CPA Accountant

The Uniform Certified Public Accountant Examination, or Uniform CPA Exam, is the most important of all required accountant exams. It is the examination administered to most people who wish to become Certified Public Accountants anywhere in the United States. There are, of course, some other required accountant exams that students will have to take throughout the course of completing an accounting degree. But if you really want to work in the field, the Uniform CPA Exam is the one exam to be most worried about.

The required accountant exams that are currently being used are tough, but they are not nearly as harsh and grueling to take as they used to be. The Uniform CPA was a 19 and a half hour test that was given over a period of three days, up until about 18 years ago when the exam was restructured into a four-section, two-day exam. The old exams sections were Auditing for 3.5 hours, Business Law for 3.5 hours, Accounting Theory for 3.5 hours, and Accounting Practice, which had two parts that each took 4.5 hours. There were only two opportunities to take the exam each year, in November and May, and there were no calculators allowed.

The required accountant exams for CPAs were restructured in the early 1990s. Test administrators eliminated material that they found to be redundant, mostly in the Accounting Theory and Accounting Practice sections, and also incorporated machine-scorable test questions to better assess the test takers’ CPA skills. Special calculators were also allowed, and four new sections were added – Business Law and Professional Responsibilities, Auditing, Accounting and Reporting, and Financial Accounting and Reporting.

The Uniform CPA Exam was developed by the American Institute of Certified Public Accountants, or AICPA, which is still responsible for maintaining the examination. These required accountant exams are not administered by the AICPA, though. This is the responsibility of the National Association of State Boards of Accountancy. All fifty states in the union, the District of Columbia, Guam, Puerto Rico, the United States Virgin Islands and the Northern Mariana Islands all require the Uniform CPA Exam of all legitimate certified accountants.

In today’s modern society, global communication has become an asset readily available to many people due to the modern advancements in technology. In the business world, the convenience of increasing connectivity with other counties has created the concept of “globalization”. As a result, the international capital market has been changed dramatically. In order to ensure that accountants are able to provide accurate and appropriate financial information for economic entities, the structure and content of the uniform CPA Examination is continually changing according to the developments of the business environment.

Changes in the past

One of the biggest changes in the CPA exam history is in 2004, when the CBT (computer-based test) came into popular use in place of the traditional paper-based exam. At about the same time the forth section, business environment and concepts, and a new case study task called stimulations were added. The benefits of using CBT includes keeping the test questions current, providing more frequent and flexible test schedules, and reducing grading time. However, the CBT also requires candidates have research and analytical skills as well as the ability to use database software and certain IT knowledge. The change indicates that solely having technical skills are no longer acceptable for a proficient accountant. Additionally, analyzing the financial situation of an entity based on the current global economic market is the ability that a CPA should have.

Changes in the future

With the development of globalization, the requirements of the CPA are getting more and more specific. Instead of simply following the formula and doing the math, CPA candidates need to be aware of what role the entity is playing in the global market. Today, considering more and more companies and institutes have expanded to the other countries, CPAs need to be able to handle the change as well.

According to the “Content and Skill Specifications for the Uniform CPA Examination” that was published on May 15, 2009 by AICPA (the American Institute of Certified Public Accountants) , there will be a new version of the CPA exam to be implemented in 2011. In the specifications, one considerable change is that the Generally Accepted Accounting Principles (GAAP) will no longer be the only principle that CPAs must follow in the U.S. Comprehending the International Accounting Standards Board (IASB) will be a new requirement due to the effects of globalization on the U.S. economy. New concepts that the IASB brings are the International Auditing and Assurance Standards Board (IAASB), International Standards on Auditing (ISAs), the International Ethics Standards Board for Accountants (IESBA), the International Federation of Accountants (IFAC), and the International Financial Reporting Standards (IFRS). CPAs will be tested in both AUD (Auditing and Attestation) and FAR (Financial Accounting and Reporting) sections. CPA candidates will be asked to not only be familiar with those concepts, but also be able to compare the difference between International Financial Standards and related concepts in the U.S. The reason for CPAs to apply for the International Financial Standard in the U.S. is to build up a global scale for financial reports and make them consistent and comparable to not only the U.S. entities, but more importantly, the entities across the world.

