The Meaning Behind the Accounting Acronyms
Ever wonder about all those letters trailing your accountant’s name? Not that long ago, most CPAs did accounting and tax services, plain and simple.
These days, it’s not uncommon to see a long string of acronyms following the name of an accountant or business advisor. In addition to being a CPA, accountants may also have an PFP, ABV, CVA, CFA, CFP, CVP and even a JD following their name. And that’s just the start.
Sound confusing? Let’s take a look at what has changed the CPA experience from one that was largely transactional to one that is a more consultative approach.
Corporate Governance, Globalization and Developing Technology
Increased regulations, rapidly changing technology and expanding globalization each have contributed to the demand for accounting and finance professionals to have advanced skills and demonstrated expertise.
As a result, the “CPA” is expected to be a strategic consultant and business advisor, weighing in on everything from mergers & acquisitions and succession planning to contract negotiation and increasingly, compliance standards. In fact, risk management has become such a significant issue for organizations that business owners rely on their financial advisors to help them manage it. Of course, that means more acronyms like CRM (certified risk manager) and many more.
Part of the Team
When CPAs moved from being in a supporting role – preparing taxes – to a more strategic role – trusted business advisor – Marcum became involved in all aspects of running a business. Today we are effectively a confidante on most of our clients’ major financial issues as and often play a major role in helping them capture greater market share by finding new sources of revenue.
Accounting firms themselves support ongoing learning and accreditation for their employees to develop a more skilled workforce. CPAs work in a variety of specializations within accounting including audit, compliance, tax, forensic accounting, fraud examination, IT systems, risk management, appraisals, among others. Some firms, like ours, also offer strategic marketing services and professional staffing.
Many of the professionals at Marcum carry a long stream of credentials following their names. Here is just a brief listing of some of the most common:
ABV: Accredited in Business Valuation
This credential is offered by the American Institute of Certified Public Accountants (AICPA) and has been around since 1997. There are approximately 2,500 practicing ABVs. Like the CVA, you must be a CPA in order to attain this designation and it is highly regarded within the valuation community.
CEPA: Certified Exit Planning Advisor
Those with the CEPA designation are part of an established global network of professional advisors who have successfully completed an executive MBA-style program taught by nationally recognized experts in their respective fields.
CFA: Chartered Financial Analyst
This credential is more commonly seen in the investment banking and investment management world, but business valuation analysts will sometimes have this designation, as well.
CFE: Certified Fraud Examiner
Certified Fraud Examiners are the cyber-sleuth detectives of the accounting profession. They help detect or prevent fraud and white-collar crimes like embezzlement.
CFF: Certified in Financial Forensics
The American Institute of Certified Public Accountants (AICPA) established the CFF credential in 2008 for CPAs who demonstrate considerable expertise in forensic accounting through their knowledge, skills, and experience. The CFF encompasses fundamental and specialized forensic accounting skills that CPA practitioners apply in a variety of service areas, including: bankruptcy; electronic data analysis; family law; valuations; fraud prevention, detection, and response; financial statement misrepresentation; and damages calculations.
CFP: Certified Financial Planner
Professional financial planners assist their clients in managing, sheltering and expanding their assets through the development of a comprehensive plan geared toward a client’s financial objectives and resources. Concerns about inflation, changing tax laws and the need to plan early for retirement are more prevalent than ever before.
CMA Certified Management Accountant (CMA)
While CPA is the designation for public accountants who specialize in taxes, compliance, reporting and auditing, those who prefer to work in corporate finance and specialize in business analysis, strategy and financial management may opt to earn a Certificate in Management Accounting.
CVA: Certified Valuation Analyst
This credential is offered by the National Association of Certified Valuation Analysts (NACVA) and has been around since 1991. There are approximately 5,000 practicing CVAs. This is one of the more common credentials that CPA valuation practitioners attain and it is well-respected within the valuation community.
CIRA: Certified Insolvency and Restructuring Advisor
This certification was developed to recognize those individuals who specialize in client service involving insolvent and/or distressed entities. This requires five years of accounting/financial experience and at least 4,000 hours of relevant business experience.
CM&AA: Certified Merger & Acquisition Advisor
Merger and Acquisition Advisors must exhibit mastery of Merger & Acquisition (M&A) knowledge and must constantly remain aware of both M&A and investment fields. CM&AA professionals must also thoroughly comprehend the process of selling and buying middle-market companies.
Those are just a few of the more popular professional certifications that accountants can earn. We have plenty of these acronyms (and more) on the Marcum LLP team to make sure we have the appropriate resources to help build and grow your business. Have a question for one of our qualified advisors? Click here to ask one of our experts, or call (855) MARCUM1.