State Board Report

December 2007

Less than five percent of the Uniform CPA Examination is devoted to ethics, CPA Licensing Examinations Committee (CLEC) Chair Robert Pearson told NASBA’s 100th Annual Meeting. CLEC, acting upon the recommendation of the NASBA Ethics Committee, is supporting consideration of increasing coverage to test the candidates’ ability to handle ethical conflicts, not just memorize the AICPA Code of Conduct and Treasury Circular 230, he explained. Mr. Pearson moderated the Annual Meeting’s panel of representatives from the three partners in the computer-based-testing agreement, NASBA, the AICPA and Prometric.

Colleen Conrad, chair of the AICPA’s Board of Examiners, noted that 10 of its members now have state board experience. They include: Ms. Conrad (MO), Whit Broome (VA), Ken Clark (MO), Michael Daggett (AZ), Ruben Davila (CA), James Flagg (TX), Leonard Jones (NC), Barbara Porter (ID), Sharon Walters (KY) and Douglas Warren (TN). Ms. Conrad reported the AICPA had completed its practice analysis survey and is developing the examination’s content specification outline based on the survey’s results, with an exposure period for the outline scheduled for May through July 2008.

As part of a new initiative to determine customer satisfaction with the computer-based examination, on October 24 the AICPA sent all state boards a background paper on “Improving the Uniform CPA Examination” and an invitation to comment on proposed examination changes. Comments are due by the end of the year, but Ms. Conrad said that period could be stretched to the end of January 2008 for the boards. Questions being raised include: How strongly do you support the introduction of task-based simulations and the results of the practice analysisconcurrently? How strongly do you support the consolidation of the written essay questions into one section of the Exam (BEC)? Is there anything of great importance missing from the list of potential improvements of the Exam?

William Burnham, Prometric vice president of the financial market segment, assured all boards that the company’s new owner, ETS, has over 60 years of experience in the testing business. Information about the sale of Prometric by Thomson Corp. to ETS was contained in Mr. Burnham’s handout material. It stated: “The obligation to protect the public required that NASBA and AICPA scrutinize the proposed deal and our potential new CPA exam partner with great care to be sure that the public’s continued high confidence in the state boards’ licensing process is maintained and justified. The process was thorough and the due diligence ensured that the new party to the CBT Agreement is in full compliance with any and all of its provisions.”

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