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How to Become an Accountant

accountant notes

Accountancy is a dynamic career option. An accountant is just as important for large companies as it is for sole traders. The field of accountancy is vast, and it can come as a surprise to many people how many different avenues it offers for professional development.

Accounting is the process of producing financial information about a business or an individual. This information is recorded, summarised, interpreted and then communicated to relevant authorities.

But accountants don’t exist in a vacuum. They need skills in the field of information technology, something that is increasingly important in a digital world. An accountant also needs to understand financial law, how to produce and interpret statistics, and other complex information. They must have an in-depth understanding of business and economics.

An accountant will often have knowledge specific to the business sector that he or she works in, such as retail or industry.

Different Kinds of Accountants

Accountants offer a range of financial services to anyone who needs help to keep their financial affairs in order, some areas of which are considered specialist.


Companies, public bodies and government departments have many legal and financial obligations to meet.

As well as preparing financial statements within their own financial departments, a business may also work with an accountant or accountancy practice to produce annual financial records.

An auditor is an external accountant who checks these financial records for accuracy. This is not necessarily due to wrong doing, but rather is an external process that can streamline how the firm or agency keeps accurate financial records.

They also check that a company’s accounting processes are up to standard.

    • Auditors perform checks on many different aspects of a company’s finances.
    • They may ask to see all kinds of information and evidence, including receipts and accounting spreadsheets.
    • They may ask for expert valuations on buildings, machinery and other assets.
    • They check that everything in the financial reports and accounts matches with the ‘reality’ of the company.
    • They produce their own report and present their own findings to the company.


Auditors spend a lot of time on site with their clients, working in different locations. This is not a role suitable for everyone.

Auditors are objective, and they must sometimes be critical of financial processes. Their presence can be an intrusive interruption, and so they are not always welcomed. As an auditor, an accountant is expected to be polite, reasonable and tactful.

Being a Financial or External Auditor

To be an external auditor, you will first need to be a registered chartered accountant. This means you will likely have to have a degree in accountancy or a relevant financial field. You will also need to complete the National Audit Office’s 3-year auditing course.

Financial Accounting

If you are organised and meticulous and enjoy things kept neat and tidy, financial accounting could be the right choice for you.

Financial accountancy is the traditional view of accounting, the one that people most associate with the field in general.

This is the book-keeping side of accountancy, the columns and ledgers of numbers. An accountant must ensure that financial reports for stakeholders are easy to read with financial information presented clearly.

They do this by:

    • Tracking the company’s current financial position based on incomings, outgoings, liabilities and cash flow – they can do this for individuals, too.
    • Monitoring the share value of the company and making statements and financial forecasts.
    • Producing reports that are used externally, including for potential investors.


Every company has a different way of keeping their finances in order, from the financial software they use to how they gather and process financial information.

It is the accountant’s job to ensure that accurate records are kept, and then this financial information can be transcribed and interpreted alongside legal issues and compliance guidelines.

In some companies, the accountant is important in streamlining these processes, and they thenhave a larger say on the budget and how money is spent.  

To be an accountant of this kind, you may be surprised to learn that experience is more important that an accountancy degree. Keep the following the guide to find out why.


Management Accounting

Are you strategic and ambitious? If so, management accountancy may be the ideal choice for you.

Management accounting is similar to financial accounting in many ways.  It still involves tracking the company’s financial position, but a management accountant also produces reports that are used internally.

  • They provide the financial information that managers need to make business decisions – e.g. they produce financial reports on aspects of the business that are not profitable. They may also include financial forecasts in this report.
  • They will produce charts and use other statistical tools to present data in a way that is easy to understand for key decision makers.
  •  At a senior level, Management Accountants will make recommendations based on financial information, and they will often be part of the senior management team

In essence, management accounting is not just about producing figures; it is also about interpreting trends, making predictions and forecasts, both financially and non-financially. Do you have what it takes to work at this level?

