By Steve Smith
The information presented here is true and accurate as of the date of publication. DeVry’s programmatic offerings and their accreditations are subject to change. Please refer to the current academic catalog for details.
October 23, 2023
5 min read
Considering a career in accounting? You may have already discovered how broad and multi-faceted this occupation truly is, and that may leave you wondering what aspect of accounting would make the best fit for you.
In this discussion, we’ll explore the scope and characteristics of public vs. private accounting; focusing on their key differences, typical duties and responsibilities, work environment and educational requirements.
Public Accounting Defined
Let’s begin our comparison of private vs. public accounting by defining them, beginning with public accounting. The field of public accounting involves working with a variety of clients to help them prepare financial documentation. Public accountants can work as sole practitioners of their own firms or on staff at public accounting firms, which can range in size from the modest to the mammoth, as in accounting’s Big Four, with multiple office locations and departments.
Public accountants act as an objective third party as they prepare tax returns and provide auditing, consulting and tax advisory services. Their clients could be individuals or businesses ranging in size from sole proprietors to large corporations. Many public accountants are CPAs. This means they’ve earned the Certified Public Accountant designation and obtained licensure in their state.
Private Accounting Defined
Private accounting typically refers to an accountant employed by a single company. All of their duties are performed within, and on behalf of, that employer. These accountants analyze and prepare financial reports for internal consumption by the company’s management teams and may also be responsible for accounts payable, preparing and sending invoices to customers and setting up the internal accounting systems required to record the company’s business transactions. In some cases, a public accounting firm will be called upon to review, or audit, a private accountant’s work.
Key Differences: Public vs Private Accounting
One could describe public and private accounting as two sides of the same coin. While accountants on both sides of the occupation perform similar duties (they both prepare financial statements and reports, and both are likely to be involved in auditing,) the fundamental differences in the public accounting vs. private accounting comparison are found in focus of their responsibilities, work settings and education and certifications.
Public accountants are responsible for reviewing clients’ financial documents for accuracy, completeness and compliance with applicable regulations before they’re disclosed to the public or filed with the IRS or the SEC.
Private accountants, who are also referred to as management accountants, examine documents in much the same way, but they review their company’s internal documents and work with financial managers within their organizations to plan budgets and evaluate the company’s financial performance.
Another key difference between public CPAs and private accountants is that private accountants do not have to obtain CPA certification and licensure, unless they file financial reports with the SEC. They may pursue other certifications that are more applicable to their regular job duties.
In terms of their working environment, they are both likely to work in office settings, but some public accountants may travel to visit clients at their offices or industrial plants, while private accountants are more likely to work from a single location. Public accountants are also likely to work longer hours during tax season, which runs from January through April, as they prepare and file their clients’ tax returns to meet IRS deadlines. Alternatively, private accountants typically work on a more even-keeled schedule.
The education requirements for public accounting vs. private accounting are very similar. Accounts and auditors typically need at least a bachelor’s degree in accounting or a related field to enter the occupation, according to the Bureau of Labor Statistics (BLS), though they point out that some employers may want candidates to hold a master’s degree. If you are preparing to pursue a career in public accounting, earning a master’s degree can help you to meet the 150 credit hours of college education needed to qualify to sit for the CPA Exam1.
If you are preparing to pursue a career in private accounting, you may eventually want to pursue the Certified Management Accountant (CMA) certification, a credential that may help you as you work to advance in your career.
Public Accounting vs Private Accounting Job Opportunities
Although they may work in different environments, the job duties for many positions in public and private accounting are similar. A list of some of these accounting careers includes:
Certified Public Accountant (CPA): Even though certified public accountants are associated principally with work in public accounting, private accounting professionals sometimes pursue CPA designation and licensing to help boost their careers. This entails meeting the requirements set by their state Board of Accountancy, sitting for and passing the CPA Exam1, then applying for licensure and maintaining the license.
Bookkeeper: Working typically in private accounting, bookkeepers maintain an organization’s financial records and make sure the books are balanced and error-free. They may also receive, document and handle cash and checks from customers. They then process payroll, receive invoices or prepare reports based on the company’s financial transactions for management to use in decision-making.
Auditor: Working in either public or private accounting environments, auditors are responsible for checking the accuracy of financial reports. Internal auditors check the books of the companies they work for, while external auditors, who are often CPAs, work for third-party organizations like banks or insurance companies.
Senior Accountant: Working with other members of a senior management team that may include the company’s Chief Financial Officer, senior accountants are responsible for preparing and recording assets, revenue, expense and liability entries to the general ledger. They also conduct monthly and quarterly account reconciliation reports and analyze financial statements for discrepancies.
Get Started on Your Accounting Career Journey with DeVry
If you’re considering a career in public or private accounting, our online Bachelor’s Degree in Accounting is a great first step. Offering you the opportunity to learn the foundations of financial accounting and build skills that can be applied in finance, operations management, entertainment and other industries, experienced faculty will help guide you as you acquire many of the skills needed for this wide-ranging field.
Online learning with DeVry can help you balance your commitment to education with work, family and other aspects of your busy life. Classes start soon. Let’s talk about getting you started in our next session!
Take the first step now
1Credits and degrees earned from this institution do not automatically qualify the holder to participate in professional licensing exams to practice certain professions. Persons interested in practicing a regulated profession must contact the appropriate state regulatory agency for their field of interest. For instance, typically 150 credit hours or education are required to meet state regulatory agency education requirements for CPA licensure.
