Structure of all 4 parts of the US CPA Exam.
Author : shinde simandhar | Published On : 20 Jan 2022
It is always that one faces many conflicts at the time of preparation for a particular exam. It can also lead to stress and anxiety issues, which can disturb the practice and directly affect the results. For such problems, one should always make the best use of their available time in making hazel free approach for preparation. Courses like CPA need complete dedication and investment of time; the level of faith should never disturb your routine and investment. But to provide a solution for such issues, one should have a significant commitment and desire to pursue the CPA exam.
It is possible to achieve such motivation from various corners like encouragement is an essential part of exam preparation. One can attain motivation from self-assessing and inspiration.
For those issues which can demotivate, quantifying the portions can probably help in reaching the targets. The CPA exam is designed from AICPA with four divisions that can help achieve the significant hurdle of CPA licensure. This is possible by having requirements that include relevant Education, Experience, and Examination.
As mentioned before, preparing for the CPA exam is about the heavy investment in time, money, and effort which has great paybacks in significant returns in terms of career.
The CPA exam has four parts which are commonly referred to as “sections”:
AUD – Auditing and Attestation.
BEC- Business Environment and Concepts.
FAR- Financial Accounting and Reporting.
The Structure of US CPA Exam.
The US CPA Exam is structured to test the candidate in the professional competence of auditing, business law, taxation, and, more importantly in accounting. AICPA, the governing body, has set 75 marks of minimum for passing and pursuing CPA as a profession.
Sections of US CPA exam.
The sections are categorized on accounting topics that cover significant issues. Below is the detailed information on Sections in the US CPA exam.
AUD- Auditing and Attestation.
· Performing Further Procedures and Obtaining Evidence-30% to 40%.
· Assessing Risk and Developing a Planned Response-20% to 30%.
· Professional Responsibilities, General Principles, and Ethics-15% to 25%.
· Forming Conclusions and Reporting-15% to 25%.
This exam has topics that usually cover the entire composition of the audit process, preparation, non-attestation services, review engagements, compilation, ethics.
The guide will, in general, help you with all the required information that can help you in preparation for US CPA Exam.
The common question that one faces is-Preparing for the Auditing exam without having and experience in auditing. This is the most prominent situation among students and can be overcome with great determination and dedicated studying. Fixing a study plan and disciplined studying can help much more than expected.
AUD has its FORMAT
In the US CPA exam, the AUD exam is divided into five testlets, out of which two testlets are of MCQ’s (Multiple Choice Questions), and 3 Testlets are Task-Based Simulations.
US CPA Audit Format
In the AUD exam, 72 questions hold 50 % of weightage, and apart from this, 8 Task-based Simulations have 50% of weightage.
The testing time for this exam is 4 hours and also has 15 mins break time.
The percentage of the composition of each topic helps in preparation and allotting specific time for significant portions.
AUD covers all aspects of the review cycle. The AUD area will test commitment as per proficient guidelines or potentially guidelines by the following:
· American Institute of CPAs (AICPA)
· Public Company Accounting Oversight Board (PCAOB)
· U.S. Government Accountability Office (GAO)
· Office of Management and Budget (OMB)
· U.S. Division of Labor (DOL)
Applicants are relied upon to show information and abilities identified with:
· Reviews of guarantor and nonissue elements
· Confirmation commitment for guarantor and nonissue substances
· Arrangement, gathering, and audit commitment for nonissue substances
· Surveys of interval monetary data for backer substances
Content or Composition Percentage of the Composition
Ethics, Professional Responsibilities, and General Principles 15% – 25%
Assessing Risk and Developing a Planned Response 25% – 35%
Forming Conclusions and Reporting 10% – 20%
Performing Further Procedures and Obtaining Evidence 30% – 40%
When would it be advisable for me to take AUD?
The vast majority don’t consider AUD as hard as FAR, and the pass rates underneath help that general agreement. In any case, AUD can, in the case be a problematic section may give you
questions that require monetary accounting information. Without that information, you might think that it is hard to validate whether a budget summary is introduced reasonably.
