As a CPA (Certified Public Accountant) candidate, you may be curious about the CPA full form and what it means for you.
In this blog, you will find out
Also read our other blogs on CPA
CPA Full form?
CPA stands for Certified Public Accountant. It is a professional designation given to an accountant who has met specific educational, experience, and examination requirements set by a specific jurisdiction. Most states recognize the CPA designation as a highly sought-after credential in the accounting and finance fields.
CPAs are responsible for preparing financial statements, preparing and filing taxes, auditing financial statements, and providing other financial advice to businesses and individuals. They are knowledgeable in various accounting and financial areas and are considered the gold standard in accounting and finance.
Definition of CPA
A CPA is an individual who has completed the necessary educational, experience, and examination requirements to become a Certified Public Accountant. To obtain the CPA designation, one must pass the Uniform CPA Examination. This is a four-part exam administered by the American Institute of Certified Public Accountants (AICPA).
CPAs must also meet the requirements set by the jurisdiction in which they wish to practice. These requirements may include a certain amount of hours in a specific area of accounting and/or a certain amount of experience in the field.
History of CPA
The history of the CPA dates back to the early 1900s when the first CPA exam was administered in New York. Before this, accounting was largely unregulated and led to various fraudulent practices. To ensure the public was getting reliable and accurate accounting services, the state of New York passed the CPA exam in 1896. Since then, the CPA has become the gold standard for professional accounting certifications in the United States and most of the world.
The CPA exam was initially administered by the American Institute of CPAs (AICPA), but in 2004, the National Association of State Boards of Accountancy (NASBA) took over responsibility for the exam. The exam consists of four parts, each of which must be passed to become a certified CPA. The four parts are Auditing & Attestation, Business Environment & Concepts, Financial Accounting & Reporting, and Regulation.
CPA Professional Organizations
There are several professional organizations for CPAs, including the American Institute of CPAs (AICPA), the National Association of State Boards of Accountancy (NASBA), the Association of International Certified Professional Accountants (AICPA), and the National Society of Accountants (NSA). These organizations provide CPAs with access to resources, training, and networking opportunities.
Overview of the CPA Profession
The CPA profession is a highly respected field that requires a great deal of knowledge and skill. CPAs are responsible for preparing financial statements, filing taxes, auditing financial statements, and providing other financial advice to businesses and individuals.
They must understand the various laws and regulations that govern the accounting and finance fields and be able to interpret and apply them accurately.
CPAs are also required to stay current on the latest developments in the accounting and finance fields, as well as changes in tax laws.
They must also be able to communicate effectively with clients and colleagues.
Types of CPA Services
The services provided by CPAs are varied and depend on their specialized areas of expertise. Some of the most common services CPAs provide are tax planning, financial statement preparation, auditing, financial consulting, and management consulting.
- Tax planning is the process of minimizing taxes for individuals and businesses.
- Financial statement preparation is creating financial statements for individuals and businesses.
- Auditing is the process of verifying the accuracy of financial statements.
- Financial consulting is the process of providing advice on investments, financial planning, and other financial matters.
- Management consulting is the process of providing advice on business operations, organizational structure, and business strategy.
Benefits of Becoming a CPA
Becoming a CPA can provide numerous benefits to individuals.
- CPAs are highly respected in the accounting and finance fields and are often seen as the "gold standard" in the industry.
- As a CPA, you will have access to various career opportunities, including those in public accounting, corporate accounting, government accounting, and the not-for-profit sector.
- In addition, CPAs typically earn higher salaries than their non-CPA counterparts. They also have access to many job benefits, such as health insurance, 401(k) plans, and other retirement benefits.
- If you aspire to be CFO or CEO, then adding a CPA will help you in a faster journey to the top.
How to become a CPA?
Becoming a Certified Public Accountant (CPA) requires careful and thorough planning. To get started, you should familiarize yourself with your state-specific CPA Exam requirements to avoid overlooking any essential qualifications.
