Understanding the JOBS Act

Transcription

1 June 2013 Understanding the JOBS Act Special Focus on Fraud Forensic Accountants in Litigation Top Tax Scams for 2013 Defending against Fraud

2 R E S P O N S I B I L I T I E S & L E A D E R S H I P professional development Navigating the Maze of Today s Professional Credentials By Douglas M. Boyle, Robyn Lawrence, and Daniel P. Mahoney There was a time, seemingly not all that long ago, when the array of professional credentials that seasoned accounting professionals could pursue was relatively narrow; many chose to work toward the CPA certification. Although this certification provides its holder with the only licensed accounting designation in the United States, financial professionals can now choose from among a wide variety of additional certification opportunities and career paths in order to differentiate themselves within the marketplace. Expertise in specific areas such as business valuation, forensic accounting, information systems, financial services, internal auditing, and management accounting, among others has become an option for all and a necessity for many. Certification credentials evidencing such types of expertise have proliferated, creating an ever-broadening array of certification possibilities. Researching the key attributes of the myriad of professional organizations and the benefits of their respective certifications and credentials is a significant undertaking, for which most accounting professionals lack the necessary time; thus, this discussion provides professionals with a guide to the more prominent U.S.-based professional organizations (i.e., those with memberships of more than 10,000) and the certifications they offer. 62

3 Such organizations include the AICPA, the Institute of Internal Auditors (IIA), the Certified Financial Planner (CFP) Board of Standards Inc. and the Financial Planning Standards Board (FSPB), the ISACA, the Association of Certified Fraud Examiners (ACFE), the Institute of Management Accountants (IMA), and the Accreditation Council for Accountancy and Taxation (ACAT). A streamlined discussion of these organizations (in descending order of membership size) and their respective certifications is followed by a discussion of essential implications and questions for professionals to consider, including potential benefits and costs. (The Exhibit provides an overview of the organizations discussed below.) AICPA Founded in 1887 and consisting of nearly 400,000 members, the AICPA is the longest established and arguably most recognized among the U.S.-based accounting organizations. It publishes the Journal of Accountancy; The Tax Adviser; CPA Letter Daily; AICPA Weekly Update; CPA Client Bulletin; six e-newsletters; and numerous online guides, alerts, and specialty-area articles. Although the AICPA is often associated specifically with the Uniform CPA Examination, it actually serves the accounting profession in a rather broad capacity, as stated on its website: The AICPA is the world s largest association representing the accounting profession, with nearly 386,000 members in 128 countries and a 125-year heritage of serving the public interest. AICPA members represent many areas of practice, including business and industry, public practice, government, education and consulting. The AICPA sets ethical standards for the profession and U.S. auditing standards for audits of private companies, nonprofit organizations and federal, state and local governments. It develops and grades the Uniform CPA Examination. ( The AICPA offers five different specialty credentials to those who already hold the CPA designation: Personal Financial Specialist (PFS); Accredited in Business Valuation (ABV); Certified Information Technology Professional (CITP); Certified in Financial Forensics (CFF); and, most recently, Chartered Global Management Accountant (CGMA). These credentials offer qualified CPAs the opportunity to further distinguish themselves and thus advance their careers and enhance the value of their practices. PFS. This credential, established in 1987 for CPAs who have or seek expertise in personal tax and financial planning, is provided to qualified CPAs who meet certain experience requirements, earn 80 hours of personal financial planning continuing professional education (CPE) within the fiveyear period preceding the PFS application date, pass the six-and-one-half hour PFS Exam (or have passed either the Certified Financial Planner [CFP] Exam or the Chartered Financial Consultant [ChFC] Exam), complete the PFS application, and pay a $400 fee. The content of the PFS exam includes professional responsibilities, the personal financial planning process, fundamentals of financial planning and income tax planning, insurance planning, financial independence (retirement planning), employee benefits, estate planning, charitable planning, and other personal financial planning issues. ABV. Established in 1998 for CPAs who have or seek expertise in the area of valuation services, the ABV credential is available to qualified CPAs who meet certain experience requirements, pass the sixhour ABV Exam (or hold a current Accredited Senior Appraiser [ASA] or Accredited Member [AM] credential provided by the American Society of Appraisers), complete the credential application, and pay a $350 fee. The ABV Exam includes content in the areas of qualitative and quantitative analysis, valuation analysis, and related