Education and Training: Bachelor’s degree
Average Salary: $49,300 per year
Job Outlook: Very good
Cost accounting is a very specific type of accounting that involves analyzing the costs of business activities, like the labor and materials required to help a business run. Cost accountants specialize in analyzing these costs so that businesses can work on reducing them in order to run more efficiently. They are normally responsible for collecting data about a business’s operating systems, writing reports on breakeven points, periodic variances, margins, and other business cost-related items.
Cost accountants are often responsible, as well, for inventory control in a business. For instance, they might oversee the counting of inventory, update costs in the bill of materials, check for discrepancies between standard costs and actual costs, and solve problems with cycle counting variances. Generally, cost accountants are not in a supervisory position, though a cost accounting position can launch an accountant into another accounting job with more oversight responsibilities.
Education and Training Requirements
Cost accountants typically need a bachelor’s degree in economics, finance, accounting, business, or related fields. A CPA is not necessary for this position, but it can be helpful. A cost accountant typically must also have a familiarity with a company’s operations as well as three to five years of experience, depending on the hiring company and its desired qualifications. A CMA license from the Institute of Management Accountants can be helpful, as well.
Getting the Job
A cost accountant must typically gain on-the-job experience in other areas of accounting before becoming responsible for a company’s cost accounting. Three to five years of experience is often required. Since cost accountants need to be familiar with production operations within their company, promotion from within the company is fairly typical. However, a cost accountant with excellent business account credentials may be able to move to a new company when a job opens up.
Job Prospects, Employment Outlook and Career Development
Career prospects in the cost accounting field are good, as accountants are a necessary factor in almost all small to large businesses. As with many business-related jobs, more cost accounting jobs are available when the economy is strong, and hiring may be more competitive in a weak economy.
Cost accountants often move up to other management level accounting jobs with higher pay. Because they are familiar with the aspects of production within their company, it’s not unusual for them to move up to a higher level accounting job within that same company. Experience as a cost accountant, however, sets one up to take on any number of management level accounting positions.
Working Conditions and Environment
Cost accounting isn’t generally considered stressful, and a cost accountant will generally work in an office environment. When a company’s production operations and inventory warehouses are spread out, some on-the-job travel may be required.
Salary and Benefits
The average salary for a cost accountant is about $49,300 per year, though they can make anywhere from $37,700 to $58,100 per year. Salary depends on experience as well as the size of company the accountant is working for.
This full-time job normally comes with health and vacation benefits, as well as personal days and sick days.
Where to Go for More Information
For more information about cost accounting and cost accounting certification programs, check out the following organizations:
The Association of Certified Project Accountants
16192 Coastal Hwy.
Lewes, DE 19958
Chartered Institute of Management Accountants
+44 (0) 208 849 2251
Institute of Management Accountants, Inc.
10 Paragon Dr., Ste. 1
Montvale, NJ 07645-1760