(taken from the May/June 2006 issue of On Balance magazine)

Local reaction to the new CPA Exam
By Robert A. Gruber, Ph.D., CPA, CMA

Isn’t it amazing how quickly a significant change becomes the status quo and is accepted by those most affected by the change? (Perhaps the amazing thing is how long we oldsters hang on to the new label.)

Slightly more than two years ago (November 2003), the last pencil-and-paper CPA Exam was given. In April 2004, the Exam’s format changed to computerized, on-demand, and one section at a time. The content of the exam changed, too. Some topics were realigned (REG), relative weightings between and within sections were altered (AUD and FIN), and a new section (BEC) was created to broaden the content domain.

Students today aren’t really interested in the changes made to the CPA Exam. They simply don’t want (or need) to know what the CPA Exam looked like three years ago, or why the changes were made. Their focus, as it should be, is on passing the Exam in front of them.

Pragmatic, aren’t they? But so were you when you took the CPA Exam. For example, I’m pretty sure that when you took the exam you didn’t care that multiple-choice questions were added in 1951. But how many of you remember being chided by your peers because your CPA Exam contained more multiple-choice questions than theirs?

I recently asked UW-Whitewater’s Accounting Advisory Board members for their reaction to the new CPA Exam, knowing that most of them had passed the Exam prior to the changes made in 2004. They, in turn, asked their colleagues who had taken the new CPA Exam for their comments. Thus, unique insights were garnered from CPAs who had experienced the new CPA Exam and from the CPAs who hired them.

It’s not surprising that most comments focused on the Exam’s format rather than its content. The two topics mentioned most often were greater flexibility in scheduling the Exam and more efficient and effective preparation for the Exam. These topics were frequently cited by NASBA and the AICPA in support of the changes when they were proposed.

Scheduling
The CPA Exam can now be taken year-around, two out of every three months. For example, it can be taken in January and February but not in March; in April and May but not in June; and so on.

“It’s very helpful being able to take the Exam throughout the year, even on weekends,” said Allison Roeder of Wipfli in Milwaukee. Brenda Neumann of Schenck Business Solutions in Green Bay added that candidates now have “the ability to retake the Exam more often throughout the year.

This flexibility is important because candidates only have 18 months to pass all four parts of the Exam. However, the scores need to be reported quicker because of this 18-month ticking clock.

Employees also appreciate the flexibility afforded by year-around testing. (Recall that under the old format the Exam was given twice a year, in the first week of May and November.)

“Public accounting’s busy-season often hindered many candidates from effectively studying and taking the Exam in the spring,” Paul Wiltsey of KPMG in Milwaukee pointed out. Mike Lutze of Ernst & Young in Milwaukee added, “We no longer have all of our young staff out the same two weeks of the year taking the CPA Exam. Sometimes, we were short people to get the work done during those weeks.”

Under the new format, candidates can take full advantage of the summer (July and August) and fall (October and November) windows.

Preparation
Now, the four parts of the CPA Exam can be taken in any order and do not have to be taken at once. Candidates can customize their review strategies to take advantage of their strengths and weaknesses, enhancing their chances of success.

“Since each part requires a completely different mode of thinking, it was nice to be able to take one part and then focus completely on the next part,” said Lori Hennessy of Strohm Ballweg in Madison.

Low passing rates have concerned candidates, educators and legislators for years. Liz Watry of Baraboo Growth LLC in Menomonee Falls provided the following insight: “I have always been troubled by the thought that so few of the country’s accounting graduates actually pass the Exam on the first try. That tells me that we, as a nation, are either not teaching the right material or, more likely, we are not testing properly. I am not sure what it says about the profession when so few of its graduates pass the licensing exam on their first attempt.”

Certainly in Wisconsin, we can be proud of how and what we teach, and hopefully, the format and content changes address some of the testing concerns with the CPA Exam. It is important to note that the new format has not made the CPA Exam easier. “I studied questions from the old exam,” Roeder said, “and I was surprised how much more detailed many of the Exam questions were when I took the Exam.”

Jill Boyle of Schenck Business Solutions, Green Bay, waited a couple years to take the Exam in order to take advantage of a “divide and conquer” strategy. She believes that fewer people will feel it is necessary to take a formal review course. The option of taking one part at a time, and in any order, makes it easier for candidates to prepare for the Exam independently.

However, other people lamented the lack of a specific, unmoving, focal point in a candidate’s preparation. For example, if a candidate wasn’t ready in May under the old format, they had to wait six months for their next chance to take the Exam.

The most interesting reaction to the new format came from David Thomas, a high school business teacher at James Madison Memorial High School in Madison. He said, “As a result of classroom visits by UW-Whitewater students and local CPAs, my students now understand that parts of the CPA Exam can now be taken separately. They have traditionally viewed this exam as a major barrier to the accounting profession, but now see it as being easier to handle—not in content, but in format. I would say that this change has created additional interest amongst my students to pursue accounting as a career.”

 

Robert A. Gruber, Ph.D., CPA, CMA is a professor and the accounting department chairperson at the University of Wisconsin-Whitewater. He can be reached at gruberr@uww.edu or (262) 472-5463.  

 

 return to previous page