New CPA exam blueprints have arrived!

Updated: May 9, 2021

They’re here! The AICPA has published updated CPA exam blueprints. New and expanded content was added to keep the CPA exam relevant to the knowledge a new CPA needs.

The Uniform CPA Exam covers four areas: Auditing and Attestation (AUD), Business Environment & Concepts (BEC), Financial Accounting & Reporting (FAR), and Regulation (REG). The format is the same for the four sections: multiple-choice questions, simulations, and written communications (BEC only). The content changes take effect in July 2021 and mostly impact the BEC and AUD sections.

D.R.E.A.M. (Data Rules Everything Around Me)

Yes, it does! Most things we see, purchase, consume, and enjoy are based on data to some degree. When you search Amazon for paper towels, you get a list of “similar products” or things people like you have purchased. Companies use data from our lifestyle, mostly our phones, to put things in front of us that people “like us” or those with similar preferences showed interest in.

It’s no different in business. Companies want to understand the drivers behind the business activity and profits. They need to analyze the data to make decisions, but first, the data must be accurate and good enough to be relied upon for these decisions.

Overall, there’s a focus on data - the gathering, integrity, and analysis of data. These aspects have become more important as CPAs have shifted from siloed data entry operators to partners and advisors. Companies rely on our expertise to not only produce financial statements but also to make business decisions.

BEC changes

For BEC, or Business Environment & Concepts, candidates must understand how to assess business processes specifically around:

  • Automation

  • Governance

  • Risk and internal controls

BEC is that exam section with 5 unrelated areas: enterprise risk management, economics, financial management, information technology, and operations management. There is, however, 1 thing that connects them: technology.

Many candidates are baffled by IT being tested on the Certified Public Accountant exam. I distinctly remember all the days and nights I was studying but still flabbergasted by an accountant’s need to master IT content to pass the CPA exam. There’s more correlation than you would think and the AICPA has expanded this section to reflect that. Candidates must understand IT systems and the risks around controls, applications, and data integrity.

AUD changes

There’s also more emphasis on IT in the audit section of the CPA exam. Specifically, candidates must understand IT from the internal controls perspective and the auditor’s reliance on technology in performing the audit. Candidates must also evaluate the completeness and accuracy of data.

Business processes

These updates to the CPA exam reflect the evolution of business processes as many companies convert to automated environments. Automating business processes requires many companies to outsource to a third-party service organization. This increased external reliance is emphasized in testing differences between SOC (System and Organization Controls) reports relative to business needs.

As many public and private companies have improved processes to incorporate automation, there are just as many that have not. Journal entries, invoice processing, and cash receipts are transactions that can be automated in the accounting cycle. The challenge comes for newly licensed CPAs working for companies that have not implemented automation. As candidates these CPAs learned about automated processes, documentation, and internal controls, but what happens when this environment doesn’t exist?

The CPA Evolution expected in 2024 changes both the format and model of the CPA exam to focus on core accounting, auditing, tax, and technology. The new CPA exam will require candidates to pass 3 sections plus a fourth exam that focuses on one of the following self-selected areas:

  • Tax compliance and planning

  • Business analysis and reporting

  • Information systems and controls

The new model enhances a new CPA’s skill set by focusing on the skills most in demand. It also provides clarity for new CPAs in choosing a niche as there are numerous career options and specialties for CPAs.

Topics no longer tested

Some exciting news for CPA candidates: as of July 2021, GAAP vs. IFRS differences are no longer tested! *cue the confetti* Estate taxes and trusts were also removed. These topics are not considered as relevant to the profession as others.

Candidates almost got lucky because governmental accounting’s removal was heavily debated. Government and nonprofit accounting is a big topic of discussion in CPA exam study groups because candidates struggle with the concepts and their variations from business accounting. It’s still testable now but might be removed later as subsequent practice analyses are performed.

The CPA exam blueprint changes are different from the CPA evolution we’ve been hearing about. That’s a bigger undertaking and at least a couple of years put. Hopefully, you’ll be a CPA and not a