topics. CITP. This credential was established in 2000 for CPAs who have or seek expertise in the areas of business systems reporting, IT audit and attest services, internal controls, fraud considerations, and risk assessment. The credential is offered to qualified CPAs who meet experience requirements, complete the CITP application, and pay a $400 application fee. In addition, since July 25, 2012, applicants are required to pass the four-hour CITP Exam that covers risk assessment; fraud considerations; internal control and IT general controls; evaluation, testing, and reporting; and information management and business intelligence. CFF. This credential, established in 2008 for CPAs who have or seek expertise in forensic accounting, is provided to qualified CPAs who meet certain experience requirements, earn 75 hours of forensic accounting related CPE within a 10- year period (with a minimum of 50% within a five-year period) preceding the date of CFF application, pass a four-hour exam, complete the CFF application, and pay a $400 fee (for AICPA members). The CFF Exam includes content related to professional responsibilities and practice management, fundamental forensic knowledge, and specialized forensic knowledge. CGMA. This designation was established in 2011 through a joint venture between the AICPA and the London-based Chartered Institute of Management Accountants (CIMA). The CIMA, founded in 1919, describes itself as the world s leading and largest professional body of management accountants, with 183,000 members an students operating in 168 countries, working at the heart of business ( cimaglobal.com/about-us/press-office/pressreleases/2011/march-2011/cima-aicpa-jv/). The CGMA designation is designed for CPAs specializing in the area of management accounting and members of the CIMA. As described on the CGMA website: The AICPA and CIMA have joined together to form a joint venture which powers a new designation for management accountants, the Chartered Global Management Accountant (CGMA). The CGMA is designed to elevate management accounting and further emphasise its importance for businesses worldwide. The CGMA recognises the unique role played by management accountants in businesses around the world who are guiding critical business decisions and driving strong business performance. It sets a new standard for global recognition of management accounting by building on the longstanding foundations and thought leadership of the AICPA and CIMA. United by global quality standards for ethics and performance, the CGMA maintains distinct credibility and positioning among worldwide business designations. Through a wide range of resources and learning opportunities, the designation further elevates CGMAs management accounting expertise, skills, ethical standards, commitment and 63

4 dedication. ( AboutUs/Pages/default.aspx) Current CIMA members are automatically accepted as CGMAs. CPAs who are not CIMA members are required to meet certain financial and management accounting experience requirements, complete an application, and pay a $150 designation fee. No exam is currently required as part of the acceptance process; however, beginning in January 2015, successful completion of an exam will be required. IIA Established in 1941, the IIA has approximately 176,000 members in 165 countries. It publishes Internal Auditor, an online version of the magazine ( intauditor/), and IIA Today. The IIA provides five certification opportunities in various specialty areas of auditing. As described on its website, the IIA is the considered the premier organization for internal audit professions: The Institute of Internal Auditors (IIA) is an international professional association with global headquarters in Altamonte Springs, Florida, USA. The IIA is the internal audit profession's global voice, recognized authority, acknowledged leader, chief advocate, and principal educator. Generally, members work in internal auditing, risk management, governance, internal control, information technology audit, education, and security. Globally, The IIA has more than 170,000 members. The IIA in North America comprises 159 chapters serving more than 70,000 members in the United States, Canada, the Caribbean (Aruba, Bahamas, Barbados, Cayman Islands, Curacao, Jamaica, Puerto Rico, and Turks & Caicos), Bermuda, Guyana, and Trinidad & Tobago. Members enjoy benefits offered by the North American Service Center including local, national, and global professional networking; world-class training; certification; standards and guidance; research; executive development; career opportunities; and more. ( The-Institute-of-Internal-Auditors.aspx) The certifications offered by the IIA include the Certified Internal Auditor (CIA), Certified Government Auditing Professional (CGAP), Certified Financial Services Auditor (CFSA), Certification in Control Self- Assessment (CCSA), and Certification in Risk Management Assurance (CRMA). Although all of these certifications can add value to a professional s career, the CIA designation is the one for which the IIA is best known. Few would argue with the IIA s assertion that the CIA is the only globally accepted certification for internal auditors and remains the standard by which individuals demonstrate their competency and professionalism in the internal auditing field ( Certification/Pages/CIA-Certification.aspx) CIA. In order to obtain the CIA certification, a candidate must be a member of