Do you have an interest in all matters relating to finance? If you think you can handle managing budgets and increase the profitability of a firm, then you can indeed think of cost accountancy as a serious profession for you. Cost Accountant analyses and handles the management of financial services of a firm. They prepare reports on financial statements and based on that guide the firm towards profitability in the best possible manner. They are financial specialists who determine the actual costs ascertained with providing a service and are responsible for reducing a company’s financial waste and increasing profits. Just like a Risk Advisor advises the company regarding potential risks by auditing its services. Read this comprehensive blog, to know how to become a Cost Accountant in real life!
This Blog Includes:
- What Does a Cost Accountant Do?
- Educational Requirements to Become a Cost Accountant
- Step by Step Process to become a Cost Accountant
- How to become a Cost Accountant abroad?
- Top Universities for Pursuing Accounting
- Cost Accountancy Course Structure
- Benefits of being a Cost Accountant
- Professional Certifications
- Diploma Courses in Cost Accounting
- Career Prospects of a Cost Accountant
- Salary of Cost Accountants
- Top-Notch Recruiting Firms for Cost Accountants
Also Read: How to Become a Chartered Accountant in UK?
|Eligibility||10+2 with any stream (except Arts)|
|Average Starting Salary||INR 4,00,000 – INR 5,00,000|
|Job Prospects||Business Firms, Banking and Financial Sector, Research and Training, Government sector|
What Does a Cost Accountant Do?
Some of the particular day-to-day tasks of a Cost Accountant can be as follows:
- Evaluating and comparing costs, revenue, and budget of the different production methods of a firm.
- Analyzing capital budgeting methods of a company and preparing its report
- Controlling data accumulation procedures and systems
- Preparing financial forecasts with the purpose of decision making
- Evaluating the company’s cost-benefit analysis for improving profitability
Also Read: Best Accounting Books for Beginners
Educational Requirements to Become a Cost Accountant
To become a Cost Accountant, a Bachelor’s degree in Commerce or Accounting is beneficial. By studying these courses, a strong knowledge of finance, economics, banking, business law, and information technology is built that is the desired skills of a Cost Accountant. The minimum requirement for a cost accounting job is a bachelor’s degree in the Commerce or Accounting field. Though many recruiters seek employees with a master’s degree in accounting or an MBA in Accounting, it really all depends on the job profile.
Step by Step Process to become a Cost Accountant
Among other financial professions, becoming a Cost Accountant is one of the toughest. The aspirant has to attempt professional examinations that are highly competitive and only 5-25% clears these examinations. The procedure to become a cost accountant has been simplified in the following section.
- Step 1: The candidate is required to pass the 10th standard
- Step 2: After 10th, the candidate should also pas 12th standard from a recognised instituion or board.
- Step 3: After appearing and qualifying for the acountancy entrance examination, the candidate is required to pursue computer training and other skills
- Step 4: The candidate must register for an itnermediate level course
- Step 5: After completing the intermediate level, aspirats are reqiired to register for the fnal level
- Step 6: After the registration is completed, the candidates are required to appear for the examonation and upon passing the exam, they are forwarded for modular training and industry oriented training.
How to become a Cost Accountant abroad?
In countries like USA, Canada, the Middle East, and Africa, the aspirant is required to undertake CMA (Certified Management Accountant) courses to start their Cost Accountant career. The basic educational requirements other than that are:
- For entry level positions as a cost accountant, a Bachelor’s degree in Accounting is considered and for advanced level, a Master’s Degree or an MBA with a focus in accounting is considered for the position.
- The candidate is required to pursue a Bachelor’s degree for 4 years minimum.
- In USA, the candidate has the advantage of completing their CMA exminations in just 6-9 months.
- To become a Cost accountant, the candidate is required to clear only two important examinations.
