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State Board Report

June 2015

In 2013 the AICPA Board of Examiners (BOE) announced the launch of a new practice analysis in support of the Uniform CPA Examination. Completing a periodic practice analysis is essential to maintaining the legal defensibility of the Examination, which all 55 Boards of Accountancy use as part of the licensure process for new CPAs. The practice analysis ensures that the Examination continues to assess the knowledge and skills required of a newly licensed CPA, and is one of the three foundational "E"s of licensure; Education, Examination, and Experience.


The team conducting the practice analysis is organized into three groups; the BOE Sponsor Group, the BOE Sponsor Advisory Group, and the Project Team. The BOE Sponsor Group is charged with overall responsibility for the practice analysis and will make the final recommendations to the BOE on the form and content of the next version of the Examination, and is chaired by Rick Niswander (BOE Chair). The BOE Sponsor Advisory Group consists of 12 CPA Guest Advisors from around the country, including several actively involved in the regulatory community, who act as a sounding board for the BOE Sponsor Group as it identifies changes that may be made to the Examination. The Project Team plans and executes the specific tasks required to complete the practice analysis. Michael Decker, AICPA VP – Examinations, and Ed Barnicott, NASBA VP – Strategic Planning & Program Management, act as project sponsors for the project team, with Rich Gallagher, AICPA Director of Content, and Joe Maslott, AICPA Senior Technical Manager – Examinations Team, serving as project owners for the effort.


Invitation to Comment – September 2014
An Invitation to Comment (ITC) was released in September 2014 to a wide range of stakeholders including the Boards of Accountancy. NASBA sent a response to the ITC that included input from the Regulatory Response, CBT Administration, Education and Executive Directors Committees, as well as feedback from a number of Boards. Several Boards provided their own direct response to the ITC. Other input was received from other regulatory bodies (PCAOB, SEC) as well as academics, firms, review course providers and a number of individuals. Responses to the ITC are being used as input for the BOE in their deliberations and will be reflected in the upcoming Exposure Draft.

Survey – December 2014 through January 2015
An extensive survey consisting of approximately 800 task statements was distributed to approximately 350,000 supervisors of newly licensed CPAs and newly licensed CPAs. This effort was supported by the State Boards with 35 Boards authorizing NASBA to provide contact information for the samples directly from the Accountancy Licensee Database (ALD). The AICPA member database was used to fill any gaps in sample coverage needed to ensure broad geographical representation. This unprecedented effort ensured that the survey respondents were from the broader licensee population and not only from the AICPA membership.

Exposure Draft – September 2015
Analysis of the ITC and the survey are combined to develop the blueprint for the next version of the Examination. The blueprint, if approved, will take the Examination to a new level in terms of specifying, not only the content of the Exam sections, but also the depth of knowledge and skills the candidate must demonstrate. This added dimension would allow the Examination to evaluate higher order skills as part of its basic design; a strong requirement identified through the ITC.

The blueprint combined with other elements of the next version of the Exam and potential changes to the test administration model will be combined in an Exposure Draft (ED) that will be released to all stakeholders in September of 2015. The comment period for the Exposure Draft will be 90 days, which makes it important that the Boards of Accountancy review and respond to the ED in a timely manner. NASBA will also submit a response using input provided through our committees and State Board outreach.

Exam Launch
Following the evaluation of the responses to the ED, the final form and content of the Exam will be set by the BOE, with the new blueprint expected to be announced in the second quarter of 2016. It is anticipated that the new blueprint will be in effect for testing in the second quarter of 2017.

During the period of the practice analysis, the AICPA is also developing new driver software; the software that controls the look and feel, and other technical and user experience aspects of the presentation of the Exam to the candidate in the test center. The new driver will be released to the test centers in 2016 and 2017 with little candidate impact. The complete version of the software presenting a new user experience to the candidate is expected to be launched in 2018.

Possible Changes

The results so far?

  • Content is still at the core of the Exam. The four sections of the Exam, AUD, FAR, REG and BEC are currently anticipated to continue, though BEC may evolve to cover more in-depth testing of higher order skills. Higher order skills will likely be emphasized more in all sections. It is also expected that taskbased simulations will be added to BEC.
  • At this time, there is little support for a "capstone" Exam section that would integrate all sections and be taken last. The notion of assessing integrated content was supported by ITC respondents and is currently being explored.
  • Excel is likely to replace the current spreadsheet in the Exam, though it is anticipated to be available as a tool for candidates in 2018.
  • We can expect a modest increase in the per section cost of the Exam to candidates.
  • Several changes to the test administration model may be proposed, including a possible extension of the quarterly testing windows. As test administration falls under the purview of the State Boards of Accountancy, NASBA will be working closely with its CBT Administration Committee and seek input from State Boards regarding any possible test administration changes. If any such changes might necessitate State Board statute or rule changes, NASBA will work closely with the affected Boards to ensure they are alerted as soon as possible.

Importance of Board Input

It is critical that the Boards of Accountancy make their views heard regarding the next version of the Examination. Fulfilling the public protection mandate of the Boards requires that thoughtful consideration be given to the changes that will be communicated in the Exposure Draft.

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