Filling the US Accounting Gap: Why US Accounting Firms are Looking at India in 2025

With over 1700 global capability centres of MNCs functioning in 2975 centres as of 2024, India has emerged as one of the fastest-growing countries in the finance sector. The NASSCOM report on India's GCC landscape projects the market size to reach around $100 bn by 2030. In recent years, there has been a surge in demand for Indian finance and accounting professionals skilled in global finance, involving US GAAP (Generally Accepted Accounting Principles) and IFRS (International Financial Reporting Standards). The US firms facing a shortage in the domestic market, are increasingly seeking Indian accounting professionals. As a result, courses such as CPA, US CMA and CFA are gaining immense popularity.

While the CFA course which focuses on investment banking and portfolio management is already popular in India with approximately 35,000 students enrolling every year, the US CPA which started India administration as a pilot project in 2021, has seen almost 60% growth in the number of student enrollments. India overtook Japan in 2023 and became the second-largest market for US CPA. There are several reasons behind this emerging trend. This article attempts to explain what forces are driving students' interest in US accounting and how promising the job market appears to be.

Shortage of Accounting Professionals in the US

A ‘report on accounting education, the CPA Exam, and public accounting firms’ hiring of recent graduates’ by This Way to CPA revealed that Bachelor’s degree completions in accounting dropped 7.8% from 2021–2022 after a steady decline of 1-3% per year since 2015–16. AICPA 2023 Trends report also revealed that the number of graduates and post-graduates in Accounting reduced from 70,515 to 65,305 in the year 2022. Declining new student enrollment in accounting, coupled with the AICPA projection of 75% CPAs reaching retirement age in the next 10 years means the US firms are facing a shortage and the replacement rate is too slow.

However, the same trends of AICPA denoted that the number of accounting graduates from the Asia or Pacific Islander region, which also includes India where significant enrollment growth can be seen since the AICPA started conducting the exam in the country.

Automation in Accounting will lead to fewer jobs?

A general notion in the US accounting job seekers is that automation in the field of accounting will lead to fewer jobs. According to a report from the Bureau of Labour Statistics in the US, more than 300,000 accountants and auditors quit their jobs between 2019 to 2021. It is to be noted that this was the period of the pandemic, where uncertainty and job losses were experienced not just in the US, but globally. However, the on-ground situation in the job market is different. The AICPA Trends Report 2023 indicated that 91% of US CPA firms will hire the same number or more new CPA graduates in the year 2022.

US looks at India to fill Accounting Professionals shortage

Amid the rising student and finance professionals demand in the US and globally, India has seen it as an open opportunity to pursue greater career opportunities. The US Certified Public Accountant course is also attracting many students given the exposure it brings to the students looking to match up with the global standards. India has an advantage when it comes to accounting and finance. Factors like cost-saving, adaptability to US time and conditions, work ethics etc are plus points for the Indian workforce.

The surge in GCCs of MNCs, and global financial and accounting work in India has also necessitated the requirements of accounting professionals qualified in GAAP and IFRS.

In its plan to boost the pool of CPA candidates, AICPA said, “The AICPA is examining the need for best practices and other potential resources that would help small and medium-sized firms partner successfully where needed with offshore talent suppliers. This is in addition to the expansion of the administration of the CPA Exam in India and South Korea, and exploration of offering the CPA Exam in the Philippines.”

Here are some reasons why India is leading the race when it comes to filling the Accounting professionals shortage in the US:

• India has a massive base of commerce students. Commerce is one of the most popular undergraduate degree courses in India with over 42 lakh annual enrollments.

• Traditional Indian finance courses like CA, CMA etc have started to focus on global accounting standards leading to better education and improved employability.

• Courses like US CPA which are getting popular in India give candidates deep knowledge of US GAAP and other US accounting standards.

• Significant cost advantages without compromising on the quality of work. Some US companies are even giving Indian students offshore opportunities along with added CPA sponsorships.

What the future holds for Indian Accounting professionals in the US?

The US accounting market has seen a tight shortage of accountants after the Covid-19 pandemic. Around 3 lakh accountants resigned during this period. The US Bureau of Labor Statistics has projected that accounting jobs in the US will increase by 6% by the year 2031. India faces competition from China, Canada, the Philippines and other countries in filling the accounting jobs in the US. However, India enjoys an edge over these countries due to its deep expertise in international accounting standards.

Increased Outsourcing and Offshore roles for Indian finance professionals

To tackle the shortage of accounting professionals in the US, accounting firms such as RSM US, Moss Adams, Bain Capital-backed Sikich are expanding their India operations. RSM US has projected to double its Indian workforce. It aims to hire 5,000 Indian professionals by the year 2027. Sikich, an accounting, advisory, and technology firm in the US, also said it aims to hire more Indian professionals to fill vacancies for accountants and auditors. The firm already has a 200-member team in India.

In the coming years, Indian finance professionals are expected to fill the resource shortage, either through outsourcing or offshore roles in accounting firms and MNCs. This is also leading to an increased demand for US CPA or US CMA certifications which are shorter in duration than the Indian alternatives.

Programmes to opt for hiring in the US

The US CMA and US CPA are good certifications, students can obtain in India itself for hiring advantage in the US. Apart from these certifications candidates have other pathways to enter the US with programmes like STEM-designated master’s programmes in Accounting. The STEP programmes in the US provide commerce graduates in India with Optional Practical Training. The STEM programmes also allow graduates to work in the US for 36 months.

Can CAs practice accounting in the US?

While Chartered Accountants enjoy a good reputation in India and play a major role in the country’s economy and finance sector, in the US the accounting standards are quite different from India. The Indian CA qualification is equivalent to the US CPA certification. However, candidates who have completed a CA in India and also choose to pursue a US CPA have a better chance at job prospects