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VOOZH | about |
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VOOZH | about |
A certified public accountant (CPA) is a professional in the accounting field who has fulfilled certain criteria such as education qualifications, examinations, and minimum experience required for licensure by a state's Board of Accountancy. The American Institute of Certified Public Accountants (AICPA) issues guidelines for conducting the state CPA exams. This exam can be only taken by professionals who are accountants and graduates. This state CPA exam demands proficiency in technical skills for conducting financial accounting, auditing, financial reporting, regulations, attestation, business concepts, and business environments. Further, organizations and non-profit organizations (NGOs) hire CPAs as they are experts in tax law, management practices, auditing procedures, and other essential corporate financial operations.
- A certified public accountant (CPA) is a licensed professional offered to qualified accountants.
- A rigorous exam (Uniform CPA exam) must be cleared to qualify as a CPA.
- CPAs can work as accountants or follow different careers in forensic accounting, financial planning, auditing, and compliance.
- CPAs are usually hired in the capacity of public and corporate accountants, some of the executive positions such as the Chief Financial Officer (CFO) or controller.
- In the United States, CPA professionals are assigned by government-aligned state agencies.
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This CPA certification is one of the most prestigious and well-known accountancy certifications. Further, there are many career opportunities lined up if you become a CPA. Some of the benefits of having this certification are as follows,
1. Opportunity to Earn More: Usually, the salary of CPAs is more than non-CPAs having equal qualifications and experience. If a CPA has public accounting experience of 1 to 3 years, then he/she can earn on average $74,529 per year, as per Glassdoor. Whereas, a non-CPA would earn on average $57,607 per year.
2. Higher Job Opportunities: Multiple opportunities open up in the field of accounting if you are CPA certified. From NGOs, government agencies, and private companies to public accounting firms, CPA has a lot of opportunities. Further, one can opt for management consulting, financial planning, information technology, and education as their careers apart from the typical accounting career as multiple industries prefer their financial expertise.
3. Sense of Satisfaction and Accomplishment: The CPA exam is tough and to clear this exam takes it all. Passing this exam shows that you are fit for this prestigious profession. On average, only 52% of the first attempters can pass all four sections of this examination.
4.Hold Credibility: As a reliable company advisor and financial professional, your credibility is critical to both your and your client's achievements. By becoming a CPA, you demonstrate to your clients that you know what you're talking about and have been tested on it. This is crucial since it helps to develop trust among clients by assuring them of your suggestions.
The United States comprise of 50 states and 5 US territories that conduct the Uniform CPA Exam. Each state has a separate Board of Accountancy that list out their eligibility and licensure requirements for the CPA program.
The aspirant should complete at least 150 hours of education (either through a bachelor's degree or take up a separate master's course). Further, a minimum of two years of professional experience is required in the field of public accounting. After clearing the CPA exam, one needs to complete a number of continuing education hours. All the 55 jurisdictions require some level of education in the accounting field to licensure a CPA. In maximum states, they require 150 credit hours in college-level accounting courses. This requirement is completed as undergraduates by the CPA aspirants.
Every state have their own experience requirements for the Uniform CPA exam, however a general notion is to have minimum two years of experience in public accounting. Few states accept other experiences like working in government or private sector, but they require more years of experience in these sectors to be eligible for the CPA exam.
The Bureau of Labor Statistics (BLS) has predicted that job opportunities for accountants and auditors would increase by 7% from 2020 to 2030. This rate is as fast as the average for other career paths.
CPAs are able to perform multiple jobs and their annual income also differs from each other. Below are few of such kinds of jobs which CPAs opt to perform:
The CPA exam is a rigorous and time-consuming. It includes 3 core sections and one discipline section. Each section should be taken one at a time. The sections comprise five parts known as testlets. First two teslets are multiple-choice questions (MCQs) and the remaining three of the testlets are task-based simulations (TBS). Further, the exam comprise 276 MCQs, 28 TBS, and three descriptive sections.
The three core sections are Auditing and Attestation (AUD), Financial Accounting and Reporting (FAR), and Taxation and Regulation (REG). The different discipline which candidates can opt for are Business Environment and Concepts (BEC), Business Analysis and Reporting (BAR), Tax Compliance and Planning (TCP), and Information Systems and Control (ISC).
Out of the total score, MCQs comprise of 50% and task-based simulations account for 50% in three out of the four sections. The descriptive portion comprise of 15% and task-based simulations 35%. Atleast 75% should be scored to pass each section.
Coming to the testlets, candidates are allowed to navigate any questions in a particular testlet. But, once a testlet is submitted, you cannot go back to the submitted testlet. Further, you cannot move to other testlets, unless you submit the previous one. You are allowed to take breaks between each of the testlets. If you take a break after testlet one, two and four, the exam clock would continue to run. After the third testlet, you are able to take a break and the clock will halt for 15 minutes. After 15 minutes, the clock shall resume running.
The total exam time is 16 hours and each section is alotted 4 hours to complete. Candidates are able to choose any section individually and also the order of section which they want to attempt. However, they need to appear and pass all the four sections within 18 months.
Although the CPA exam pattern is same for all, there are separate requirement from each state and thus, one should check their state's jurisdictions.
1. At the first step, you need to understand your exam, familiarize yourself with its demands and exam structure. Knowing the whole exam structure is very important to crack the exam.
2. Prepare a structured and realistic study plan. This plan should consider the time and way of studying and approaching for each section of the exam. There should be time slots for studying, revising and practicing. Set small and easy targets initially and regularly note your progress.
3. Multiple companies offer CPA review courses. Pick any one to supplement your study materials. These courses offer comprehensive study materials addressing to each section of the exam. Few of the reputable review companies are Becker, Wiley CPAexcel, Surgent CPA Review and Roger CPA Review. There are other who offers this service. You need to know what best suits for you and choose the eligible one.
4. For being successful in any prestigous exam, one requires tremendous practice. CPA exam demands high level of practice and you should practice questions and simulations to be comfortable with the process of examination. Review courses offer extensive questions banks and practice tests to make you familiar with the exam.
5. Keep yourself updated with different regulations and changes in polices. The American Institute of Certified Public Accountants (AICPA) frequently updates the CPA exam as changes occur in tax laws, professional and accounting standards. Regularly checking AICPA website and other resources is necessary to avoid missing out any important updates.
6. Preparing in isolation might sometimes be boring and demotivating. So, try to connect with peers who are similarly preparing for this exams. Connect to different study groups or online forums, where you can keep yourself motivated and updated with any recent changes which you might have missed out.
7. The AICPA and the National Association of State Boards of Accountancy (NASBA) provide free study materials, practice questions and blueprints of exam to help candidates. You can opt for this materials for preparing in a much effective manner.
8. Lastly, stay focused, positive and persistent. This exam demands dedication, determination, and never giving up attitude. Although CPA exam is tough, challenging and takes a lot from you, you should be persistent enough to continue preparing in the right track with right resources. Don't overburden yourself with multiple resources. Stick to one course and material and do repeated revisions and practice multiple times.
One can work as an accountant without being a certified public accountant. However, being a CPA licensed accountant earns respect, prestige and a lot of credentials to your resume. Having this license means you have cleared the nationally accepted exam that changes based on individual state's regulations. It is a gateway to multiple career paths apart from accountants like conducting audits of public organizations.