the IIA, hold a four-year postsecondary degree (or higher) from an accredited university or its equivalent, exhibit high moral and professional character as evidenced by a character reference form, have at least 24 months of internal auditing experience (holding a master s degree can substitute for 12 of these months), and pass an exam consisting of four two-hour-andtwenty-five minute sections (internal audit activity s role in governance, risk, and control; conducting the internal audit engagement; business analysis and information technology; and business management skills). The application fee for an IIA member is $100 and the exam part fee is $150. Other IIA certifications. The CGAP, CFSA, and CCSA specialty certifications provide opportunities for accounting professionals to demonstrate their knowledge and expertise in specific content areas. These certifications require that the candidate be a member of the IIA and have a four-year postsecondary degree (or its equivalent) or a two-year degree and defined experience (depending upon the designation). In addition, the candidate must complete a charac ter reference form and pass a three-hour-andfifteen minute specialty exam for each certification. The CGAP Exam includes four domains (i.e., topic areas): standards, governance, and risk/control frameworks; government auditing practice; government auditing skills and techniques; and government auditing environment. The CSFA exam likewise includes four domains financial services auditing, auditing financial services products, auditing financial service processes, and the regulatory environment and allows the candidate to select from one of three disciplines (banking, insurance, securities). The CCSA Exam includes six domains: CSA fundamentals, CSA program integration, elements of the CSA process, business objectives and organizational performance, risk identification and assessment, and control theory and application. The CRMA certification is the most recent addition to The IIA s specialty offerings and will have requirements similar to the other certifications discussed. The administering of CRMA is planned to commence in mid The IIA previously allowed candidates to apply for the CRMA based upon a point system, whereby candidates could obtain certification depending upon the professional experience and credentials that they possessed. This opportunity expired on September 30, 2012, and new candidates are subject to the exam procedures. The application fee for all specialty certifications is $100 for IIA members and the specialty exam fee for the CGAP, CFSA, and CCSA is $325, and it is $350 for the CRMA. FPSB The FPSB, formed in 2004, consists of approximately 140,000 members in 24 territories worldwide, approximately 64,000 of whom are located in the United States. The FPSB s publications include FPSB s Update and It s Your Turn. As noted on its website, the FPSB works to promote competency, ethics, and standards for financial planners across the globe: Financial Planning Standards Board Ltd. (FPSB) is a nonprofit association that manages, develops and operates certification, education and related programs for financial planning organizations so that they may benefit the global community by establishing, upholding and promoting worldwide professional standards in financial planning. FPSB works in conjunction with its members to develop and promote rigorous international competency, ethics and practice standards for CFP professionals in member territories to ensure that consumers looking for qualified financial planners understand and value CFP certification. ( fpsbincreasesrepresentation.html) The FPSB offers the CFP credential through agreements with nonprofit (or equivalent) organizations that become FPSB members. Following FPSB standards, these members administer the CFP certification standards and can adapt the 64

5 certification process to address the regulations, laws, and products of local areas. The CFP Board established the eight major domains of the CFP Exam: establishing and defining the client-planner relationship, gathering information necessary to fulfill the engagement, analyzing and evaluating the client s current financial status, developing recommendations, communicating the recommendations, implementing the recommendations, monitoring the recommendations, and practicing within professional and regulatory standards. The exam, which costs $595, may include one comprehensive exam or a series of exams; formats for the exam may vary depending upon location and the preferences of each FPSB member. In order to be qualified to sit for the CFP Exam, a candidate must be an FPSB member and demonstrate completion of courses at the upper division undergraduate or graduate (master s degree) level (or its equivalent) in financial planning. In addition, a condition of obtaining initial certification is that the candidate holds at least a bachelor's degree from an accredited institution. The CFP Board has an experience requirement, defined as the supervision, direct support, teaching or personal delivery of all or part of the personal financial planning process to a client ( ISACA Formed in 1969 and previously known as the Information Systems Audit Control Association, ISACA has a global membership of more than 100,000, representing more than 180 countries. Its publications include ISACA Journal and JournalOnline, which features online-only articles available to ISACA members