Being a Management Accountant

Once you have accredited accountancy qualifications, you will need to work towards chartered accountancy status with one of three bodies:

Association of Certified Chartered Accountants (ACCA)

Institute of Financial Accountants (IFA)

Chartered Institute of Management Accountants (CIMA)

When you see references to chartered accountant status, the accountant will belong to one of these professional organisations. 


Tax Accounting

accountant financial notes

Tax accounting is all about tax liabilities – in other words, how much tax is owed to the government.

Self-employed or employed, we all have tax liabilities. For a company or organisation, the tax picture can be much more complex.

Tax rules continually change, and as a tax accountant you are expected to interpret these and apply new rulings to the company’s (or an individual’s) finances.

    • Tracking all transactions, a tax accountant calculates how much tax a company owes and how much it pays.
    • They also try to find way to reduce tax liabilities within the legal tax framework.
    • They complete all of the tax forms from HM revenue and Customs, and ensure that the correct amount of tax is paid.

A tax account will often work with companies and small businesses, as well as with individuals. They will interpret complex information and solve problems. Does this sound like the type of accountancy you would like to do?

Being a Tax Accountant

There are many routes for school leavers and graduates into the role of a tax accountant.

A degree in an accountancy related discipline will give you a head start, but is not essential. For school leavers and graduates alike, work placements and experience are what counts when it comes to being accepted on an accredited tax accountancy course.

Tax advisers are usually chartered. This means they are highly skilled and qualified as recognised by the Chartered Institute of Taxation (CIOT).

As well as your existing qualifications, you will need to complete a 12-month course in order to earn the qualification necessary in order to be called a Chartered Tax Adviser. You will need to continue developing your practice with at least 90 hours of continuing professional development each year in order to maintain your membership with the CIOT.

Forensic Accounting

Forensic accounts are like financial detectives, investigating financial crimes such as fraud and embezzlement.

They use accounting techniques to detect and solve financial crimes that can be complex and far-reaching.

  • They analyse a range of financial information in order to detect fraud and embezzlement – these types of financial crimes can be very well hidden, lying behind complex and multi-layered accounting.
  • A forensic accountant may also analyse information that will be used during legal proceedings – and example of this would be analysing a couple’s income to decide on a fair
  •  At trial hearings, forensic accountants will often be called on to interpret complex financial information so that the jury can understand it.

Fraud, theft, embezzlement and other financial-related crimes happen all the time, costing companies, governments, charities, businesses of all kinds and taxpayers thousands of pounds in lost revenue every year.

If you have an interest in law and are analytical and logical in your approach, forensic accounting could be for you.

Being a forensic accountant

Most forensic accountants are qualified accountants with many years of experience who have chosen to specialise in this field.

However, there are now some universities offering specialist forensic accountancy degree courses, as well as post-graduate courses.

You will need a key eye for detail, as well as well-developed detective skills that will help you to see through elaborate scams and fraudulent behaviour. 

Other Specialist Areas of Accountancy Work

Accountants can explore and specialise in all kinds of financial work, including project accountancy, insolvency, internal audits and government accountancy.

With so many specialisms, it is no surprise that accountancy is seen as a dynamic career, and it is an  increasingly popular choice with many people. 


How to Become an Accountant

#1 Get the Right Qualifications

Becoming an accountant demands a high level of concentration, along with an ability to focus on detail for long periods of time.

With the right qualifications, you can enjoy many avenues of accountancy work. Accountancy is open to anyone, from school leavers to graduates, and to people of all ages.

At GCSE level and A-Level education, you will need to show you have a high level of academic ability. In most cases, there are no prerequisites required to study accountancy courses. Qualifications in maths, economics, business studies or basic accountancy courses can be beneficial.

The Degree Route

You don’t need a degree in accounting to be an accountant, but accountants are coming to the market with increasingly sophisticated accounting degrees. Some accountants know which areas they want to specialise in before they begin to practice, and so they take a degree in this area.

