CFO/Controller without a CPA

To your first question, I get an email from the AICPA every day that is a nice update. If you can't or don't want to get a daily email then recommend you just check their website from time to time. Another great resource is the GAAP research tool that I subscribe to from PwC, it is called Comperio. Think it is about $1,500 a year but it is a great tool to keep up to speed on GAAP changes and to do GAAP research. Most large public accounting firms have something like this but PwC's is the best in my opinion.

As far as your second question goes, I personally don't see the big deal with being a CPA. Yes it is nice to have but I don't think it means anything other than you passed a difficult exam. When I passed it in 1996 (shortly after I finished undergrad) I can assure you that I was clueless about business and how accounting really worked. Experience matters more to me than whether somebody has passed an academic exam.

Think you noted some good ways to overcome this in the event that somebody thinks it matters. Ultimately what matters to me is that somebody is experienced at being an accountant and knows how to research GAAP should that be a necessary skill set for a particular job. Consequently being able to discuss recent GAAP developments such as IFRS, the recent FASB codification, or new pronouncements illustrates that.

Everyone is different but I like it when a candidate asks me my view on something that they have an intelligent view on. So, for example, in an interview when they say "do you have any questions for me" you could ask a technical accounting question to the extent relevant such as "how have you dealt with FIN 48" or something like that.

Andrea:

Been there, done that. I have been a CFO many times and without a CPA I have lead many successful audits. To your point above, it is about understanding which issues are "accounting" issues and that everyone must approach learning about and preparing for these issues in the same way. Heck, unless you are a freshly minted CPA you are in the same boat as others w/o the CPA: learning all the time about the things that matter to your company.

The CPA "requirement" is an annoying one. I find that this requirement is typically part of job descriptions written by non finance folks (that is: written by recruiters, people in HR, or CEOs). They simply don't know any better and like to put up roadblocks in the hiring process b/c they think this produces a better outcome. Ha! Unfortunately, those people will be tough to get around with the logical arguments you have constructed above b/c they just don't know any better. With a CEO, though, you have a better shot - if you can get to him or her to explain. I think that to get there you have to a)write about this in your cover letter and b)discuss technical accounting skills in your resume that would be applicable to the company.

So far as keeping up to date goes, I use Deloitte's online GAAP resource (DART) but it's only as good as the documents included which tend to be codifications, Q&A, etc.. This falls way short when it comes to practical application and that's one thing i really like about Proformative. If you have a technical question, just ask it to the appropriate audience here and you'll get loads of practical feedback.

I think Bryan's got it right on getting past HR and recruiters when a job listing has "CPA required," Andrea. There are some companies who want that designation in their CFO and won't consider candidate without it. However, sometimes it isn't required as much as it is preferred. A strong and compelling value proposition can mitigate the lack of a credential (and age bias), but generally NOT if you are responding to a job posting that takes you through HR or a recruiter (who is taking his marching orders from his client company).

Leveraging networking and social media as major search strategies can help you leapfrog the non-decision-making authority of HR and get directly to the guy who is calling the shots.

My observations concerning the two questions asked.

First, there are many avenues and resources to keep up to date regarding accounting rules. Likely what is most relevant concerns how the most recent accounting rules changes effect your employer or your preferred industries.

Second, the CPA requirement in the job description.

I am a CPA, and have held this since passing the exam on my first try in 1983. Always have kept mine in active status. Doing this requires meeting minimum annual continuing education requirements.

However, I got my license in Texas, and at the time did not need public accounting experience. Over the years, particularly in employment down cycles, the job description specifications requiring the CPA, also required "BIG" firm experience and an active license.

To me, this is a pedigree issue, something unless you have it will rule you out in the eyes of HR gatekeepers, and maybe with the hiring manager and/or at the Board of Directors level.

I too have been through many external audits by the "BIG" firms, and second tier firms. What a company should be concerned about is the ability to handle and negotiate with the external auditors - and depending on issues, negotiating does come into play - whether this be with fees and/or resolving interpretive issues. Since CPA firms became regulated by the PCAOB, this is not a prevalent now vs. before.

