US CPA is one of the most lucrative career options in the accounting field. The global demand for CPAs has increased exponentially over the last few years. Parallelly, the roles and responsibilities of CPAs have also varied in accordance with the ever-changing business landscape. The advent of digitization and the implementation of new technologies have revolutionized the finance and accounting industry. To ensure that CPAs are updated and competent with the technology-driven business landscape, AICPA has introduced the CPA Evolution Initiative.
The US CPA Exam Evolution Initiative will come into effect from January 1, 2024 and will have significant changes to the CPA curriculum. The passage below explores in detail the CPA 2024 changes.
CPA Evolution Initiative – What is the New Model?
The new model has been proposed to make the CPAs more tech competent. The new model will follow a Core + Discipline model with 3 Core Sections and 3 Discipline Sections.
CPA students have to study all three core sections. The three core sections are:
CPA students can choose one discipline section out of the three. The three discipline sections are:
- Business analysis and reporting (BAR)
- Information systems and controls (ISC)
- Tax compliance and planning (TCP)
Irrespective of the discipline section the CPA candidate chooses, he can opt to practice in other areas well. His choice of discipline section will not have any effect on his CPA licensure.
Transition Policy – What it Means to CPA Aspirants?
AICPA along with NASBA, have created a smooth transition policy for implementing the new changes. The transition policy is simple and straightforward. Below is the break of the transition policy and how it affects the CPA candidates.
- Candidates who have passed and have credit for AUD, FAR, or REG on the current CPA Exam will not need to take the corresponding new core section of AUD, FAR, or REG on the 2024 CPA Exam.
- Candidates who have passed and have credit for BEC on the current CPA Exam will not need to take any of the three discipline sections.
- Candidates without credit for AUD after Dec 31, 2023, will have to take the AUD core section on the 2024 CPA Exam.
- Candidates without credit for FAR after Dec 31, 2023, will have to take the FAR core section on the 2024 CPA Exam.
- Candidates without credit for REG after Dec 31, 2023, will have to take the REG core section on the 2024 CPA Exam.
- Candidates without credit for BEC after Dec 31,2023 will have to take one Discipline section on the 2024 CPA Exam.
The current sections and curriculum of the CPA exam will not be available for testing after Dec 2023.
CPA Exam 2024 – What are the Content Changes?
There are some significant changes in the curriculum of each section for the CPA exam 2024. The content from the section has been transferred to the other sections.
The only section that remains relatively unchanged is AUD. While no content has been removed from it, some content from BEC has been added to this section. The newly added topics in the AUD section are basic economic concepts and business processes and internal controls. Some existing content from FAR will be moved to the BAR discipline section under the new model. These topics include business combinations, R&D costs, stock compensation, and public company reporting, among many others. Some BEC topics have also been moved to the FAR section. Similarly, some existing REG content has been moved to the TCP discipline section. This content includes gross income concepts.
In the case of discipline sections, the BAR section includes complex technical accounting topics along with lease accounting and revenue recognition. It also includes certain topics from the BEC section such as managerial and cost accounting, variance analysis, non-financial measures of performance, and financial valuation decision models. ISC exam section will evaluate the candidate on knowledge of IT audit and advisory services. It also borrows some BEC topics. Lastly, the TCP discipline section evaluates the candidates on knowledge of federal tax compliance policies and focuses on complex tasks. As specified already, some REG topics have been included in the TCP section.
Below is the summary of how the content has been spread across different sections under the CPA 2024 model:
- REG – REG + TCP
- FAR – FAR + BAR
- AUD – AUD
- BEC – FAR + BAR + AUD + ISC
CPA Exam 2024 – Scoring Weight Changes
There is not much change in the scoring weight of the CPA exam. Under the new model, every section has a scoring weight of 50% MCQs and 50% TBSs, except one section. The ISC discipline section gives 60% weightage to MCQs and 40% weightage to TBSs.
CPA Exam 2024 – Section Time and Question Count Changes
There is no change in the section time. The current section time of 4 hours will remain the same for the new model as well. In the case of question count, the new model has 2 changes. The current model has a question count in the range of 62-72 MCQs and 8 Sims, except for BEC. The BEC exam has 4 TBSs and 3 Written Communication questions. Under the new model, the ISC exam section will have 82 MCQs and 6 TBSs. Similarly, FAR and BAR exam sections will have 50 MCQs and 7 TBSs
CPA Exam 2024 – Skill Level Changes
There are no changes in the skill level categories but there are a few minor changes in the skill level allocation for some sections. The changes to the question count also reflect the skill level changes. For instance, ISC with more MCQs has more skill allocation to Remembering and Understanding. AUD section lays more emphasis at Remembering and Understanding and Analysis levels, whereas FAR section lays emphasis at Remembering and Understanding and Application levels. The latter section has fewer questions at the Analysis level.
REG section retains the same skill level with no changes. FAR and BAR have more questions at the application level with MCQs having complex calculations. TCP section contains the highest percentage of questions at the Application level.
It should be noted that these changes are not finalized. There might be a few changes to the new model. But, the core concept of the model will remain the same. AICPA has announced that it is waiting for inputs on the new model till September 30, 2022. Post that, it will review the comments and make any changes if deemed fit. The blueprint will be finalized in December 2022 and will be published in January 2023.