How to become an accountant

What accountancy qualifications are available?

If you’re studying to become an accountant in the UK, there are three main bodies that you’ll be considering:

1. ICAEW (offering the ACA qualification)
2. ACCA
3. CIMA

There are other accountancy bodies – such as AIA, EAA, IFA and CIPFA – but these are more specialist organisations and a far less common route into accounting for trainees. So, what’s the difference?

ICAEW

The ICAEW (Institute of Chartered Accountants in England & Wales) is the largest accountancy body in Europe and offers members the ACA qualification. You’ll be required to sit 15 exams and log 450 days of relevant work experience to qualify, and you have a maximum of five years to do so. In addition, you’ll need to sign a training contract with an authorised employer.

ACA is a prestigious qualification – once you hold it, you can work at any accountancy firm, including in audit, or move to the public and private sectors, through to contractor accountants. It’s also the route taken by the ‘Big Four’ accountancy firms – more on them later.

ACCA

The ACCA (Association of Chartered Certified Accountants) is a globally-recognised organisation and the largest accountancy body in the world.

To qualify as a member, you’ll take 14 exams and log three years of relevant work experience – although you have up to ten years to do so. Unlike the ACA, you don’t need to sign a training contract and can more easily move between employers while training.

ACCA members have similarly broad prospects to ICAEW members – whether you see a career within an accountancy practice or in industry, you’ll have the knowledge and skills to go down any route you choose.

CIMA

The CIMA (Chartered Institute of Management Accountants) is an organisation geared towards skills valued in commercial business settings. Students will sit 12 exams – 9 tests and 3 case studies – and have no time limit within which to complete them.

As with ACCA, you don’t need to sign a training contract – but unlike the other two qualifications, you’re very likely to be studying in a business environment, rather than at an accountancy firm.

CIMA members will usually find themselves working as management accountants in the private sector – the qualification focuses heavily on skills valuable in the real-world running of a business.

AAT

The AAT (Association of Accounting Technicians) isn’t a full chartered accountancy qualification like the other three, but is a very common route into finance and accounting for trainees. It’s commonly offered by small accountancy firms and within business finance teams and gives a solid grounding in the principles of finance and accounting.

Holding an AAT qualification provides exemptions to some exams for students of the above organisations, which is a major reason it’s seen as a stepping stone to a chartered qualification.

AAT members are found in a broad spectrum of roles and are valued within industry and accountancy firms alike.

The rigorous qualifications also instil a broader range of skills and qualities that are valuable to any employer – over half of FTSE 100 CEOs have a finance background, and one-fifth are chartered accountants.

However,it’s anything but easy. Years of study and a series of varied and challenging examinations, coupled with practical experience requirements, mean that studying for an accounting qualification isn’t something to embark upon lightly.

If you’ve got what it takes to make it through the study, though, you’ll be set for life.

What do I need before I begin studying as an accountant?

Many potential students worry that they don’t have the proper background to begin studying as an accountant. A few common questions, and their answers, are below.

1) Do I need a degree in a relevant subject?

The short answer is, no you don’t! Although an Accounting & Finance degree can provide exemptions to examinations, speeding up your progress and making it easier to juggle work and study, plenty of accountancy trainees have no directly relevant qualifications – a first-class or 2:1 degree in any academically rigorous subject will be viewed favourably by employers.

It certainly doesn’t hurt to hold a relevant degree, but employers offering training contracts are primarily looking for candidates who are bright, focused and willing to learn.

2) Do I need relevant work experience?

Again, the answer is a resounding no. A large number of accountancy trainees are university leavers – with or without a relevant degree. Some students do transfer from Finance-related roles – ambitious individuals often move from accounts payable/receivable or bookkeeping roles into accountancy training.

Other trainees enter accountancy later in life as a career change from an unrelated industry – although not directly relevant, experience in fields such as management, sales and technical roles are valuable in their own right. As before, candidates who are intelligent, capable and motivated always stand out.

3) Do I need connections within the industry?

Absolutely not. The overall intake of accountancy students each year in the UK is in the tens of thousands. The best route into an accountancy firm is to interview well and fit the company culture – that’s entirely down to you, not who you know.

And although it’s never a bad thing to have contacts who can put in a good word for you and help secure an interview, accountancy is a professional career which demands excellence – you won’t find any preferential treatment during the interview process.

What routes can I take into accounting?

The Big Four

The Big Four firms are the most prestigious accountancy firms in the UK – and the world. These include:

1. Deloitte
2. PricewaterhouseCoopers (PwC)
3. Ernst & Young (EY)
4. KPMG

As you might expect, it is very difficult to secure a role at one of these companies – due to the sheer number of applicants, acceptance rates for trainees are around 5%.

The interview process is gruelling, and can include numerical and verbal reasoning tests, personality assessments and strength/judgement assessments. You can expect online testing and telephone interviews before an in-person assessment is secured, which involves analytical, skills and written tests.

The calibre of applicants is extremely high and many have been preparing since leaving school – or even before! This route is suitable for ambitious, driven and intelligent candidates who have a clear idea of the route they want to take from a young age.

Other accounting firms

The spectrum of accountancy firms in the UK is extremely broad – an accountancy firm can be anything from a very large, established company with 100+ partners to single-partner practices, and everything in between.