Have seen many discussions regarding the pros/cons of pursuing the CPA license later during one's career, which is likely something you are asking yourself. My advice - evaluate how difficult this will be based on the state of residence. Each state has different qualification requirements to get the license - passing the exam is not the only issue.

Over the past 15-20 years, Accounting rules have been as significantly impacted by special interests, and made almost as complex, as the IRS tax code. The next issue under debate is IFRS, which in my opinion will ultimately be adopted. Probably not on the timeframe originally targeted, when has this ever happened?

In today's environment, you likely will see some job description requirements wanting both an MBA and CPA. About 15 years ago the CPA licensing educational requirement was changed to include an additional 30+ hours post-grad, leaving the person just a few hours short of their MBA. It is a way to age discriminate through the job description requirements.

At the end of the day, if you do not have an alternative entry method with a particular company that has posted a senior accounting job, and the requirements include the CPA and/or MBA, not having this is going likely to eliminate you immediately.

The recruiters/resume screeners (including automated), that don't see these will put your's in the rejected pile because you did not check off all "required" boxes. It just is the way it is. You have to ask yourself in viewing the job description if a requirement really is a requirement - look at the end recepient - if it is the hiring manager, you may have a chance if in all other areas the "match" is there.

Last spring, CFO magazine had an article about CFO without a CPA. They found that 60%-70% of Fortune 1000 companies CFO’s do not have a CPA. The percentage of CFO’s with a CPA has been increasing over the last few years due to SOX. I have been a CFO w/o a CPA for several companies. However, I believe in this competitive market not having a CPA has caused me to lose out on some opportunities. As a result, I am currently studying to take the CPA exam. When I am asked by employers about not having a CPA, I tell them that having a CPA would not make me any smarter or better at my job. However, I believe there is a stigma out there especially with mid size companies that believe having a Controller/CFO with a CPA adds some cache to the company.

I have been a CFO for multi national companies more than 20 years without a CPA. In fact, in my capacity as CFO I have hired many CPA's who fail to grasp the nature of business and subsequently created more difficulties for the company than their non-CPA counterparts. There is no dispute that a seasoned CPA has the theory behind him/her but as one person commented, the accounting laws are changing everyday for both CPA and non-CPA which puts them both on level ground. In applying for jobs; If the CPA is a requirement I submit my cover and CV anyways. Sometimes years of experience is taken into consideration.

I have worked as a CFO without a CPA for several companies. The primary reason why I don't have a CPA is due to having earned an Engineering rather than an Accounting degree (though I do have a MBA and have had other financial as well as non-financial related jobs). The primary difficulty that I have experienced in not having a CFA is getting past the gatekeeper (usually HR) for CFO-level positions. On the otherhand, I have found having an Engineering degree useful in serving in high-tech companies and as a consultant, especially for Sarbanes-Oxley compliance work for both the Finance and IT areas. Degrees and certifications are only an indication of the minimum amount of knowledge that someone has (or had). The ability to apply one's knowledge and experiences is what is valuable to an organization.

I would agree, John, that there are situations where a non-CPA can win a job but would argue that it isn't "years of experience" but rather a "record of positive contributions" over the course of a career that can swing the pendulum.

The real key, though, is the pain connection. A company, requiring a CPA or otherwise, isn't hiring a CFO because there is an empty corner office with a great view and a CFO plaque on the door and they need a body to sit at the desk. A company hires because it has a pain, problem, challenge, or issue it needs resolved or it is stuck and can't move forward. When you can make the pain connection, through a solid record of solving those issues and the quantifiable impact of doing so, the CPA (like age-bias) becomes much less of a factor.

There are, of course, companies for whom the issue is non-negotiable, which is why it is key to understand what you have that a company is willing to pay to get ... and then who will buy it (your target market).

I believe there is an alternative certification to a CPA that has value in industry and that is the CMA (Certified Management Accountant). This certification exam covers everything on the CPA exam plus added knowledge such as decision theory, cost accounting, management theory, computer system knowledge, etc. Yet there are very few companies who identify CMA as a required or preferred certification. There are continuing education requirements for CMAs similar to what is required of CPAs.

Along with the CMA comes membership in the IMA (Institute of Management Accountants) which is another great way to stay current on accounting issues and changes through monthly meeting speakers, specific conference offerings, a monthly publication, and the web site.

