Every individual establishes a different set of expectations and ideals when they choose a field or career path to pursue. Career counselors and experts often recommend choosing a field that is a passion of an individual as well as enough paying to have a decent living.
On the other hand, some people believe that you can take any degree or choose any career path until and unless you know how to market your skills and sell them.
If we focus on the first school of thought without denying the second ideology, the field of study chosen by every individual has an impact on the future. The implications of a career path and education degree are extended to the whole professional life of an individual.
With that said, we are going to talk about the most popular and closely related professions with market value.
Yes, we are talking about accounting and financing. Many people consider finance and accounting are the same subjects and career fields. It might be okay to say that finance and accounting are the same if we talk about the basics. However, finance and accounting are two whole different subjects with different applications and implications.
A most common asked question: is finance harder than accounting?
Answer: This article will answer all the questions by comparing two subjects and career paths.
So let’s get into it without a further ado.
What Is Finance?
Let’s start with finance.
Finance can be defined as the management of the money or funds held by companies or governments. Finance encompasses everything from investing to budgeting, borrowing, lending, and forecasting the money.
We can say that finance is the first part of the cycle where planning where to invest money and how to earn a return is done. On the other hand, accounting can be termed as the second part of the cycle where financial performance is measured.
According to the definition given by Webster’s Ninth New Collegiate Dictionary,
“Finance is the money resources, income, etc., of a nation, organization, or person.”
If we go through the definition of finance given by Ivan Thompson, he says,
“the term finance comes from the Latin word finis, and it means end or finish. It has to do with obtaining and using money management. Its implications affect both individuals and businesses, organizations, and the state.
Finance can be categorized into three types: public finance(government), corporate finance(businesses), and personal finance(individuals). Another category of finance also exists that is termed behavioral finance. It studies the emotional or cognitive reasons behind financial decisions of individuals or businesses.
What Is Accounting?
Accounting or accountancy can be defined as the measurement, processing, and communication of the financial information of an entity. Accountancy can also be defined as maintaining, auditing, and reporting financial transactions.
Accounting, as a whole, is all about the financial recording and reporting of transactions and data of businesses and corporations. The field can be further divided into different types, each of them being a separate career path for the students looking to pursue accounting.
There are nine types of accounting: Financial accounting, cost accounting, managerial accounting, auditing, accounting information systems, tax accounting, public accounting, forensic accounting, and governmental accounting.
A bookkeeper of a company can handle basic accounting. However, for the advanced interpretation of the financial data and transactions, a Certified Public Accountant or Certified Management Accountant is hired in the USA.
Finance Vs. Accounting
If we come to the question of which one is harder among finance and accounting, it can’t be answered without comparing the two.
We will compare the subject of finance and accounting based on degree, professional career, salary, and benefits. After comparison, we will be able to give a verdict about which subject is harder or easier than the other.
Let’s start with a degree or formal education in either of the fields.
The difficulty of an educational degree is determined by how cumbersome a field of study is. It must be understood that each degree is different and unique from all other degrees offered. Science, art, or social science dichotomy is not the differentiating factor in a degree’s difficulty level.
The finance degree requires you to have an understanding of not only accounting but economics as well. To simply put, finance is a sub-category or branch of economics.
Therefore, a finance degree is a plus to an accounting degree and also covers the economics of money management at the public, corporate or personal level. The students of finance degree can expect to learn the subjects like:
- Financial planning
- Risk management
- Financial trend analysis
- Financial reporting
- Financial markets
- Financial economics
- International finance
- Corporate finance
- Financial mathematics
- Behavioral finance
- Financial management
- Preparing financial statements
On the other hand, a bachelor’s degree in accounting means you must be good at numbers, present financial data, and have an interest and expertise in mathematics.
Accounting studies might not be as practically demanding as a nursing degree would be. Most of the degree requirements have nothing to do with the fieldwork involving a lot of human interactions. However, there are still internships, training, etc., in the line of studies.
The students of accounting can expect to cover the subjects like:
- Financial accounting
- International accounting
- Forensic accounting
- Corporate accounting
- Management accounting
- Accounting information systems
- Professional standards and ethics
- Financial reporting
- Macro and microeconomics
- Risk management
- Quantitative analysis
- Tax accounting
If we analyze the scope of both subjects, it’s clearly evident that there is a lot of similarity in the course content of the subjects. However, we will have to analyze if this overlapping also extends to the career and professional life of an accountant and finance expert or not.
The professional life and career path of accounting and finance sound very similar to many in the professional life and career path. However, when we dig deeper, the job description, responsibilities, and orientation for both careers are distinct.
Let’s start with the accounting career.
Regardless of which accounting career you have chosen, calculation, measurements, and working with lots of numerical data and figures are inherent to the job of an accountant.
The typical career paths are tax accountant, bookkeeper, credit controller, budget analyst, financial examiner, staff accountant, payroll accountant, auditor, and financial accountant.
One relaxation in the accounting job is that there is no fieldwork involved, and most of the work is done sitting behind the desk. The job timings of an accountant can be abrupt, and long hours sitting might be there when preparing taxes or other reports.
When we talk about an individual’s career and orientation with a major finance degree, the job description and requirements can be similar when it comes to working hours, the nature of the job, and fieldwork requirements.
However, the job roles differ as people with finance degrees are typically hired as commercial bankers, financial traders, insurance officers, investment bankers, hedge fund managers, financial consultants, quant specialists, and financial managers. Simply put, the jobs of finance degree holders are more focused on money management and planning.
What is the crux of the matter?
Regardless of which career path is harder, you cannot excel in the most comfortable career if it doesn’t entice you or you don’t have an interest in it. Therefore, whichever path you choose, having an interest in the respective field is necessary.
The financial benefits of each career path are different from each other. However, one should be clear that both finance and accounting career paths are well paid and can help professionals earn a decent living.
However, in the debate of nursing vs. accounting, the finance profession is a winner when the question of median annual salary is concerned. The median annual salary of degree holders with a finance major is between $70,000 to $122000, depending on the role. On the other hand, the median annual wage of accountants and auditors as per the data for 2020 was $73,560.
Check out the table given below for a thorough comparison:
|Finance Major||Accounting Major|
|Financial Planner: $87,850||Accountant: $71,550|
|Financial Analyst: $81,590||Managerial Accountant: $76,230|
|Budget Analyst: $76,640||Auditor: $73,560|
|Accountant: $71,550||Tax Accountant: $55,640|
|Attorney: $122, 690||Bookkeeper: $42,410|
|Credit Analyst: $73,650||Financial Analyst: $83,660|
|Commercial Real Estate Agent: $42,500|
Is Accounting Harder Than Nursing?
After thoroughly comparing the two subject fields, let’s give the final verdict about which one is harder than the other.
The actual question is if finance is harder than accounting?
Here is the detailed answer:
If we talk about the degree of finance vs. accounting, the finance degree requires arithmetic skills, mathematical expertise, and analytical skills to excel. On the other hand, the accounting degree is more focused on making the students skilled in arithmetic and mathematical reasoning.
However, the level of difficulty of accounting in a finance major is not beyond the basics. What makes finance hard is the requirement of having an understanding of economics along with accounting. On the other hand, accounting degree holders must possess expertise in arithmetical and mathematical aspects of financial data.
As a whole, accounting is easier than finance, as once you have excelled in the logic of an accounting process and how a transaction works, things become easy.
On the other hand, finance is an evolving subject that considers different factors and variables that are not fixed. Finance requires robust analytical skills to judge every situation having different requirements as it is tied to economics and financial decision-making,