Qualifying as an Accountant in Japan

Qualifying as an Accountant in Japan

The opportunities for foreign workers in Japan continue to improve and certainly for bilinguals in the IT, HR, travel, and financial sectors, there are plenty of jobs to go around. However, with the expansion of foreign involvement in the realm of professional services, the question of licenses and appropriate education become important. For example, very few foreigners are able to directly practice law in Japan because very few have been able to complete the extremely challenging bar exams here. I don't know of any rules banning foreigners from practicing law, just they must have passed the exams - which seem to be a sufficiently effective barrier.

Another profession where certification is required to practice is that of tax and accounting. I recently had a reader write in and ask about the feasibility of his sitting for an accounting exam, in Japanese, with the intent of starting his own firm and offering tax advice. Since it is illegal for an unqualified person to give domestic tax advice in a professional capacity, he would need to become a qualified tax attorney, otherwise known as a "Zeirishi" or else figure out a work-around. Like many professions here, being a Zeirishi, or for that matter, a CPA, can be very lucrative. The demand is high, due to the growing amount of domestic and cross-border M&A going on, as well as the coming of JSOX and all the auditing and measurement that the new standards will require.

To become a Zeirishi, our reader needs to study for and sit the Zeirishi exam, which covers both tax and accounting subjects. Like most nationally administered professional exams, anyone can sit for it - you don't need to have completed a specific college course. In addition, those people who are already qualified lawyers, have worked in the National Tax Agency, or are CPAs (Certified Public Accountant, in Japanese, a "Konin Kaikeishi") can apply for the certification.

More difficult than the Zeirishi exams are those for a Japanese CPA. It is famous among Japanese professionals that the CPA exams are among the toughest, consisting of a 3-stage exam on financial matters and tax laws. After the written exams there are verbal ones, along with an internship program similar to that for lawyers. According to the Japan Institute of Certified Public Accountants (JICPA), as of 2005 there were only 16,245 CPAs and 6,026 Junior CPAs in the entire nation.

As a foreigner, can you get your US CPA qualification recognized here? Although it is theoretically possible to have your foreign credentials recognized in Japan, it requires approval from the highest levels of government and apparently the last time this happened was in 1975!

If our reader doesn't want to aim quite so high, he could however, sit the US CPA exam, which would allow him to run his own accounting firm, although not to undertake Japanese audits. Certainly he would be allowed to give advice to Americans living in Japan for their US taxes. The US CPA exam is a lot easier to do, and in fact many Japanese accountants take the US CPA test so that they can start working in well-paid jobs at foreign companies. The qualifications, you have to undertake a college course and get credits to be allowed to take the exam, to get into a US CPA course vary between states. Apparently Hawaii and Delaware are among the least demanding in terms of pre-qualifications needed, with only a 2-year associate degree being required in Delaware.

Another track that my reader asked about is the Nissho Boki 2 exam, basically a Junior Bookkeeper exam. I've been told by accounting professionals that this would simply qualify the reader to work in the lowest levels of the profession, and that at least a Level 1 exam pass would be needed to be meaningful. You often see foreign firms advertising financial controller and accounting jobs which require "3 years accounting experience and Nissho Boki qualification". So this is a useful certification to have. Salaries of people with such qualifications appear to start at around JPY2.4m for an absolute beginner, through to JPY7-8m a year for an experienced person.

Another two qualifications worth considering are the BATIC and Eibun Kaikei Kentei. How do you go about getting qualified in any of these? As mentioned earlier, anyone can sit them, and it is not unusual for university students to pass the exam in their spare time, as a back up qualification, just in case their preferred studies don't work out. The normal path, though, is a 1-to-2year course at a Senmon Gakko (Vocational College) specializing in accounting.

For more information:

http://www.kentei.ne.jp/boki/

http://www.kentei.org/batic

http://www.aaakentei.com/aboutus/about.html