Another organization that can be useful in the continuing education arena is FEI (Financial Executives International). There are monthly meetings, continuing education sessions, a publication, and a great web site for use by members as a resource.

In the end I agree with many of the comments offered previously - experience and keeping current in the accounting best practice arena are far more important than a certification. I believe employers especially in today's market often use the CPA as a filter to screen out candidates which in the long run just causes them to miss some excellent, well qualified candidates who may actually bring more to the table.

I don't have a CPA but everytime I went for an interview that required a CPA license, I got it.
I have held board seats at three different companies overseeing finance and operations. Yes, there are CPAs in our team but not necessarily in a decision-making role.
I will hire a CFO without a CPA anytime as long as s/he has the vision, experience and attitude for the job.

I agree with practically all of the above comments.

I operated first as a Controller and then a CFO at the same company, without a CPA. During the time I went back and did an MBA and ultimately took an additional 8 accounting and tax classes after my MBA in order to meet my state's (NC at the time) requirements for sitting for the CPA exam. The extra classes took me a year, then studying for and sitting for each section of the CPA exam took a total of a full year. It was a very rigorous exercise and I learned much in the process.

At the end of the day, I decided to do that because I knew it would contribute to my knowledge, and it would deal with the "CPA required" issue once and for all, if and when I ever pursued another role. As it happened, I did leave that company when I moved to Texas and I am glad I did the due diligence to get my CPA license.

As all have said, certainly a designation can only say so much, and not having a designation can't say all that much either. My recommendation would be though, given what is definitely a bias in industry about having your CPA license, that you do try and pursue it if possible as it will help knock down barriers.

It's unfortunate that it works that way out there, but sadly it does often work that way at least at the first line of resume screening.

Having seen CPAs whose accounting skills were marginal, and non-CPAs whose skills were superlative, I question the "requirement".

That being said, requiring a CPA is 1) an easy way to pre-screen (read eliminate) a significant number of resumes and 2) allow non-finance types to have some confidence in the candidate's accounting skills (which they otherwise may not be able to assess).

As such, if you know accounting, it's not that difficult to 1) get the necessary educational requirements in an accredited on-line or evening program, 2) pass the exam (I found the Becker CDs very useful, and 3) become a CPA in one of the states that doesn't require experience working for a CPA. Granted, it won't work in every case (i.e., those who seek a candidate licensed in a particular state), but it will work in most cases.

I am an experienced public company Controller and an experienced public company Treasurer. I have an MBA, CMA (Certified Management Accountant) and CTP (Certified Treasury Professional) credentials. I have recently completed the requirements for the CPA license in NC as well and I am awaiting licensure.

There are three reasons why CPA is usually listed as a requirement for Finance Executives. First, as others have posted here, it is an easy, bright-line test to disqualify the majority of applicants. In this job market, recruiters do what they must to manage their workload when faced with the volume of responses they receive. Second, if the position (Controller, Treasurer, Divisional CFO, etc.) reports to a CFO, often the hiring authority is him/herself a CPA and wants someone "just like me". Third, it is often a CYA strategy by the hiring authority in case the hire doesn't work out, or worse.

A CPA friend recently made the comment to me that earning the CPA also indicates the ability to initiate, manage and complete a complex project. He is right. Although we have all successfully completed many projects, how is a hiring authority to know for sure that I was responsible for the success of a project as opposed to taking credit for excellent work done by my staff? When earning the CPA (and the CMA, CTP or some other credential) there is no staff. There is only you navigating your way through a body of knowledge, exams, rules, forms and, in the case of CPA, laws as well. Something to think about.

I'm always asked about not having a CPA. My quick answer to that is to suggest that the best folks to answer that would be the audit partners at the big 4 firms I've worked with. That and a few more examples of the complex accounting problems I've solved & that usually puts the question to bed.