An accountancy and financial degree are useful if you want to work as:

    • An accounting technician
    • An Actuarial analyst
    • A chartered accountan
    • A chartered certified accountant
    • A chartered management accountant
    • A chartered public finance accountant
    • A company secretary
    • A forensic accountant
    • A stock broker

Accountancy degrees can also be useful for jobs such as:

    • An accounting technician
    • Actuary
    • Data analyst
    • Economist
    • Licensed conveyancer
    • Management consultant
    • Purchasing or procurement manager
    • Retail banker
    • Tax adviser

The Non-Degree Route

Many people study to become accountants by working alongside private clients and larger companies to gather experience alongside qualifications.

For many employers (and those seeking the help of an accountant) an Association of Accounting Technicians (AAT) qualification is sought-after.

As with qualifications in all sectors and industries, qualifications should have a recognised accreditation process. This shows potential clients and employers that your range of skills and qualifications have value. In other words, you have the accounting, budgeting and analytical skills that they need.

There are many avenues open to you when it comes to gaining accounting qualifications, from attending a local college to online & distance learning accounting courses.

Online courses allow you to study at your own pace, at a time and place which is comfortable for you.

Many people come to accounting from different backgrounds, often studying accounting qualifications whilst working at their ‘day job’.

For example, bookkeepers will often use accountancy for their career progression. Other people who want a change in career will study a new profession at home in their own time.

Continuing Professional Development

Financial accounting rules, regulations and guidelines are constantly changing to address our constantly changing world.

The biggest impact on how companies and individuals keep accounts has been the invention of the computer and sophisticated software, followed by the digital revolution.

At one time, a business accountant was responsible for the payroll, physically giving out wage packets at the end of the week.

Now, many of these processes are completed electronically, with an accountant and bookkeeper overseeing the payroll, as well as paying invoices and bills.

Credit control is also an important part of an accountancy role with some businesses. This means they are managing the cash flow into and out of a business.

An accountant will have other professionals who help them complete these tasks, such as a bookkeeper or accounting assistant. Many people use these openings as the first step on the ladder to becoming a fully-fledged accountant, using the experience to back up their qualifications.

Accountants must understand the important of staying relevant with their qualifications, completing courses that see them specialise in widely used software and processes, such as Sage Accounting.

Many accountants also take on a philanthropic approach by volunteering their services as a professional to local and national charities. In recent years, the increase of people in debt has meant that many charities struggle to assist all of people in need of their services. Accountants can help.

Debt counselling is the process of managing debt, dealing with creditors and maximising income over expenditure. Many accountants work with charities to help people whose lives are crippled with debt.

debt crushing a wallet

#2 Gain Experience

Accountancy is an active field of work. You need to show potential employers that you not only have the right mix of qualifications and skills, but the right mix of experience too. 

Initially, this means getting a wide range of experience. As well as work experience with businesses and organisations, charities and community organisations will also welcome your financial skills in a voluntary way. In exchange, they will often provide you with a reference to highlight the key skills you have shown whilst volunteering on their project.

#3 Become a Specialist

It is perfectly feasible to enjoy a long-lasting and widely varying career as a self employed accountant or by managing your own accountancy practice.

If you want to specialise, you will need to start the processes of specialising in this area of work. This means two things:

         I.            Gaining specialist accountancy qualifications that specifically relate to your chosen area

       II.            Getting work experience in this area to back up your qualifications and skills base.

#4 Consider Becoming a Chartered Accountant

As you research accountancy, you will come across references to chartered accountancy. You may wonder about the difference between being a chartered accountant and a non-chartered accountant.

An accountant is ultimately responsible for producing an accurate record of the financial transactions of an individual or organisation.

They will need to be aware of all compliance guidelines, as well as other financially legal obligations. Most people recognise an accountant as the professional who helps individuals or a company to file accurate annual tax returns.

In reality, robust experience is required for this type of accountancy, with many accountants possessing accountancy specific certifications (but who may hold degrees in other fields of study).

A chartered accountant will generally have completed more training than a non-chartered accountant.

In other words, after successfully completing an academic programme of study, the chartered accountant will have undergone a period of mentorship. This means they would have shadowed a senior accountant with vast experience and qualifications, working on tax returns and many other complex financial matters.

