The CPA course leading to the Certified Public Accountant (CPA) degree is one of the most widely recognized and coveted finance qualifications in the USA. CPAs are considered to be experts in various aspects of finance like public accounting, auditing tax preparation, etc. So naturally, every candidate who is desirous of becoming a CPA needs to gain the highest levels of educational qualification and professional experience. Accordingly, the CPA syllabus has been prepared carefully to ensure that only the best candidates qualify as CPAs.
The CPA course syllabus is regularly updated to keep ahead of the requirements of the industry. The latest update was approved by AICPA Board Of Examiners (BOE) in February 2016 and a new syllabus has been introduced from April 2017.
The New Syllabus Of The CPA Course:
The certification of the CPAs happens through the Uniform CPA Examination. It tests the candidates on the four sections covered in the CPA course. These are as follows:
- Auditing and attestation (AUD)
- Business environment and concepts (BEC)
- Financial accounting and reporting (FAR)
- Regulation (REG)
Let us now look at the objectives of each paper, the knowledge areas that are tested, and the skill allocation of each paper.
Section 1: Auditing and attestation (AUD)
Auditing and attestation (AUD) are one of the most important functions of a CPA, and hence section of the uniform CPA examination (the exam) tests the candidates on the following knowledge areas:
- Audits and attestation for issuer and non-issuer entities
- Preparation, compilation and review engagements unlisted entities and reviews of interim financial information for listed entities.
The content areas and their respective weights are as follows:
| CONTENT AREA | ALLOCATION | |
|---|---|---|
| Area I | Ethics, professional responsibilities, and general principles | 15–25% |
| Area II | Assessing risk and developing a planned response | 20–30% |
| Area III | Performing further procedures and obtaining evidence | 30–40% |
| Area IV | Forming conclusions and reporting | 15–25% |
The skill allocation for the examinations are as follows:
| SKILL ALLOCATION | WEIGHT |
|---|---|
| Evaluation | 5–15% |
| Analysis | 15–25% |
| Application | 30–40% |
| Remembering and understanding | 30–40% |
Section 2: Business environment and concepts (BEC)
CPAs are required to provide auditing, attestation, accounting and review services and prepare financial reports and tax returns for their clients in their professional capacity. In the uniform CPA examination, they are tested on the following subject areas:
- Corporate governance
- Economic concepts and analysis
- Financial management
- Information technology, and
- Operations management.
The weights assigned to these areas are as follows:
| CONTENT AREA | ALLOCATION | |
|---|---|---|
| Area I | Corporate governance | 17–27% |
| Area II | Economic concepts and analysis | 17–27% |
| Area III | Financial management | 11–21% |
| Area IV | Information technology | 15–25% |
| Area V | Operations management | 15–25% |
The skill allocation for the examinations are as follows:
| SKILL ALLOCATION | WEIGHT |
|---|---|
| Evaluation | – |
| Analysis | 20–30% |
| Application | 50–60% |
| Remembering and understanding | 15–25% |
Section 3: Financial accounting and reporting (FAR)
In the uniform CPA examination (the exam) the CPA must demonstrate deep knowledge and expertise in the accounting and reporting frameworks used by companies, government, and not for profit entities. These accounting and reporting frameworks are issued by various regulators like:
- S. Securities and exchange commission (U.S. SEC)
- Financial accounting standards board (FASB)
- International accounting standards board (IASB)
- American institute of certified public accountants (AICPA), and
- Governmental accounting standards board (GASB)
The content areas covered in the CPA course, and their respective weights are as follows:
| CONTENT AREA | ALLOCATION | |
|---|---|---|
| Area I | Conceptual framework, standard-setting and financial reporting | 25–35% |
| Area II | Select financial statement accounts | 30–40% |
| Area III | Select transactions | 20–30% |
| Area IV | State and local governments | 5–15% |
The skill allocation for the examinations are as follows:
| SKILL ALLOCATION | WEIGHT |
|---|---|
| Evaluation | – |
| Analysis | 25–35% |
| Application | 50–60% |
| Remembering and understanding | 10–20% |
Section 4. Regulation (REG)
In this section of the Uniform CPA Examination, you will be tested on your knowledge and professional skills related to:
- Federal taxation
- Ethics and professional responsibilities for tax practice
- Business law A listing of reference materials relevant to the REG section of the exam are included under references at the conclusion of this introduction.
The test areas and the weights allocated to them are as follows:
| CONTENT AREA | ALLOCATION | |
|---|---|---|
| Area I | Ethics, professional responsibilities, and federal tax procedures | 10–20% |
| Area II | Business law | 10–20% |
| Area III | Federal taxation of property transactions | 12–22% |
| Area IV | Federal taxation of individuals | 15–25% |
| Area V | Federal taxation of entities | 28–38% |
The skill allocation for the examinations are as follows:
| SKILL ALLOCATION | WEIGHT |
|---|---|
| Evaluation | – |
| Analysis | 25–35% |
| Application | 35–45% |
| Remembering and understanding | 25–35% |
While preparing for the uniform CPA examinations you will have to carefully prepare for all these areas of the CPA course syllabus and ensure that you pay adequate attention to all these sections. Keep this ready reckoner handy with you, and refer to this often while studying for the CPA course.