Having worked in financial services and within the finance function of public and private organizations, I can tell you that the CPA designation is of import in the obvious area of ACCOUNTING. As an MBA and CFO, I put a great deal of importance on the accuracy of information contained within the systems that support corporate decision-making. I also put a great deal of importance on complying with the relevant and prevalent rules governing corporate accounting. That being said, it has been my experience that the CPA designation offers little in the way of preparing a professional for the rigors of the CFO position in terms of managing and growing the business. You have to have breadth and depth in terms of treasury, banking relationships, currency/FX management, working and investment capital sourcing/pricing/securing, legal ramifications of contract language and the difference between letter and intent of same, people management skills, CEO/Board management skills, analyst/investment banker management skills, due diligence oversight and acquisition/divestiture planning and execution, strategy development, assessment, deployment, execution and adjustment, fostering growth initiatives and risk assumption while curtailing mavericks within the organization (likely to be found in Sales & Marketing, naturally) and limiting liability and exposure for products, services, workforce, internal practices and employee behavior and work product. This doesn't even cover tax strategy, debt/stock issuance, asset-based borrowing and factoring, joint-venture sourcing, etc etc.

The CFO of companies that 'do it right' is the one person in the company that makes the grandiose ideas of product development, the CEO and/or the marketing team come to life, through responsible analysis, aggressive and cost-effective financing, and ensuring the product/service that has whiz-bang all over it on the whiteboard, actually results in whiz-bang on the income statement. Very little in the CPA preparation, exam and CPE universe prepares you for ANY of that.

And I think this is what's being communicated with certain candidates who express frustration with the "CPA only" recruiting process...it's that old adage "No one ever got fired for going with IBM", and that probably holds true for the HR folks looking for a new CFO or Controller: the CPA designation is a safety net, more than it is a profit-enabler or indication of business intellect and an ability to make complex product/service concepts come to life.

This seems to have attracted a lot of attention, and some long, well-thought-out responses. People can be successful without having a CPA. But the CPA exam is a tough test and the experience requirements make sure that people can use the practical knowledge in an effective way.

Although not everyone needs or wants public accounting experience, it was invaluable training to learn the value of hard work under tight deadlines and sometimes stressful conditions. It also allowed exposure to how CFOs and CEOs conduct business in the corporate world, exposure to big picture and company risk issues, and allowed one to become confident in presentations and public speaking. All-corporate CPAs with no public accounting experience may also achieve the same over time, but think the public accounting path is accelerated.

Non-CPAs can be successful as well, but one with a credential could certainly have a valid edge in a hiring decision, all else being equal. That being said, careers are a body of work so the credential is just one factor in the hiring decision. All else is rarely equal! Because it is so helpful, though, I have not put a priority on getting an MBA.

Some people will also make jokes about CPAs of course and think that we all do continuing education because we love accounting. We do it because education is beneficial and we want to keep our hard-earned licenses, whether we follow Corp. Controller path, CFO path, COO path, CEO path, or some other VP path. Some of us even do consulting!

Those interested in becoming CPAs should note that the requirements vary considerably by state. As such, unless you intend to practice public accounting in your state, licensing elsewhere can be an alternative.

For example, some states require experience with a CPA firm while others will allow experience in a business or government setting, providing that you were supervised by a CPA. (And, one state does not require experience.) This variation extends to residency and coursework as well.

Also, I purchased a review course and found it to be invaluable. It focused on the material to be tested and identified some of the test questions and tricks that one might expect.

Raffy's comments are spot on. I have been a CFO for a number of companies including leading an IPO and the lack if a CPA was and is not an issue regarding getting the job done. Accounting was a very small part of my job and it is always backward looking. Understanding what drives the business and providing forward looking guidance is critical. I think
CPA is included in job specs if CEOs have little background working with a CFO. A good CFO is much mire than the chief accounting officer. In addition accounting rules are constantly in flux so anything learned as a CPA becomes obsolete. A non CPA can keep up with new rules.

I have recently started an outsourced CFO and controller service after serving a number of years in public accounting and as a controller for a retailer and a non-profit agency. I never passed the CPA exam; the closest I came to passing was getting a 74 in AUD back in '05. My last attempt was in 2009 when I decided my time would be better spent building my track record as a CFO/controller. IMO, a solid track record of measureable and deliverable results would trump, if not be equal to obtaining a CPA credential.

