Congratulations! You are thinking of getting your CPA, which is a great way to advance your career as an accountant. So, how do you earn your CPA credentials? There are a number of boxes to check before you can get your license and it can feel a little overwhelming at times. Below, you will find the process broken down into 5 steps, namely:
Step 1: Meet the Educational Requirements
To qualify for the CPA exam you will need to gather 150 college credits. If you have completed a standard Bachelor’s degree you will already have 120 credits under your belt. This leaves a 30 credit gap which needs to be filled. Since 30 credits (measured in hours) amounts to one full year of education, many candidates choose to complete a one-year Masters program. Alternatively, you may decide to accumulate extra credits by taking courses at a community college.
A great way to gather your 30 extra credits is by taking online courses. CpaCredits offers an exciting range of accredited courses to get your CPA online.
When it comes to collecting your 30 extra college credits there are a number of options, so do your research and choose a route that works best for you.
Of the 150 credit hours, it is necessary that a certain portion is gathered by completing accounting and / or business-related courses. The exact requirements, however, vary by state. It is recommended that you check with the relevant board in the state you will be sitting for the examination.
Step 2: Apply to Take the CPA Examination (…and start studying!)
This step is a little more complicated than it sounds. First, you will need to submit your college transcripts to the state board of accountancy, which is responsible for verifying your educational history. Your state will then grant an authorisation to test (ATT). Here, you are also required to pay a fee to your state board of accountancy. Once approved, submit your ATT to the National Association of State Boards of Accountancy (NASBA), which will provide a notice to schedule (NTS).
Your NTS is basically a document that allows you to log into the Prometric website and set up your CPA examination. You will need to get a new NTS for each section of the examination that you write. From here, you will be required to pay separate fees to NASBA for each section of the CPA examination. Remember, once you have your NTS, you have only six months to set up your first examination date. It is recommended that you do this well in advance, as spots fill up fast.
Once you have scheduled your CPA examination, you will need to start studying! At this point in your CPA journey it is probably a good idea to check out our tips for passing the CPA exam. Choosing a suitable CPA exam preparation course can make or break your CPA journey. Look for one that works with your learning style, budget, lifestyle, and schedule.
Step 3: Write the CPA Examination (and pass!)
The CPA examinations are written in Prometric centers around the US. Under the current circumstances, it is a good idea to consult the websites for AICPA, NASBA, and Prometric before your test. They frequently update information about the running of tests during the COVID19 pandemic.
The CPA examination consists of four sections and runs over four testing windows throughout the year. Candidates can complete the sections in any order. Some might want to do the easiest section first, others may want to get the hardest section out of the way. Once you have passed the first part of the exam, you have 18 months to complete the remaining three. If you don’t pass all four sections within an 18 month window, your first examination will have expired and you will be required to retake it.
You are able to take each section once per testing window, but there is no need to rush. It is recommended that CPA candidates study for about 6 weeks for each part of the exam. Rather than scheduling all four sections for one testing window, give yourself time to learn and rest.
Once you are ready to write the exam, you should familiarize yourself with the layout and grading system. The exam is graded on a scale of 1-99. In order to pass each section, candidates must achieve a score of 75 or higher. Scores for each section completed are released at the end of each testing window. The exam’s grading system is a little complicated, but it may be useful to understand how the different sections of the CPA exam are weighted before you write.
It might also help you to know that the CPA examination is written on a computer. You don’t need to have any specialized computer skills, outside of basic spreadsheet and word processing functions. You will also need to work with a four-function online calculator. If you’re feeling uncertain, it might be a good idea to familiarize yourself with the AICPA’S CPA exam software tutorials.
The CPA exam is known to be challenging, so it’s important that you are well prepared.
Step 4: Write the AICPA Ethics Exam
After completing your CPA examination, you are likely going to need to write the AICPA Ethics Exam. The ethics examination is required by most state boards, but it is worth checking if it is mandatory in your state.
