CPA Licensure Model to Focus More on Tech and Data

By Kathleen Hoffelder, NJCPA Senior Content Editor – March 25, 2021

Representatives from the American Institute of CPAs (AICPA) and the National Association of State Boards of Accountancy (NASBA) shared on a webinar last week that more data and technology will be incorporated into CPA education and the CPA Exam by January of 2024. The changes represent an effort to advance CPA Evolution, the initiative designed to revise the CPA licensure model and the CPA Exam to match education with the changing skillsets needed for today’s accounting profession.

Curriculum Shifts

Key areas of change in curriculum include aligning the Uniform Accountancy Act (UAA) Model rules with the majority of state boards of accountancy; having a greater emphasis placed on foundational skills, such as data analysis, information security, digital transformation and risk; and expanding the number of credit hours that can be earned through internships from six to nine hours.

The curriculum will better reflect new skills and knowledge needed for CPAs today by including core areas of study, such as accounting, audit, tax and technology and three disciplines to show deeper knowledge: tax compliance and planning; business analysis and reporting; and information systems and controls. “Each candidate would select one of those disciplines. Regardless of the discipline they select, they become a fully licensed CPA with all of the rights and responsibilities of a CPA,” explained Carl Mayes, AICPA associate director, CPA Quality & Evolution during the webinar.

“The model is reflecting the reality that already exists,” he added, noting that the curriculum is in the implementation stage. However, feedback on the curriculum is still being collected. Both AICPA and NASBA have a goal to launch the model curriculum in June 2021 and will continue to develop resources to support educators through 2023.

Gaps Exist

An AICPA/NASBA curriculum gap analysis survey of more than 300 accounting department heads revealed that the study of data-focused and other accounting topics varies currently by school size. In their study, of those schools with more than 100 accounting undergrads, 79 percent teach data analytics, but that number falls to 51 percent for those schools in which there are less than 50 accounting undergrads. Even fewer accounting departments teach predictive analytics, with 58 percent teaching that topic at the larger schools and only 31 percent teaching that at the schools with less than 50 accounting undergrads. The gap in accounting programs that cover digital acumen drops from 30 percent at the larger schools to 15 percent at those schools with less than 50 accounting undergrads.

The study also showed that “very little attention” is being paid to system and organization controls (SOC), noted Mayes, saying it’s a concern that only a small percentage intend to increase content in that area. The larger schools had a 32 percent response to that question, while the smaller schools had a 17 percent response. Since this is a topic that will be covered on the Exam, Mayes said, “We want to get it a whole lot higher.”

The best way to close those gaps and assist faculty is to work with the major publishers, which is ongoing, explains Mayes. “What we hear from the academic community is if you get it into a textbook, it’s a whole lot easier for us to teach versus us having to design our own approach to teaching that content.”

CPA Exam Changes

So, what does that all mean for the CPA Exam? The use of technology will be more present in the Exam, given the large role that technology plays in the CPA profession. “Technology has to be baked into everywhere. There will be technology components to all of those core sections and baked into the disciplines too,” said Colleen Conrad, CPA, executive vice president and chief operating officer at NASBA, during the webinar.

Having the Exam incorporate the three core sections (accounting, audit and tax) and one discipline will be different, but the main reason for candidates to take the Exam remains the same, according to Conrad. Candidates, she explains, “don’t have the option to be an overachiever and pass all three disciplines. This is a licensure exam, not an exam to go out and tout their expertise in multiple areas. That’s not what this is about.” She adds, “If a candidate took a discipline and failed it, they could switch and take a different discipline. They are not married to that discipline once they take it the first time. That could happen.”

While there are several changes to content, the Exam will remain consistent in the following ways:

Designed for one- to two-year level.
No more than a 16-hour Exam.
No new experience requirements are needed to sit for the Exam.
Candidates must pass four sections (three core plus one discipline)
Exam sections can be taken in any order.
No separate time limits to pass core and discipline.

A task force is still working out the details on what to do with those CPA Exam candidates who may be in the midst of taking the current Exam when the new one is rolled out. Information on that will soon be shared with the state boards of accountancy and discussed more widely later in the year. The CPA Exam Blueprint will be open for public comment in 2022.

The curriculum and CPA Exam changes will not impact those professionals who are already a CPA and need continuing professional education (CPE) credits to maintain their license. As Mayes reiterated, “Once you become a CPA, from a CPE requirement perspective, it’s all pretty much the same thing as it is today. A CPA is still a CPA.”

Learn more about CPA Evolution at evolutionofcpa.org. Access the archived link to the AICPA/NASBA webcast here (use passcode 09KD?$!R).