I respect the CPA credential and those who have worked to obtain it, but I think that it isn't nearly as necessary to have as one would think. Working in industry, I think an MBA would be more ideal, especially coupled with a CMA for those who are controllers would actually compliment each other very well, as they serve as two sides of the same coin in that respect.

But I find no disgrace at all with those CFO without a CPA; the two are actually apples and oranges. CFOs serve a strategic role, controllers, CPA or not, serve a tactical role. Both roles are necessary, but the same person does not need to serve both roles at once. Further, CFOs by design are more prone to taking major risks, while controllers tend to be conservative (the conceptual framework of GAAP emphasizes conservatism as one of its constraints). It's kinda hard to wear both hats at once in that regard.

Bottom line, a CPA is much more of a "nice to have" than a "need to have" feature for CFOs and controllers (once possible exception being those who work in public companies where SEC and SOX compliance is an integral component to a CFOs and controller's duties).

CFO.com is an excellent resource with daily emails on all the latest updates.

Great chart, thanks for sharing. I have performed tasks in both of the roles.

I agree there are plenty of job opportunites that require the CPA designation whether needed or not, it is definitely key to getting your foot in the door at many companies where that has been selected as a required hiring criteria. I tend to not be interested in those particular traditional accounting roles.

I am not a CPA, but have worked as Controller, and no interest in being a CFO.
I have an MBA in Accounting and 30 years of Govt contract accounting expertise which assumes GAAP & SOX and requires FAR & CAS experience on top of those two.

Federal Acquistion Regulations & Cost Accounting Standards required in industry are harder to learn/find, so that outweighs the CPA requirement in these roles I am interested in. So I have not needed a CPA and do not foresee needing one.

To answer Matthew's question of why not get a CPA license, I know for me, the niche market I work in has been my main reason, but also no interest in taxes or public accounting, or taking a huge pay cut to take job to get audit hours.

Also, from my view as accountant/controller being audited by CPA and DCAA at the same time, the CPA audits seemed liked the no-brainers since you are paying the audit firm, of course you will pass the audit so they get next engagement.

DCAA (Defense Contract Audit Agency) were the more challenging audits since the auditors do not have that conflict of interest. You pass or fail their audits. I would definitely say dealing with them is better prep for a CFO or CEO role.

Also, although Enron has made CPA a household word, the word is not all good, and I think I would rather not be stereotyped into that particular group so if I were to find the time to add to my credentials, I would pursue CMA vs. CPA, since that would more closely match my experience, interest and future needs.

I currently work as an Accounting Consultant for Government contractors, advising them on DCAA audit requirements for FAR & CAS compliance and with implementation of Deltek ERP Accounting systems to facilitate those needs.

This discussion has continued over quite some time focussing on the relative merits of a CPA qualification vs no accredited qualification as a senior financial manager. I am a member of the UK institute of Chartered Accountants with an FCA qualification on my certificate. I came to work in the US more than 20 years ago on an intercompany transfer, so my public company employee knew me and did not care whether I had a CPA qualification. For a while I contemplated sitting for a CPA but decided not to spend the time and effort since I did not consider I would learn anything significantly new, and although I may be biased, I did not consider a CPA as good as my FCA. Subsequently, I have presented my qualifications to prospective employers and found that they generally accept my qualifications as being an acceptable alternative, even though they have no understanding of the comparative qualifications.

I conclude that most recruiting gatekeepers are simply looking to tick a box that proves some qualification evidenced by some initials and i wonder whether we are more concerned with having a "badge" rather than the underlying knowledge and experience. I would be imnterested to hear if anayone else has duplicated a native professional qualification inorder to add the magic CPA initials on their resume?
Simon

In my overall experience, the black and white translates to the person that is in review of the experience and credentials, to the depth of ‘live’, in person or in voice connection to ‘define’. It is having a receptive-right person that is the recipient. Yes, there are areas that have a requirement of CPA, there is a ‘but, ‘yet’, ‘however’ that a high percentage of the time is the pivot point.

Have a grand day!
Annette

Annette F. Heintz
Director of Recruiting
Banking, Credit Union, Finance
WaterMark Executive Recruiting
Direct to Annette: 612-462-7671
[email protected]
Reiterating complete confidentiality for all information and communication.