in the months that the bimonthly ISACA Journal does not appear in print. The ISACA s website describes the organization as follows: A nonprofit, independent membership association, ISACA is a leading global provider of knowledge, certifications, community, advocacy and education on information systems assurance, control and security, enterprise governance of IT, and IT-related risk and compliance. Founded in 1969 as the EDP Auditors Association, ISACA helps its members and their employers ensure trust in, and value from, information systems. ISACA has more than 100,000 constituents in more than 180 countries in Asia, Latin America, Europe, Africa, North America and Oceania. Its members include internal and external auditors, CEOs, CFOs, CIOs [chief information officer], educators, information security and control professionals, business managers, students, and IT consultants. ( Press-room/Pages/ISACA-Fact- Sheet.aspx) The certifications offered by ISACA focus on various systems-related specialties: Certified Information Systems Auditor (CISA), Certified Information Security Manager (CISM), Certified in the Governance of Enterprise IT (CGEIT), and 65

6 EXHIBIT U.S.-Based Accounting Organizations with More Than 10,000 Members Key Information American Institute of Certified Public Accountants (AICPA) Website: Offices: New York, N.Y.; Durham, N.C.; Ewing, N.J.; and Washington, D.C. Established in: 1887 Membership: 377,000 members in 128 countries Publications: Journal of Accountancy (printed monthly), The Tax Adviser (printed monthly), CPA Letter Daily (free daily e-newsletter), AICPA Weekly Update (e-newsletter), CPA Client Bulletin (printed 10 times yearly), six Insider e-newsletters (CPA, career, corporate finance, corporate taxation, tax, and wealth management). Monthly online guides: IFRS Report; InfoTech Update; Forensic & Valuation Reporter; Financial Planning Digest; BusIndNews; and numerous other specialty-area publications, alerts, and guides. Institute of Internal Auditors (IIA) Website: Office: Altamonte Springs, Fla. Established in: 1941 Membership: 176,000 members in more than 165 countries Publications: Internal Auditor, an online version of Internal Auditor, IIA Today (bimonthly) Certified Financial Planner Board of Standards Inc. (CFP Board) [Financial Planning Standards Board (FPSB)] Website: [ Office: Washington, D.C. [Denver, Colo.] Established in: 1985 [2004] Membership: FPSB has 140,000 members in nonprofit organizations from 24 territories worldwide Publications: FPSB s Update (bimonthly e-newsletter), CFP Board s It's Your Turn (monthly e-newsletter) ISACA Website: Office: Rolling Meadows, Ill. Established in: 1969 (EDP Auditors Association) Membership: More than 100,000 members in 180 countries Publications: ISACA Journal (printed bimonthly), JournalOnline, (online-only articles bimonthly, alternating with ISACA Journal) Association of Certified Fraud Examiners (ACFE) Website: Office: Austin, Tex. (headquarters); Singapore; London; Tokyo Established in: 1988 Membership: More than 60,000 members Publications: Fraud Magazine (bimonthly), Fraud-Magazine.com (e-newsletter), The Fraud Examiner (e-newsletter), Blogs: ACFE Insights and FraudInfo Institute of Management Accountants (IMA) Website: Office: Montvale, N.J. Established in: 1919 (National Association of Cost Accountants) Membership: 60,000 members internationally Publications: Strategic Finance (monthly), Management Accounting Quarterly (online); IMA Educational Case Journal (quarterly, online); IMA Online News (weekly, e-newsletter; specialized e-newsletters on technology, careers, CMA certification, and students interests. Accreditation Council for Accountancy and Taxation (ACAT) Website: Office: Alexandria, Va. Established in: 1973 by the National Society of Public Accountants (now the NSA, which was established in 1945) NSA Membership: 10,240 Publications: Action News (ACAT's e-newsletter), Main Street Practitioner, formerly NPA Magazine (digital six times per year, printed quarterly by NSA); NSA Practice Advisor, formerly NSA Technology Advisor (published eight times per year by NSA); NSAlert (biweekly e-newsletter by NSA); MemberLink (biweekly newsletter by NSA) Certifications Offered n Accredited in Business Valuation (ABV) n Certified in Financial Forensics (CFF) n Certified Information Technology Professional (CITP) n Chartered Global Management Accountant (CGMA) n Personal Financial Specialist (PFS) n Certified Internal Auditor (CIA) n Certified Government Auditing Professional (CGAP) n Certified Financial Services Auditor (CFSA) n Certification in Control Self-Assessment (CCSA) n Certification in Risk Management Assurance (CRMA) n Certified Financial Planner (CFP) n Certified Information System Auditor (CISA) n Certified Information Security Manager (CISM) n Certified in the Governance of Enterprise IT (CGEIT) n Certified in Risk and Information Systems Control (CRISC) n Certified Management Accountant (CMA) n Certified Fraud Examiner (CFE) n Accredited Business Accountant (ABA) n Accredited Tax Advisor (ATA) n Accredited Tax Preparer (ATP) n Accredited Retirement Advisors (ARA) 66

