One of my roles at Saint Peter’s University is to advise accounting students on their pathway to the CPA. I aim to stay in touch with recent alumni to help them on their pathway to the CPA, and often get questions specific to this cohort. Some recent questions I’ve heard from recent graduates are:
- I have earned my 150 credits in undergraduate. Should I now study for the CPA exam or complete my graduate degree?
- Should I wait for the new exam format (which takes effect in January 2024)? Or take the current format?
- What if I pass part of the current exam but then have to take part of the exam after 2024?
These are all great questions. I wanted to share some thoughts around each but I’m also available to my students (past and present) for in-person/phone/zoom dialog.
I have earned my 150 credits in undergraduate. Should I now study for the CPA exam or complete my graduate degree?
I recommend thinking about targeting the CPA exam as soon as possible, and even wrote an article about it titled “Making the Most of Post-Grad CPA Exam Summer Studies.”
But…let’s be clear that this is a question of personal priorities and I advise choosing an option that makes sense for you and your personal context. So if the CPA exam is an objective, then focus on the steps needed to get there, which includes: your undergraduate degree, 150 credits, passing the CPA exam, and work experience. I have it summarized below in an infographic we use with accounting majors at SPU:
What’s more, the CPA exam can factor heavily into career advancement depending on the type of accounting you want to practice. Consider:
- Passing the CPA exam is a factor for advancement in some public accounting firms (including the big four). Generally speaking, graduate school is not (at least not earlier in your career).
- The CPA license is what authorizes you to sign off on audit statements or tax returns, either for your own business or perhaps as part of a public accounting firm. The graduate degree does not give you that authority.
- Jobs in accounting and audit will, according to the U.S. Bureau of Labor Statistics, grow 7% between 2020 and 2030. What’s more, accountants who possess a CPA license will have a 10-15% salary advantage over those who do not; that equates to more career optionality and higher pay.
A key insight here is: passing the CPA exam sooner could differentiate you sooner for jobs that require the CPA. Graduate school – while important – is not required in the same way. That is not to say that a graduate degree won’t be a differentiating factor as your career progresses, but it will not – it cannot – replace the CPA license in the ways listed above.
Should I wait for the new exam format (which takes effect in January 2024)? Or take the current format?
The new CPA exam will launch in January 2024. So timeline out your plan to pass the exam; literally draw it out. I have an example below, broken out by semester because I have a student-centric view. But current CPA candidates may have busy periods (eg January through April for tax) depending on your service area; build those busier peaks into your schedule and work around them to study. Candidates today (in Summer 2022) can view December 2023 as a concrete deadline to pass all four parts of the CPA exam; we are now a little shy of 18 months from the current exam format sunsetting.
If you’re in the midst of CPA prep, I suggest focusing on the current exam format and what you can pass before January 2024. If you’re curious about the new exam format, NASBA has a great landing page here to explore. But I do want to caution recent graduates: do not get too wrapped up in the new exam format if you think you have a shot at passing the current exam before January 2024. Focus on what you need to know for your current objective (i.e. all four parts before January 2024), and efficiently work towards that goal (i.e. don’t focus on the new exam if you don’t have to).
If I pass part of the old exam, will that credit transfer into 2024’s new exam format?
The short answer here is “YES.” For the longer answer, I’m going to defer to this article about NASBA’s transition policy and I’ll highlight from that piece:
“The transition policy is quite simple. Candidates who have credit for AUD, FAR or REG on the current CPA Exam will not need to take the corresponding new core section of AUD, FAR or REG on the 2024 CPA Exam. Candidates who have credit for BEC on the current CPA Exam will not need to take any of the three discipline sections.““Transition Policy Announced for the 2024 CPA Exam Under the CPA Evolution Initiative,” NASBA.
Here is a pictorial view of “old to new” format changes, from that same article on NASBA’s site. If you are a current student, I will be covering this more extensively in my AC-495 “Pathway to CPA” elective in Spring 2023 at Saint Peter’s University.
Be persistent … aim for the CPA
Recent accounting graduates who aspire to become CPAs are on the cusp of a wonderful career. Legitimate hurdles exist but if you have your 150 credits then you’re over one of the toughest obstacles already. Work next to pass that CPA exam. Be persistent, ask questions, and know that a future with more options awaits if you can obtain the license.
“Making the most of post-grad CPA Exam Summer Studies“, NJ Society of CPAs Magazine, Brigid D’Souza. Summer 2021.
“Why CPA?,” This Way to CPA, AICPA.
“Everything you need to know about the CPA exam,” AICPA.