (404) 814-4922 or email@example.com.