7 Certified in Risk and Information Systems Control (CRISC). All of these certifications require ISACA membership and three to five years of related specialty experience (depending upon the certification), with certain allowable waivers that depend upon the candidate s educational credentials. Although a candidate s education might be used toward a waiver of certain experience requirements, ISACA does not state any educational requirements needed to obtain certification. In addition to having experience, candidates must pass the related specialty exam and adhere to ISACA s Code of Professional Ethics in order to obtain a certification. The early exam registration fee for ISACA members is $410 per certification. The specialty exams cover various domains. The CISA includes five topic areas: the process of auditing information systems; governance and management of IT; information systems acquisition, development, and implementation; information systems operations, maintenance, and support; and protection of information assets. The CISM exam covers four domains: information security governance, information risk management and compliance, information security program development and management, and information security incident management. The CGEIT exam consists of five domains: strategic alignment, value delivery, risk management, resource management, and performance measurement. Finally, the CRISC exam covers five domains: risk identification, assessment and evaluation, risk response, risk monitoring, information systems control design and implementation, and information systems control monitoring and maintenance. ACFE The ACFE was established in 1988 and has an international membership of more than 60,000. The ACFE publishes Fraud Magazine, Fraud-Magazine.com, and The Fraud Examiner. The ACFE identifies itself as follows: The ACFE is the world's largest antifraud organization and premier provider of anti-fraud training and education. Together with nearly 65,000 members, the ACFE is reducing business fraud worldwide and inspiring public confidence in the integrity and objectivity within the profession. ( acfe.com/about-the-acfe.aspx) The ACFE offers the Certified Fraud Examiner (CFE) designation. In order to obtain this credential, a candidate must be a member of the ACFE, agree to comply with the CFE s bylaws and Code of Professional Ethics, meet professional and educational standards, and complete the 10-hour CFE exam. The professional minimum experience requirement is at least two years of related experience in the field of fraud examination; generally, applicants must have at least a bachelor s degree or its equivalent. Ultimately, the professional and educational requirements are determined based upon a point system, whereby the candidate is awarded credit according to certain education, professional affiliations, and experience criteria. The CPA Journal Online The editors invite readers to continue their interaction with The CPA Journal online by joining our LinkedIn group, at Connect with top accounting and auditing professionals and discuss hot topics confronting the profession from forthcoming accounting standards and recent tax legislation to financial planning issues, educational and regulatory requirements, and much more. Join the conversation with other readers and NYSSCPA members now. 67

8 The CFE Exam, which costs $300, includes the topics of fraud prevention and deterrence, financial transactions, fraud investigation, and legal elements of fraud. IMA The IMA was founded in Buffalo, New York, in 1919; it was originally known as the National Association of Cost Accountants and later as the National Association of Accountants, but it adopted its current name in 1991 in order to signify its broader role as the association for accountants and financial professionals working inside organizations ( about_ima/our_history.aspx). The IMA has a global membership of more than 60,000 members. Its publications include Strategic Finance; Management Accounting Quarterly; IMA Education Case Journal, IMA Online News; and various specialized e-newsletters pertaining to technology, careers, CMA certification, and students interests. The IMA s website clearly states its mission to provide a forum for research, practice development, education, knowledge sharing, and the advocacy of the highest ethical and best business practices in management accounting and finance ( mission.aspx). In 1972, the IMA established the Certified Management Accountant (CMA) credential. CMA candidates are required to join the IMA, hold at least a bachelor s degree from an accredited institution, have a minimum of two years of professional management accounting or financial management experience, and successfully complete the two-part, eight-hour CMA exam. The exam content for the first part includes planning, budgeting, and forecasting; performance measurement; cost management; internal controls; and professional ethics. Content for the second part includes financial statement analysis, corporate finance, decision analysis and risk management, investment decisions, and professional ethics. There is a $225 certification entrance fee and a $350 fee for each exam part. ACAT Established in 1973 as a nonprofit independent testing, accrediting, and monitoring organization, the ACAT has a membership of more than 10,000. It publishes Action News, Main Street Practitioner, NSA Practice Advisor, NSAlet, and MemberLink. As noted on its website, the ACAT targets accounting professionals servicing small to mid-sized businesses: The Council seeks to identify professionals in independent practice who specialize in providing financial, accounting and taxation services to individuals and small to mid-size businesses. Professionals