What Is CPA Evolution?

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“The only constant is change,” goes the saying. Well, what’s true of life in general is also true of the accounting profession. The relentless march of technological change means that accountants can never rest on their laurels in confidence that their current skills will be enough.

This truism is why the National Association of State Boards of Accountancy (NASBA) and the American Institute of Certified Public Accountants (AICPA), the organizations responsible for the CPA Exam curriculum, periodically update both the exam and the competencies that accounting instructors are expected to teach aspiring CPAs. The AICPA Governing Council and the NASBA Board of Directors have now voted to advance an initiative, called CPA Evolution, that will implement a new CPA Exam by 2024 , with the core competencies of accounting being augmented by new skills that aspiring accountants will need to learn to succeed in coming years. Instructors will have to pay close attention, not just to this initiative as it develops and once it’s completed, but to the underlying reason for the necessary changes.

In 2019, an AICPA research report had some interesting – and for accountants unsettling – findings. It found that accounting firms were hiring fewer actual accountants, but more were hiring people with non-accounting backgrounds who had special competencies related to technology. This reflects the broader trend of accountants having to leverage more data and tools for analyzing that data, as more routine accounting tasks become automated. In a subsequent “ gap analysis ” of what in-demand and necessary competencies accounting graduates are lacking, AICPA and NASBA discovered that college and university accounting departments are not sufficiently teaching particular skills. Though two-thirds of accounting departments teach data analytics and IT audit, relatively few, the survey found, teach increasingly important competencies like cybersecurity, IT governance or Systems and Organization Control engagement. The result is that people with accounting degrees have become less relevant to CPA firms, who have been seeking out professionals who can help bridge this skills gap. But obviously the ideal is to have accountants who are competent in the skills of the future – and that’s where CPA Evolution comes in.

Set to launch in January 2024, the new CPA Exam will include a greater focus on the role of technology across the core competencies of Accounting, Audit and Tax. The new curriculum will help ensure that all accountants taking the CPA Exam will have some exposure to vital tech skills, with Audit covering the tech topics most heavily. But the new exam will also include “discipline” tracks which include the option of a specific focus on Information Systems and Controls (ISC). The ISC discipline will cover topics related to assurance or advisory roles related to a client’s business processes, information systems, information security, and governance and IT audit. For those students who opt for a different track, they have the opportunity of focusing more specifically on Tax Compliance and Planning or Business Analysis and Reporting, with a greater emphasis than previously on technology and analytics skills.

As the new CPA Exam will not take effect until 2024, current students and instructors in accounting programs have time to prepare. For students who will graduate in 2024 or later, this entails thinking about the particular discipline track they wish to take, conscious of the rising importance of technology and analytics in CPA firm hiring decisions. For instructors, this means studying the existing model curriculum and adapting their courses accordingly to reflect the new competencies. The model curriculum has been designed by a task force of educators, regulators and practitioners to serve as a roadmap that will help evolve accounting education to include the skills and competencies needed by CPAs. This event is open to all who are interested, and all accounting educators should consider attending. To attend,  register here.

Over the coming weeks, I will be publishing further blogs going into greater depth on the curriculum and new exam, as well as the concrete effects on students and instructors as they get ready for 2024. Stay tuned!

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