Interview, educational and work experience requirements will vary widely depending on the firm, its culture and the part of the UK it’s located in – the latter affecting the number and quality of candidates they’ll get through the door.

Aside from very small firms, almost all will regularly take on students on training contracts. This is often the best route into accounting – search for firms in your local area, look for vacancies, polish up your CV and have a working knowledge of the firm and its history before you interview.

Recruitment companies can also help here – there are many specialist finance recruitment firms who will be aware of vacancies, intake dates and accountancy practices in the local area.

The AAT stepping-stone

Because the AAT is a broad qualification which is valuable in almost any business, it’s common for staff in a company’s finance function to be offered the chance to study for the AAT.

You’ll also see this offered in small or contractor accountancy firms, where it could be more challenging for students to gain broad enough work experience for an ACA/ACCA qualification and where the AAT is more suitable to the needs of smaller clients.

Holding an AAT is helpful when applying to small or mid-sized accounting firms – it demonstrates valuable qualities in candidates, and gives a guarantee of a fundamental level of knowledge in accounting and finance.

Directly from university – or directly from school

If you’re aiming to come out of education directly into an accounting career, look for graduate schemes – typically these have fixed intake dates, so you’ll need to be aware of when applications need to be submitted by. Don’t work to deadlines, either – getting an application submitted in plenty of time shows that you’re organised and motivated.

If you don’t hold a degree, school leaver programs and apprenticeships also exist – even for Big Four firms, although these are naturally very competitive and you’ll typically need to hold strong A Levels to think about this route.

It’s also valuable to gain relevant work experience – as well as giving you an insight into, and familiarity with, the day-to-day workings of a workplace environment, it demonstrates that you’re proactive and committed to the career.

Later in your career

Plenty of accountants come to the profession later in their careers. Skills picked up in the workplace, even if not directly related to accounting, can stand you in good stead – client-facing skills, familiarity with Excel and office software, corporate standards of behaviour and dress, and even simple maturity can all be valuable and differentiate you from younger candidates.

Changing careers later in life is likely to close off the route into the Big Four firms, but a huge number of accountancy practices will consider a bright candidate from any background.

Rates of pay as an Accountant

Starting salary as a trainee accountant varies widely – it’s dependent on your age, experience, qualifications, the geographic location and size of the firm, whether you’re on an apprenticeship scheme… and more!

As a rule, you’ll earn more in more affluent areas with a strong accounting presence, and also at bigger firms which have the resources to pay their trainees a more competitive rate. If you’re looking to begin training in an area of the country without a strong economy or finance sector, salaries can start at £14,000 for an AAT trainee – although you should acknowledge that firms will often pay thousands (or even tens of thousands) of pounds in exam fees, membership dues and training on top of your salary. Working in and around London, you can expect to start anywhere from £18,000 to £25,000.

If you’re received an offer but are unsure about the salary, be sure to ask about incentives and pay rises as you progress. A common approach for firms is to offer pay rises upon each passing exam grade – over the course of 13+ exams, this can add up to a hefty rise over the course your training.

Earnings potential rises for part-qualified accountants – due to the difficulty of tempting trainees away from employers, a trainee with over a year’s experience can command a premium from a company in need of a capable individual. And of course, once you’re qualified, the world is your oyster – ACCA finalists earn an average of £30,700 a year, and this can be much more in and around London.

Once you have a couple of years’ experience and any chartered accounting qualification under your belt, you can expect to earn comfortably in excess of £50,000 a year. With over five years’ experience, this can easily double – so if starting salaries are getting you down, it helps to take a long-term view when embarking on a career as an accountant!

What can I expect as a trainee accountant?

Your experience as a trainee accountant will vary widely, depending on:

1. The firm you’re training at
2. Your previous experience
3. Your qualifications
4. Your specialisation

The most common routes to your qualification at a private practice are through audit and accounts. Audit is focused on testing and verifying client accounts – it involves plenty of client contact, meetings and travel to work on-site.

At a top firm with extremely large audit clients, it’s not uncommon to work with the same client for several months, and as a trainee on a large audit team your role may initially be restricted to a limited set of audit tests.

Working on smaller audits, your experience will be far more varied – you’ll be exposed to a variety of different clients and are likely to gain experience with a bigger variety of audit tests more quickly.

A good auditor requires both interpersonal and analytical skills, as well as the ability to work well in a team, meaning that you’ll gain a range of useful skills and competencies during your training. There is plenty of variety in audit, and you can gain insight into the workings of vastly different businesses and industries.

An accounts role is more office-based than audit specialisation, although still with plenty of client experience. This position is focused on the preparation of financial statements (year-end accounts) from client records – depending on the client, anything from well-maintained accounting software records to a box of invoices and receipts!

An accounts role at a contractor accountancy firm comes with its own set of challenges – Being able to advise to individuals confidently the financial implications of moving from permanent to contracting as well as technical knowledge and ability, these roles require particularly strong time management, prioritisation and organisational skills in order to juggle a large number of individual clients.

Strong analytical and critical thinking skills in particular are required for this route, as well as solid IT skills You will still be expected to communicate with clients by telephone and in meetings, and regular work in an office requires its own set of interpersonal skills.

It’s worth noting that, especially at a mid-sized firm, audit and accounts typically overlap and a trainee will find themselves assigned to both types of work over the course of a year.