receive accreditation through examination and/or coursework and maintain their accreditation through commitment to a significant program of continuing professional education and adherence to the Council's Code of Ethics and Rules of Professional Conduct. ACAT programs are governed by a Board of Directors that includes practitioners, educators and a public member. ( ACAT/About1/AboutACAT/) ACAT certifications include Accredited Business Accountant (ABA), Accredited Tax Advisor (ATA), Accredited Tax Preparer (ATP), and Accredited Retirement Advisor (ARA). None of these certifications has educational requirements. The ACAT identifies the ABA as its trademarked designation that meets state regulatory requirements to practice public accounting in the states of Delaware, Iowa, and Minnesota. For this certification, a candidate must have at least three years of related professional experience. The ABA exam consists of two parts, each lasting threeand-one-half hours. The content of the first part of the exam includes financial accounting and financial statement preparation, presentation, and reporting. The content of the second part includes taxation, managerial accounting, business law, and ethics. The ATA and ATP designations require a candidate to have at least five years of tax experience and three years of tax experience, respectively, whereas the ARA credential does not have a stated experience requirement. All three of these designations require candidates to pass an exam consisting of 100 multiple-choice questions. The topical areas for the questions on the ATA exam include tax preparation, planning, client services, and ethics. The ATP exam covers tax preparation and ethics. The ARA exam includes content in the areas of retirement plans, benefits, and distribution; insurance, healthcare, and senior and long-term care options; estates, trusts, estate planning and taxation; personal residence issues; and ethics. The cost to take both parts of the ABA exam includes a $285 exam fee and a $50 registration fee. If the parts are taken separately, the cost is $200 for the exam and $50 for registration. The ATA, ATP, and ARA exams cost $200 each, along with a $50 registration fee. Implications for Professionals Accounting professionals have long had the opportunity to pursue one or more professional designations, each designed to reflect an individual s competence and interests and to help with career advancement. Of course, the CPA designation commands significant respect. But today there are many other additional certifications that one might choose to pursue. Indeed, in an era that demands new levels of specialized knowledge, it seems intuitive that both novice and veteran members of the profession would be well served by securing the kinds of credentials that reflect such knowledge. The obvious question for professionals to consider is whether the benefits of obtaining the certification exceed the related costs. Although all of the organizations discussed above readily cite in their marketing material a vast array of benefits in obtaining their certifications, formal research on this topic has found mixed results. In Costs and Benefits of APFS Accreditation, a survey of approximately 320 accredited personal financial specialists (AFPS) found that the majority of participants believed that benefits of certification were equal to or exceeded the related costs (John E. Elsea, The CPA Journal, 1992). Key benefits included improved professional image, skills, expertise, and competiveness. Although preparing for and taking the examination were cited as the top two costs, they were not viewed as major obstacles. Yet, respondents noted that their certifications did not have a significant impact on billings and that certain state restrictions on promotion of specialty services likewise limited the incremental revenues that one might logically expect from having such certifications. In contrast, another study, Costs and Benefits of Personal Financial Planning Accreditation, pointed to an increase in billings and hourly rates; however, on the downside, it also highlighted a potential addi- 68

9 tional cost of increased legal liability and related insurance premiums (Joseph G. Donelan, Journal of Accountancy, vol. 176, no. 3, 1993). This cost may have been an overstated perception, because only 6% of participants had indicated that they had actually experienced an increase in premiums. Interestingly, studies that surveyed holders of a particular certification have identified a wider array of perceived benefits than those that focused on executives who did not hold such certifications and worked outside of the specific functional area. In other words, those who are certified in a specific functional area and work in that area seem to perceive greater benefit to their respective certifications than those who work outside of that specific functional area. In Practitioners and Users Perception of the Benefits of Certification of Internal Auditors, survey participants included directors of internal audit and executives outside of internal audit, such as CFOs and members of the board of directors (Audrey A. Gramling, Accounting Horizons, March 1997, pp ). This study found that although the CIA designation is perceived to represent a high level of competence and support for advancement within the internal audit profession, it is not generally perceived to be important to management s