Assuming you have as of late contemplated reviewing in school or been functioning as an evaluator, you might be prepared to take AUD first.
Assuming you are not in both of these circumstances, we suggest you plan AUD after FAR.
BEC-Business Environment and Concepts
The Business Environment and Concepts (BEC) CPA Exam segment tests your insight into the business climate and related ideas. BEC is novel for including composed interchanges (WCs), notwithstanding the numerous decision questions (MCQs) and assignment-based reenactments (TBSs) that make up the other CPA Exam segments.
CPA BEC Exam design
The BEC CPA Exam segment comprises five testlets: two MCQ, two TBS, and one WC. The MCQ testlets represent half of your BEC score, the TBS testlets contribute 35%, and the WC testlet supplies the excess 15%
US CPA BEC Structure
The AICPA publishes CPA Exam Blueprints that specify precisely what a CPA needs to know, all the way down to specific tasks.
Candidates are relied upon to exhibit information and abilities identified with:
· Audit, attest, accounting, and review services financial reporting
· Tax preparation
· Other proficient responsibilities in their job as Certified Public Accountants -CPA.
BEC assesses your comprehension of a CPA’s responsibilities and professional duties by testing five major content areas.
BEC Exam Schedule
Content of Composition Percentage of Composition
Enterprise Risk Management, internal controls, and Business Process. 20% to 30%
Economics. 15% to 25%
Financial Management. 10% to 20%
Information Technology. 15% to 25%
Operations Management. 15% to 25%
When may it be a savvy thought for you to take BEC?
BEC constantly has the most basic fruition rates among CPA Exam pieces, so you have a gigantic heap of chance with this part while wrapping up your CPA Exam plan. Notwithstanding, it indeed requires a decent strategy of study time, as it covers a massive load of material, and the WCs might combine substances from other CPA Exam districts.
We propose you take the BEC section either first or last:
First, you can make your conviction and open yourself to the subject of the other CPA Exam sections.
Last, with the truth that you can bring your prevalence of the other CPA Exam district’s content to the table and end your testing experience on a looser up note.
In any case, this isn’t unchangeable. The focal concern is to address different sales on your time. Expecting you are trying to finish a CPA Exam district yet conditions are alarming your time and energy (for instance, if accounting included season). It’s presumably a preferable plan over get ready for BEC than for FAR (the most complicated CPA Exam segment).
FAR-Financial Accounting and Reposting
The Financial Accounting and Reporting (FAR) CPA Exam area generally has gotten the most minimal breeze through paces of any CPA Exam segment. CPA competitors frequently allude to FAR as the most troublesome of the CPA Exam. FAR tests your insight into the monetary accounting norms. In this four-hour test, you are relied upon to demonstrate that you have the information and abilities that a recently authorized CPA should exhibit in the monetary accounting and announcing systems utilized by business, not-for-benefit, and state and neighborhood government substances.
CPA FAR Exam Plan.
The FAR CPA Exam region contains five testlets: two testlets of different choice inquiries (MCQs) and three testlets of Task-Based Simulations (TBSs). The MCQ testlets of FAR address half of your CPA Exam score, and the TBS testlets address the other half.
US CPA FAR Exam Plan
In total, 66 MCQs have a weightage of 50% and 8 Task-Based Simulations, which hold the other 50% in the exam.
The AICPA disperses CPA Exam Blueprints that show precisely what a CPA needs to know, directly down to unequivocal endeavors. Of the four CPA Exam regions, FAR contains the broadest consideration of accounting information.
FAR expects that up-and-comers should show data and capacities related to the financial accounting and uncovering structures used by business substances (public and nonpublic), not-income driven components, and state and neighborhood government components.
The FAR fragment tests standards and rules are given by:
· Money related Accounting Standards Board (FASB)Opens in new window
· U.S. Assurances and Exchange Commission (U.S. SEC) Opens in new window
· American Institute of Certified Public Accountants (AICPA)Opens in new window
· Authoritative Accounting Standards Board (GASB)Opens in new window
Worldwide Accounting Standards Board (IASB)Opens in new window
FAR Exam Structure.
