Topics of Certified Public Accountant (CPA) Exam

The CPA Exam test consists of four, four-hour sections. You must clear all four sections within 18 months with a minimum score of 75 on each part. The core topics for each of the four sections are listed below. These contents are likely to be used for the examination. However, on any particular delivery of the test, other similar topics could also appear.

It is recommended that, where possible, the applicant uses these contents and/or other resources to provide background information on the exam objectives. The syllabus for the Certified Public Accountant (CPA) Exam is listed below with detail of each section and their topics:

1. Auditing and Attestation (AUD)

Objectives covered by this section:

Developing a Planned Response & Assessing Risk (20 to 30%)

• Planning an engagement
• Specific areas of engagement risk
• Debtor-creditor relationships
• Entity's internal control
• Materiality
• Assessing and identifying the risk of material misstatement

Professional Responsibilities, Ethics & General Principles (15 to 25%)

• Communication with management
• Engagement documentation
• Communication with component auditors
• Nature and scope
• A firm's system of quality control
• Ethics and professional conduct

Obtaining Evidence & Performing Further Procedures (30 to 40%)

• Written representation
• Acquisition and disposition of assets
• Sampling techniques
• Internal control deficiencies and misstatements
• Performing specific procedures to get evidence
• Subsequent events

Reporting and Forming Conclusions (15 to 25%)

• Review service engagements
• Reports on auditing engagements
• Reports on attestation engagements
• Other reporting considerations
• Reporting on compliance

2. Regulation (REG)

Objectives covered by this section:

Federal Tax Procedures, Professional Responsibilities, and Ethics (10 to 20%)

• Legal duties
• Licensing and disciplinary systems
• Responsibilities in tax practice
• Federal tax procedures

Business Law (10 to 20%)

• Contracts
• Business structure
• Debtor-creditor relationships
• Government regulation of business
• Agency

Federal Taxation of Property Transactions (12 to 22%)

• Cost recovery
• Acquisition and disposition of assets
• Determination of taxable estate
• Gift tax deductions
• Gift tax annual exclusion
• Estate and gift taxation

Federal Taxation of Individuals (15 to 25%)

• Reporting items from pass-through entities
• Passive activity losses
• Computation of tax and credits
• Computation of tax and credits
• Alternative Minimum Tax
• Gross income
• Filing status

Federal Taxation of Entities (28 to 38%)

• S corporations
• Limited liability companies
• Liquidation of business entities & tax treatment of formation
• Partnerships
• Trusts and estates
• Tax-exempt organizations
• C corporations

3. Financial Accounting and Reporting (FAR)

Objectives covered by this section:

Standard-Setting, Conceptual Framework, and Financial Reporting (25 to 35%)

• Public company reporting topics
• General-purpose financial statements
• Conceptual framework
• Standard setting and conceptual framework for nonbusiness entities
• Standard setting for non-business entities
• Special purpose framework

Select Financial Statement Accounts (30 to 40%)

• Investments
• Inventory
• Cash and cash equivalents
• Compensation benefits
• Income taxes
• Property, plant, and equipment
• Intangible assets
• Long-term debt

Select Transactions (20 to 30%)

• Leases
• Nonreciprocal transfers
• Contingencies and commitments
• Fair value measurements
• Derivatives and hedge accounting
• Accounting changes and error corrections
• Foreign currency transaction and translation
• Software costs
• Research and development costs
• Subsequent events
• Differences between IFRS and U.S. GAAP
• Business combinations

State and Local Governments (5 to 15%)

• Comprehensive Annual Financial Report (CAFR)
• Government-wide financial statements
• State and local government concepts
• Specific types of transactions and events: calculation, measurement, presentation in a governmental entity, and valuation

4. Business Environment and Concepts (BEC)

Objectives covered by this section:

Corporate Governance (17 to 27%)

• Internal control frameworks
• Regulatory frameworks and provisions
• ERM (Enterprise Risk Management) frameworks

Economic Concepts and Analysis (17 to 27%)

• Market influences on business
• Financial risk management
• Economic business cycles

Financial Management (11 to 21%)

• Working capital
• Capital structure
• Financial valuation methods

Information Technology (15 to 25%)

• Role of information technology business
• Systems development of maintenance
• Information security/availability
• IT governance
• Processing integrity

Operations Management (15 to 25%)

• Planning techniques
• Performance management
• Process management
• Cost accounting

How to Prepare For Certified Public Accountant (CPA) Exam

Preparation Guide for Certified Public Accountant (CPA) Exam

Introduction

For practitioners aspiring to become CPAs, the Standardized Certified Public Accountant test is a credentialing exam. The CPA exam tests are graded and governed by the American Institute of Certified Public Accountants (AICPA) and by the National Association of State Accountancy Boards (NASBA).

The American Institute of Certified Public Accountants (AICPA) is the United States' national professional association of Certified Public Accountants (CPAs), with more than 418,000 members in business and industry, public practice, government, education, student affiliates, and foreign associates in 143 countries. Established in 1887, the association sets ethical guidelines for audits of private businesses, non-profit organizations, federal, state, and local governments for the profession and U.S. auditing standards. It also establishes the Standardized CPA Test and rates it. The AICPA has offices in New York City; Durham, NC; Washington DC; and Ewing, NJ.

This exam guide is intended to get you to know about the exam details and help you to prepare for the Certified Public Accountant (CPA) Exam successfully. This guide includes information on the certification test target audience, recommended preparation and documentation, and a full list of exam targets, all to help you obtain a passing grade. To increase your chances of passing the test, AICPA strongly recommends a mix of on-the-job experience, a study of CPA exam dumps, course attendance, and self-study.

Introduction to Certified Public Accountant (CPA) Exam

Passing all four sections of the Uniform CPA Test is one of the first steps to being a licensed CPA. The CPA Exam is a computer-based examination conducted by the AICPA, consisting of four parts evaluating the minimum knowledge and skills needed by a CPA. The new version of the exam takes 16 hours in total.

While each state/jurisdiction has its particular criteria for obtaining a CPA license, they all require the CPA Exam to be passed by an applicant, and you have 18 months to complete all four sections of the CPA Exam (the clock starts ticking after you pass the first section), so be aware of scheduling and preparing.

The exam contains the following four main parts which are further described in details in the following section:

• Auditing and Attestation (AUD)
• Regulation (REG)
• Financial Accounting and Reporting (FAR)
• Business Environment and Concepts (BEC)

See the CPA practice exams to get a know-how of how these sections are divided. The AUD section offers questions based on professional obligations, ethics, risk assessment in the production of plan responses, the performance of procedures and facts, and drawing conclusions and reporting of accounting information. The BEC chapter discusses topics related to corporate governance, economic concepts, and interpretation, financial management, IT, and operations management. The FAR section consists of questions that emphasize the conceptual structure and financial reporting, the selection of accounts of financial statements, the selection of transactions, and the application of state and local governments to accounting work. The REG section consists of topics that concentrate on ethics, federal tax practices, professional obligations, business law, federal property transaction taxation, federal individual taxation, and federal agency taxation.