Top Universities for Pursuing Accounting
- Harvard University
- Stanford University
- Massachusetts Institute of Technology
- Northwestern University
- The University of Chicago
- University of Virginia
- Dartmouth College
- University of Pennsylvania
Cost Accountancy Course Structure
The course structure for Cost Accountancy has been structured as follows:
|Level Name||Eligibility||Course Fee|
|CMA Foundation||To appear for the intermediate level of CMA, the candidate must be a 10+12 pas out||INR 4000|
|CMA Intermediate||Other than being a 12th standard graduate, the student should also complete CMA Foundation Course Candidates while being qualified for ICSI Foundation.||INR 20,000|
|CMA Final||Those who have passed the intermediate level of CMA can apply for the finals||INR 17,000|
Benefits of being a Cost Accountant
By getting a plethora of opportunities in the sector of Finance, being a Cost Accountant can bring numerous benefits to the aspirants such as:
- Competitve Salary – You can start your career as a Cost Accountant right from the entry-level with a salary of around 4 LPA which increases to 6 LPA mid-career and goes til 9-10 LPA as you gain more experience. This is comparatively a pretty high pacakage compared to other financial professions.
- Job Security – This profession is highly stable if you are considered proficient and experienced at what you do. There are added benefits to being a cost accountant as you can also choose to work remotely because a large part of accountings are work are digitized today.
- Positive Impact of Cost Accountant – As CMA itself is a highly competitive examination and indulges a heavy amount of professional skills in the candidates, there is a high chance that an experienced Cost Accountant may end up in top management positions. These positions may include Chairman, Managing Director, Finance Director, and Cost Controller for both governemnt and private sector.
- Experience – This profession is a continous process of learning. With a dynamic work environment, you will always get to learn something new at the field through which you can gain an adequate amount of expereince for future growth.
Further, interested candidates can even pursue CMA (Certified Management Accountant), a recognized qualification by The Institute of Cost and Works Accountants of India (ICWAI). CMA is perhaps one of India’s toughest professional exams that are pursued by accounting and commerce students. Though challenging, clearing this exam is worth it for a career in Cost Accounting as well as in the business world. The CMA consists of three levels:
- CMA Foundation
- CMA Intermediate
- CMA Final
Diploma Courses in Cost Accounting
- Basics of Cost Accounting
- Variance Analysis
- Managerial Cost Accounting
- Executive Diploma in Cost and Management Accounting
- Various forms of Costing
- Diploma in Financial Accounting
Must Read: MBA in Accounting
Career Prospects of a Cost Accountant
Career prospects of a Cost Accountant are spread across all industries. Some people go for banking and insurance sectors while others go for government services. Some Cost Accountants even establish themselves as independent consultants or begin a career as teaching professionals. Apart from this, some of the specific job profiles of a Cost Accountant are as follows:
|Job Profile||Job Description|
|Chief Auditor||The chief auditor is responsible for reviewing the company’s financial records, monitoring the audit system, and preparing reports on the financial statement.|
|Financial Consultant||They work with clients and offer advice regarding taxes, investments, or financial plans.|
|Financial Controller||A financial controller is responsible for monitoring internal controls, compliance audits, analyzing financial information, etc.|
|Cost Controller||A cost controller is responsible for analyzing and evaluating the costs related to the projects. For any firm, the expenses, budgets, and invoices are extremely important for profitability, and for this, a cost controller is required.|
Salary of Cost Accountants
The salary packages for Cost Accountants in both private and government sectors are comparatively high. These are few salary packages for some of the most popular designations in cost accounting.
|Banking Manager||INR 4-8 LPA|
|Investment Banker||INR 2-4 LPA|
|Investment Analyst||INR 2-3 LPA|
|Cost Accountant||INR 4 LPA|
|Chief Financial Officer||INR 4 LPA|
Top-Notch Recruiting Firms for Cost Accountants
Cost Accountants have great potential for growth, and opportunities for them are numerous. Remuneration and perks associated with it are also good. A cost accountant has been and will continue to be a necessary position in all the industries across the globe. According to the U.S Bureau of labour statistics, there will be an average growth of cost accountants from the year 2018-2028. Here are the top recruiters for Cost Accountants:
- Bain & Company
- AT Kearney
- Boston Consulting Group
Hope you liked our blog on how to become a Cost Accountant. Let us know your feedback in the comment section below. If you want to know more about universities, applications, admissions and courses at top universities across the globe, get in touch with Leverage Edu experts! Book a free counselling session now!