A certified public accountant (CPA) license is a symbol of achievement, an assurance of quality, and the accounting profession’s highest standard of competence, according to the National Association of State Boards of Accountancy (NASBA).
The CPA license is an essential designation in business and financial consulting and is necessary to perform certain high-level accounting functions such as representing clients before the IRS and filing with the Securities and Exchange Commission. In both public and private accounting, the CPA license is an assurance of dedication and skill and stands as the most trusted credential in the corporate environment.
To earn this prestigious title, recognized by all states and jurisdictions in the U.S., aspiring CPAs must demonstrate a specific level of knowledge and competence by meeting the license requirements of the jurisdiction or state in which they want to practice accounting.
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The CPA license is not a national license; so all aspiring CPAs must meet the requirements of the board of accountancy that holds authority in the state or jurisdiction in which they plan to practice. Still, under the Uniform Accountancy Act, becoming a CPA in any state or jurisdiction involves meeting similar basic requirements:
- Bachelor’s Degree at minimum and 150 semester hours of college education (most bachelor’s programs are 120 semester hours in duration, making master’s degrees common for aspiring CPAs
- Passing scores on the Uniform Accountancy Exam
- One year of supervised experience under the guidance of a licensed CPA
About half of all states also require candidates to take and pass an ethics examination, which may be the AICPA Professional Ethics Examination or a state-specific ethics examination.
Meeting High Educational Standards
The CPA designation signifies a high level of technical competence and a commitment to the profession. All U.S. states and jurisdictions, with the exception of the U.S. Virgin Islands, require candidates for CPA licensure to complete a course of education that totals 150 semester hours.
Although 150 semester hours of education is the standard throughout the U.S., states do vary regarding the specific curriculum necessary for state licensure as a CPA. Therefore, candidates must ensure that the program they choose meets the specific curriculum requirements set forth by the state board of accountancy in which they want to earn their CPA license. Many state boards of accountancy maintain a list of approved institutions and programs for this purpose.
To meet the 150 semester-hour educational requirement, candidates must complete a four-year bachelor’s degree from an accredited college or university, followed by either a master’s degree or the completion of the necessary graduate-level courses. However, because the educational requirements extend beyond a four-year degree, many accounting students choose to complete a master’s degree in accordance with the recommendations set by the American Institute of Certified Public Accountants (AICPA)
Aspiring CPAs may meet the 150 semester-hour requirement a number of ways:
- Complete a bachelor’s and master’s degree in accounting
- Complete a bachelor’s degree in another discipline, followed by a master’s in accounting or an MBA with a concentration in accounting
- Complete a five-year professional accounting school program that leads to a master’s degree in accounting
Passing the Uniform CPA Examination
The second step necessary for CPA licensure involves taking and passing the Uniform CPA Exam, a national examination recognized by all U.S. states and jurisdictions. Candidates for CPA licensure may sit for the exam once they have successfully completed the required education as described above. In some states; however, they may sit for the exam before they have completed the 150 semester hours.
For example, Pennsylvania allows candidates to take the Uniform CPA Exam once they have completed 120 hours of college education. In Wisconsin; however, candidates can take the exam if they are within 60 days of completing the 150 required semester hours. Currently, 27 states require the completion of 150 semester hours before candidates can sit for the exam.
One of the best ways to learn about the Uniform CPA Examination is by reading the Uniform CPA Examination Candidate Bulletin, the go-to resource for information regarding the exam scheduling process, exam content, and taking the exam.
The Uniform CPA Examination consists of four sections that represent a total of 14 hours of testing:
- Auditing and Attestation
- Business Environment and Concepts
- Financial Accounting and Reporting
In all states and jurisdictions, third party exam provider Prometric is contracted for the purpose of administering and proctoring the CPA exam at its many testing locations nationwide.
Gaining the Necessary General Accounting Experience
Once candidates pass the Uniform CPA Examination, they earn a state-issued CPA certificate. However, to begin practicing as a CPA, candidates must complete the post-examination requirements for licensure in their state, which include completing a course of general accounting experience.
The length and type of experience differ from one jurisdiction to the next, so candidates must ensure they understand their state’s requirements regarding accounting experience.
Some states, like Texas and Washington State, require just one year of accounting experience, while other states require more.
For example, candidates for CPA licensure in Connecticut must complete at least 2 years of experience in any type of accounting (public, government, or industry), while candidates in Alaska must complete either 2 years in public accounting or 3 years in private or government accounting.
Passing the Required Ethics Examination
The final step to CPA licensure in many states involves taking and passing an ethics examination, which may be either a state-specific examination or the AICPA’s Comprehensive Ethics Course and Exam.
Some states have their own state ethics examination. For example, Texas candidates for CPA licensure must take and pass the Texas Rules of Professional Conduct exam. Other states, such as Tennessee and Montana, require candidates to take and pass the AICPA examination. Other states, such as Pennsylvania and Kentucky, do not require candidates to take and pass an ethics examination for CPA licensure.