Written by Joe Hoyle, based over 30 years of experience in preparing candidates for success on the CPA Exam.
Question from the candidate: Why do accountants attempt to pass the CPA Exam? I understand that it is a difficult challenge. Why should I even consider taking the exam?
Joe: The Uniform CPA Examination is a state licensing exam. Any accountant who works for a CPA firm or who plans to practice publicly as a Certified Public Accountant must pass the exam. It is a requirement of the state in which you plan to practice.
However, a large number of other accountants take the CPA Exam even though they never plan to work as a CPA. They usually want "Passed CPA Exam" on their resumes because that designation sets them apart and can help them when seeking jobs or promotions. Success on the CPA Exam is recognized around the world as a mark of excellence. Having passed this challenging test is a great accomplishment that makes every resume look stronger.
Finally, many accountants simply take the CPA Exam as a personal challenge. From early in their college days, accountants hear all about the CPA Exam and understand what an outstanding achievement it is to receive those passing scores. Many accountants relish pitting their knowledge and understanding against the exam. It may sound odd but many accountants tell me that they really enjoy preparing themselves mentally for such a demanding challenge.
Question: When is the CPA Exam actually available?
Joe: The CPA Exam is offered in four two-month windows throughout the year. A candidate can take each part of the exam up to one time in each of these testing windows: January-February, April-May, July-August, and October-November. At international sites, the exam is only given for one month during each quarter rather than two.
Question: Where is the CPA Exam physically given?
Joe: The CPA Exam is only given at specified Prometric testing centers across the United States and in five other locations (Guam, Puerto Rico, the District of Columbia, the Virgin Islands, and the Commonwealth of the Northern Mariana Islands). Information about the location of available testing centers can be found at www.prometric.com. The exam will now be offered in Brazil, Japan, Bahrain, Kuwait, Lebanon, and the United Arab Emirates. The international exam will be the same as the one offered in the U.S., using the same computerized format and administered in English. International candidates must qualify for licensure as a CPA through U.S. state boards of accountancy.
Citizens, permanent residents and long-term residents of Egypt, India, Jordan, Oman, Qatar, Saudi Arabia and Yemen may sit for the Exam in Bahrain, Kuwait, Lebanon and the UAE.
Citizens and long-term residents of Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, French Guiana, Guyana, Paraguay, Peru, Suriname, Uruguay, and Venezuela may sit for the Exam in Brazil as of July 1, 2013.
International candidates can find information to frequently asked questions about the international exam that provides virtually all of the information needed for applying and taking the test.
Question: What is the first thing that I should do if I am considering applying to take the CPA Exam?
Joe: Candidates must be certain that they qualify under the rules of a particular U.S. state--even if a person takes the exam at an international location. If the person plans to practice publicly as a CPA, the state most likely needs to be the one in which he or she will work. If the person does not plan to practice publicly as a CPA but just wants to pass the exam, the state in which the person qualifies is not nearly as important. Many states do not have a residency requirement so that a person, for example, living in Maryland might choose to qualify in Colorado unless that person plans to practice as a CPA in Maryland.
Question: If I qualify to take the exam based on the laws of a state, do I have to take the exam in that state?
Joe: No, as long as you have received approval by a state to take the CPA Exam, you can take the actual test in any designated Prometric testing center. For example, you could qualify and be approved by South Carolina but then take the exam in Hawaii.
Question: How do I determine the requirements for a particular state?
Joe: The AICPA has a website (www.thiswaytocpa.com)that is a great place to get started. Click here and you can get information state by state to help you determine if you are eligible to sit for the exam. Be sure to read this information very carefully. If you are currently a student in college, you may want to check these rules during your sophomore or junior year to make certain that you take both the quantity and specified courses that are necessary. There will also be information available on these sites as to how to go about filing an application.
Questions: Do all states require candidates to have 150 hours of college credit to qualify to sit for the CPA Exam?
Joe: Many states do have 150-hourrequirements. However, several states still have less stringent rules. More and more states now require a candidate to have 120 hours to take the exam but 150 hours to receive a license. Make sure to read the rules for your state to determine the hours and the courses that are required. You should also check them periodically because they can change rather significantly over time.
Question: After I have filed my application, how long does it take to receive approval?
Joe: The process for approval is rather quick; it should take only a few weeks to get the approval needed to qualify to sit for the CPA Exam. However, many candidates accidentally leave off some of the required information which obviously slows down the approval. Read the directions carefully.
Question: What happens when I get my approval to take the CPA Exam?
Joe: You will receive a Notice to Schedule(NTS) that allows you to contact the Prometric organization and schedule exam times for the parts that you wish to take. The AICPA has made a genuine effort to provide important information with the NTS. It is vital that you read this information completely and carefully. You certainly do not want to arrive at the testing center on the appointed day and time and be turned away because you have not followed the guidelines correctly.
Question: How many parts are there to the CPA Exam?
Joe: There are four parts to the CPA Exam: Auditing and Attestation is 4 hours, Financial Accounting and Reporting (FAR) is 4 hours, Regulation is 3 hours, and Business Environment and Concepts is 3 hours.
Question: How much does it cost to sit for the CPA Exam?
Joe: It depends on the state, but there are exams, applications and registration fees that can bring the cost of sitting for the exam to $1000 + USD for all four parts. Most candidates sit for one part at a time which spreads the cost out.
Question: What are the scoring weights on the exam?
Joe: In AUD, REG, and FAR, Multiple-Choice Questions (MCQs) will account for 60% of the overall score and Task-Based Simulations (TBS) will count for the remaining 40% of the total score. In BEC, MCQs will account for 85% and written communication tasks for the remaining 15% of the total score.
Question: Do I have to take all four parts in each two-month testing window?
Joe: No, you can make that choice. You can sit for 1, 2, 3, or 4 parts per window. Furthermore, you can choose to take the parts in any order that you wish. A vast majority of candidates take either one or two parts of the exam in a window. In fact, taking one part in a window is (by far) the most popular approach. Often candidates who take the exam right after graduation from college and before they go to work will take 3 or 4 parts per window. Other candidates who are already employed and have less time to study are more likely to sit for 1 or 2 parts per window.
Question: How long do I have to pass all four parts of the exam?
Joe: In most states, but not all, to receive credit for passing the CPA Exam, a candidate must pass all four parts within an18 month period of time. Usually, once a candidate passes a part and learns how to be successful, passing all four parts within 18 months is a very reasonable goal.
Question: I am seriously considering taking the CPA Exam. Do you have any other advice?
Joe: There is no reason to think about the CPA Exam unless you plan to be successful. Failure is no fun. You can pass but it takes a serious investment of time and energy. For that reason, it is very helpful if you take time before you begin to determine exactly why you want to pass. Over the years, I have worked with thousands of CPA candidates. I have found that most get to a point in their lives where they are really ready to pass. The challenge becomes interesting. They truly want to pass and are willing to do the work necessary to achieve that success.
Too many candidates start the process before they are really ready. A friend or a relative or a teacher will tell them to take the CPA Exam and they do so without knowing exactly why they should want to do all that work. They do not yet have the burning ambition that is necessary. Fairly quickly, they lose interest, stop doing the work, and they never pass. If you are not very sure why you want to pass, if you do not have that burning desire for success on the CPA Exam, it is hard to force yourself to put in the necessary time.
Therefore, I always suggest that you wait until you really want to pass before you start this adventure.