Are you considering becoming a Certified Public Accountant (CPA), or are you already preparing for the exam? There’s something important you need to know: The CPA exam has undergone some changes in 2024 that could impact how you study, what you focus on, and even your career path once you become a CPA.
Since the accounting profession continues to evolve, technology plays a bigger role than ever, with businesses relying more on data analytics, cybersecurity, and IT systems than traditional bookkeeping and tax filing methods. The CPA exam has had to adapt to keep up with these shifts.
The new structure, known as CPA Evolution, breaks the exam into two key parts: core exams and discipline exams. The core exams will test the universal skills all CPAs need, while the discipline exams will allow you to specialize in an area that aligns with your interests.
In this blog post, we’ll review what these CPA exam changes mean for you.
Overview of the 2024-2025 CPA Exam Changes
Starting January 10, 2024, the CPA Exam has been revamped with a fresh core-plus-discipline structure. This new model introduces three core sections that every CPA candidate must pass and one discipline section of their choice. This allows candidates to focus on their areas of interest. The exam is still made up of four parts, totaling 16 hours.
The shift in how the CPA Exam is structured is mainly due to the growing influence of technology on the accounting profession. As accountants are increasingly using advanced tools and IT systems, the exam now tests these new skills. Some traditional areas, like the BEC (Business Environment and Concepts) section, have been eliminated, and its content spread across other core and discipline areas. This restructuring ensures candidates are equipped with modern, relevant knowledge needed in the workplace.
Also Read: All About CPA Exam
The New CPA Exam Structure: Core Sections and Disciplines
The following three core sections, which all candidates must pass, focus on the essential skills every CPA needs, include:
- Financial Accounting and Reporting (FAR)
- Auditing and Attestation (AUD)
- Taxation and Regulation (REG)
These core areas ensure every CPA is equipped with a solid foundation in the key aspects of the profession. After completing the core sections, candidates must choose one of the following disciplines to specialize in:
- Business Analysis and Reporting (BAR) – Builds on FAR and focus on advanced business analysis and reporting skills
- Information Systems and Controls (ISC) – A continuation of AUD, focusing on technology, cybersecurity, and data management
- Tax Compliance and Planning (TCP) – An extension of REG emphasizing advanced tax topics and strategies
You will still receive the same CPA license no matter which discipline you choose. The discipline you pass won’t change the type of license granted, meaning the new structure allows flexibility without altering the fundamental certification.
2024-2025 CPA Exam Core Disciplines: What to Expect?
The newly introduced three discipline sections allow candidates to specialize in areas that match their career goals and interests. Let’s break down what each discipline covers.
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Business Analysis and Reporting (BAR) CPA Exam
The BAR CPA Exam is an extension of the FAR core exam. This discipline emphasizes advanced skills in financial statement analysis and the interpretation of financial information. It requires candidates to evaluate and compare historical data to budgets and forecasts.
BAR also dives deep into technical accounting and reporting topics, including revenue recognition, leases, business combinations, and more. Besides this, knowledge of Financial Accounting Standards Board (FASB) guidelines, Accounting Standards Codification (ASC), and U.S. Securities and Exchange Commission (SEC) rules is essential for passing this discipline. These standards are critical for those working with for-profit businesses and employee benefit plans.
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Information Systems and Controls (ISC) CPA Exam
The Information Systems and Controls (ISC) CPA Exam focuses on the intersection of technology and accounting. With the rise of digital processes and the growing need for cybersecurity in the financial world, this discipline tests your ability to manage and protect information systems within a business setting.
ISC candidates will need to demonstrate their knowledge of data management, processing integrity, and system availability. This exam is meant for those interested in roles involving IT assurance or advisory services.
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Tax Compliance and Planning (TCP) CPA Exam
The Tax Compliance and Planning (TCP) CPA Exam is an in-depth look into U.S. federal tax compliance and tax planning. It builds on the foundational tax knowledge tested in the REG core section and dives deeper into more complex tax issues. This discipline is for candidates interested in roles related to tax compliance and planning.
Candidates taking the TCP exam will need to demonstrate their ability to prepare and review tax returns. The exam is tailored for professionals involved in tax planning, compliance for businesses, and personal tax services.
Transitioning to the New CPA Exam: What You Need to Know?
As the CPA Exam undergoes changes in 2024, the AICPA and NASBA have made the migration process from the old exam structure to the new one smooth for candidates who already hold credits from earlier sections.
If you’ve already passed exams in AUD, FAR, or REG, you won’t need to retake those core sections under the new structure. You can carry those credits over without any extra effort.
Additionally, if you’ve passed the BEC exam, you’ll also be exempt from having to sit for the new discipline section. The BEC content has been redistributed across the core and discipline areas, so candidates with BEC credits don’t need to start from scratch.
CPA Exam Credit Extension: More Time for You
To accommodate these changes, NASBA has introduced a credit extension that most states have adopted. Here’s how it works:
- Credit Extension for Earlier Sections
If you have passed any section of the CPA Exam before January 1, 2024, the credits you’ve earned will be extended until June 30, 2025. This means you have extra time to complete the remaining sections under the new exam structure without losing your previous progress.
- Extended Timeframe to Complete the Exam
The timeframe in which you must pass all sections of the CPA Exam has also been extended. In the past, you were required to complete the exam within 18 months from the date of passing your first section. Most states have extended that period to 30 or 36 months.
Recommended Read: CPA Vs. Accountant: Key Differences
FAQs
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What are the main changes in the 2024 CPA Exam?
The 2024 CPA Exam introduces a core-plus-discipline structure, where candidates must pass three core sections followed by one of three discipline sections. The content has been updated to better reflect modern accounting practices.
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How does the transition from the old CPA Exam to the new 2024 model work?
If you’ve already passed any of the core sections (AUD, FAR, REG) or BEC, you don’t have to retake them. The credits from these sections will carry over. If you’ve passed BEC, you are exempt from sitting for the new discipline section. This can make the transition easier and saves time for candidates who have already made progress.
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How does the credit extension work for candidates who have passed sections before January 2024?
Candidates who have passed any CPA Exam section before January 1, 2024, will have their credits extended until June 30, 2025. Additionally, the time limit for completing the entire exam has been extended to 30 or 36 months (depending on the jurisdiction), compared to the previous 18-month limit.
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Do I need to choose a discipline to become a CPA?
While every candidate must pass the three core sections, choosing one of the three discipline areas is required to complete the exam. However, the discipline you choose does not affect the type of CPA license you receive. The license is the same regardless of which discipline you specialize in
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Will the exam format change in terms of the number of sections or time?
No, the number of sections (four) and the total time (16 hours) remain the same in the 2024 CPA Exam. The changes are primarily in the structure and content.
