CPA Evolution: what’s next?

The AICPA and NASBA created CPA Evolution as an initiative to recognize the skills and knowledge CPAs need in a technology-driven marketplace. The new CPA licensure model was developed over three years of research and data collection with over 40 discussion groups and discussion with over 3,000 stakeholders. The model was built to be dynamic, allowing the license to adapt and evolve as the profession and the marketplace dictates. The core and discipline model was first presented in October 2019 and then again in March 2020.

The AICPA Governing Council and the NASBA Board of Directors recently voted to support advancing the CPA Evolution initiative. They are establishing plans for a multi-year effort to implement this licensure model. The goal is to launch a new CPA Exam in January 2024.

Model Details

The new model is a core + discipline licensure model. The model starts with a deep and robust core in accounting, auditing, tax and technology that all candidates must complete. Then, each candidate will choose a discipline in which to demonstrate more in-depth skills and knowledge. Regardless of the chosen discipline, this model leads to full CPA licensure, with rights and privileges consistent with any other CPA. A domain selected for testing does not mean the CPA is limited to that practice area.

This model:

  • Enhances public protection by producing candidates who have the in-depth knowledge necessary to perform highquality work, meeting the needs of organizations, firms and the public
  • Is responsive to feedback, as it builds accounting, auditing, tax and technology knowledge requirements into a robust common core
  • Reflects the realities of practice, requiring deeper proven knowledge in one of three disciplines that are pillars of the profession
  • Is adaptive and flexible, helping to future-proof the CPA as the profession continues to evolve
  • Results in one CPA license

Education/Academia

Throughout the research, academic institutions of all sizes were interviewed about their needs and thoughts on the new model. Academia notes that while they are mainly supportive of the new model, they need resources and support to prepare for the change adequately. Professors need education to ensure they are up-to-date on the latest changes and resources to integrate into their curriculum. Most institutions see the model as an opportunity to grow/adjust their undergraduate and graduate programs.

CPA Exam

With all of these changes, what will the CPA Exam look like? While an exam practice analysis will ultimately determine all changes to the exam, the AICPA and NASBA propose it will follow this structure:

• Designed for 1-2 year (entry) level

• 16-hour exam • Candidates pass four sections (3 core + 1 discipline)

• Exam sections are taken in any order; maximum = four sections

• No option to pass additional disciplines • All sections cover discrete content and a range of skills (including higher-order)

• Discipline passed will not differentiate the license granted

 

Students/Candidates

As the primary demographic affected by the changes, students and exam candidates were surveyed to gauge how they would receive the new licensure model. AICPA and NASBA surveyed over 600 students and recent graduates and found that students are comfortable focusing on a specific discipline. Given the structure of existing learning tracks in undergraduate and graduate programs, selecting a focus area in an internship and selecting a practice area in a full-time job offer, students are already concentrating on specific disciplines. The model does not dissuade candidates; most say it increases their interest in the CPA.

Specific results from the AICPA and NASBA surveys were:

  • 91 percent of juniors, seniors and graduate students, and 78 percent of sophomores surveyed have either selected a focus area or are comfortable doing so
  • The model either increases or does not dissuade interest in CPA for accounting and non-accounting majors
  • The model does not change hiring behavior as it is consistent with current practices and allows continued ability to work in multiple disciplines

Proposed Changes To The Uniform Accountancy Act Model Rules

NASBA is working on UAA model rule changes to create more consistency and flexibility. Here are some highlights of what is being proposed, according to the AICPA:

  • Not proposing any changes to the Act of model rules with respect to the CPA Exam
  • Concerning education requirements, no changes to the Act are envisioned
  • Recommending model rules changes to o Improve the alignment with what is required by states today,
    • Integrate technology into the definition of "accounting curriculum" and "business courses," and
    • Allow up to nine hours of internships to count toward the 150-hour requirement, to aid students in their pursuit of 150 credit hours
  • Exploring possible changes that would clarify the role that accreditation plays when a board is reviewing a candidate's transcript

While these changes are not required to implement Evolution, they will improve the model rules' alignment with what is currently required in the states. The AICPA and NASBA will aspire to make rule changes in all jurisdictions to create greater uniformity.

What's Next?

Now that the AICPA Governing Council and the NASBA Board of Directors voted to support advancing the CPA Evolution initiative, states will begin to work on statutory and rules changes this fall. Based on the AICPA and NASBA’s analysis, CPA Evolution requires minimal legislative and regulatory changes at most state levels. Between now and the launch of the new CPA Exam in 2024, transitional elements will be taking place, including creating a new CPA Exam with many stakeholder touchpoints, including a formal practice analysis, public exposure and comment. AICPA and NASBA will develop model curricula, syllabi and internship programs to support universities, and states will work through changing statute and state board rules.

For academic institutions, the AICPA has recently launched the Academic Resource Hub, a database of hand-curated content from the AICPA, accounting firms, academics and AICPA teaching award winners. This content is designed to help accounting educators prepare students for the rapidly evolving demands of the profession. Educators may access it here: https://www.thiswaytocpa.com/ segmented-landing/academic-resource-hub/

The AICPA provided information contained in this article. Learn more about CPA Evolution and the latest news at https://www.evolutionofcpa.org/

JAMIE ETZBACH is the director, publications and marketing for The Georgia Society of CPAs. She ensures all member communications, both print and electronic, provide member value and strategically meet the needs of the Society’s membership.