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J. Michael Barham, CPA, Deputy DirectorNorth Carolina State Board of CPA Examiners
About the Board Established in 1913 by NCGS Chapter 93 to license and regulate CPAs Grants certificates to individuals that meet the legal requirements Adopts Rules of Professional Conduct to be observed by CPAs in this State Registration of CPA firms Administration of the Uniform CPA Examination
About the Board continued Administration of the continuing professional education (CPE) compliance program Conducts administrative hearings with respect to state statutes and rules (process 150 to 200 cases per year) 7 Board members (5 CPAs and 2 public members; serve 3 year terms ) Monthly newsletter (Activity Review)
The Three E’s of LicensureThree E’s are required for CPA licensure Education (to sit for the Exam, to become licensed) Exam Experience
Education to Sit for the Exam Bachelor’s degree with a concentration in accounting A concentration in accounting is At least 30 semester hours, or the equivalent in quarter hours, of undergraduate accountancy courses including no more than 6 semester hours of accounting principles and no more than 3 semester hours of business law; or At least 20 semester hours or the equivalent in quarter hours, of graduate accounting courses that are open exclusively to graduate students; or A combination of undergraduate and graduate level courses equivalent to either option above.
Education for Licensure 150 semester hours (including a concentration in accounting and 24 semester hours of coursework including at least one 3-semester hour course from at least 8 of the following fields of study: Communications; Computer technology; Economics; Ethics; Finance; Humanities/social science; International environment; Law; Management; or Statistics Masters or more advanced degree in accounting, tax law, economics, finance, business administration, or a law degree from an accredited college or university is in compliance with 150-semester hour requirement.
Uniform CPA Exam According to the CPA Exam Mission Statement, the purpose of the Exam is "To admit individuals into the accounting profession only after they have demonstrated the entry-level knowledge and skills necessary to protect the public interest in a rapidly changing business and financial environment.” The Uniform CPA Exam is the exam that an individual must pass in order to qualify for licensure as a CPA in any of the 55 US jurisdictions (the 50 states, the District of Columbia, Puerto Rico, US Virgin Islands, Guam, and the Commonwealth of Northern Mariana Islands).
Uniform CPA Exam continued The CPA Exam is presented by three organizations—the AICPA, NASBA, and Prometric AICPA writes (question development) and scores the exam NASBA issues Notices to Schedule (NTS) to candidates based on Board-approved applications, releases scores to state boards of accountancy, and maintains a central database of candidate records Prometric offers the Exam Monday – Friday at 300+ testing centers in the US (NC has sites in Asheville, Charlotte, Greensboro, Raleigh, Greenville, and Wilmington)
Uniform CPA Exam continued Computer-based format since April 5, 2004 Prior to this date the exam was pencil and paper and given twice per year (May and November) On January 1, 2011, CBT-e (Computer-Based Testing evolution) was launched Largest revision since 2004
Uniform CPA Exam continued 4 sections Auditing and Attestation (AUD)- SAB & SARS Business Environment and Concepts (BEC) – Corp. governance, economic concepts, financial management, IT, operations management Financial Accounting and Reporting (FAR) – financial statement presentation, govt., not-for-profit Regulation (REG) – ethics, business law, taxation
Uniform CPA Exam continued• Same test no matter where it is taken (Portland, Oregon is same as Portland, Maine)• Passing score is 75 on a 0-99 scale• Question types include multiple choice, simulation, and written communication
Uniform CPA Exam – CBT-e CBT-e changes are available on AICPA exam website (www.aicpa.org/becomeacpa/cpaexam/examcontent ) include: FASB Accounting Standards Codification made available New on-line calculator Improved candidate performance report New spreadsheet software Exam content change International Standards (refer to article in the Spring 2010 issue of the Uniform CPA Examination Alert, available on AICPA exam website)
Uniform CPA Exam – CBT-e continued Scoring weights AUD, FAR and REG – 60% MC, 40% task-based-simulations BEC – 85% MC, written communications 15% Section structure AUD, FAR, and REG – 3 MC testlets and 1 testlet containing 6 to 7 task- based simulations BEC – 3 MC testlets and 3 written communication task on BEC topics Section time allocations AUD shortened by ½ hour to 4 hours BEC increased by ½ hour to 3 hours Short task -based simulation questions versus the long format
Applying to Take the Exam Exam cost is $973.20, including $230 initial application fee (effective 10/20/12 = $953.20) Don’t procrastinate Sign up for all four parts while it is fresh in your mind. It is a better approach and it saves you money (Board charges initial application fee of $230 plus re-exam fee of $75) Your best chance of passing is within the first 6 months of graduation You never know about the future (job demands, marriage, family) National and State Pass Rates (2012 Q-3) FAR (53.90/57.00) REG (51.30/62.80) AUDI (50.10/57.10) BEC (57.60/73.20)
Applying to Take the Exam continued If you have a questions about the “pertinent data” section of the application, contact the Board for clarification (arrested, charged, convicted, found guilty of, received a Prayer for Judgment, or pleaded nolo contendere to any criminal offense?) Be up front and honest about your court record and any current or previous charges (we need to know about probation, too) Read the application carefully and submit all necessary documentation Passport-type photo Method of contact Official college transcripts (no copies), 3 moral character references (no family members)
Applying to Take the Exam continued Takes 10 to 15 business days to process your exam application Notice to Schedule (NTS) from NASBA (valid for 6 months and never extended) How to schedule to sit for the exam (visit Prometric website, www.prometric.com, or call Prometric) Four (4) testing windows available (Jan./Feb., Apr./May, July/Aug., & Oct./Nov.)