Once chartered, they work across a range of industries, as well as with private individuals and charities.

There can be real benefits attached to being chartered. For employers and individual clients, these qualification can imbue sense of trust and peace of mind in the accountant's ability to handle complex financial information.

How Much Can an Accountant Earn?

An accountant is a sought-after professional. As well as working for yourself, you could also be employed by various organisations and companies, including local authorities and Government departments.

The table shows a general guide to accountant scales of pay. Remember that location and your level of qualifications and experience will impact your earning potential.


£17,000 to £49,000+ – running your own accountancy practice could bring large rewards. A Chartered Accountant can expect to earn in excess of £43,000 with some Chartered Accountants taking home a £90,000 salary.


Financial Auditor

Average is £28,000 although there are some auditor posts that can pay up to £79,000


Management Accountant

£23,000 to £45,000 – the average is £32,000 after 5 to 10 years’ experience


Tax Accountant

£15,000 to £52,000 with the average salary around £32,000.


Forensic Accountant

£19,000 to £74,000 with the average being £36,000

Career Progression

From a basic accountancy qualification, you can acquire all kinds of specialisms that place an increasing value on your skills and abilities.

Although qualifications are important, most accountants would stress that accountancy is an experienced-based profession. This means gaining knowledge and skills through working with the financial information of individuals, as well as with larger firms and organisations.

That said, the world of accountancy is changing. The digital era is upon us and with the UK Government announcing the end of ‘shoe box’ accounting with quarterly digital tax returns from 2018 onwards. Accountants must now adapt to working online with complex financial software.

Do you have what it takes to be an accountant?



Being an accountant means having a varied career. As well as helping individuals and companies file tax returns, you can also be at the leading edge of detecting financial crimes such as fraud. 

Once qualified, you can work with businesses of all sizes or choose to be self-employed. You can also choose to become an accountant that specialises in certain accountancy areas, such as local authority finance. 

Education Required  Good level of GCSE qualifications as well as specific and accredited accountancy courses. A degree is not necessary. 

Average Salary UK  £17,000 starting salary, rising to £43,000. Some accountants, especially chartered accountants, can earn in excess of £100,000. Self-employed income will vary. 

Job Growth  Accountancy is a fast-paced and dynamic career choice, with many opportunities to not only create your own vibrant practice but work for some of the biggest, global businesses too. There will, and always has been, a high demand for accountants. 

Key Skills  Ability to understand complex data, enjoy working with numbers, ability to focus for long periods of time, understand and apply changes in tax laws and understand complex financial regulations, maintain a customer focus. 

Qualifications Requirements  Online accountancy courses provide a range of opportunities to gain accredited and recognised accountancy qualifications. An Association of Chartered Certified Accountants (ACCA) accredited courses means you can ‘sign off’ tax accounts of larger companies. 


UK Accounting Terms

This is a comprehensive A to Z of key accounting terms you will come across in the UK. From small business to larger companies, an understanding of bookkeeping and accounting is an integral part of running a successful business. This is why understanding key terms used by accountants is essential.


Abnormal losses – these are losses within a business that should have been avoided.

Accounts payable –  the money you owe other companies for supplying you with goods and services. Also known as trade creditors.

Accounts receivable – the totals of how much your customers owe you. Also known as trade debtors.

Accounts – refers to the financial reports created at the end of each tax year. This is an accurate report, either compiled by yourself or by your accountant, that shows your profit and loss over the fiscal year.

Accounting period – depending on financial and accounting regulations relating to business type, the accounting period can be the tax year, the financial year, every month or every quarter.

Accrual – the accruals process allows for the adjustment of monthly accounts for payments that are made in arrears. For example, some expenses are paid a time after they have been used. Electricity is a good example – as a business, you may pay for the electricity you have used last month in the coming months. The accounting process allows the overall cost of expenses in arrears to be spread equally over the accounting period.

