[cafeteria_food]

NASBA/AICPA released more information today on the proposed changes to the CPA license. On first blush I wasn’t overly enthusiastic about what I read, but the more I chew on it the more I like it. It’s impossible for the exam content to keep pace with the ever growing demands of the CPA profession… Going this route allows for a mix of core competencies + specialized knowledge. I’m curious to hear your guys take. Similar to the exam changes that took place in 2017 I’m sure this is going to ruffle feathers.

NASBA and the AICPA will continue to gather feedback on this proposed model, with a goal of finalizing an approach for the new model in the summer of 2020. Once a new model is approved, a multiyear effort will commence to implement the model.

Link to the release:
https://www.journalofaccountancy.com/news/2019/dec/new-cpa-licensure-model-201922573.html

[DocJ]

Personally, I just want them to do away with SIMs completely.

[cafeteria_food]

Haha I feel you there. However, I would bet they are going to utilize SIMs more and more. I only caught the tail-end of the 2017 changes but the “upgrade” to the FAR SIM was substantial. It will be interesting to see how the review material changes and the exam morphs as the core plus disciplines model is finalized.

[aaronmo]

Interesting – I think it should be entirely sims.

[jenpen]

I like the idea of creating disciplines for CPAs to become more specialized. My old boss and I had a couple of conversations about how it would be nice if the CPA exam allowed for that – so, like, for me – no AUD would have been great because I have no intentions of doing auditing at any point in my career, and that exam was the bane of my existence for a few years.

However, I disagree with no SIMs, @DocJ. For me, SIMs were what I was consistently stronger on during my exams. They made the most sense to me and actually forced me to know what I was doing vs. making an educated guess on MCQ.

AUD - 56 - 68 - 61 - 9/8/16
REG - 75
FAR - 7/15/16
BEC - TBD

Wiley CPAexcel and NINJA 10 Point Combo

[3Countries]

I personally think that a key part of the CPA exam should be a pocket protector contest. Candidates enter the testing center dressed up, and then an expert evaluates each individual's pocket protector, and then conducts a conversation with the candidate. Afterwards, the evaluator scores the CPA candidate on how many times they looked at their shoes, their topics of conversation and how many (or few) times they made eye contact.

High scorers will exhibit low rates of eye contact, frequent glances at the exit, and during the conversational phase they will gravitate toward awkward silence or discussion about the weather. An EWS award winner will embrace their internal mechanisms of fight or flight when threatened by the prospect of non-accounting-related conversation.

(This is obviously a joke that involves making fun of myself and stereotypes associated with the accounting profession; my real thoughts are that there should be a different and higher experience requirement for all states in order to obtain a CPA license, but that's just my humble opinion.)

[aaronmo]

So I work at a state association, and there has been a lot of talk about this here. I hate it, but I get it.

The truth is that fewer accountants want to be CPAs, and AI is changing how, and who, firms hire. So the real underlying question is how can CPAs regain their place in the big four, and is the future accountant an IT nerd with some accounting background, or a CPA with some IT? either is going to make bank right now.

To me, as an iconoclast, the CPA truly is vital to the process, and, at some point, someone with a license is needed to reduce information risk. AI is only as good as the data, and that can be manipulated…granted, so can we. It's a tough area…but I also think ALL CPAs need to have the basics of the profession down, whether they practice in that area or not.

The CPA is not a certification, it's a LICENSE…and I fear that we're cheapening it with some of the proposed changes. As far as the exams…SIMs are what tests the concepts and reasoning ability…they are vital in showing APPLIED analysis as opposed to memorization. I think the CPA test should be easier to prepare for, but take more intelligence to pass.

[vbmer]

I have to agree that SIMs should be at least 50% of the exam, perhaps 100% on FAR. You can't get a driver's license without a road test, and it doesn't really make sense to have CPA licensing based purely on MCQs.

I'm also tempted by the idea of making AUD optional, but I think that conflicts with the CPA being a license to practice public accounting. I realize that in some states, CPA licensure doesn't automatically come with audit privileges, but I think in principle, it makes sense that all new CPAs have at least basic audit/tax knowledge, which is all AUD/REG are.

[aaronmo]

To me, “specializing” is, in this case, a way to dilute, long term, the brand/value of a CPA in an attempt to bring more in with the license.

[Mercenary]

I tend to agree that the exam should be entirely sims or at least a bigger part than now.

I think specializing is what should come after licensure. The CPA exam should indicate you have the minimum knowledge necessary. So I disagree that AUD should be optional.

[cafeteria_food]

@Aaronmo – do you think the multi-faceted PE license is devalued/diluted?

[aaronmo]

I know nothing about PE licenses, so I can't comment.

I do know a bit about the thought process behind these changes…and everyone is scared (FOR GOOD REASON). I don't know that I have easy answers, but I don't love some of what they're considering.

Ideally, I'd like to see things go the other way…make the exam harder, weed more people out, add prestige and BILLING to the profession to generate business…include more IT and technology components.

There are a few problems here:

The profession is losing interest because we work too hard for too little relative to other professions.

Larger firms are hiring more tech people and fewer accountants (If you're both, you're “made”).

AI is pushing the accounting business back towards consulting, but consulting is constrained by the changes made post-melt down, where those services compromised independence.

CPAs are, and should be recognized as, the smartest business background person in the room (if there isn't an attorney there). We're the ones who have passed an objective, rigorous standard. Part of the issue is that the “smartest guy in the room” thing doesn't always have the value it should have in private…where self replicating HR departments and MBAs push their own mediocrity. “We” have to do a better job branding ourselves as more than just people in public and folks licensed to sign some things. We have to push our value to private…so that they are paying for CPE, and asking people to keep the license.

I think the best way to do that is with increased prestige.

I think another issue is the “everyone gets a certificate” culture where you get degrees in things that aren't academic, and certificates in being certified. It's watered down the actual PROFESSIONS with false equivalency to marketing fluff self aggrandizement.

[aaronmo]

Another thought…”we” have lost trust and prestige because a lot of us haven't done the right things, enabled a lot of theft, and no one went to prison. The CPA with Madoff didn't spend time in a cell, which to me is outrageous…he should have been the one hit the hardest…even harder than Bernie…since HE was the one tasked to protect the public.

If WE aren't held accountable, it undermines our value and trust. We're seen as part of a game and a way to spread some liability/blame around. We're supposed to be more than that.

[Author]

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