Passing the Uniform CPA exam is one of the requirements to attain CPA licensure. The CPA examCPA ExamA Certified Public Accountant (CPA) is a US state board-issued license to practice the accounting professionread more is conducted by the American Institute for Certified Public Accountants (AICPA) in coordination with the National Association of State Boards of Accountancy (NASBA).

The following table outlines the details related to the CPA exams.

Each time you apply to take one or more CPA Exam sections, submit the required documents and fees to your state board. After that, your state board or its designated agent will evaluate your application and contact you. 

You can take the exam in any order that suits your preference. AICPA also offers various sample tests to help you prepare for each exam section. 

This article briefly discusses each of the four sections’ content, format, and structure. This will help you prepare and schedule your CPA Exam better and maximize your odds of success.

Exam Section 1: AUD

AUD CPA exam section tests your competence in performing auditing, attestation, and accounting consulting services. It also tests your understanding of ethics and professional responsibilities.

This section includes all topics relevant to a newly licensed CPA performing a typical engagement.  From the nature, type, scope, and procedure of an engagement to planning and reporting the same, the AUD section includes all aspects of accounting service. 

Content Allocation

The AUD section includes four content areas. The following table lists these areas along with the percentage of the content tested from each one of them. 

Required Skills

Every area of the AUD section requires you to master specific skills for better performance in the examination. 

Exam Format

The section includes five testlets, two MCQs and three TBSs.  The overall weightage of these two segments is equal.

Pass Rate (2015-2020)

Since the last five years, there has been an impressive growth in the AUD pass rates. The cumulative pass rates in the AUD section have increased from 47% in 2015 to 53% in 2020. 

2020 Quarter 2 has witnessed the highest pass rate of 65% in the last five years. Besides, the rest of the quarters have also shown a positive trend.

CPA Exam Section 2: BEC

The BEC CPA Exam Section tests your competency in performing the following services:

  • Financial reportingFinancial ReportingFinancial reporting is a systematic process of recording and representing a company’s financial data. The reports reflect a firm’s financial health and performance in a given period. Management, investors, shareholders, financiers, government, and regulatory agencies rely on financial reports for decision-making.read moreAccounting, auditing, and attestationPreparing tax returns

This section assesses your understanding of the general business environment and your duties and responsibilities towards it. Also, it ensures you possess effective communication skills to discharge your duty as a CPA.

This is the only section with an extra segment of written communication tasks. Please note that the BEC examBEC ExamThe BEC CPA Exam (Business Environment and Concepts) exam section evaluates your understanding of the general business environment and your duties and responsibilities as a CPA towards it. It assesses your ability to recognize and scrutinize situations related to Financial reporting, Financial statement audit and attestation and Tax preparation read more result can be delayed by a week or so beyond the target release date. This is due to the extra analysis required in evaluating WCTs. 

The BEC section includes five content areas. The following table lists these areas along with the percentage of the content tested from each one of them. 

Similar to the AUD section, BEC also aims at testing higher-order skills. However, the latter does not test the content at the evaluation skill level. It is because you are not expected to display that skill concerning BEC content. 

Let’s see which skill(s) will be helpful to master the several BEC content areas. 

Format

BEC section incorporates five testlets with 62 MCQs, 4 TBSs, and an additional element of 3 WCTs (Testlet 5). The following table outlines the breakup.

The section had reported a significant growth from 56% in 2015 to 66% in 2020. The performance of this section over the years has been incredible. This section is considered to be the easiest of the lot. This reflects in its pass rates.

Though it suffered a minor setback in 2017, BEC picked up in the next year and has been thriving since then. As a result, BEC is presently the exam section with the highest cumulative pass rate of 66% in 2020.

CPA Exam Section 3: FAR

FAR Section of the CPA Exam evaluates your competence in understanding and using various financial accountingFinancial AccountingFinancial accounting refers to bookkeeping, i.e., identifying, classifying, summarizing and recording all the financial transactions in the Income Statement, Balance Sheet and Cash Flow Statement. It even includes the analysis of these financial statements.read more and reporting regulations and standards. The following entities issue these rules and standards:

  • US Securities and Exchange Commission (US SEC)Financial Accounting Standards Board (FASB)Governmental Accounting Standards Board (GASB)American Institute of Certified Public Accountants (AICPA)

It includes four content areas. The following table lists these areas along with the percentage of the content tested from each one of them. 

Each content area in the section requires you to ace specific skills for better performance. Like BEC, FAR exam also does not test the content at the evaluation skill level. 

There are five testlets in the REG section comprising 66 MCQs and 8 TBSs. Both of the item types have an equal scoring weightage. 

The FAR Pass Rate has gone through a roller-coaster ride during 2015-2020.  FAR is considered to be the toughest exam section with the lowest pass rates. However, Q2 2020 witnessed the highest passing rate (63%) across the entire five-year period.

While Q1 and Q3 have been a bit topsy-turvy for FAR, Q2 and Q4 have proved to be a period of growth. Moreover, the overall pass rate for the section has seen only a 3% growth from 2015 to 2020. 

CPA Exam Section 4: REG

REG CPA Exam Section analyses your competence in understanding and applying the concepts of federal taxation, business law, and ethics. This section tests your abilities and ethics while performing taxation and advisory services.

The section includes five content areas. The following table lists these areas along with the percentage of the content tested from each one of them.  

Here lies the breakdown of specific skills tested in the REG section. 

There are five testlets in the REG examREG ExamREG CPA Exam (Regulation) exam section tests a candidate’s competency in applying the concepts of federal taxation, business law, and ethics. It is a four-hour exam with 15 minutes break. read more section comprising 76 MCQs and 8 TBSs. Both of the item types have an equal scoring weightage.

REG pass rate has been the highest in the Q2 2020 with an impressive 76%. Though it suffered a tiny setback in 2017, there has been a significant improvement in the succeeding years. 

The overall pass rate of REG surged 13%, from 49% in 2015 to 62% in 2020. Even the onset of Q1 2021 was promising for the REG section. It witnessed a 59% pass rate. 

Ranking of Exam Sections (Toughest to Easiest)

In August 2020, NASBA conducted a survey on the difficulty of CPA exam sections. Here is the ranking of each section based on its level of difficulty:

  • FAR – 43%REG – 27%BEC – 17%AUD – 13%

As evident, there was a general consensus that FAR is the most challenging exam section. Please note that these statistics are only to give you an idea of how and in which order to take the exam sections for better results. As long as you are well-prepared for the examination, you can take up any section with sheer ease. 

The Right Order

Going by the CPA exam section difficulty order mentioned above, here are two suggested exam orders: 

  • AUD-REG-BEC-FAR, orFAR-BEC-REG-AUD

Start with a difficult section like FAR or REG and let the burden off of your shoulders in the very beginning itself. 

A pro tip here is that never take up two difficult sections in a row. This will cause mental fatigue and affect your performance. Instead, always go with an “easy-difficult-easy” or “difficult-easy-difficult” flow. 

Know that there is no proper or perfect order to sit for the CPA exam sections. Go by your preference and comfort to pass all four sections with flying scores. 

This has been a guide to the CPA Exam Sections. Here we discuss the content, format, and structure of all the CPA Exam sections. You may also have a look at the below articles to compare CPA with other examinations –

  • REG CPA Exam TipsAUD CPA Exam TipsCPA Exam Pass RateHow to Become a CPA?