What Skills Does an Accountant Need to Have?
Good accountants possess a unique combination of soft and hard skills that help them understand the intricacies of financial reporting and clearly communicate concepts and results to various people. If you’re looking to learn more about what skills an accountant needs to have if they want to succeed, this post will help.
The Importance of the GAAPEmployers are always on the lookout for skilled professionals who understand all the position entails - including auditing, tax law, and data analysis that helps them operate efficiently. While the accounting landscape has changed to a more digital-focused one, the Generally Accepted Accounting Principles (GAAP) are as relevant as ever. Without them, accountants couldn’t ensure their financial reporting was transparent and consistent from one business or industry to the next. GAAP includes ten key principles, but the four major rules and standards are:
- Accrual accounting methods. Accrual accounting records revenue when goods or services are sold, not when payment is received.
- Depreciation and capital expenditures account for the cost of major asset buys over the asset’s entire life.
- Historical cost reporting entails accounting for property like equipment and facilities using original purchase cost instead of current market value.
- Bad debt reporting covers money that might be received and instead becomes lost revenue.
Accounting Software ProficiencyAccountants today must know how to use various accounting programs like spreadsheet and account reconciliation software, as well as software that handles database reporting, compliance, and project management. For upper-level jobs such as senior accountant and financial analyst, accountants should be able to navigate Enterprise Resource Planning (ERP) software.
General Business Practices KnowledgeAccountants trained in the basics of business are better equipped to better understand their company’s and client’s unique financial needs and the accounting services they need. A bachelor’s degree in accounting combined with leadership and management courses and an MBA is a great way to improve critical thinking skills and use data to make sound judgments.
Data AnalyzationWith access to more information than ever before, accountants must be able to identify and use critical data to help companies and clients improve business outcomes. Accountants with a thorough knowledge of data query language have an advantage when seeking careers in accounting because they can:
- Extract specific information from large volumes of data
- Identify patterns in business data sets
- Uncover errors
- Catch fraud