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The new CPA exam--meeting today's challenges: the revised exam simplifies the process not only for those taking the test but also for their employers.

During a recent JofA interview, David A. Costello, president and CEO of the National Association of State Boards of Accountancy (NASBA), said that computerizing the CPA exam required dramatic shifts not only in the test's content and format but also in the means of administration. And, he said, the exam related roles NASBA and the state boards of accountancy play have changed as well.

"While the AICPA creates and grades the exam, NASBA now is responsible for the national candidate database, which will contain information about everyone who applies for the exam," Costello said. He added that state boards no longer will provide test sites. Instead, Prometric, which develops electronic testing products, will administer the exam at its more than 300 computer-testing centers throughout the United States. "But the 54 individual boards of accountancy continue to be responsible for the licensing of certified public accountants," he said.

According to the estimates Costello has seen, the various parts of the computerized CPA exam will be administered a total of 250,000 times during the test's first full year. This implies that slightly fewer candidates will take the test than in previous years. "But I'm not sure I agree with that," he said. "Naturally, our estimates are conservative. There'll he growing pains and we'll learn a lot in the first six months. But I've spoken with every state board and we're all excited about this opportunity to improve not only the exam, but also the quality of CPAs joining the profession."

Costello said the new exam makes improvements in three important areas: flexibility, security and candidate skills assessment.


When the paper-and-pencil exam was in use, candidates could take the test only once every six months, and in most states the entire test had to be taken at the same sitting. Now candidates can sit for the exam up to four times each year and can take each part separately. "They even can study for one part and keep taking it until they pass, then move on to the next part," Costello said. "Also for the first time, candidates will be able to take the exam anywhere in the United States, regardless of where they live or work."

The new exam's flexibility also benefits employers. "Because they're no longer limited by a semiannual testing schedule, businesses can give their employees time off to study and take the exam during slow periods in their business cycle," Costello said. They also can stagger employee testing so their recruits won't all be absent simultaneously. Costello believes this will make it easier for employers to support staff members studying for the exam and will foster a culture that promotes the goal of becoming a CPA.


Costello admits there's no such thing as perfect security. But, he said, the computer-based test incorporates measures to prevent and detect cheating and other dishonest activities. "The exam will also be given continuously, during two of every three months, so each set of questions will be different," he said. In addition, the new test's emphasis on simulations and the increased number of multiple-choice questions from which it makes random selections reduce the value of memorization and make it almost impossible for candidates to anticipate specific questions. Sophisticated new software for the national candidate database will ensure no one can take an examination section more than once within a single testing period. "And we will immediately be alerted when someone who already has passed the test applies to take it again," Costello said. (In the past, before such practices could be detected easily, a few unscrupulous candidates took the test multiple times and assembled "crib" sheets they then sold to others.)

The new exam also employs stringent security measures to protect the confidentiality of personal information, which NASBA takes very seriously, Costello said. "The AICPA, the state boards and Prometric are prohibited from using the database for any purpose other than administering the exam. A candidate's personal information, including his or her test results, is very secure."


By asking test candidates questions that simulate actual business situations and giving them access to various online databases, the computerized exam is much more realistic than the paper-and-pencil test was, and it can adapt quickly to changes in the business environment.

Today's CPAs have to know much more than how to perform audits or file tax returns, Costello said. "Every state board's mandate is to present the public with the most qualified individuals possible, and the computerized exam is a giant step in that direction. It's good for the profession and the public--the two groups the state boards serve."

This is the fourth in a series of JofA articles exploring different aspects of the new, computerized version of the Uniform CPA Examination, which in April 2004 will replace its paper-and-pencil predecessor. The computer-based test is a joint effort by the AICPA, NASBA and Prometric, a developer of technology based testing services.

When You're Ready to Take the Test

Once candidates are ready, they should apply to their state accountancy board, which will ensure their application is complete, verify their education and other eligibility requirements and electronically send an "authorization to test" to the national candidate database. The NASBA-administered database then will send the candidate a "notice to schedule." Upon receiving it, the candidate can call Prometric to schedule taking any or all parts of the exam. For those test takers who require a particular test date and place, Costello recommended contacting Prometric at least 45 days in advance. But in most cases, he said, candidates will be able to schedule the exam with much shorter notice.

Adam Snyder is a business writer based in New York. His e-mail address is
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Author:Snyder, Adam
Publication:Journal of Accountancy
Date:Dec 1, 2003
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