Updated April 19, 2019

How to Become a CPA

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It takes more than passing one exam to become a CPA. In fact, it could take you a couple of years to earn your license.

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As a CPA, you have many specialty areas you can work in, whether as a public accountant or corporate accountant. For example, you can combine your expertise in accounting and IT to work in Information Technology, or you can specialize in tax accounting, helping businesses minimize their tax liabilities as well as understand the tax laws.

Regardless of the area of accounting you choose, you'll need to take the same steps to become a CPA.

Satisfy the Education Requirements

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Typically, you need at least a bachelor's degree to sit for the CPA exam. Some states require a master's degree, though. The exact number of credit hours you need and the type of degree required depend on the requirements of your state board.

In addition to your bachelor's degree, you'll need proof of a specific number of credit hours in accounting courses. Typically, you need 24 credit hours in accounting-related topics and 30 credit hours in business topics.

Can You Become a CPA Without an Accounting Degree?
If you have a bachelor's degree, but it's not in accounting, you may still sit for the CPA exam. The exact rules depend on where you live, as each state has their own requirements.

In general, you'll need to take "some" accounting courses, but if your degree isn't in accounting, you still stand a chance to become a CPA (assuming you can pass the exam).

Get Your Education Verified

Before you can formally apply to sit for the CPA exam, your state board must verify your education. In order to do this, you must send in a copy of your transcript from each school you attended. Even if you just took one summer course at a school, include it. The state board must verify that you meet their education requirements before you can sit for the exam.

If you skip this step and apply for the exam first, the AICPA won't be able to approve you to sit for the exam.

Purchase a CPA Exam Review Course

Before you even apply to sit for the CPA exam, it's a good idea to choose your review course and begin it.

You only have six months to take the exam once you receive your NTS (Notice to Schedule) from the AICPA.

If you apply to sit for the exam and haven't started studying yet, you may not be ready within that six-month window. We discuss this in further detail below.

Choosing the right CPA review course is an important step. Each student has a different timeline and learning style. What works for one student may not work for another. The review courses come at a hefty cost, which is yet another reason you want to give it careful thought.

You can purchase a CPA review course for the section you plan to take first or you can buy all sections at once. Just make sure that the review course offers access for enough time for you to pass all four sections, as not all courses offer "access until you pass."

Is It Hard to Become a CPA?
Many exams are hard, especially those that certify you to have an important title/job. The CPA exam is no exception, but with a pass rate of at least 50%, people are passing it. It all comes down to how well you prepare yourself for the exam, how much schooling you have behind you, and how much "real world" experience you have in the accounting industry.

Apply to Take the Exam

You'll actually take three steps when you apply to take the CPA exam. This is assuming that you already had your education verified by your state board, too.

First, you'll complete the application in the state you plan to become a CPA. With your completed application, you'll need to send the application fee, which averages around $150, but each state varies. Within 4 weeks or so, you'll receive an Authorization to Test (ATT).

Once you have the ATT, you can sign up for the section of the exam you wish to take first. You'll want to act fast with this step, though, as you generally only have 90 days before the ATT expires. When you sign up for the exam section, you'll pay the fees for that exam, which are often $1,000 or more.

Once the board receives your fees, they will send you a Notice to Schedule in about four weeks. The NTS is what you need to schedule your exam. Keep in mind that you only have six months to take the exam or your NTS expires and you start at square one again.

You'll actually schedule your exam with Prometric, the test sponsor for the CPA exam. They offer four testing windows per year, each of which is approximately two months long.

Take and Pass the CPA Exam

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The CPA exam consists of four sections. You must get a passing score of 75 on each section in order to become a CPA. The exam works on a scale of 1 - 99, but the required score of 75 isn't a percentage. Each question is worth a specific number of points and you need 75 points in order to pass.

Once you pass your first section, you have 18 months to pass the three remaining sections. If you don't accomplish this task, you'll have to retake all sections and pass each one within the 18-month window.

You can schedule each section one time within each testing window. Typically, you'll want to take just one section within each window, though, since you'll need approximately 80 - 100 hours of study time for each section.

Take and Pass the AICPA Ethics Exam

You won't need nearly as many hours of studying for this exam, but you still have to pass it. Once you pass the four sections of the CPA exam, you must register for the ethics exam. The AICPA will send you a textbook that outlines your ethical duties as a CPA. Once you read the book and feel ready, you can take the exam online.

Satisfy Any Work Experience Requirements

Each state has different work experience requirements for CPAs. You may need anywhere from six months to two years of experience in the industry before you can become a licensed CPA. Typically, you need to work under the supervision of a licensed CPA for a specific amount of time before you can become licensed.

Pay close attention to your state's requirements, as some are particular in the type of experience you must have. For example, some states require a specific amount of time working in auditing while others allow you to work as a public accountant to satisfy the requirement.

Pay Your Dues

The final step includes more money. You'll need to pay the licensure fee for your state to your state board. Once you pay the fee, you will receive your state's certificate indicating that you are a licensed CPA in the state you took the exam.

Bottom Line

Becoming a CPA isn't a decision you should take lightly. It can take you months, or even years, to accomplish, depending on your schedule and level of dedication. In the end, obtaining your CPA license can help you further your career in accounting, no matter the specialty you choose.

Write to Kim P at evan@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.

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