Applying to Take the Exam continued Read the application instructions carefully and collect all the required information & documents Picture Check or credit card info Transcripts, and Moral character information If you have questions, call or e-mail us No need to send your application by FEDEX, UPS, or certified mail If your application is not right, we send it back
Common Issues for Exam Candidates Not receiving e-mail from NASBA or Prometric Fastest way to receive NTS, etc., is to elect to have sent to email, but make sure messages don’t get stopped by spam filters, etc. Not getting the day/time you want at the center you want Schedule your section(s) the day you get your NTS schedule your section(s) in the first month of the testing window (January/April/July/October ) because seating is limited in the last weeks of second month of testing windows (February/May August/November) Schedule your exam on off peak days— Tuesday, Wednesday, Thursday
Common Issues for Exam Candidates continued Being late to your testing appointment (if more than 30 minutes late, you are considered a “no show”) Know where the Prometric center is located & leave early in case of traffic problems Not taking your NTS with you to the test center (without it, not able to test) When you receive your NTS, make a copy and place it in the glove compartment of your car
Common Issues for Exam Candidates continued Not taking your IDs (NTS plus primary and secondary IDs) to the testing center or not taking the proper IDs to the testing center Before you leave for the testing center, check again to make sure you have your NTS and IDs Acceptable primary IDs are driver’s license, passport, or US Military ID Acceptable secondary IDs are credit card, debit card, or ATM card Unacceptable forms of ID include green card, Social Security card, and college/university student ID
Common Issues for Exam Candidates continued Not being admitted to the testing center because the name on you NTS does not match your IDs When you receive your NTS, verify that the name matches the IDs you will use--if not right, get a new NTS Showing up at the testing center on the wrong day or at wrong time or for the wrong section When you get your NTS, verify the section and then schedule your appointment and write the appointment day/time down someplace you won’t lose it or add it to your phone’s calendar
Common Issues for Exam Candidates continued Not being adequately informed about the Exam policies, procedures, etc. As part of your study plan, read the Exam information available on the Board’s website, the NASBA website, and the AICPA website (candidate bulletin, content specifications, etc.) Not knowing how to use the Exam software Software is unique to the Exam—you must complete the tutorial and sample tests available on the AICPA website You may have the knowledge to answer all the questions on the exam, but if you cannot enter those answers it does not matter
Common Issues for Exam Candidates continued Failure to start (launch) the exam section After being seated and entering your password, you have 10 minutes to get through the screens and begin the exam If you take longer than 10 minutes, the exam session is terminated and it cannot be restarted. You use lose your session—it cannot be reinstated Writing down mnemonics and notes from a review course can cause this to happen Taking too much stuff to the testing center Only NTS , IDs, & materials provided at testing center (pencil, scrap paper & earplugs), are allowed in testing center Storage is provided for personal items—only take what you must have
FAQs about the ExamQ. Do I have 120 days after my Exam application is approved by theBoard to meet the educational requirements?A. Yes, a candidate has 120 days after his/her Exam application isapproved by the Board to meet the educational requirements.Q. How much time do I have to pass all sections of the Exam?A. Once a candidate receives credit for a section of the Exam, he orshe will be allowed a maximum of 18 months to pass all remainingsections of the Exam in order to retain credit for the passedsection(s).Q. When does the 18-month period for my Exam credit begin?A. The 18-month period begins on the date the first passed sectionwas taken
Exam Score Notices NC Exam candidates can access their Exam scores online through the NASBA Gateway www.nasba.org/exams/cpaexam/northcarolina/ Scores are usually available 24-48 hours after the AICPA releases grades to NASBA Check the Board’s Twitter feed and Facebook page for notification
Applying for Licensure Pass the Uniform CPA Exam Complete the education requirement Complete the experience requirement 1 year in the field of accounting under the direct supervision of a licensed CPA, or 4 years in the field of accounting Complete the accountancy law course (within 12 months of applying for licensure)
Applying for Licensure continued Application for original NC CPA license requires: Recent passport-type photo Three moral character affidavits from licensed CPAs, Experience affidavit(s) 150-semester hour worksheet Any official transcripts not submitted with your Exam application Licensing fee of $100 (check or credit card) Make sure you truthfully answer all questions
Applying for Licensure continued If did not sit for the Exam as an NC candidate, must include Application for transfer of credit Interstate Exchange form All transcripts (official only) to show compliance with education requirement
Maintaining Your License Keep up with changes in rules and statutes Activity Review (monthly newsletter) Website (www.nccpaboard.gov) Twitter (@NCCPABoard) Facebook (www.facebook.com/NCCPABoard) Comply with the annual CPE requirements 40 hours annually Ethics course (2 hours group-study or self-study from a CPE sponsor registered with the Board or on the NASBA National CPE Sponsor Registry)
Maintaining Your License continued Renew license annually by June 30 No postcards to remind you Online Answer truthfully all questions about CPE, moral character, etc. Register a firm If you use CPA in or with the name, and If you perform attest work (audits, reviews, compilations, or agreed-upon procedures) CPAs may only perform attest work while working in a CPA firm
Maintaining Your License continued File and pay all taxes on time (business, individual and 941) Only perform engagements that you are qualified to perform Do not take on attest engagements that you are not up to speed on without a pre-issuance reviewer Return client records upon request Keep client records confidential Respond to clients in a timely manner Respond to any Board inquiry promptly