acceptance of internal audit s recommendations, nor does it provide career advancement advantages outside of the internal audit function. This study further noted the fact that prior research found that other non-cpa designations in accounting might not be perceived by business executives as being particularly beneficial to the organization. The article thus indicates that the primary benefits from obtaining a non-cpa designation might be a personal sense of accomplishment, a perceived competence within the specialty area, and greater potential for advancement within a particular function; however, with respect to matters external to the holder s specific functional area, the benefits of such certification are quite limited. Accordingly, those considering the pursuit of certifications in specific functional areas should consider whether such certifications are congruent with their specific career goals. For example, an internal auditor whose goal is to become director of the internal audit function would very likely benefit from the CIA certification; in contrast, an internal auditor whose goal is to become a CFO might find that obtaining the CIA certification has limited value. One key benefit that warrants further discussion is the potential effect a non-cpa certification might have on compensation. A broad survey of IMA members, IMA 2011 Salary Survey: What Does This Recovery Feel Like?, found that the average total compensation for participants who held neither the CMA nor CPA designation was $103,960, as compared with $131,093 for participants who held the CMA designation and $145,712 for participants who held the CPA designation (Lee Schiffel, David L. Schroeder, and Kenneth A. Smith, Strategic Finance, vol. 93, no. 12, 2012). Participants who held both the CMA and CPA designations reported an average total compensation of $149,484. In the ACFE s Compensation Guide for Anti-Fraud Professionals, 2010/2011 Global Salary Study, antifraud professionals indicated that the average total compensation for participants who held the CFE designation was $90,500, as compared to $74,500 for participants not holding the designation. The study did not provide information comparing participants who held the CPA designation. The results of these various studies indicate that holders of non-cpa certifications typically find value in such designations and often receive personal satisfaction, peer recognition, and career advancement within the specialized area of the certification; however, these holders might not enjoy such benefits outside of their particular specialty areas. In addition, non-cpas can benefit from increased compensation if they acquire a non-cpa designation (e.g., CMA, CFE), but the compensation increase for those holding a CPA license is marginal, and thus should not serve as a significant factor in considering the pursuit of additional professional credentials. The available professional certification areas provide accounting professionals with a host of potential choices. Depending upon a professional s particular career goals and objectives, one or more such certifications could prove beneficial. But one should not pursue a particular certification without considering all of the potential costs and benefits. The accounting profession is hardly one size fits all ; what well serves one particular individual might offer little or no benefit to a colleague. Accounting professionals should ask themselves the following questions: n Do the benefits identified above outweigh the costs? In particular, will the certification serve long-term career goals? n Which specific areas of specialization do I truly find interesting? n Which areas of specialization could help me and my firm better serve current and potential clients? n Which certifications flow most logically from my answers to the first and second questions? n Do I possess the education and experience requirements for the certifications identified in the third question? If not, are the steps to meet the requirements feasible? n What kind of testing (or other) process is necessary in order to obtain such certification? n How can I allot time from my schedule to prepare for this process in such a way that maximizes my likelihood of success? n Does my employer typically support this kind of endeavor via financial support, study time, or change in the nature of the work experience, or might it be to my advantage to develop a formal request? n Once I obtain the new credentials, what are the continuing education requirements and maintenance costs? Will my employer be supportive in this respect? Once these questions are answered, accounting professionals are ready to begin the application process via the organizations discussed above. Taking time to consider the pursuit of new credentials can be one of the most important career moves that an accounting professional makes. Of course, identifying areas of specialization that are of genuine interest rather than just financially lucrative is an essential part of this process. It is most certainly time well invested, because the result can be a career path that is rewarding in a variety of ways. q Douglas M. Boyle, DBA, CPA, CMA, is an assistant professor of accounting, Robyn Lawrence, PhD, CPA, is an associate professor of accounting, and Daniel P. Mahoney, PhD, CPA, is a professor of accounting, all in the Arthur J. Kania School of Management, University of Scranton, Scranton, Pa. 69