The New CPA Exam - 2017 Fall Spectrum

THE NEW CPA EXAMby Elaine W. SmithAs American business evolves, so Thomas continued, “So, if you are someone who had takenmust the accounting profession. and passed some of the parts—and I think a lot of the bigAnd as the accounting profession changes were in BEC—and that’s what you have left to pass,evolves, so must the CPA exam. On you will be quite anxious. You’ve got to learn some newApril 1, 2017 the AICPA launched stuff and you’re on the clock as well.”its newest version of the CPA exam, One such person who was in this predicament was Lindsaywhich is designed to“meet the N. Smith, an audit associate who started her CPA journeyshifting needs of the profession by taking the BEC section. “I chose this section to beginin protecting the public interest,” with because it was going to undergo the most changesaccording to the AICPA. after April 2017, so I wanted to pass it first. Unfortunately, I did not pass it before April, but did pass [the new version]Ralph Thomas, CEO of the New Jersey Society of CPAs in July.” Smith now has until December 2018 to pass the(NJCPA), explained that the changes were developed by the remaining three sections.AICPA Examinations team with oversight by the Board of Thomas said that one of the things that the NJCPAExaminers. “AICPA goes through this periodically to look at questioned in its comments to the AICPA on the newwhat needs to be changed to meet the needs of the current exam was the 18-month time period to pass. “We wereprofession,” said Thomas. “A couple of things that came out concerned that given today’s state of the profession andwere the need to test critical thinking skills, problem solving demands on staff that 18 months was a short period of timeskills and analytical skills. Some of the comments coming once someone started taking the exam to have to completefrom regulators questioned whether the profession’s it. We had seen anecdotally that people were losing partsskepticism was where it needed to be.” of the exam and it was because of work demands.”Thomas said that this is coupled with the fact that many people waitA cursory look at a few CPA forums revealed many to take the exam once they start working because theyaccountants expressing concern and anxiety over the believe they can manage the work load and studying forchanges. “Any time you have change, people are going the exam.to be anxious. Particularly those folks who are already inprocess and have taken parts of the exam, because now continued on next pagethey have to go back and learn new stuff that is going tobe tested,” Thomas said. “On this exam, we had a coupleof changes that I would call significant—fewer multiplechoice, more test-based simulations and an additional totalof two hours was added to the exam; so now the exam is 16hours instead of 14 hours.”12 SPECTRUM | FALL 2017

“One of our big efforts is to communicate that you should Smith says she plans to devote roughly two months oftake the exam right away after you graduate or as soon study per section before each of the remaining sectionsas you are eligible to take it, hopefully before you start of the exam. “One exception is the audit section. I wasworking, because those work demands do get in the way,” working on an audit when I began preparing for thatThomas said. “The conflict is the firm wants you to pass section. We began to have to work 11-hour days. I startedthe CPA exam, but the staff and supervisors leading the about four months out to give myself time to prepareengagement are saying,‘let’s get my job done.’” around my longer workdays.”Candidates do have to prepare differently, according to Each year, NABA members who are candidates for the CPAThomas. “This is an exam that you have to study for. Just exam have an opportunity to take advantage of the Beckerbecause you were a top student, you can’t roll out of college Review during the annual convention.and take it and expect that you are going to pass. You really With respect to pass rates, AICPA has released pass rates onhave to put some time in and we’re talking 200-300 hours the new exam and they are only slight fluctuations in thethat you really need to devote, which is why we emphasize rates compared to rates under the old exam.that you really should do this before you start working. Will the change build a better CPA? Thomas believes thatThat vacation or the backpack adventure in Europe can be ultimately it will. “Certainly, the profession is changing.done later on in life. This is such an important step in one’s The way we are auditing is going to change with all thecareer progression to have the CPA.” data analytics and big data, and as those new thingsSmith, who entered the profession after obtaining a emerge, we’ve got to make sure that accounting majorsmaster of science in accounting, but with about 10 years of coming out of schools have the right skill sets andnon-accounting work experience, admits that she did not competencies to be part of what the new profession andprepare properly when she initially took the BEC portion the new auditing model is going to be about,” he said.of the exam. She said she took a different approach when “Our hope is that these changes will result in employeesshe took the new version. “The biggest difference in my having improved competencies . . . . At the end of the daystudy plan was that I actually purchased an exam prep the changes will result in improvement of an individual’scourse. My first attempt, I only used a book and multiple critical thinking skills, problem solving and analyticalchoice questions I found online. The second time, I went abilities, tied into what the profession wants CPAs to bethrough my course’s entire study unit for BEC as though I known as: trusted advisors.” ▲had never taken it. Also, I took advantage of AICPA’s examblueprints to really focus on the subject areas that would FALL 2017 | SPECTRUM 13appear more frequently on the exam,” Smith said.