It's also essential to ensure that the associated application fees and costs are accounted for as early in the process as possible; this is best achieved by staying connected with your State Board of Accountancy.
CPA Eligibility criteria
Students must meet the necessary state education requirements. While these criteria may differ between states, they typically require 150 semester units or 225 quarter units from an accredited college/university in addition to completion of bachelor's and master's degree programs in accounting. The following are the criteria.
- 150-semester units
- A Bachelors degree
- Minimum 24 units in accounting
- You must be 18 years of age.
States which require only 120 units instead of 150
Prospective CPAs across the United States may be cheered to learn that twenty-four states and Guam have implemented regulations that allow individuals with only 120 hours of academic credit to sit for their CPA Exam.
These jurisdictions include Alaska, Arizona, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, New Hampshire, New Jersey, New Mexico, New York, North Carolina Pennsylvania Rhode Island South Carolina Vermont Virginia and West Virginia.
A handful of states and jurisdictions demand that any aspiring Certified Public Account (CPA) be a resident before taking the exam. These include Idaho, Kansas, Louisiana, Maryland, and Minnesota, to name just some - Mississippi, Missouri, Nebraska etc.; all must abide by this crucial requirement too!
Steps in the CPA certification process for Indian students
Becoming a CPA requires a rigorous process of education, examination, and experience.
- To become a Certified Public Accountant, take time to familiarise yourself with your state's requirements for education, residency and age. Doing so will ensure you meet all the qualifications before taking the CPA Exam.
- Submit your transcripts and application fees to the respective state board
- Receive the approval to take the CPA exam, also called Authorization to test (ATT). The ATT is valid for 90 days.
- After paying for the CPA Exam, you can expect to receive your Notice To Schedule (NTS) within four business days. The NTS will authorize access to taking the exam and serve as a necessary step towards success!
- The NASBA website is the starting point for aspiring CPAs to take their first steps towards licensure. Each candidate must select a State Board of Accountancy or CPA Examination Services according to jurisdiction, allowing them full access through the inviting portal to complete all related applications.
The following are Eduyush recommendations for choosing a state for writing your CPA Exam. These states dont have a requirement to have a Social Security number to write the CPA exam, making it easy for International students.
- New York
CPA Exam and Certification
Passing the CPA Exam is no small feat: it requires a deep understanding of various topics, honed skills in multiple-choice questions (MCQs), task-based simulations (TBSs) and written communication tasks – all tested within four tightly restricted hours for each section.
To complicate matters further, each exam contains five tests containing an unknown number of these different types of exercises. With such high demands on time and knowledge, effort should not be spared when preparing to take the CPA Exam!
The exam consists of four sections:
- Auditing and Attestation (AUD): The CPA Exam section assesses a candidate's proficiency in auditing, examining their ability to apply procedures, adhere to generally accepted standards and comply with ethical obligations. Successful completion is necessary for candidates aspiring to be Professional Accountants.
- Business Environment and Concepts (BEC): The BEC section of the CPA Exam is a comprehensive examination that covers business concepts and provides insight into an accountant's ethical and professional obligations in today's economic landscape. It serves as both gatekeeper to certification, as well as preparation for success on future projects.
- Financial Accounting and Reporting (FAR): The FAR section of the CPA Exam is an intensive and comprehensive test of one's mastery over US GAAP. As it covers a wide array of topics, this part demands great dedication and skill from future CPAs during preparation.
- Regulation (REG): The REG section of the CPA Exam serves as a measure for aspiring CPAs to demonstrate their mastery in critical areas related to federal taxation, business law, professional responsibility and ethics. Passing this challenging assessment is essential to becoming a Certified Public Accountant.
CPA Exam format
The CPA Exam comprises three kinds of questions, with each test focusing on a single type. Experienced accountants must demonstrate mastery over these varying formats to succeed in the exam.
- Multiple Choice Questions (MCQ)
- Task-based Simulations (TBS)
- Written communication (WC)
The AUD, FAR, and REG Exams share a familiar style. These exams combine two distinct types of questions - Multiple Choice Questions (MCQs) and Task-Based Simulations (TBSs)- making them challenging yet rewarding tests.
