Difference Between CPA and CFP
The full form for CPA is Certified Public Accountant and it can be pursued by aspirants who aspire to work in matters pertaining to accounts and taxes whereas the full form of CFP is a certified financial planner and it can be pursued by aspirants who aspire to become financial planners for individual clients.
The financial industry is steering for a nerve-wracking growth and gaining a foothold in the booming industry is more than important for every finance professional. Each one desires unique professional opportunities and in this cat race, the right course will put you right ahead. On one side CPA is all about accounting and auditing, CFP is about Investment and Retirement Planning. Let’s explore these two courses.
What is CPA?
The Certified Public Accountant (CPA) exam is conducted by The American Institute of Certified Public Accountants (AICPA) which is recognized across the globe for its competence. Accountant professionals who wish to make a successful career in the US or has to work with US-based clients is required to take the examination held by the AICPA. This certified exams can be conducted in the 55 states in the US who have been granted the license to do so.
There is no centralized body of control and each state has its own licensing requirements and pattern of the exam. A CPA professional is an expert in handling tax law questions or provides tax advice to people. He can choose to practice in his individual capacity or create a small business or work for big firms. A CPA goes through rigorous training and learning to be able to handle financial reports thoroughly and in-depth.
What is CFP?
Financial planners aiming to boost their careers through specialization specialize in the strategic financial planning or advisory role in the financial services industry should opt to take the CFP or Certified Financial Planner exam. CFP is a certificate course for financial planners awarded by the Certified Financial Planner Board of Standards (CFP Board) in the United States and by its affiliated body FPBS in India.
CFP is recognized as a mark of excellence, and is well respected and considered competent by the finance industry worldwide. The course is designed to meet the stringent standards of education, examination, experience, and ethics to ensure that the individuals certified win the trust of employees and have a plethora of opportunities waiting for them after completing the course.
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CPA vs CFP Infographics
Let’s see the top differences between CPA vs CFP along with infographics.
Key Differences
CFP
The candidates must fulfill the 4E criteria to be certified as a CFP.
- Education
- Examination
- Ethics
- Experience
The minimum eligibility criterion for the CFP course is a graduate or bachelor’s degree or higher degree with a working knowledge of the financial planning practices prevalent in the industry.
CPA
To be eligible for the CPA examination a candidate is required to have education which is equivalent up to five years. The candidate must have a 4-year bachelor’s degree and preferably a master’s degree and this should amount to 120 to 150 hours of credit in the business education domain.
CPA vs CFP Comparative Table
| Section | CPA | CFP |
|---|---|---|
| Certification Organised by | CPA is organized by American Institute of CPAs. But they don’t provide license to the students who pass out. The licensing authority is of the Board of Accountancy of the particular state you pass out from. | Certified Financial Planner Board of Standards(CFP Board) |
| Exam Window | The CPA testing windows 2017 are: 1st Quarter: January to February 2nd Quarter: April 1 to May June 10 3rd Quarter: July 1 to August September 10 4th Quarter: October 1 to November December 10 | Held thrice in a year in Mar. 14–21, 2017, July 11-18, 2017 and Nov. 7-14, 2017 |
| Subjects | Let’s look at the subjects of CPA. 1. Auditing & Attestation (AUD) 2. Financial Accounting & Reporting (FAR) 3. Regulation (REG), 4. Business Environment Concept (BEC) | • General Principles of Finance and Financial Planning • Insurance Planning • Employee Benefits Planning • Investment and Securities Planning • State and Federal Income Tax Planning • Estate Tax, Gift Tax, and Transfer Tax Planning • Asset Protection Planning • Retirement Planning • Estate Planning • Financial planning and consulting |
| Pass percentage | Still waiting for 2016 full year’s results. The overall 2015 CPA exam pass rate was 49.9%, a tad higher than the 49.7% in 2014. It has been hovering around 50% for many years. | In 2016, the overall pass rate was 70 percent |
| Fees | Let’s sum up the CPA Examination fees: CPA examination and application fees: $1,000 CPA Exam review course fee (mid range): $1,700 CPA Ethics Exam: $130 (rounded up figure) Licensing fees (mid range): $150 Grand Total: $2,980 | The actual CFP exam cost is $695.However, you can apply up to six weeks before the date. If you do that, your cost would be $595. If you apply during the last two weeks before the date, then your CFP exam fees would come up to $795. |
| Job opportunities | Job opportunities for a CPA are many. You can work in a consulting firm or regional or local firms as accountant or financial advisor. The top three job opportunities of a CPA are public accountant, internal auditor and management accountant. | Chartered Alternative Investment Analyst Chartered Certified Accountant Chartered Financial Analyst Chartered Financial Consultant Chartered Market Technician Certified International Investment Analyst Certified Management Accountant Certified Public Accountant Financial Risk Manager |
Why Pursue CPA?
The CPA is a prestigious qualification and it commands a great deal of respect from insiders in the industry. The AICPA is the body is known for its strict norms and standards, and therefore the CPA exam is looked upon with high regard. The candidates are required to meet certain criteria to be eligible for the exam and this ensures the quality of the professionals is maintained.
The CPA is arguably the highest qualification a CA could achieve and it greatly boosts a professional’s career by availing him opportunities to work in the public accounting department in American MNCs as well as the license to practice in the US.
A CPA license is widely respected as an indicator of quantitative skills and high standards of professionalism and it is a necessary achievement to qualify for the Big 4 firms that dominate the public accounting sector, PricewaterhouseCoopers, Deloitte Touche Tohmatsu, Ernst & Young, and KPMG.
Why Pursue CFP?
CFP is a mark of professional excellence and is considered to be the highest level of certification a professional can aim to achieve in the financial industry. The certification is accepted and appreciated worldwide by professionals as well as consumers. The certificate has been awarded the Gold Standard Award by the Wall Street Journal which speaks volumes of its credibility.
The CFP candidates have been found to benefit leaps and bounds from achieving this course. The professionals are said to have been compensated with attractive salaries in industries such as investments, insurance, tax, retirement & real estate.
Take your right foot forward in your professional journey with the course that meets your career requirements. All the best!
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