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What You Need To Know About The Revised CPA Exam

. . . A Webcast for Employers

The views expressed by the presenters do not necessarily represent

the views, positions, or opinions of the AICPA

or the presenters’ respective organizations

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Program Objectives

This program is designed to:• Inform employers about the changes in the

computerized Uniform CPA Examination• Communicate best practices from other

professions• Discover practical ways to motivate your

employees to become CPAs

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Today’s Speakers

Diane Rubin, CPA Partner

Novogradac & Company, LLP

--------John C. Riina

Vice PresidentLegg Mason

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Arleen R. Thomas, CPA Vice President

American Institute of CPAs

--------John F. Hudson, CPA

ModeratorHudson Consulting Group, LLC

--------

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6 Months to Launch

• Historic change • Last paper and pencil exam is over• CBT launches on April 5, 2004• Major milestones have been met/cooperative

effort among AICPA, NASBA and Prometric

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Getting Started

• Contact State Board to determine eligibility

• CBT will be administered in secure Prometric centers

• Eligible candidates will receive a Notice to Schedule (NTS)

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National Candidate Database

• New system created by NASBA• Designed to track each candidate with unique

national ID• All candidate data maintained within the NCD• Ensures only eligible candidates test at

appropriate times • Secures candidate data, including grades

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Dates to Test

Open Closed

April – May June

July – August September

October – November December

January – February March

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Taking the Exam

Upon completion of check-in, the candidate:

• is seated at a designated workstation

• begins the exam after proctor launches

• is monitored • is video taped

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At Completion

Upon completion of the examination, the candidate:

• signs-out• collects his/her belongings• turns in scratch paper • is given a Post Exam

Information sheet

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The Examination

• Four Sections– Auditing and Attestation (4.5 hours)– Financial Accounting & Reporting (4 hours)– Regulation (3 hours)– Business Environment & Concepts (2.5 hours)

• 14 hours total length

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Business Environment & Concepts

• Business Structures • Economic Concepts• Financial Management• Information Technology• Planning and Measurement

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Transitioning Recommendations

Paper & Pencil CBT

Auditing Auditing & Attestation

Financial Accounting & Reporting

Financial Accounting & Reporting

Accounting & Reporting Regulation

Business Law & Professional Responsibilities (LPR)

Business Environment & Concepts

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Granting of CreditImpact on Candidates

• Candidates have more flexibility in terms of scheduling to test

• Candidates can focus study on a section(s) as they feel comfortable

• Can take one or more sections within a month, window or longer period

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Employer Resources

• CBT Tutorial available on www.cpa-exam.org– Provides guided tour of revised

exam– Demonstrates look and feel and

available tools– Allows users to try functionality

themselves

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Employer Resources

• Practice samples available in early 2004

– Condensed set of multiple choice and simulations

– Will be downloadable from website

– Replicate look and feel of CBT

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Multiple Choice Questions

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Simulations

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Simulations

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Simulations

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Simulations

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Simulations

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Simulations

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Simulations

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Simulations

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CBT from the CPA Firm Prospective

• The passage of the CPA exam is critically important to CPA Firms– Quality Control

• All managers must have passed the CPA Exam prior to promotion to manager

• Indicates that candidate has at least the knowledge required for licensure

– Commitment to the Profession– Separates you from your peers and puts you on

the Road to Success– Important in obtaining new clients

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Building Awareness in the Firm

• Recognition and congratulations to those who have passed

• Allow time off to take the Exam• Passage of Exam is a prerequisite to

promotion to Manager• Discussion of changes from paper and pencil

exam to new computer based Exam• Discussion of changes in State Board of

Accountancy Rules

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Best Practices on Discipline to Sit

• Plan ahead– Determine the dates to sit for the Exam– Decide whether to take all parts at once or one or

two at a time– Select a review course or start a study group– Start studying months before you take the Exam– Schedule time off in advance so that you are

available

• Set your targets for passage as soon as you join the firm

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Promoting Studying for the Exam

• Take a review course and study with a colleague

• Use available time, if any, to study for the Exam

• When recruiting we determine candidate’s interest in and plans for taking and passing the Exam

• In house training helps in studying for the Exam

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Current Recruiting Efforts

• Ascertain that recruit has enough hours to sit for the Exam

• Determine whether the recruit has sufficient accounting classes to sit for the Exam

• Determine whether the recruit is planning to take the Exam and when

• Determine through review of GPA, transcripts, and discussions with candidate whether the recruit will have a reasonable chance to pass the Exam

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Communications to Recruits

• When speaking at Beta Alpha Psi or Accounting Association meetings discuss the importance of the Exam

