About US CPA
US CPA – Certified Public Accountant is the title equivalent to an Indian CA (Chartered Accountant). Although predominantly pursued in the US, It has a worldwide acceptance and provides a strong foundation to students and professionals for careers in Accounting, Assurance, Tax Consulting, Business Consulting and Valuations.
In this blog you can read all about US CPA, Course Structure, Syllabus, Exam Requirements and Patterns, career options post CPA, How to pursue CPA and other related details.
What is CPA?
The American Institute of Certified Public Accountants (AICPA), the world’s largest accounting body offers the “Certified Public Accountant” qualification in the United States.
US CPA is one of the most sought-after qualifications which is globally recognized, well reputed and has over 650,000 actively licensed members as per NASBA and over 430,000 members of the AICPA.
Having a global reach and continuously updated/ Industry relevant content, US CPA is a great way to build a career in accounting and finance. The flexible examination scheme with multiple examination windows and the continuous testing model started by NASBA in India since 2020 makes this qualification even more attractive.
- Recognized worldwide and can open doors to opportunities in North America, Europe and Asia.
- Well-designed curriculum which is continuously updated to develop relevant knowledge, skills and professional value.
- Better Career opportunities as they have numerous career options available to them as opposed to unlicensed accountants. For example, Unlicensed accountants are not permitted to represent a client to the IRS and Only CPAs can legally sign documents that publicly traded companies must submit to the Securities and Exchange Commission.
- Competitive salary. According to the National Association of State Boards of Accountancy (NASBA) a licensed CPA earns 10-15% more on an average as compared to unlicensed accountants.
- Communicates credibility as a CPA is the highest level of an accountant, they’re highly regarded and carry prestige.
- Total cost is nearing INR 3.5 – 4 lakh, which would be cheaper than most other options available.
- Flexible pattern of examination: The 4 sections of exams are taken throughout testing windows in the United States, Dubai and now even in India. The same can be applied and given anytime during the testing windows in an order preferred by the candidate and the 4 sections can be spread across or given together at the option of the candidate.
CPA opens multiple options at a wide range of organizations because:
- CPAs are accountants who have met strict educational requirements, been tested on it and also gained relevant experience which is mandatory for obtaining licensure.
- Since CPA is a very prestigious and recognized qualification, all of the Big 4s and many other multinational organizations actively hire CPAs.
Not only internationally, but some of the top firms of India are the biggest employers of CPA candidates and would even sponsor the education of their employees to upgrade their skills and knowledge and obtain a CPA License.
The biggest employers of CPAs in India are:
Below are some of the roles performed by CPAs
Some of the roles for CPAs in India:
- Corporate controller
- Finance controller
- Accounting software developer
- Personal finance director
- Internal Auditor
- Risk and compliance professional
Following are the steps that need to be followed in order to become a CPA (i.e clear the 4 sections of examination and obtain licensure):
STEP 1: ACADEMIC EVALUATION – Check academic requirements and make sure you are eligible to give the exam which depends from state to state.
STEP 2: APPLICATION TO TAKE THE EXAM – Post evaluation, fill out the necessary forms and submit your application
STEP 3: STUDY FOR THE EXAM – Create a study plan and study section-wise/ multiple sections together.
STEP 4: SCHEDULE THE EXAM – Receive an NTS (Notice to schedule) and schedule an exam at your chosen location well in advance.
STEP 5: TAKE THE EXAM – Take the exam on the notified date and complete all sections within 18 months of clearing the first section.
STEP 6: OBTAIN WORK EXPERIENCE – Most states require certain years of work experience (2 years in most cases) along with 150 Credits to obtain licensure.
STEP 7: OBTAIN LICENSURE – Apply for licensure within 3 years of passing all 4 sections and possessing the required work experience.
STEP 8: CPE TO MAINTAIN LICENSURE – Continuous professional education is required to maintain the CPA License which varies from state to state.
To summarize at a basic level, The 4 E’s can be followed to become a CPA:
Education – Most states require 120 credits from college-level coursework and some states even require 150 credits. Some candidates may fill the required criteria with undergraduate degrees, however not all undergraduate degrees can help a candidate earn the required credits and a post-graduate degree may be required.
Experience – Depending on the states’ requirements, the experience of 1-2 years is required to obtain a CPA license. Any CPA can verify your work experience.
Exam – This might be the most challenging area of the path to becoming a CPA. The examination consists of 4 papers and is generally completed by candidates within 9-12 months.
Ethics – A separate Ethics exam may be required by some states for obtaining the CPA license.
Scroll further down to know a little more about each step of the process to become a CPA!
