June 19, 2018

If I Pass CPA Exam Parts in 2010, Will I Have to Pass Them Again in 2011?

Have a question on the CPA Exam? What section is easiest? How should I study for Regulation? Are pants mandatory at the testing site? Shoot us an email with your query.

It’s the big question on everyone’s minds so we better address it now before you cute little CPA exam candidates start freaking out:

Do you know what will happen if as of December 31, 2010 I have completed two sections of the exam? Will I only have to take the remaining two sections or will I be subject to the new exam parts coming in 2011?


Good question. First of all, keep in mind that a lot of the hype surrounding the 2011 changes is:

A) CPA Review course marketing (“buy new materials! Be sure you’re up to date!”)

B) AICPA marketing (“Hey! Check out how advanced we are and how easily we can integrate a whole new set of standards into our psychometric exams!”)

C) Misinformation spread by candidates who “heard from someone” that BEC will now contain 10 simulations and all of them will be graded.

Just stop. The two biggest changes for 2011 are the addition of IFRS (which will mostly affect FAR) and communications in BEC, that’s it! That means get FAR out of the way this year if you can and throw in BEC before December if you are allergic to written communication. The exam changes twice a year anyway, this is nothing new.

Now that that’s out of the way, the rolling 18 month period also stays the same so whatever you have passed in the last 18 months will still be good. Again, if you’re freaking out about all of this, get FAR done ASAP and you will have minimal IFRS and GAAP codification garbage to deal with. A few sections are moved around (for example, business structures will be moving out of BEC) but it’s mostly the same content. REG is hardly changed at all and AUD will be one half hour shorter with more on professional ethics while BEC will be one half hour longer with written communications.

Simulations are trimmed down to “simlets” and instead of getting one topic, you have a better chance of doing well as they will be smaller and consist of several different topics. In my opinion, the exam is just getting easier.

I’m willing to bet that testing will be a bit of a bumpy ride for the first two windows of the year as the AICPA BoE gets its bearings with the new information and somewhat adjusted formats. But debits are still on the left and credits on the right so it’s not worth getting bent out of shape over; the exam will still suck and you’ll still have to study but thankfully, just like thousands of CPAs before you, you’ll rarely use anything you learned for the exam in the real world.

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor. You can see more of her posts here and all posts on the CPA Exam here.

Have a question on the CPA Exam? What section is easiest? How should I study for Regulation? Are pants mandatory at the testing site? Shoot us an email with your query. It's the big question on everyone's minds so we better address it now before you cute little CPA exam candidates start freaking out:

Do you know what will happen if as of December 31, 2010 I have completed two sections of the exam? Will I only have to take the remaining two sections or will I be subject to the new exam parts coming in 2011?

Good question. First of all, keep in mind that a lot of the hype surrounding the 2011 changes is: A) CPA Review course marketing ("buy new materials! Be sure you're up to date!") B) AICPA marketing ("Hey! Check out how advanced we are and how easily we can integrate a whole new set of standards into our psychometric exams!") C) Misinformation spread by candidates who "heard from someone" that BEC will now contain 10 simulations and all of them will be graded. Just stop. The two biggest changes for 2011 are the addition of IFRS (which will mostly affect FAR) and communications in BEC, that's it! That means get FAR out of the way this year if you can and throw in BEC before December if you are allergic to written communication. The exam changes twice a year anyway, this is nothing new. Now that that's out of the way, the rolling 18 month period also stays the same so whatever you have passed in the last 18 months will still be good. Again, if you're freaking out about all of this, get FAR done ASAP and you will have minimal IFRS and GAAP codification garbage to deal with. A few sections are moved around (for example, business structures will be moving out of BEC) but it's mostly the same content. REG is hardly changed at all and AUD will be one half hour shorter with more on professional ethics while BEC will be one half hour longer with written communications. Simulations are trimmed down to "simlets" and instead of getting one topic, you have a better chance of doing well as they will be smaller and consist of several different topics. In my opinion, the exam is just getting easier. I'm willing to bet that testing will be a bit of a bumpy ride for the first two windows of the year as the AICPA BoE gets its bearings with the new information and somewhat adjusted formats. But debits are still on the left and credits on the right so it's not worth getting bent out of shape over; the exam will still suck and you'll still have to study but thankfully, just like thousands of CPAs before you, you'll rarely use anything you learned for the exam in the real world. Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor. You can see more of her posts here and all posts on the CPA Exam here.

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Score One for U.S. GAAP

two thumbs up.jpegU.S. GAAP just got a little boost in its image versus its sexy rival, IFRS, courtesy of Audit Integrity, a research services firm.
Audit Integrity studied filings by European companies from 2001 to 2008, looking at filings both pre and post IFRS adoption. The objectives were, “to determine whether IFRS has been implemented consistently across Europe, whether it has resulted in a common method of reporting financial data, and how the depth and comparability of data under IFRS compares to U.S. GAAP.”
At first glance, one might think that with all the bashing of U.S. GAAP in recent years that this was IFRS chance to prove once and for all that it was the new cock of the walk.
Well, not so fast GAAP haters:

“Based on our analysis, we are not seeing a significant improvement in financial reporting when companies shift to IFRS,” said Jack Zwingli, CEO of Audit Integrity. “We found that IFRS is a common standard, but there are significant variances in IFRS reporting, in the completeness of information, the timeliness and the filing frequency.”

Sounds like IFRS ain’t all that does it? You want more?

The firm says overall there are indications that financial reporting is more consistent and more comparable under IFRS than before IFRS adoption in Europe, but it’s not clear that IFRS represents an improvement over U.S. GAAP. In fact, the firm’s report says GAAP filers may have an edge over IFRS filing in terms of the timeliness, depth and breadth of financial data provided to investors.

Ouch, IASB. You want the best part? The Europeans disclose less on executive compensation than we do here in America. You’re all familiar with how popular corporate executives are. To wit:

[Jack] Zwingli [Audit Integrity CEO] said he was also surprised that the analysis revealed IFRS generally provides less information about executive compensation. “It’s not good in the United States, but it’s better than it is in Europe,” he said. “There is more consistency in reporting and deeper coverage of data under GAAP than under IFRS.”

Seems like IFRS has got work to do…IASB, you can call us when you want to get serious.

Study Pokes Holes in IFRS Reporting Quality, Consistency
[Accounting & Auditing Update/Compliance Week]

The Convergence Debate, Already Geeky, About to Get Geekier

Academics in the U.S. aren’t too psyched about the benefits of IFRS, according to Compliance Week:

The United States already meets a high level of reporting quality relative to other countries as a result of various “institutional features,” said [Peter] Wysocki [Professor at MIT]. Those include things like an active investor and analyst community, a rigorous audit process, and oversight by the Securities and Exchange Commission, among others, he said.
“It’s a little difficult to argue a move to IFRS will result in significant improvement in reporting quality,” Wysocki said. “We’re already at a high level because we already have those institutional features in place.

The debate over convergence has reached Biggie/Tupac fever and now that U.S. GAAP has got American bookworms shouting about how IFRS isn’t all that, we expect that academics on the other side of the pond will get involved and the debate will get fiercely geekier.
Academics: Move to IFRS Won’t Boost Reporting Quality [Compliance Week]