Jump to content

Advice Needed - Will earning the CPA make me a better investor?


spartan

Recommended Posts

Is the CPA a valuable designation re: investing? Buffett always talks about the importance of accounting, but is earning the CPA necessary? Can't I learn as I go along by reading regulatory filings?

 

My thinking is that if there are particular aspects of a financial statement that I don't understand, I can always look up the rules (i.e. CPA handbook, etc.). I have 3 years of experience in Big 4 audit, which has built a strong foundation of accounting knowledge. My original intent for joining Big 4 was to learn accounting, but earning the CPA will likely take me another 2 years.

 

I'm not concerned about the time/effort required, but if I'm going to embark on an arduous journey and take time away from finding bargains, I want to know that there's light at the end of the tunnel. Any thoughts/opinions are welcome.

 

How has everyone else on this forum learned accounting over the years?

Link to comment
Share on other sites

I'm a CPA and I certainly do not think the designation did anything for me as an investor, so I would not be pursuing it if that is your only goal.  The tests cover topics that a mile wide and an inch deep, so the few that are applicable to investing could be learned by pretty much anyone independently. 

 

Since I worked in public accounting for many years it was still worthwhile professionally though.  I was always a good test taker so I had no worries about failing, and the studying process took probably 300 hours total. 

Link to comment
Share on other sites

Guest cherzeca

wouldn't you be thinking about a CFA if you want to add a credential and want to work in investment management?

Link to comment
Share on other sites

What is optimal depends on your career plan.

 

Whether you choose the accounting or investment route, when you start – you need to be in a Big-4, no older than 22-24, an undergrad from a top school, the right skin tone, have ‘connections’, and there to obtain the experience component of a designation. Same process whether the designation is a CPA or a CFA. Widespread abuse, par-for-the-course.

 

Don’t meet the criteria? you will always be 2nd fiddle to those who do. Sure, you might be smarter – but if you’re too old, not the ‘right’ school, wrong colour, or no connections ….  you will be 2nd fiddle for life. If this is you, play a different game.

 

A great many CPA’s and CFA’s are also MBA’s - particularly if the plan is to become senior management at some point; a fairly high % hold all 3 designations. And almost all of them will tell you than once you grow up - you build and run companies, not trade bits of paper.

 

Back to the plan, and is there one?

Then what have you done today - to make the plan happen?

 

SD

 

 

Link to comment
Share on other sites

Is the CPA a valuable designation re: investing? Buffett always talks about the importance of accounting, but is earning the CPA necessary? Can't I learn as I go along by reading regulatory filings?

 

My thinking is that if there are particular aspects of a financial statement that I don't understand, I can always look up the rules (i.e. CPA handbook, etc.). I have 3 years of experience in Big 4 audit, which has built a strong foundation of accounting knowledge. My original intent for joining Big 4 was to learn accounting, but earning the CPA will likely take me another 2 years.

 

I'm not concerned about the time/effort required, but if I'm going to embark on an arduous journey and take time away from finding bargains, I want to know that there's light at the end of the tunnel. Any thoughts/opinions are welcome.

 

How has everyone else on this forum learned accounting over the years?

I would guess that you probably already know more about accounting than you need for investing.

Link to comment
Share on other sites

It's not necessary, and won't necessarily make you a better investor, but it could.

 

You'll have a better understanding of how financial statements work, and be able to catch inconsistencies and call out management BS (there is a lot, even with large cap widely followed stocks).

 

Independent thought is the most important aspect to being a good investor, and the better your technical skills, the more valuable your insights will be.

 

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...