Amortisation – this is defined as spreading the cost of intangible assets over the number of years they are paid, e.g. a 10-year lease over 10 years and so on. The annual figure is then used as an ‘annual charge’. It is a process similar to depreciation, except depreciation deals with tangible assets such as vehicles and equipment.

Articles of association – this document sets out the rights of shareholders in a limited liability company.

Assets – assets are defined as something that your business either owns or uses. This could be equipment or the rights to a trademark.

Audit – feared by many, an audit is an independent examination of the financial statements of a business, company or organisation. The auditors will often express opinions and ideas for improvement.




Bad debt – this is when a business knows that the outstanding money owed by a customer is unable to be repaid. For example, when a company has gone into liquidation.

Balance sheet – a statement of the overall financial position of a business. A balance sheet shows a company’s assets and liabilities. A balance sheet must always balance.

Break-even – the point at which gross profit equals total costs.

Budget – this is a forecast of income and expenditure over a specified period of time.

Budget variance - shows the expected difference between the expected amount and the actual amount of income and/or expenditure in the original budget forecast.




Called up share capital – this is the face value of shares for which payment is ‘called up’ or requested. The payments may not necessarily be made.

Capital – this is the amount of financing provided by owners and/or shareholders that enables the business to continue trading, start trading or to acquire assets.

Capital expenditure – this is what is spend on the fixed assets of a business.

Cash flow – the movement of cash in and out of a business. It must always be measured, as slow-paying customers can bring down successful businesses, especially if the business pays their suppliers quicker than their customers pay them!

Cash flow projections – these are financial statements of expected cash flow in and out of a business over a period of time.

Companies Act 2006 – the latest set of UK legislation that controls the activities and administration of limited liability companies.

Corporation tax – the tax payable by companies based on their declared taxable profit.

Cost of goods sold – this refers to the total cost of labour, materials and other costs compared to the goods and services provided.

Credit (terms of business) – an agreement by which the supplier or business agrees that the customer can make a payment at some time in the future. This could be within 30 or 60 days, for example.

Credit note - issued when a customer has returned defective goods and the cost of these goods are deducted or credited to their account.

Credit sale – where a business sells goods or services to a customer and allows them to make a payment at a later date.  

Creditor –  an individual or a business to whom you owe money.

Current asset – this is defined as an asset that is expected to be converted into cash at some point in the trading cycle. The opposite of a fixed asset.

Current liability – this is a liability, such as debt, that is expected to be settled in the trading cycle, normally within 12 months of the balance sheet date.




Debit– this accounting and bookkeeping term comes from Latin debere which means ‘to owe’. The opposite of a debit is a credit.

Debtor – a customer, person or business that owes your business money.

Deferred income – as the term suggests, this is money that is invoiced and paid for in advance of providing a product or service. 

Deferred taxation – some businesses use different points in the financial year for certain accounting and financial reporting tasks. Deferred taxation is a means by which the timing difference between accounts is balanced.

Depreciation –how much the value of something decreases over time.

Director(s) – the person or people appointed by shareholders to manage the affairs and running of a limited liability company.

Dividend – the amount paid to a shareholder out of the company’s post-tax profits as a reward for investing in the company.

Drawings – common for the accounting purposes of sole traders, drawings is defined as the cash taken from a business for personal use.




Entity or entities – this is something that exists independently, such as a business that exists outside of its owner.

Equity – this describes the additional value found within a business, such as an increase in the positive share value for a company.

Expenses – these are the costs incurred in running a business.

Financial statements – the documents that present the financial status of a business. They are expected to have a ‘useful purpose’.




Fixed asset – this is an asset used by the business to produce a product or service. Examples are production equipment, cars, land or buildings.

Fixed cost –  costs that are not affected by the changes in the level of the output of a company over a period of time.

Forecast – a prediction of all things that could possibly change financially within a business over the coming months (or even years). A forecast is based on assumptions of past performance, as well as an understanding of how policies and the economy could impact on the business going forward.  




Going concern basis – a ‘going concern’ is a phrase used to describe the assumption that the business will continue to trade for the foreseeable future. 

