The Uniform CPA Examination 19 th Brazilian Accounting Congress August 27, 2012 Dr. Craig N. Mills

The Uniform CPA Examination ™ The U. S. CPA License The license is granted by individual states Education: 150 hours of college credit with a certain amount in accounting Experience: 1 year Examination: Pass all 4 sections of the U.S. Uniform CPA Examination within an 18 month period 2

The Uniform CPA Examination ™ Continuing Professional Education Required to keep the license Average is 40 hours per year States audit a sample of license holders to check their Continuing Professional Education People who do not pass the audit usually have their license suspended for at least a year and have to pay a penalty 3

About the Uniform CPA Examination

The Uniform CPA Examination ™ Protect the Public Interest Content Design for Uniform CPA Examination : Required knowledge and skills for entry-level CPAs Ensures protection of public interest Criteria for determining knowledge/ skills Relevance to work of entry-level CPAs -Importance to work of entry-level CPAs -Frequency of use by entry-level CPAs 5

The Uniform CPA Examination ™ Uniform CPA Examination Structure 4 Sections Audit and Attestation (AUD) Business Environment and Concepts (BEC) Financial Accounting and Reporting (FAR) Regulation (REG) 6

The Uniform CPA Examination ™ Uniform CPA Examination Structure Section Time (Hours) Content AUD4 90 Multiple Choice Questions 7 Task Based Simulations FAR4 90 Multiple Choice Questions 7 Task Based Simulations REG3 72 Multiple Choice Questions 6 Task Based Simulations BEC3 72 Multiple Choice Questions 3 Essays 7

Uniform CPA Examination Trends and Volume

The Uniform CPA Examination ™ 9 Domestic Volume 13.5% Increase 10.2% Increase 10.9% Increase 7.9% Increase 15.3% Increase 19.2% Decrease

The Uniform CPA Examination ™ 10 Uniform CPA Examination Pass Rates (%) AUD BEC FAR REG

IFRS and the Uniform CPA Examination

The Uniform CPA Examination ™ IFRS on the Uniform CPA Examination IFRS is already entry-level practice and many CPAs are now using IFRS CPAs who work for companies in the U.S. that are owned by foreign IFRS entities. CPAs who work for companies in the U.S. that own foreign entities reporting in IFRS. Auditors who audit companies that report under IFRS, or who audit their subsidiaries who report under IFRS. 12

The Uniform CPA Examination ™ Sample IFRS Question #1 On July 1, year 2, a company decided to adopt IFRS. The company’s first IFRS reporting period is as of and for the year ended December 31, year 2. The company will present one year of comparative information. What is the company’s date of transition to IFRS? A) January 1, year 1. B) January 1, year 2. C) July 1, year 2. D) December 31, year 2. 13

The Uniform CPA Examination ™ Sample IFRS Question #1 On July 1, year 2, a company decided to adopt IFRS. The company’s first IFRS reporting period is as of and for the year ended December 31, year 2. The company will present one year of comparative information. What is the company’s date of transition to IFRS? A) January 1, year 1. See Note A B) January 1, year 2. C) July 1, year 2. D) December 31, year 2. Note A: The date of transition is the beginning of the earliest period for which an entity presents full comparative information under IFRS in its first IFRS Financial Statements (IFRS 1, Appendix A). 14

The Uniform CPA Examination ™ Sample IFRS Question #2 A company determined the following values for its inventory as of the end of its fiscal year: Historical cost $100,000 Current replacement cost 70,000 Net realizable value 90,000 Net realizable value less a normal profit margin 85,000 Fair value 95,000 Under IFRS, what amount should the company report as inventory on its balance sheet? A)$70,000 B)$85,000 C)$90,000 D)$95,000 15

The Uniform CPA Examination ™ Sample IFRS Question #2 A company determined the following values for its inventory as of the end of its fiscal year: Historical cost $100,000 Current replacement cost 70,000 Net realizable value 90,000 Net realizable value less a normal profit margin 85,000 Fair value 95,000 Under IFRS, what amount should the company report as inventory on its balance sheet? A)$70,000 B)$85,000 C)$90,000 D)$95, Inventories are measured at the lower of cost and NRV (IAS 2, par. 9).

International Administration of the Uniform CPA Examination

The Uniform CPA Examination ™ International Delivery – 12Q1 Pass Rates 18

New Test Questions

The Uniform CPA Examination ™ Original MCQ 20

The Uniform CPA Examination ™ MCQuel Item, Sample: Time value of money calculation 21

The Uniform CPA Examination ™ MCQuel Item, Sample: Time value of money calculation 22

The Uniform CPA Examination ™ MCQuel Item, Sample: Time value of money calculation 23

The Uniform CPA Examination ™ MCQuel Item, Sample: Time value of money calculation 24

The Uniform CPA Examination ™ MCQuel Item, Sample: Time value of money calculation 25

Thank You Craig N. Mills