• Discuss the State Board of Accountancy rules relating to requirements to sit for the Exam and requirements for licensure

• Discuss the changes in paper and pencil and CBT

• Refer recruits to www.cpa-exam.org

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The Buzz on the Street

• More convenient scheduling options• Candidate can take one part at a time which might

make it easier to study for and pass• Simulations are an unknown at this time and some

candidates are unsure of their difficulty• Most believe that taking the test on a computer will

not be more difficult than paper and pencil• The new section, Business Environment and

Concepts, worries some• There has been little change in the number of

candidates sitting for the last paper and pencil test in 11/03 vs. 11/02

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AICPA Student Affiliate Membership

• Available to students and recent graduates• Subscription to the Journal of Accountancy

and CPA Letter• $40 subscription to reSOURCE online • Access to AICPA web site and special

student page located at www.aicpa.org/nolimits

• Scholarship opportunity through AICPA/Accountemps

• Discounted subscription to The Tax Adviser

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AICPA Student Affiliate Membership

- CPA2BIZ Web Site- Significant discounts on publications, software,

professional development courses and conferences- AICPA Competency Assessment Tool- Access to AICPA Antifraud & Corporate

Responsibility Center- AICPA Member Elite Values Program- Access to AICPA’s Technical Information Hotline

(Recent Grads only)

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A Case in Point . . .Experiences within the Securities Industry

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Professional Alliance Group

Legg Mason’s Alliance Program

Create alliances with accounting firms to provide their clients with a broad array of financial services through a team-work approach or referral process.

CPAs remain in a counseling role within our program and clients benefit through a coordinated financial strategy.

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Legg Mason

Legg Mason Background

• NYSE Broker Dealer

• SEC Registered Investment Advisory Firm

• Manage $215 billion

• Advising investors since 1899

• 130 offices, 1300 Financial Advisors

• Alliance programs since 1990

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Securities Industry

Broker Dealer Registration

• Tests – Series 6, 7, 8, 9, 24, 26, 63

Investment Advisor Registration

• Tests – Series 65, 66

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Central Registration Depository

• NASD tracks each candidate with a unique national ID – CRD Number

• All candidate data is maintained within the CRD System

• Ensures only eligible candidates test at appropriate times

• Secures candidate data, including grades

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The Examination

• 8 hours total length• The test is created by the computer

a. selects questions from each categoryb. creates a unique exam from a pool of thousands

of questions

• Multiple choice questions• True – False questions• Pick all that apply• Distinct topics are mixed throughout Exam

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Securities Exam Preparation

• Establish a 120 day window by completing and filing a form U-4

• Receive a CRD number –ID within the NASD• Study for Exam – Schedule your study time

for several weeks• Call Prometric 3 weeks prior to preferred

exam date• You can change date within window – 3 days

prior

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Securities Exam Preparation

Study Process

• Read selected chapter• Take chapter test – CD Rom• Continue process throughout book• Take full practice exams until scoring 80%• If you don’t take the exam during your

window, you must pay for another window to take the exam in the future

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Best Practices For Exam Day

• Sleep well• Arrive early• Review highlight sheets• Bring ID• Dress comfortable – Layers• Leave materials in car• Pack your lunch

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Taking the Exam

Upon completion of check-in, the candidate:

• is seated at a designated workstation

• begins the exam after proctor launches the session

• is monitored by a Test Center Administrator

• is video taped• calculators and paper are provided

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At Completion

Upon completion of the Examination, the candidate:

• signs-out

• collects his/her belongings

• is given a Post Exam Information Sheet

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Continuing Education Requirement

CBT – Computer Based Training

• 2nd Anniversary• Every 3rd anniversary thereafter• 120 day window to complete

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Best Practices for Personnel Policies

• Compensated for study time?• Compensated to sit for the exam?• Reimbursement of Prometric Seat Charges –

“window”• Reimbursement of NASD fees

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General Reactions to Computerized Exams

• Securities exams have been computerized for several years

• Provides a flexible study and testing process• Provides ability to become licensed in a

relatively short period of time

Revenue producing employee

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General Reactions to Prometric Testing Centers

• Convenient

• Professionally Run

• Secure

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Summary & Questions

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Thank You For Participating!

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Upcoming CPA Examination Webcasts

For a complete listing, check our website at http://www.cpa-exam.org

Date Time Title

1/14/04 1pm – 3pm EST

Candidates: Registering for the computerized CPA Exam

2/17/04 1pm – 3pm EST

Students and Candidates: Preparing for the revised CPA Exam