 For the BEC (Business Environment and Concepts) section, the “specification” stated that candidates are required to “apply knowledge of changes in the global economic markets in identifying the impact on an entity in determining its business strategy and financial management policies, including managing the risks of: inflation, deflation, commodity costs, credit defaults, interest rate variations, currency fluctuation, and regulation.” In other words, the skills based on managerial accounting are being recognized and increasing in demand.

Different than the traditional accountants, CPAs of this generation will deal with both financial and non-financial data to help decision making of the entity. They are required to use their professional skills to analyze the data of the past, predict the data of the future, and compare that information with other entities in the same industry across the world. CPAs will be required to provide possible strategies in a managerial aspect.

As a result of the impact of globalization on the U.S. economy, there certainly will be more and more requirements on the CPA exam. The people who intend to take the CPA exam should start to build their knowledge, skills, and abilities on the international business environment in order to be more marketable in this increasingly competitive field.

Works Cited

Howard, Randy, Anjo, Kotaro, Gleim, Irvin N, “Global deman for the CPA exam”. The CPA Journal Dec 2001.

Pounder, Bruce. “How Globalization is Affecting U.S. Accountants”. Strategic Finance Jan. 1 2007: Vol. 88 Issue 7, p41-45, 5p

Shoaf, Victoria. “International financial reporting standards: Significance, acceptance, and new developments”. Review of Business Jan 1 2002.

The Board of Examiners American Institute of Certified Public Accountants, ” Content and Skill Specifications for the Uniform CPA Examination “. The Uniform CPA Examination. May 15 2009 <www.cpa-exam.org/>

It takes enormous amounts of time and effort to get organized and accurately keep track of your finances. To eliminate this pain, hire a Certified Public Accountant (CPA). A CPA is a trained financial professional that helps individuals or businesses organize and keep track of their financial records. Besides tracking your finances, developing financial statements and filing taxes, CPAs can also act as business advisers. They can create your budget plans, prepare cash flow projects, advice on investments and help secure business financing. Many businesses hire CPAs to only file their taxes. CPAs are trained to complete tax returns. They can help you organize tax documents and maximize deductions.

How to hire a CPA?

Following is a list of things you need to keep in mind while selecting a CPA.

* Is your CPA familiar with your industry and its accounting standards? Ideally, she should have experience working with clients in a business like yours.

* Does your CPA have good relationships with banks? If you are a growing business, your CPA may be able to help you secure funding.

* Does your CPA have relationships with attorneys? Any business can fall on hard times. Your CPA may be able to help you find an attorney to negotiate with your creditors.

* How involved is the CPA going to be with your company? If most of the work is handled by junior staff, make sure they are well supervised.

* How much interaction will you have with your CPA? If the meetings are much spaced out, how much attention will the CPA pay to your company in the interim?

* Does your CPA firm guarantee its work?

* Has your CPA passed the exams to gain the CPA designation? Does she have the license to practice in your state?

* Is your CPA a member of professional organizations that ensure that their members follow a professional code of ethics and are regularly reviewed for quality? Every country has such professional organizations. For example in the US one such organization is American Institute of CPAs (AICPA).

* Is it important for you to have regular face to face meetings with your CPA? If not then you may also consider a non local CPA. There are many firms that operate nationwide accounting services and may assign a non-local CPA to you.

* Have you checked the references and made sure they are happy with the service?

How much does it cost to hire a CPA?

Accounting service can be expensive. Before you hire, compare price quotes from multiple Certified Public Accountants and shortlist a few to interview. Ask your business associates and friends for recommendations. You can also find multiple CPA firms on a B2B network such as TradeSeam.

Many Certified Public Accountants will bill you hourly for rendering their service. If you are uncomfortable with the hourly rate, ask for a fee based service. Before you sign on, ask for an engagement letter that details costs and services and review it carefully so that there are no surprises later.