Here’s the Real Reason Why CPA Exam Pass Rates Are Up

Posted on by Adrienne Gonzalez

Sunil Kumar wrote a piece called "CPA Exam Passing Rates and CPA Salaries on the Rise" for Accounting Today the other day that offers up a few theories on why CPA exam pass rates are up these days. Among Kumar's ideas why numbers are up:

  • Pre-2003, the CPA exam was a pen and paper exam spanning two full days. A CPA candidate was required to take all four parts at once.
  • The testing timeframes were much shorter and there was very little flexibility in exam scheduling, thus making it difficult for candidates to plan around the CPA exam preparation process.
  • In 2004, the Uniform CPA Exam transitioned to a Computer-Based Testing examination, allowing more flexibility in terms of preparing for and scheduling the CPA exam.
  • CPA candidates are no longer required to take all four parts of the exam in one sitting and can space out each part over the course of 18 months.
  • The Sarbanes-Oxley Act was established in 2002, increasing the need for CPAs more than ever.

Now, it doesn't take a rocket scientist to figure out the first four reasons are probably BS. Pass rates are up because the AICPA thinks there should be more CPAs out there, THAT'S IT. Yes, CPA exam candidates, next time you study your little butt off only to get a 74, you can rest easy knowing you're probably not a total loser but instead simply undershot a 75 and the AICPA decided there wasn't room for you among the future CPA elite.

The flexibility offered by the computerized exam probably has helped candidates perform better on the exam and feel better about committing their lives to passing it but at the end of the day, there will always be as many new CPAs per year as the AICPA allows. Period. Lucky for them, there are usually so many underachieving candidates that they can easily fail most of the borderline candidates if they feel too many are sneaking through.

We could sit here all day and try to figure out why more people are passing the CPA exam than ever but really, we all know the real reason is that demand for CPAs is up. That's it. No super studiers, no improved CPA exam review materials, no more committed candidates. More people are passing the CPA exam because we need more CPAs. According to the AICPA, 75 percent of all CPAs in the U.S. will be to be retiring or nearing retirement by 2018, so you guys can pretty safely assume those borderline 74s will magically turn into 75s for years to come.

Congratulations, underachievers, this is your lucky decade!

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The CPA Exam: It’s Too Late Now

Thumbnail image for Thumbnail image for panic.jpgIt’s October which means CPA exam candidates have about 7 weeks left to sneak in one more exam part before the end of the year. If you’re like most candidates, you blew off this entire year with excuses or got disappointed by failing scores early in the year and haven’t given the exam much thought since. Well you better start because you’ve got about 1,248 hours until the final window of the year is closed.
Sometimes procrastination pays off but in this instance, the exam will never get easier and you’ll never get through it if you keep putting it off.
Continued, after the jump


Typical prep time for the sections is as follows*:
BEC – 64 hours
AUD – 80 hours
REG – 96 hours
FAR – 132 hours
With 1,248 hours remaining until the December blackout, you should easily be able to fit in FAR, right? Wrong. If you’re working fulltime, lets just take out 50 hours a week, leaving you with 898 hours. But you’ve got to sleep, right? So if you get 6 hours a night, that leaves 580 hours. Well hell, you could prepare for two sections in that time, couldn’t you?
Not so much. Do you think you’re the only one who waited until the last minute?
The lesson for next year? Schedule early. Chances are if you’re trying to fit in one more section before the end of the year, you will not be able to sit at the Prometric test center of your choice, or may not be able to get the time/date that you desire. Well, that sucks for you, so hopefully you remember that for next time.
If you don’t start studying now, you’ve probably blown it for the year and should just wait for the first window of 2010. Remember the CPA exam isn’t like college, you can’t just stay over-caffeinated for a weekend and cram everything in that you need. Think of the information like a fine wine, it’s got to ferment in your brain to be useful come test day. Your brain learns best in layers anyway and without the foundation, you’re going to get tricked by the easiest MCQ simply because you don’t have the background on each concept.
Otherwise it will be November before you know it and you won’t have cracked a single CPA Review book between now and then. Trust me on this one, kids, start early and start slow. I’m trying to help you.
*Time based on video lectures and AICPA recommendation of 2 – 3 hours of self-study MCQ/sims for every hour of lecture but we’re sure you’re all Einsteins when it comes to this stuff so it’s probably less.