Are YOU Smarter than a CPA Candidate??? Which of the following would likely cause a rightward shift in the aggregate demand curve? a.an increase in wealth b.an increase in the level of real interest rates c. This garbage is not on the CPA exam d.i already passed so I don t need to know what is covered on today s exam
Why do I need to know what is on the exam? We are ambassadors for the profession We have a duty to mentor those entering the profession Shortage of exam candidates Succession planning and mobility Content Changes BEC Business Environment and Concepts (BEC) Area Current CSOs 2011 CSOs Area I Business Structure (17-23%) Corporate Governance (16-20%) Area II Economic Concepts (8-12%) Economic Concepts and Analysis (16-20%) Area III Financial Management (17-23%) Financial Management (19-23%) Area IV Information Technology (22-28%) Information Systems and Communication (15-19%) Area V Planning and Measurement (22-28%) Strategic Planning (10-14%) Area VI N/A Operations Management (12-16%)
Corporate Governance According to the Sarbanes Oxley Act of 2002, which of the following statements is correct regarding an issuer s audit committee financial expert? a. The issuer s current outside CPA firm s audit partner must be the audit committee financial expert. b. If an issuer does not have an audit committee financial expert, the issuer must disclose the reason why the role is not filled. c. The issuer must fill the role with an individual who has experience in the issuer s industry. d. The audit committee financial expert must be the issuer s audit committee chairperson to enhance internal control. Content Changes REG Regulation (REG) Area Current CSOs 2011 CSOs Area I Ethics and Professional and Legal Responsibilities (15-20%) Ethics, Professional and Legal Responsibilities (15-19%) Area II Business Law (20-25%) Business Law (17-21%) Area III Area IV Federal Tax Procedures and Accounting Issues (8-12%) Federal Taxation of Property Transactions (8-12%) Federal Tax Process, Procedures, Accounting and Planning (11-15%) Federal Taxation of Property Transactions (12-16%) Area V Federal Taxation of Individuals (12-18%) Federal Taxation of Individuals (13-19%) Area VI Federal Taxation of Entities (22-28%) Federal Taxation of Entities (18-24%)
Content Changes AUD Auditing and Attestation (AUD) Area Current CSOs 2011 CSOs Area I Plan the Engagement (22-28%) Auditing and Attestation: Engagement Acceptance and Understanding the Assignment (12-16%) Area II Internal Control (12-18%) Auditing and Attestation: Understanding the Entity and Its Environment (including Internal Control) (16-20%) Area III Obtain and Document Information (32-38%) Auditing and Attestation: Performing Audit Procedures and Evaluating Evidence (16-20%) Area IV Review and Evaluate Work Performed (8-12%) Auditing and Attestation: Evaluating Audit Findings, Communications and Reporting (16-20%) Area V Communications and Reporting (12-18%) Accounting and Review Service Engagements (12-16%) Area VI N/A Professional Responsibilities (including Ethics and Independence) (16-20%) Content Changes FAR Financial Accounting and Reporting (FAR) Area Current CSOs 2011 CSOs Area I Concepts and Standards for Financial Statements (17-23%) Conceptual Framework, Standards, Standard Setting and Presentation of Financial Statements, (First-time adoption of IFRS) (17-23%) Area II Typical Items in Financial Statements (27-33%) Financial Statement Accounts: Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures (27-33%) Area III Specific Types of Transactions (27-33%) Specific Transactions, Events and Disclosures: Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures (27-33%) Area IV Area V Governmental Accounting and Reporting (8-12%) Not-for-Profit Accounting and Reporting (8-12%) Governmental Accounting and Reporting (8-12%) Not-for-Profit (Nongovernmental) Accounting and Reporting (8-12%)
Structure Changes Current Format Business Environment and Concepts (BEC) Three Multiple-Choice Question (MCQ) Testlets containing 90 questions No Simulations or Written Communication Tasks 2011 Format Three Multiple-Choice Question (MCQ) Testlets containing 72 questions Three Written Communication Tasks on BEC topics Scoring Business Environment and Concepts (BEC) Item Format Current Weight 2011 Weight Multiple-Choice Questions (MCQ) 100% 85% Simulations N/A N/A Written Communication Tasks N/A 15%
Structure Changes Current Format Three Multiple-Choice Question (MCQ) Testlets containing 72 questions Two Written Communication Tasks Two Simulations in current (long) format Regulation (REG) 2011 Format Three Multiple-Choice Question (MCQ) Testlets containing 72 questions NO Written Communication Tasks One testlet containing six short task-based simulations (TBS): research question in NEW format Structure Changes Current Format Financial Accounting and Reporting (FAR) Auditing and Attestation (AUD) Three Multiple-Choice Question (MCQ) Testlets containing 90 questions Two Written Communication Tasks Two Simulations in current (long) format 2011 Format Three Multiple-Choice Question (MCQ) Testlets containing 90 questions NO Written Communication Tasks One testlet containing seven short taskbased simulations (TBS): research question in NEW format
Scoring Financial Accounting and Reporting (FAR) Auditing and Attestation (AUD) Regulation (REG) Item Format Current Weight 2011 Weight Multiple-Choice Questions (MCQ) 70% 60% Simulations 20% 40% Written Communication Tasks 10% N/A Additional Issues Codification IFRS fair game Beta Questions International Test Sites
IFRS Question Based on a physical inventory taken on December 31, an entity determined its inventory on a FIFO basis to be $70,000, with replacement cost of $65,000. The entity estimated that after further processing costs of $8,000, the completed inventory could be sold for $75,000. The entity s normal profit margin is 30%. What amount should the entity report as inventory in its December 31 balance sheet under IFRS? IFRS Solution GAAP: NRV = 67 (75 8) NRV profit margin = 44.5 (67 (30% x 75) Replacement Cost = 65 Designated Market Value (middle) = 65 Cost = 70 GAAP Answer = 65 IFRS: Compare Cost to NRV (that s it!) Answer = 67
Let s See those Simulations! http://apps.aicpa.org/cbtesampletest/samplet estinstpremet.html