Educational requirement for examination –
Candidate must have:
- A bachelor’s degree or equivalent to enroll in the CPA certification program.
- 120-semester credits to enroll for examination. (1 year of education in India is equivalent to 30-semester credits) **
** Although there are some exceptions where extra credits are awarded to candidates in certain scenarios.
For eg: Students who graduated from a NAAC-A accredited college with a distinction are awarded extra credits.
- Additionally Indian students are eligible if they possess any of the following qualifications:
- Member of the Institute of Chartered Accountants of India
- Member of the Institute of Cost and Works Accountants of India
- Member of the Company Secretaries in India
- Masters of Commerce
Educational and work experience requirement for licensure
- In general, a candidate would need 150 credit hours of education with an accounting concentration. This consists of 30 semester hours in accounting and 24 semester hours in business administration.
- A minimum of 15 semester hours in accounting must be taken at the graduate or upper-division level.
- A minimum of one year of experience (roughly 2,000 hours) is required and should be verified by a licensed CPA. This can vary from state to state and could be 2-3 years in some states.
- The experience must be in the fields of accounting, attest, auditing, or tax.
- For licensure-specific requirement information, visit the NASBA website.
The CPA Exam
The US CPA Exam consists of 4 papers –
- Auditing and Attestation (AUD)
- Financial Accounting and Reporting (FAR)
- Regulation (REG)
- Business Environment and Concepts (BEC)
Details on each section:
|Paper||Time *||Pattern||Exam type|
|Auditing and Attestation||4 hrs||72 General MCQs and 8 Case Study based MCQs||30-40% Application based25-30% Remembering and understanding 20-30% Analysis 5-15% Evaluation|
|Financial Accounting and Reporting||4 hrs||66 General MCQs and 8 Case Study based MCQs||50-60% Application based10-20% Remembering and understanding25-35% Analysis|
|Regulation||4 hrs||76 General MCQs and 8 Case Study based MCQs||35-45% Application based25-35% Remembering and Understanding25-35% Analysis|
|Business Environment and Concepts||4 hrs||62 General MCQs, 4 Case Study based MCQs and 3 written communication tasks||50-60% Application based 15-25% Remembering and Understanding 20-30% Analysis|
* Each paper is 4 hours each with a mandatory 15 min break (clock stops). However, more optional breaks can be taken by the candidate where the time keeps running.
Auditing and Attestation: Covers Statements of Audit Standards
- Professional Responsibilities and ethics
- Planning and supervision
- Internal controls
- Corroborative Audit evidence
- Audit sampling
- Audit reports
- Other Auditing and attestation topics
Financial Accounting and reporting: Covers USGAAP and IFRS
- Conceptual framework, financial reporting and miscellaneous topics
- Current assets and liabilities
- Investments, PPE and Intangibles
- Bonds, Leases and Pensions
- Deferred Tax, EPS, Equity and Cash Flows
- Consolidation, Foreign currency, Partnerships and NPOs
- Governmental accounting
Regulation: Covers US federal taxation
- Taxation of Individuals
- Property transactions and depreciation
- Taxation of C-Corporations
- Taxation of other entities
- Supplementary taxation topics
- Statutory Reg & Business structures
- Business law
Business Environment and Concepts: Covers understanding of Business environment
- Corporate governance, Internal controls and ERM
- Cost measurement
- Financial management
- Financial management and Risk management
- Performance measures
- Economic concepts and strategy
- Information technology
OTHER IMPORTANT INFORMATION FOR THE CPA EXAM :
- Minimum score for passing each of the section is 75.
- All 4 sections of the exam have to be cleared within 18 months of clearing the 1st section in most states.
- A candidate can take multiple exams in one test window but cannot take the same section in the same exam window more than once.
- The CPA license has to be obtained within 3 years of clearing all 4 sections to avoid invalidating the exams taken. However, this can vary from state to state.
*excluding prep material
|Particulars||Amount in USD||Amount in INR**|
|Exam fee (USD 250 per section)||USD 1000||INR 78,000|
|International testing fee||USD 1500||INR 1,17,000|
|Evaluation fee||USD 350||INR 27,300|
|Application Fee||USD 200||INR 15,600|
|Total||USD 3050 (approx.)||INR 2,37,900 (approx.)|
*Please note, International testing fee is only applicable if the exam is taken outside the United States.
** Amount is INR is subject to US Dollar Conversion Rates
Where and When can the exams be given?
Exams take place in various places in the United States, Dubai and India (Starting July 1, 2020).
The continuous testing window model started in India allows the candidate to take the exam year round, from the following 8 Prometric centers:
- New Delhi
Target score release date:
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