Fortunately, you don’t need to take the ethics examination immediately after passing the CPA exam. Phew! Once again, check with your state board. Most states require that candidates pass the ethics exam within a year or two of their CPA examination.
After you sign up for your AICPA Ethics Exam, you will be mailed an ethics textbook. Much of the content comes from the AICPA Code of Professional Conduct, outlining the ethical duties and obligations that CPAs must uphold. However, your exam is also likely to include topics unique to your state board.
The examination is taken online and consists of multiple-choice questions. To pass, candidates must answer at least 90 percent of the questions correctly. Don’t worry too much about this examination… While a good understanding of ethics is very important for prospective CPA’s, most people find the AICPA Ethics Exam easy to pass. It is an open book test, so you will have the opportunity to refer to your ethics textbook during the online examination.
Step 5: Meet the Work Experience Requirements
The work experience requirements that you will need to gain CPA credentials differ depending on your state. The timeframe ranges from as short as 6 months to 2 years of experience in accounting, working under supervision of a CPA.
In some states, candidates can obtain their CPA certificate upon passing the examination before they have completed their experience requirements. These are known as two-tier states. These jurisdictions are different from one-tier states, where candidates must pass the CPA exam and fulfill the experience requirements before obtaining their certificate. In both cases, experience is absolutely necessary before you can obtain your CPA license and begin practicing.
How Long Does it Take to Become a CPA?
This is not a straightforward answer. The typical year of college earns you 30 credits, meaning that you would usually have earned 120 credits upon completing a basic four-year Bachelor’s degree. Many then follow the Master’s degree route for their final 30 credits. That is a five-year commitment so far to reach the 150-credit limit.
Therefore, coupled with work experience and CPA exam prep for the four part Uniform CPA Exam, this could take about 6 or 7 years in most states. It might also take longer if you fail any part of the exam, which is unfortunately a real possibility given the 46.37%-61.76% pass rate for each section in 2020. This is one of the reasons that they give you an 18-month window from each passed section to pass the remaining three parts before your results expire. This is shortened in states that allow you to sit the exam before you have completed you work experience and have only acquired 120 credits so far.
However, the 100% college route is both a major time and financial commitment that more and more people are trying to avoid by searching for alternative methods of gaining credits. Below, we will outline some faster methods to becoming a CPA accountant.
There is a 150-credit hour requirement in all states before they will issue you your CPA License. This holds true even if you passed the full Uniform CPA Exam in a state that allows you to sit with only 120-credits. As explained above, this means that you will still need to obtain another 30 credits on top of your basic four-year degree.
It is also important to note that each state has its own accounting and business course credit requirements. Furthermore, some states will only accept certain types of credit courses, while others will only accept college credits from NASBA approved colleges. These would exclude online courses that are not accredited through a NASBA-recognized college.
Getting a jump start in high school
In this article, we have highlighted a number of useful ways to earn credits before you have even earned you high school diploma. Depending on the time invested, you could shave off a semester to two year’s-worth of credits before even getting your highs school diploma and officially entering into a college. In fact, in one case a home-schooled 17-year-old was able to earn her CPA thanks to combining a number of different credit-earning options together. However, that is a very rare phenomenon.
Getting credits while working
Completing your work experience requirements while acquiring the last 30 credits you need after completing your Bachelor’s degree is another way of saving both time and money. Whether it is by taking night courses at a community college, or going the online route, this will provide you the flexibility you need to get the credits you need without breaking the bank. CpaCredits courses is one such resource, as all of the courses are accredited through Monroe College, whose accreditation is in turn recognized by both NASBA and ASBSP. Each course takes 7.5 weeks to complete, awards 3 credits and can be done in your own time.
Take it Slow, and Enjoy the Process!
Remember, becoming a CPA is not just about checking the boxes and passing the examination. The skills that you will learn as you move towards gaining CPA credentials are going to be essential as you embark on your career – so take your time, enjoy yourself, and try to absorb the information. Good luck!