To reflect the rapidly changing skills and competencies accountants need today, the CPA exam is changing. Starting in January 2024, CPA exam candidates will have the choice to demonstrate skills and competencies in one of three new areas: Business Analysis and Reporting (BAR), Information Systems and Control (ISC) and Tax Compliance and Planning (TCP). To prepare students for the changing profession and the CPA exam, the Department of Accounting recently revised the curriculum to create the flexibility for students to complete coursework in each of these three test areas. Elizabeth Gordon, chair of the Department of Accounting and Cory Ng, associate professor at the Fox School discuss what these changes mean for the industry and for students who are pursuing accounting.
“Currently the CPA exam consists of four parts–Financial Accounting and Regulation (FAR), Auditing (AUD), Business Environmental Concepts (BEC) and Regulation (REG),” says Gordon. “Starting in January of 2024, three parts of the CPA Exam – FAR, AUD and BEC, would remain the similar (to the previous version of the Exam) but the fourth exam REG would be replaced with a choice which would depend on a discipline the student wants to study.”
NASBA says that the new disciplines reflect the three pillars of the CPA profession. The three disciplines would be Business Analysis and Reporting (BAR), Information Systems and Control (ISC) and Tax Compliance and Planning (TCP).
“In addition to these three disciplines, NASBA plans to integrate technology and technology-related topics in the three core sections,” adds Ng.
While the American Institute of Certified Public Accountants (AICPA) usually introduces minor updates to the CPA exam to keep up with changes in accounting standards, governmental regulations and changes in the accounting industry, the changes in January 2024 are part of a major overhaul in the CPA exam, called the CPA Evolution.
Both professors agree that these changes might not be a bad thing.
Ng says, “In my view, these changes are good because the intention behind the changes is to recognize the changing skillset and competencies needed for the future of the accounting profession.”
“In my view, these changes are market-driven,” adds Gordon. “Even before these changes were proposed by the AICPA, we have been identifying these market demands in our curriculum.”
The Fox School already accounts for changes in demand in the accounting industry by incorporating technology andf technology-related courses into curricula.
In the Master of Accountancy (MAcc) program, for example, Gordon teaches Advanced Studies and Financial Reporting, a class that covers most content required for the BAR specialization exam. Two advanced tax classes taught by Fox School faculty David Jones and Wayne Williams prepare students planning to specialize in TCP. And finally, Ng teaches enterprise systems and data analytics which covers several topics on the ISC specialization.
“At the undergraduate level, we have incorporated changes by adding electives focused on each of the three new exams that students can pursue in their junior or senior year depending on the area they might want to specialize in, for the exam,” says Ng.
Since the curriculum is designed to prepare students for a career in accounting, both professors agree that they would not have to decide on a specialization if they didn’t want to. Students could take all electives if they wanted to do so.
“We wanted to build more flexibility for our students,” says Gordon. “Our curriculum, both at the graduate level and undergraduate level is heavily influenced by the CPA or CMA exams and we try to help our students not only excel in obtaining licenses but also maintain skillsets that are current and relevant to the accounting profession.”
The new changes to the CPA exam go into effect starting in 2024. Most students enrolled in the accounting program at Temple would be well equipped to pass these exams with a curriculum already tailored to fit their needs.
“There aren’t a whole lot of changes that need to be made to the curriculum,” says Ng. “For my course, I think there is a little bit of room to create content on SOC engagements (Reports on Systems and Organizational Controls). I hope these changes will go into effect in Fall 2023.”
In terms of recruitment, the new changes are not going to heavily influence the job opportunities for students in accounting firms.
Gordon explains, “To me, it’s natural that if someone specializes in tax compliance, they would be a good fit in the tax department. But what we’ve heard is that firms are still looking for the best fit and choosing a specialization on the exam is not going to predetermine or lock students into a certain path in their career.”
The US Department of Labor says that accountants with a CPA certification are more likely to make 10-15% more than accountants without a CPA certification. For most students entering public accounting, taking the CPA exams is not a choice but something they are required to hold to progress in their careers in public firms.
Be it a financial incentive or career progression, the US Bureau of Labor Statistics estimates that about 50% of the accountants in the US have their CPA certification.
Dealing with uncertainty is difficult. It doesn’t matter how the changes to the CPA exams are structured because Fox professors want students to know that no matter how rough it gets, they are there to help students weather the storms.
“With the changes in the accounting curriculum,” says Gordon. “We’re focusing on the student and helping them develop skills required as they begin their career and throughout their professional life.”