FAQs on CPA (Certified Public Accountant) of the USA

[CiC]

Who should take the CPA exam?

CPA exams may be taken by individuals interested in working with MNCs as finance professionals.

Which organisations take part in delivering the CPA exams?

• AICPA (American Institute of Certified Public Accountants) – Prepares and administers the Uniform CPA Examinations
• State Boards of Accountancy –There are 55 Boards of Accountancy (for 50 US states and 5 US jurisdictions) each of which set various eligibility criteria for candidates to qualify for the CPA exams
• National Association of State Boards of Accountancy (NASBA) - All the state & territorial boards of accountancy are members of NASBA. NASBA plays the role of a central clearinghouse where all jurisdictions submit information on eligible candidates and from which all jurisdictions receive advisory scores and other examination data
• Prometric –Provides the infrastructure for computerized testing of the Uniform CPA Examinations through its network of computer-based test centers

Is eligibility criteria for CPA exams different across state boards?

Yes, all the 55 jurisdictions (50 US states and 5 US territories) have the autonomy to set their own eligibility criteria for the CPA exams. However, the CPA exams across the US are uniform and conducted by the AICPA.

Why is it called "Uniform" CPA Exams?

Even though all state boards have their various eligibility criteria, the exams for all state boards are "uniformly" prepared and administered by the AICPA.

How many subjects do the CPA Exams have?

The CPA exams consist of four parts:

• Auditing and Attestation (AUD)
• Business Environment and Concepts (BEC)
• Financial Accounting and Reporting (FAR)
• Regulation (REG)

What is the exam testing pattern?

The CPA exams include the following types of questions:

• Multiple Choices Questions (MCQ) – Candidates would need to choose the single best response from a list of 4 available options. Each of these questions are scored automatically and assigned a different value based on a variety of factors.
• Task-Based Simulations (TBS) – Case study examples of situations that require candidates to demonstrate a variety of skills. Candidates create their own responses instead of choosing from a list. Most simulations require multiple responses. Like multiple choice questions, simulations are scored automatically. Simulations are tested on AUD, FAR and REG exams
• Written Communication – Tested only on the BEC exams, the written communication portion requires candidates to demonstrate their skill at writing a variety of professional documents in response to provided case study situations

What are the specific structures of each of the sections?

AUD and FAR exams each consist of three testlets of 30 Multiple Choice questions (total of 90 MCQs) and seven Task-Based Simulations

REG exam consists of three testlets of 24 Multiple Choice questions (total of 72 MCQs) and six Task-Based Simulations

BEC exam consists of three testlets of 24 Multiple Choice questions (total of 72 MCQs) and three Written Communication tasks

What is the total exam duration?

The total exam duration is 14 hours (4 hours each for AUD and FAR, and 3 hours each for BEC and REG). All the 4 parts are to be taken separately and candidates have the option of selecting convenient dates in any " testing window".

What is the content of the exam?

The Content Specific Outlines (CSOs) for the CPA exams are as follows:

• Auditing and Attestation (AUD) covers auditing procedures, auditing standards generally accepted in the United States (GAAS) and other standards related to attest engagements
• Business Environment and Concepts (BEC) covers underlying business reasons for and accounting implications of business transactions
• Financial Accounting and Reporting (FAR) covers accounting principles generally accepted in the United States (GAAP) for business enterprises, not-for-profit organizations and governmental entities
• Regulation (REG) covers federal taxation, ethics, professional and legal responsibilities, and business law

Is IFRS included in the CFA syllabus?

Yes, IFRS has been included in the FAR portion of the CPA exams with effect from 2011.

How is the exam administered?

Until the end of 2003, the Uniform CPA Examination was administered twice a year in the paper-and-pencil format. In April 2004, the computer-based CPA Examination was launched and the paper-and-pencil examination was discontinued.

What has been changed in the CPA exams in 2011?

The CPA exams have been transformed in 2011 with major changes to both the exam structure and functionality. Referred to as CBT-e (CBT stands for Computer-Based Testing and the e for evolution), this represents the first major change since CBT was introduced in 2004. Major changes have been made to:

• Content and Skill Specifications (CSOs/SSOs), including the addition of International Financial Reporting Standards (IFRS)
• Question formats, including short task-based simulations
• Research functionality, including the addition of the FASB Codification
• Exam structure and section time allocation
• Percentage value of exam components

When is the exam administered?

The Uniform CPA Exam is an online examination offered in the first two months of each calendar quarter. Thus a candidate can take the exam at his own convenience in the following 'testing windows' -

• January & February
• April & May
• July & August
• October & November

What is the passing score?

Candidates need to obtain a score of 75 or more in a scale of 0-99 on all the 4 parts to pass the CPA exams.

When are the exam scores released?

The exam scores release date would vary depending on the dates the CPA candidate has taken the exams. On an average, the scores for each of the 4 parts of the CPA exams should be received in slightly over a month after the candidate has appeared for the respective part of the CPA exams.

How difficult is the CPA exam? What is the pass rate?

The CPA exam tests you on basic concepts and is predominantly objective (multiple choice questions and case-study format simulations)

The overall pass rate for CPA exams is between 45 - 50%.

What is a distinction on the CPA Exams?

The AICPA awards Elijah Watt Sells Award Gold Medals to the 10 best performing CPA candidates every year.