A Certified Public Accountant only reaches the top of a few 'dream job' lists. But, in an increasingly competitive and unstable job market, the security (and paycheck) that come with a CPA position are incredibly desirable.
If you're considering becoming a CPA for the reasons above, you're in the right place. In this article, we'll dive into why many accountants like you are choosing to follow this career path, and precisely what you can expect when you set out to become a licensed CPA.
What is a CPA?
Certified public accountants have undergone a rigorous process to achieve professional accreditation that sets them apart. They…
- Complete an examination, the Uniform CPA Exam, to achieve their license
- Are licensed by their state's Board of Accountancy
- Adhere to strict ethical guidelines
- Take on work such as conducting audits and representing clients before the IRS that regular accountants cannot
- Complete ongoing education to maintain their license
- Often work in corporate banking, forensic accounting, compliance, or executive positions like Chief Financial Officer
CPAs are some of the most trusted financial professionals in the industry, offering credibility, expert guidance, and oversight to a range of clients. As such, they're in much higher demand than regular accountants, and that's only one benefit of becoming a CPA.
Why Become a CPA?
Let's take a closer look at some other reasons why accountants strive to become CPAs.
Career Progression: If you've worked as a regular accountant and want to continue in the profession, becoming a CPA is the next step on the ladder.
Increased Salary: According to the US Bureau of Labor Statistics (BLS), junior accountants make an average of $58,530 per year, while CPAs make an average of $79,880 per year.
Flexibility: As a CPA, there's a good chance you'll be able to work remotely, have a say in which clients you take on, and be part of a team that shares the workload.
Variety: As mentioned, becoming a CPA offers a varied workload and allows you to explore different industries and accounting specialties.
Standout Skills: Since the examination process for CPAs is quite intensive, there's much less competition for job roles that require a Board of Accountancy license.
Job Security: U.S. News estimates that 67,400 accounting roles will open up before 2032. There is always a demand for accountants, and with CPAs in shorter supply, becoming certified will solidify your value for employers.
Becoming a CPA offers several advantages that position you for a successful and rewarding career. Hopefully, the above benefits have convinced you that gaining your CPA license is a strategic and worthwhile next step.
What Are the Requirements for Becoming a CPA?
If you've decided to become a CPA, here are the things you must do/have to apply to take the Uniform CPA Exam and get your license:
Age and Residency
To become a licensed CPA, you must be able to prove that you are over the age of 18 and are a resident of, or have a legitimate business interest in, the state in which you are sitting the exam. Some states will conduct background checks to verify this information and ensure you meet the professional conduct standards necessary to become a CPA.
Education
You must have a bachelor's degree in a relevant field, such as accounting, finance, or economics. Additionally, you must complete 120–150 semester hours/credits, often requiring additional coursework beyond a standard bachelor's degree.
Since most bachelor's degrees consist of around 120 semester hours, you might need to pursue further education, such as a postgraduate degree, or take additional coursework to reach the total credit requirement. However, you can take the Uniform CPA Exam even if you don't have a postgraduate qualification, as long as you've completed the required 150 semester hours through any combination of degrees and coursework.
Work Experience
Most states require you to have at least one year of non-academic work experience in accounting, taxation, financial consulting, or advisory roles before you can obtain your CPA license. Some states require as much as two years of work experience. This experience can typically be completed part-time or full-time, but you must provide documentation and references to prove that you meet the requirements. Depending on the state, the work experience may need to be supervised by a licensed CPA.
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Though these are the prospective requirements you'll need to meet if you want to apply for the Uniform CPA Exam, they vary from state to state. For example, in Hawaii, Alaska, Georgia, Massachusetts, and Maine, you can apply for the exam regardless of your area of study during your bachelor's degree.
The Uniform CPA Exam
If you meet the above requirements, you can apply to sit the Uniform CPA Exam. Though the progression from a bachelor's degree to a CPA license is well-established, the journey will be challenging. The 2023 pass rates for the Uniform CPA Exam range from just 38-59%.
So, preparation for the exam is vital to ensure you get your license and start reaping the benefits of being a CPA as soon as possible. If you want to know more, here are the answers to some frequently asked questions about the exam:
Who Develops the Uniform CPA Exam?
The exam is developed and maintained by the American Institute of Certified Public Accountants (AICPA) in partnership with NASBA, which coordinates with the states' Boards of Accountancy to administer it.
