CPA or Certified Public Accountant is a well-known and global designation, which is offered by the American Institute of Certified Public Accountant (AICPA) after an individual clears the Uniform CPA Examination®. In India, Chartered Accountant (CA) designation is equivalent to CPA. The CPA certification is the highest standard of competence in the field of accountancy globally and is a highly sought after and versatile credential for accountants.

CPA Exam Requirements

To become a CPA certified professional, one must have the desired education and experience. Every state has its own CPA exam prerequisites, but some standard eligibility criteria are:

  • Graduation or equivalent degree to pursue a CPA examination.
  • 150 semester hours of college course to earn a CPA license.
  • 1-2 years of experience under any CPA

CPA Exam Schedule and Details

The CPA exam is a 4-hour exam divided into four sections, which test the skills and knowledge of candidates.

4 Sections of the CPA Exam:

  1. Financial Accounting and Reporting (FAR)
  2. Regulation (REG)
  3. Auditing and Attestation (AUD)
  4. Business Environment and Concepts (BEC)

CPA Exam Details

A candidate must finish all 4 sections in the 18-month testing window, and each section of the exam has a limit of 4 hours.

CPA Exam Structure

Section

MCQ

   Questions

     Weighted

(%)

   Task-based

    Simulation

      Weighted

(%)

Written

     Communication

      Weighted

(%)

FAR

66 50 8 50 0

0

REG

76 50 8 50 0

0

AUD

72 50 8 50 0

0

BEC

62 50 4 35 3

15

What is the Syllabus of Financial Accounting and Reporting FAR?

FAR Content Allocation (%)
Area I Standard-Setting, Conceptual Framework, and Financial Reporting 25-35
Area II Financial Statement Accounts 30-40
Area III Select Transactions 20-30
Area IV Local and State Governments 5-15

What is the Syllabus of Regulation REG?

REG Content Allocation (%)
Area I Professional Responsibilities, Ethics, and Federal Tax Procedures 10-20
Area II Business Law 10-20
Area III Property Transaction Federal Taxation 12-22
Area IV Individual Federal Taxation 15-25
Area V Entity Federal Taxation 28-38

What is the Syllabus of Auditing AUD?

AUD Content

Allocation (%)

Area I

Professional Responsibilities, Ethics, 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

What is the Syllabus of Business Environment and Concepts BEC?

BEC Content

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

What is the CPA Exam Cost?

Pursuing CPA and getting licensed involves some CPA exam costs and below is a list of all the expenses required to become a CPA:

 

  1. Application Fee

Depending upon the state, CPA application fee is around $50-$200.

  1. Examination Fee

Approx. $194 for each section

  1. Registration Fee

Depending upon the state one can either apply for one section at a time or can club all the sections and pay a registration fee to save the overall cost. The Notice to schedule (NTS) is valid for 6 months, so if you sign up for all the four sections in one go, you need to schedule and appear for all four sections of CPA exams in the next 6 months, else, NTS won’t be valid. The list of CPA registration cost is:

  • When you take one section at a time- $63
  • When you take two sections at a time- $81
  • When you take three sections at a time- $99
  • When you take four sections at a time- $177
  1. Ethics Fees for CPA exam

Some states ask to clear ethics exam in order to earn a license after the completion of the uniform CPA exam. The fees for the ethics exam is $150-200.

  1. CPA Licensing Fees

After the uniform CPA exam and ethics exam, candidates are eligible for earning a CPA license and for this, you need to pay approximately $50 -500 per year depending upon the states. Yes, licensing fees are to be paid every year till eternity so as to maintain a CPA license and practice CPA.

  1. Continuing Professional Education (CPE) for CPA

Many states demand 40 hours per year of continuing education so that the public accountant stays updated with the industry norms and updates. So the approx. cost for this CPE could be as low as $800 per year ranging up to $5000.

2020 CPA Exam Testing Windows

Every year the CPA exam is announced by AICPA and in 2020 it is scheduled in 4 windows:

  • January 1 – March 10
  • April 1 – June 10
  • July 1 – September 10
  • October 1 – December 10

 

Brief History of CPA

To define the standards of the accounting industry, 31 accountants formed an association called the ‘American Association of Public Accountants (AAPA) in 1887. This association was renamed as AICPA in 1957, and it also conducts the CPA exam. In 2001 industry witnessed a major scandal called the ‘Enron Corporation scandal.’ In this, the company’s leaders duped regulations by showcasing fake holdings and poor accounting practices. Thus, in 2002, the Sarbanes-Oxley Act was passed, and through this act, accountants are now liable to follow stringent restrictions for their consulting assignments. After this, the accounting industry saw a major shift in its overall practices, and hence the demand for certified accounting professionals rose.

Commonly Asked Questions for CPA Exam

Q1. In India, what is the average salary of a CPA professional?

Ans. In India, CPA salary averages between Rs. 6 -7 LPA for CPA professionals with 1-4 years of experience.

Q2. Are CPA professionals demanded in India?

Ans. Yes, since MNCs and Big4s are rising in India, the demand for CPA certified professionals is progressing.  CPA certification holders are giving preference over CAs because they have in-depth knowledge of subjects like US GAAP, IFRS & US Compliance & Taxation. In contrast, CA only has proficiency in Indian GAAP.

Q3. How is the CPA exam different from the CA exam?

Ans.

Point of Difference

CPA

CA

Governed by The American Institute of Certified

Public Accountant (AICPA), US

Institute of Chartered

Accountant of India (ICAI),

India

Course Duration 1 year 4-5 years
Gain Knowledge of US GAAP and IFRS Indian GAAP
Recognized by US and global India
Exam Single-level exam with 4 papers 3-level exam with 16 papers
Work experience 1 year in accounting/finance 3 years of article ship under certified CA
Pass rate Approximately 40-45% Approximately 5-6%

Q4. Who are the top recruiters hiring CPA professionals?

Ans. Below is a list of recruiters hiring CPA professionals:

Top Recruiters Hiring CPA Professionals
Deloitte Accenture American Express Philips
PWC Capgemini Barclays Tata Power
KPMG Genpact JP Morgan Sintex
EY WNS MetLife Caterpillar

Q5. As an Indian, what are the eligibility criteria for attending the CPA exam?

Ans. To become eligible for the CPA exam, an Indian student should have any of the below qualifications ­

  • Member of the Institute of Chartered Accountants of India
  • Member of the Institute of Cost and Works Accountants in India
  • Member of the Company Secretaries in India
  • Master of Commerce or MBAs

The minimum education qualification for taking the US CPA exam is –

  • CPA exam – 120 credits
  • CPA license – 120 credits

In India, 1 graduation year is equal to 20 credits; hence, 3 years B.Com and 2 years of MBA course equal 90 + 60 credits.

Q6. How many hours of studies are required to prepare for the CPA exam?

Ans. Ideally, candidates must at least give 15-20 hours per week to prepare for the CPA exam.