Goodwill –  described as an intangible asset of a business that reflects its reputation, customer connections and overall community standing.

Gross –  the overall figure before deductions are made, such as taxes.

Gross profit or margin – the gross profit or margin is reached by deducting the cost of the sales from sales figures, along with deductions for administration and selling costs.




Intangible fixed asset – an asset, such as a trademark, that cannot be ‘touched’.

Inventory – a list of stock and goods held for manufacturing purposes or for resale. In other words, this is an accurate list of what is in the stockroom.

Invoice – the bill or the financial document sent to customers that outlines the price to be paid for the goods and/or service supplied.




Leasing – a lease agreement is a rental agreement guaranteeing that a business can use an asset for the price stated over a period of time. For example, this could be leasing vehicles for the business or leasing a property.

Liabilities – debts that the business owes.

Limited liability – this phrase describes the limit of shareholder (also called members) liability should the company go into liquidation.

Limited liability company – a company wherein the liability of the owner is limited to the amount of capital they originally agreed to contribute. In some cases, this can be as little as £1.

Liquidity – the liquidity of a business refers to the extent to which a business can access cash or items that can be exchanged for cash quickly.




Margin -  the purchase and sale of a good can be shown as ‘cost price + profit = selling price’. When the profit is expressed as a % of a selling price, this is known as the margin. The ‘margin of safety’ is the gap between the break-even point and the actual cost of sale.




NB Where you see the word ‘net’ in accounting, it denotes that certain deductions have been made. For example, net profit indicates that this is the sum left after the business has paid its tax bill.

Net assets – assets remaining after all liabilities have been deducted.

Net book value (NBV) – the net value of assets once liabilities have been deducted.

Net profit – the amount left once tax and other costs have been deducted.

Net loss -  this is where the total costs of goods, production etc, is more than revenue.

Normal losses – this is where the losses made in the production process are deemed as unavoidable.




Ordinary shares – these are the shares in a company that entitle the shareholder to a portion of the dividends in the closing down of a business.  




Partnership – where two or more people/companies are in business together with the aim of making a profit.

Prepayment – a payment made in advance of a business or customer receiving the goods or service. For example, some businesses may pre-pay their energy bills.  

Profit – how much a company or business makes after deducting costs from sales of goods.

Profit and loss account – a financial statement that shows revenue, expenses and profit. It is also called an income statement.

Provision – a liability of uncertain time or amount.

Provision for bad debts – an estimate of the risk of not collecting full payment from a credit customer.




Receipt –  a written acknowledgment that a specified article, or money or a shipment has been received.

Reserves – the accumulated and retained difference between the profits and loss of a business year or years since the company or business was formed.

Retained earnings – this is what the company ‘holds back’ to invest in new assets for the business.




Secured loan – this is a sum of money is loaned to a lender and secured against a high-value asset such as property, vehicles or similar.

Share capital – the phrase used to describe the total amount of cash that shareholders have contributed to a company.

Share certificate – the document that provides evidence of share ownership.

Share premium – the price paid for shares over and above their nominal (basic) value.

Shareholders – the group of people who own a company by owning shares.

Sole trader – describes someone who operates their business alone

Stakeholders – a commonly used term, it indicates people – individuals and businesses etc. – who have a legitimate interest in receiving financial information about the business.

Stock – an accounting term that has two meanings:

  1. The goods on the shelf or in the warehouse
  2. Or the ownership of shares in a company




Tangible fixed assets – fixed assets that have a physical existence

Trade creditors – these are other companies or traders who may supply a business with goods and services and allow a period of time before payment is made.

Trade debtors – individuals or businesses who buy goods or services without making immediate payment. This means they owe the money within so many days of receiving them as per the trade agreement.

Turnover – this is the value of sales a business makes over the course of a period of time in the business.




Working capital – the excess of current assets when current liabilities have been deducted. The resulting figure is the amount of resources the business has that can be readily converted to cash. It is the same as ‘net current assets’.

Work-in-progress – as the phrase suggests, this is work or goods that are partially completed. Their intended completion is recorded as an asset.