The Certified Public Accountant designation is one of the most sought-after designations in the accounting profession. To be certified, you must fulfill many requirements and pass both an exam and ethics review by your state board of accountancy. Here are five steps to help you become a CPA in 2021
Fulfill the Specific Educational Requirements
CPA candidates must complete the specific educational requirements as stipulated by their state. Every state has different educational requirements. You must check and verify the CPA licensing requirements in your state. But, most state boards need you to get a bachelor’s degree before sitting for a CPA exam.
Generally, the degree must be in business or accounting and must contain at least the core set of coursework. In most states, CPA candidates must have at least 30 credit hours of a business-related course, like business law, finance, or management. They must also have at least 24 college credit hours in taxation, auditing, and accounting education. Other states need CPA candidates to sit for 150 semester hours for the CPA exam.
Apply and Prepare for the CPA Exam
The CPA exam application process is quite lengthy and complicated. Candidates must get their educational requirements verified by their state board of accountancy. Take note that you can only apply for the CPA exam in one state at a time. Once verified, you can now proceed to formally apply for the exams.
Upon the acceptance of your application by the state board, you will get the Authorization to Test and the Notice to Schedule. The ATT allows candidates to decide on the section of the CPA exam they wish to sit for. It is only valid for 90 days.
Upon making a choice, proceed to log in to the NASBA site and pay the fee. Upon successful receipt of the fee, NASBA issues a Notice to Schedule. This schedule enables you to schedule the exam date within six months.
It is advisable to start studying for your CPA exam before applying for it. Choosing the right cpa exam preparation course is key to passing your CPA exam. The right course will ensure that you pass all four sections on your first try. The wrong one will waste a lot of your time to fail in the end. Pick a CPA review course that suits your study schedule, learning style, and budget.
Pass the CPA exam
Passing the CPA exam means scoring at least 75 on a scale of 1-99. You must pass all four sections of your CPA exam within 18 months from when you passed the first section of the exam. Given that there are four test windows every year, CPA candidates can take all the sections at once per every testing window. Although it is not advisable to over-schedule all the sections in the same window as it can be too overwhelming.
Many people recommend a six-week study period for each section. In turn, you can take two sections in every testing window. Take note that you cannot retake one section more than once within one testing window. So, if you fail one section once, you have to wait for the next testing window to retake it.
Pass the Ethics Exam
Once you pass all the sections of the CPA exam, you will have to take an ethics exam within two years of applying for your CPA license. But, this depends on your state board of accountancy as not all state boards need you to pass this exam. So, check with your state board to know if you have to complete this step.
The AICPA Ethics Exam is more of a take-home exam. After you sign up, you will receive an ethical textbook with the ethical obligations and responsibilities every CPA should uphold. Once you complete reading the book, you have to sit for the exam, consisting of 40 multiple-choice questions.
Gain Work Experience and Complete Your Certification
Once you pass both the CPA exam and the Ethics Exam, apply for your CPA license. Successful application of your license requires you to fulfill the work experience requirements as specified by your state board. Different states have varying work experience requirements. They range between 6 months to two years of public accounting work experience or as an accountant in the private industry. Some states also accept work experience from non-public accounting fields but at a higher work experience count.
Upon completing the required work experience, you can proceed to pay the licensure fees as provided by your state board. Then, wait for your certificate in the mail.
From the steps mentioned above, it is a long process to become a licensed CPA. But, the process is completely worthwhile. Completing these steps proves that you have the discipline, ethics, dedication, and passion required from a CPA professional. Furthermore, your license opens doors that you have never considered before. It also makes you one of the most respected professionals the world has to offer.