What Does the Uniform CPA Exam Involve?
The Uniform CPA Exam consists of four smaller exams. These include three CORE modules:
- Auditing and Attestation (AUD)
- Financial Accounting and Reporting (FAR)
- Taxation and Regulation (REG)
And one discipline module. For the discipline module, you have a choice of:
- Business Analysis and Reporting (BAR)
- Information Systems and Control (ISC)
- Tax Compliance and Planning (TCP)
Each of these examinations lasts four hours, and you must pass all four sections to achieve your CPA license. Generally, you must pass all the sections within an 18-month time limit. However, this deadline can also vary, so make sure to check your state's specific requirements.
What Types of Questions Are on the Uniform CPA Exam?
Each of the four examinations has five sections. The first two include a variety of multiple-choice questions, while the remaining three sections consist of task-based simulations.
Where Do I Take the Uniform CPA Exam?
The exam is taken using specialized software at Prometric test centers. This means the questions you answer might differ from those of other budding CPAs.
How Should I Prepare for the Uniform CPA Exam?
Four hours may seem like a lot, but with five sections worth of questions, the allotted time can run down quickly. Plus, once you have submitted a section of your exam on the software, you can't go back and change your answers. This is why thorough preparation for the exam is essential.
You should:
- Plan exactly when you will take the four exams so you know what to study and when
- Aim for at least 8–12 weeks worth of studying for each test
- Read posts and listen to podcasts that detail the experiences of past exam takers
- Review notes from your college coursework
- Download the exam blueprints here to find out exactly what to study
- Try out a sample test by visiting this link and clicking the 'CPA Exam Sample Test' button
- Reach out to your lecturers and classmates taking the exam for guidance and support
How Do I Apply for the Uniform CPA Exam?
Once you have proof of your age, state residency, education, and experience, you can apply to sit the Uniform CPA Exam by selecting your state on the NASBA website.
Continuing Professional Education
Once you've passed the Uniform CPA Exam and any additional ethical examinations, you can apply to your state's Board of Accountancy for your license number. However, just because you've got your CPA license, doesn't mean the journey's at an end.
You'll need to complete 120 credits of continuing professional education (CPE) every three years after achieving your license. This will ensure you're up to date with any changes in the field, and your skills match those required of a newly-licensed CPA.
While you can get CPA credits through dedicated modules from AICPA, you can also meet the requirements by undertaking training at your place of employment, attending conferences, or completing a postgraduate qualification through qualifying programs.
In Conclusion…
Obtaining a CPA license requires dedication, hard work, and rigorous preparation. But the benefits are substantial. CPAs enjoy higher earning potential, a wide range of career opportunities, and a level of professional recognition and job security that is hard to find in many other fields. Overall, becoming a CPA opens the door to an incredibly stable, lucrative, and secure career path.
To be eligible for a CPA license, you must meet state-specific education, work experience, and residency requirements, pass the Uniform CPA Exam, and fulfill continuing education obligations. If you're ready to embark on this journey, remember that thorough preparation and careful planning are essential. Stay dedicated to your goal of becoming a licensed CPA, and when things get tough, remember that you're setting yourself up for a successful and fulfilling career.
Sources and Resources
- https://www.investopedia.com/terms/c/cpa.asp
- https://www.investopedia.com/articles/investing/051415/how-much-do-cpas-make.asp
- https://www.efficientlearning.com/blog/why-become-a-cpa/
- https://www.pwc.com/us/en/careers/why-cpa.html
- https://money.usnews.com/careers/best-jobs/accountant
- https://www.bls.gov/ooh/business-and-financial/accountants-and-auditors.htm
- https://www.bls.gov/ooh/business-and-financial/tax-examiners-and-collectors-and-revenue-agents.htm
- https://www.gleim.com/cpa-review/exam-pass-rates/
- https://www.aicpa-cima.com/resources/toolkit/cpa-exam
- https://www.accounting.com/careers/cpa/how-to-become/
- https://www.aicpa-cima.com/resources/article/find-answers-to-frequently-asked-questions-about-cpa-exam
- https://www.accounting.com/resources/cpa-exam-guide/
- https://corporatefinanceinstitute.com/resources/career/continuing-professional-education-cpe/
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