The answer to this question is subjective, and the answer varies from person to person. Generally, the difficulty of studying financial accounting or any other subject is dependent upon the person’s interest and other factors.
These factors include but are not limited to your educational background, personal interest, and available facilities like tutors, etc. However, in comparison to other subjects like arts & architecture, sociology & psychology, business & management…financial accounting is tough.
It’s also evident from the handful of students who opt for this field and the masses of students enrolling in other fields. This article will discuss myths and facts related to accounting and if you should opt for this.
Misconceptions vs. Truth about Financial Accounting
1) Accounting is Hard
The misconception roots from different perceptions. The difficulty varies from person to person. It is hard for a person who does not like putting in extra effort, it is challenging for a person who hates calculations, and it can be boring for a person who loves reading long books on science or history. On the other hand, it is interesting for a person who has an analytical, logical, and organized mind, who loves solving puzzles and seeing the big picture, and it is a pushover for a person who is good at numbers.
Students of accounting are seen in libraries making notes and doing homework, so do students of Law or Biology, while students of Marketing or Human Resource Management might be out there visiting firms and taking interviews.
A point of difference is that accounting concepts are cumulative, which means they are interconnected at every step of the degree. In a nutshell, every subject demands certain skills and struggle; however, it is up to you to decide what you want to sweat for.
2) Accounting is Math-intensive
Math is, without a doubt, a vital part of financial accounting. One must have the basic knowledge of Math for this degree, although complete financial accounting is not mathematics. You would need to analyze companies’ financial information, which requires working with a lot of numbers.
Tax returns and auditing also contain playing with amounts and percentages. The real skill needed is understanding how company transactions work and the way they are recorded. All subjects taught do ask the student to possess logical number analysis, so financial accounting may be more challenging for you if you are not very good at basic math.
The bottom line is that students must have a medium level of mathematical concepts. Surely, they won’t be asked to prove theorems or solve impossibly long equations. Still, they must have a basic understanding of addition, subtraction, division, multiplication, decimals, percentages, rates, division, etc. So, if you’re not good at math, there’s always time to improve. Enroll yourself in math classes or courses, nothing too advanced; the main goal must be to grasp all basic math operations.
3) Accounting is for Introverts
You might have heard people say that accounting is all about sitting at a desk, performing boring tasks all day, and becoming a human calculator that has the least interaction with people. This is true for some accounting jobs like bookkeeping, but it is not generalizable for all accounting professions. Other areas of this field require financial accountants to collect information about business transactions and finances, analyze it, and build presentations to communicate the business’s financial position with senior executives and give advice accordingly so that they can make informed decisions about their business.
In order to communicate numbers to people, an accountant has to make interactions for which they need good oral and written expression. But it is true that accountants don’t need to be as outgoing as a person majoring in Marketing or Sales.
Is Financial Accounting Suitable for You?
If you are hardworking and committed, you have the intrinsic motivation to study the subject, and like working with numbers, go for this challenging subject. But then again, financial accounting can be a tough route; the classes are intense with many long exercises and case studies. The workload can be challenging for some and you may need to sacrifice weekends for study.
Financial accounting requires an in-depth understanding of concepts, and that usually requires students to study the courses with full commitment. With difficult classes and lengthy curriculums, you must be fully committed to undertaking this degree. To have further information on accounting before diving into the degree you can take Intro to Accounting class. If the basics of debits, credits, double-entry accounting, valuing assets, balance sheets, profit, and loss statements, forecasts sound interesting, go for accounting.
Financial Accounting – (a Promising Profession)
Hard work always pays off! There are many choices from working in corporations to high-paying private financial accounting jobs. Observing the trend since the past decades, it is safe to say that with a degree in financial accounting, you can get into any decent organization at a worthy pay scale regardless of external environmental factors. It is a field that provides you with knowledge and a particular set of skills that opens up multiple career options. Most importantly, as the Covid-19 pandemic stuck the world, businesses were suffering, the stock market was crashing, job cutting was at its peak, yet accountants were valued and wanted. Owing to the fact that taxes still needed to be filed, companies still needed to be audited, forecasting and financial reporting still needed to be done.
Moreover, the demand for accountants always exceeds the supply, which makes it a worthy profession. This degree would also allow you to diversify your skillset as you become proficient with spreadsheets, sales, engineering, business, IT, and programming. As an accountant, you’ll be an indispensable asset to any organization you work for, and all those sleepless nights would be worth it in the end.
Modern trend for accounting and finance professionals
It’s a time of technology and automation. Financial accounting firms have implemented automated processing systems that perform repetitive tasks and generate reports within seconds. So, studying artificial intelligence in connection to finance process automation can be a good idea.
Similarly, studying for the system audit can be a career goal as there is increasing demand for these professionals and IT is further expected to flourish.
Likewise, taxation is never going to end in the world. Companies and individuals always need tax professionals to calculate tax liability and file tax returns. So, it can be a promising career. However, one should remain updated for changes in tax laws and regulations.
Generally, it’s advisable to focus on IT and related systems. For instance, data analytics, forecasting tools, digital transformation, remote working collaboration, data securities, statutory compliance, and studying accounting standards can be desirable career options.
However, you must consider your personal interest before making any final decision.
Financial accounting can be hard and easy depending on the person’s interest. Financial accounting can be a rewarding field if you have basic math skills, analytical, logical, and organized mind. It’s true that you need to apply different mathematical concepts while studying financial accounting.
However, it’s not completely about math. Although concepts are connected, one must be able to analyze the overall picture.
It’s important to note that humans are no longer required to compute figures at the workplace because computers do it. However, one must be efficient in analyzing numbers, connecting numbers with the company operations, and helping management in decision-making to be a good accountant.
Frequently asked questions
Is auditing a good field to study?
Auditing is a high-paying job. As per experts, the demand for accountants and auditors is expected to increase by 11%, which is more than any other professional field.
Further, this profession offers ease in international traveling as companies have operations in multiple geographical locations. Hence, it can be easy for their employees to travel.
In addition to this, most of the countries around the globe have adopted international financial reporting standards. So, uniform application of the accounting standard enables accountants and auditors to easily switch.
Enlist the top three accounting professions with the applicable regulations.
- Taxation – (Local regulations)
- Assurance – (International standard on auditing)
- Accounting – (International financial reporting standard)
What’s the difference between financial accounting and managerial accounting?
Financial accounting is about identifying, recording, and reporting financial information. It’s focused on profit calculations and external communication. On the other hand, managerial accounting refers to internal accounting for processes and operations. It’s mostly focused on the internal process and product cost to make decisions.