The BEC exam is an intensive assessment of business acumen, testing candidates across multiple-choice questions, task-based simulations and written communication tasks. It provides a comprehensive challenge to all who attempt it!.
The following is the marking scheme across the four sections
The following is the weightage of question types
CPA Exam passing requirements
- Pass each section within 18 months, or your scores may be forfeited! Work diligently to achieve this prestigious certification and its accompanying benefits.
- A minimum score of 75% is required for each section.
- Scoring for online tests is highly efficient, with most of the assessments delivered through automated systems. For Writing Component (WC) questions, however, experienced human graders use sophisticated computer grading programs to deliver an accurate evaluation.
- Overall Pass rates are 50% with FAR is the toughest exam to take.
CPA Exam fees
Jumpstarting your financial career by becoming a CPA is an excellent investment in the future, yet its associated costs can understandably be intimidating. But don't worry - we've provided you with all of the necessary information to help manage expenses and make it worth every penny. To begin, fees differ from state to state, so keep that in mind when seeking finances for this incredible endeavour!
The components of the CPA fees are
- Application fees - 200 USD
- Examination fees - 950 USD
- CPA Exam retake fee - 200 USD
- CPA course fees - 2000 USD
- International student CPA Exam fees for all four subjects - 1500 USD
Overall it can cost around 5000 USD if you are on self-study.
The CPA's full form is Certified Public Accountant. It is a professional designation recognized by most states and is highly sought-after in the accounting and finance fields. To become a CPA, one must meet the educational, experience, and examination requirements set by a specific jurisdiction.
The CPA exam is a comprehensive exam that covers a wide range of topics related to accounting and finance. It is administered by the American Institute of Certified Public Accountants (AICPA) and is considered the "gold standard" in accounting and finance.
Becoming a CPA can provide numerous benefits to individuals, including higher salaries, access to a wide range of job opportunities, and a wide range of benefits if you are interested in becoming a CPA, research and prepare for the exam accordingly.
We hope this blog has helped you better understand the CPA full form and the requirements for becoming a CPA. Good luck on your journey to becoming a Certified Public Accountant!
Students can have any of the following qualifications.
- Member of the "Institute of Costs & Works Accountants in India."
- Member of the "Institute of Chartered Accountants of India."
- Member of the "Company Secretaries in India."
- Master of Commerce.
- B.com graduates pursuing a Master's.
There are plenty of AICPA courses that offer you CPE credits, Eduyush partners with AICPA to offer these courses at Indian pricing. Most of these courses offer between 15-30 CPE credits.
Passing all four sections of the CPA Exam within an 18-month window is essential, achieving a score of 75 or higher on each.
Your notification letter will include when your time limit runs out for those components you have already passed - giving you just under eighteen months from that date to complete any remaining tests and attain success on them all!
Yes students are allowed to take all the four sections together.
No, most states permit international students to sit for the CPA exams.
Yes, the exams and testing pattern is the same.
To take the CPA Exam, a current passport is essential. Successful completion of this exam can open many doors - providing aspirants with numerous career opportunities far beyond borders!
Responding to the changing needs of accounting professionals, the AICPA and NASBA are transforming how CPAs reach licensure. By January 2024, a new core-plus-discipline licensure model will be in effect – designed not only to provide upskilling opportunities for future CPAs but also ensure they possess cutting edge knowledge required by today's evolving profession.
The cost of the CPA Exam can vary depending on the state in which you take it.
Typically, the total fee is between $4000 and $6000 for students on self study.
So, while the CPA Exam may not be considered cheap, it is an investment that can pay off in terms of career opportunities and higher wages.
With the innovative computer-based CPA Exam offered at Prometric Testing Centers, candidates can now access limitless opportunities! You can strive for successful exam results throughout the year through the continuous testing model.
While future attempts will depend on your scores from previous tries of each section – no cap or restrictions control how often you take each part of this rewarding examination.