Content of Composition Percentage of Composition
Conceptual Framework, Standard-the setting, and Financial Reporting. 25% to 35%
Select Financial Statement Accounts. 30% to 40%
Select Transactions. 20% to 30%
State and Local Governments. 5% to 15%
When might it be prudent for me to take FAR?
Regardless of pass rates, some consider the FAR component of the CPA Exam to be the least demanding of the four because the content most closely resembles ordinary academic accounting study. Appropriately, current understudies or late school graduates who have information from their classes still recently available may have to take FAR first.
CPA candidates who have been out of school relatively longer can benefit from taking the FAR CPA portion first. The AICPA anticipates that the contender should pass all of the four spaces of the CPA Exam in a moving 18-month time interval. This suggests that once you give your first section, you’ll have eighteen months to pass the other three. Since the clock doesn’t start ticking until you pass an area, it will, in general, be priceless to pass FAR first, as it consistently requires more survey time than another fragment. Positively no piece of that extra time would be associated with your 18-month window.
Moreover, the CPA FAR material covers the other three fragments, so beginning your assessments with FAR will give you an early benefit on your examinations for AUD, BEC, and REG.
Disregarding these advantages, FAR is considered the most inconvenient CPA Exam region by the more significant part of contenders. You can address a critical issue by taking care of FAR first, but it’s reasonable to gather your assurance and database by starting with another section.
The Regulation (REG) CPA Exam region mainly covers three focuses: business law, ethics, and government charge assortment. The subject that gets the most thought is government charge assortment in its various constructions, which makes up over part of the test!
CPA REG has a Plan for the Exam.
The REG CPA Exam region contains five testlets: two testlets of various choice inquiries (MCQs) and three testlets of task-based Simulations (TBSs). The MCQ, some portion of REG, addresses half of your CPA Exam score, and the TBS fragment addresses the other half.
US CPA REG Exam Plan
76 Multiple Choice Questions hold 50% of the total paper and 8 Task-Based Simulations, which keeps the rest 50%.
Passing REG requires a solid comprehension of morals, business law, and government tax assessment. The substance is obtained from various demonstrations, guidelines, and so forth, including:
1. Protections Exchange Act of 1934
2. Uniform Accountancy Act
3. Uniform Commercial Code
4. Depository Regulations
5. Interior Revenue Code of 1986, as amended
5. Depository Department Circular 230
The AICPA distributes CPA Exam determines what a CPA has to know for REG, right down to explicit errands. The topic is separated into six substance regions.
REG Exam Syllabus.
Content of Composition Percentage of Composition
Ethics, Professional Responsibilities, and Federal Tax
10% to 20%
Business Law 10% to 20%
Federal Taxation of Property Transactions. 12% to 22%
Federal Taxation of individuals 15% to 25%
Federal Taxation of Entities 28% to 38%
When may it be reasonable for me to take REG?
Expecting you have charge knowledge, REG may be the fragment you should take first. A fair plan of REG content will be conspicuous to up-and-comers who have had passage-level positions or worked in public appraisal practice. Accepting this depicts you, of course, if you’re aiming to begin work to a detriment firm shortly, consider arranging this portion precisely on schedule to gather conviction. The data you gain will be a unique asset for you in your master’s occupation.
For candidates missing a ton of evaluation experience, REG can be fascinating because there is a lot of material you ought to hold before you can begin to apply it at an unquestionable level. The BEC, FAR, and AUD CPA Exam portion content covers decently, so it’s by and large best to design those regions close to one another. Expecting you are troubled taking REG first, consider arranging it last.
As you plan when to take the different regions, we propose starting with the one you’re for the most part familiar with to help with arranging you for early achievement. This can give you sureness and let you become adjusted to the CPA Exam to some degree all the more gently.
Overall, for sparkling in accounting and money globally US-CPA can endeavor you for such dreams. What’s more, to attempt such pursuits, Simandhar Education has you covered on the stepping stool for outstanding accomplishment.
For more information on the CPA course and its required skills, please feel free to Contact Simandhar Education @ +91 7780273388 or mail us at firstname.lastname@example.org.