Tips on Preparing Employees for the New CPA Exam

Both employers and staff candidates can benefit from getting ready.

This article explores the new, computerized Uniform CPA Examination, which in April 2004 will replace the paper-and-pencil version. The computer-based CPA exam is a joint effort by the AICPA, the National Association of State Boards of Accountancy and Prometric, a developer of computer-based testing services.

The webcast discussed in this article is available at .

A panel of accounting professionals recently offered advice to employers on how to prepare themselves and their CPA candidates for the new, computerized CPA exam in a November 12 webcast, archived and still available by registering at .

In the webcast, moderator John F. Hudson, CPA, of the Hudson Consulting Group, begins by summing up the purpose: The format and the content of the CPA exam are about to change; consequently the process for preparing CPAs to pass the exam needs to change as well. “The changes are more than just turning in your pencil and paper for a keyboard, so the webcast informs candidates of the differences between the two formats, discusses best practices from other professions and motivates both employers and employees to adequately prepare for the new exam,” says Hudson.

The new exam reflects the enormous growth that has taken place in the accounting profession during the past 20 years, says Diane Rubin, CPA, partner of Novogradac & Co. LLP, San Francisco. Arleen R. Thomas, CPA, AICPA vice-president of professional standards and services, spearheaded the transition to the computerized exam that had as one of its milestones a practice analysis that queried supervisors on the kinds of work skills entry-level CPAs use so that an exam could test their knowledge and skills. One was the ability to communicate, specifically in writing; others were a “higher order of skills,” which included researching an issue or problem, analysis, judgment, understanding, conducting an analytical review and preparing solutions to current business problems.

“In this day and age, no one can memorize the volume of accounting literature that’s out there,” says Thomas. “The practice analysis told us to move away from testing that kind of memorization and move toward evaluating a higher order of skills.”

The Panelists

The webcast advising employers on how to prepare themselves and their CPA candidates for the new, computerized exam was moderated by John F. Hudson, CPA, of the Hudson Consulting Group, Hastings-on-Hudson, New York. Its panelists were

Diane Rubin, CPA, a partner in the San Francisco office of the CPA firm Novogradac & Co. LLP. Ms. Rubin is a past president of the California Board of Accountancy and a current member of the board of directors of the National Association of State Boards of Accountancy (NASBA).

Arleen R. Thomas, CPA, AICPA vice-president of professional standards and services, who spearheaded the transition to the computerized exam.

John Riina, vice-president of the investment firm Legg Mason. Mr. Riina addressed the experiences of the securities industry, which moved to a computerized exam a decade ago.

The panelists emphasize that the extraordinary flexibility of the new exam is a great benefit to both employers and employees. This was found to be true in the securities industry, which moved to an electronic test more than a decade ago. “We’ve found that the biggest improvement was the flexibility it gave candidates in terms of when they could take the test and how they prepared for it,” says John Riina, vice-president of the investment firm Legg Mason. “From the employer’s point of view, it makes the hiring process much easier. You can hire someone who can take the exam when he or she is ready, and not have to wait for some fixed date.”

“For employers this flexibility is one of the most exciting things about the new exam,” says Rubin. “You no longer would have a huge portion of your professional staff gone all at once.” Thomas adds that with the paper-and-pencil exam employers had to manage their businesses knowing that twice a year many of their people would be taking significant time off to study and take the exam. “The world kind of stopped because of the CPA exam,” Thomas noted. But with flexibility comes a certain amount of responsibility for businesses. “We have to make sure employers give their people the time to study and sit for the exam,” says Rubin.

Dates to Test
Open Closed
April–May June
July–August September
October–November December
January–February March

Beginning in April, the computerized exam will be given every two out of three months.

Beginning in April candidates will be able to take the computerized exam at more than 300 Prometric test centers, a number about three times that of the old paper-and-pencil test, and the total duration of the exam will be reduced from 15 12 to 14 hours.

Thomas emphasizes there is motivation for candidates to complete all four parts of the exam within the allowed time frame; otherwise they may lose credit for sections they’ve already passed. “Once you’ve passed one part of the exam, you have 18 months to pass all four,” she explains. “You can take each exam section only once within a single window. (Two months out of every three constitute a window.) We want candidates to demonstrate over a reasonable period of time their grasp of the entire breadth of knowledge. All 54 jurisdictions have adopted this policy, so for the first time there is uniformity.”

Best Practices
Plan ahead

Determine the dates to sit for the exam

Decide whether to take all parts at once or one or two at a time

Select a review course or start a study group

Start studying months before you take the exam

Schedule time off in advance so that you are available

Set your targets for passage as soon as you join the firm

Candidates should start preparing in advance and coordinate the schedule with their employers.

The panelists suggest employers could help both themselves and their CPA candidates by establishing a formal process of preparing employees for the exam. “The exam is important not just from a licensing standpoint, but also in terms of quality control for firms,” says Rubin. “In our firm, for example, we require people to pass the exam before they can be promoted to manager. This also is an excellent opportunity to strengthen a firm’s mentoring program; employers should make sure candidates have a plan for studying and taking the exam,” she adds.

Thomas believes that employers could be particularly helpful with the new Business Environment and Concepts section. “Senior people can walk through these questions and really be of tremendous assistance,” she says. “If you look at what’s happening in the accounting world, it’s more important than ever that accountants involved in auditing or recording any kind of transactions understand how those transactions fit into the larger picture. That’s what the new section focuses on. It’s also probably what’s creating the most angst amongst candidates because it is so new.”

All the panelists agree on the importance of spending time on the tutorial available online at . “The tutorial is something everyone should look at—for the process as well as the content,” says Hudson.

Thomas, who notes the AICPA and NASBA have been working closely with review course providers, agrees. “You won’t have time at the testing center to become familiar with the functionality of the exam,” she says. She points out that a sample test, which allows candidates to interactively answer multiple choice questions and simulations from each section of the exam content, is available at .

—Adam Snyder

Adam Snyder is a business writer based in New York. His e-mail address is .

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