2018 CPA Exam Content & Structure

Discover exactly what you need to know in order to pass the CPA exam and prepare for FAR, REG, AUD & BEC

By Bryan Kesler, CPA on 10/21/2017

Welcome to CPA Exam Guide!

You are in the right place to learn everything you need to know about what's tested on the CPA exam, the exam content and structure of the CPA exam in 2017, what the heck FAR, REG, AUD and BEC means and much more!

Let's get started!

Explore Each Part Of The CPA Exam, Content & Structure Below:

CPA Exam Content & Structure Overview

The CPA Exam is the most comprehensive exam given in the business world today and arguably the most difficult to pass.

Here's the good news!

Even though this exam is extremely difficult it all but guarantees if you play your cards right you will increase your net worth by $1MM over your career.

I am living proof already that this is possible [CPA Exam $25K/YR Salary Increase Case Study]

Now before you can skyrocket your career and salary, sign up for the CPA exam and start studying for the exam, you need to know the content and structure of the CPA exam.

The CPA exam is 16 hours long and contains 4 sections or parts which cover a wide range of topics that are taught in most accounting classes at the university or college level.

What are the four sections of the CPA exam?

Types Of Questions On CPA Exam

There are three types of questions asked on the CPA Exam. It's important to understand what is expected of you when answering these questions and understand the differences between each type.

1) Multiple Choice Questions

For each section of the CPA exam you will be given 2 testlets of multiple choice questions. Each question will have 4 possible answers that you can select from.

2) Task-Based Simulations

All four sections of the CPA exam now have TBS or task-based simulations. These questions are designed to re-create real world scenarios you will experience as a CPA.

You will be required to show you understand the topics and concepts asked and to prove you are able to research accounting questions for clients or customers.

3) Written Communications

On BEC you will be given written communication questions which are designed to prove you are able to write professional emails and discuss subject matters related to accounting concepts.

Format Of The CPA Exam By Parts

Each section of the CPA exam is formatted slightly differently. Here is a breakdown of each section by format so you can know what to expect and how to budget your time on CPA exam day.

FAR, REG & AUD Format

Financial Accounting & Reporting (FAR) , Regulation (REG) and Auditing & Attestation (AUD) are all formatted similarly. You can expect to have 50% of your exam be multiple choice and the other 50% be task-based simulations (TBS).

For each of these sections you will have 2 testlets of multiple choice as follows:

Following your multiple choice testlets you will have 3 additional testlets of Task-Based Simulations (TBS) which will contain the following:

Testlet #1 has 2 TBS
Testlet #2 has 3 TBS
Testlet #3 has 3 TBS

For a total of 8 TBS asked for FAR, REG & AUD respectively.

BEC Format

Business Concepts & Enviroment (BEC) is slightly different than FAR, REG and AUD. You will still have 2 individual testlets of multiple choice. BEC has 31 multiple choice questions per testlet making up 50% of your exam.

After the multiple choice, you will also have 2 testlets of Task-Based Simulations (TBS) which make up 35% of your exam.

Each TBS testlet will contain 2 TBS for a total of 4 TBS asked.

The primary difference is that you will also have 3 testlets of Written Communication questions in the final testlet which makes up 15% of your exam.

These written communication questions will be required to be written in a memo format.

What Is The Tested On FAR

Financial Accounting and Reporting is the largest section of the CPA exam and comprehensively covers many different areas of general accounting and reporting.

FAR requires CPA candidates have a strong understanding of US GAAP, primarily covering concepts and standards for financial statements, items on financial statements, various types of transactions, governmental and not for profit accounting standards and reporting for governmental entities.

CPA Candidates will also be expected to apply these concepts and standards as required by any CPA.

FAR is made up of the following primary topics:

Conceptual Framework and Financial Reporting (25-35%)

1) Conceptual framework and standard-setting
2) General-purpose financial statements: for-profit business entities 3) General-purpose financial statements: nongovernmental, not-for-profit entities
4) Public company reporting topics 5) Financial statements of employee benefit plans 6) Special purpose frameworks

Select Financial Statements Accounts (30-40%)

Cash and cash equivalents Trade receivables Inventory
Property, plant and equipment Investments Intangible assets
Payables and accrued liabilities Long-term debt Equity
Revenue recognition Compensation and benefits Income taxes

Select Transactions (20%-30%)

Accounting changes and error corrections Business combinations Contingencies and commitments
Derivatives and hedge accounting Foreign currency transactions and translation Leases
Nonreciprocal transfers Research and development costs Software costs
Subsequent events Fair value measurements Differences between IFRS and U.S. GAAP

State and Local Governments (5%-15%)

State and local government concepts Format and content of the Comprehensive Annual Financial Report (CAFR)
Deriving government-wide financial statements and reconciliation requirements Typical items and specific types of transactions and events in governmental entity financial statements

How Much Time Do You Have To Complete FAR and How Is It Weighted?

You are given 4 hours to complete the exam. When being graded your exam will be weighted as follows:

What Is The Tested On REG

Regulation is the 2nd largest section of the CPA exam and comprehensively covers many different areas of taxes and business law.

Regulation is made up of the following topics:


Ethics, Professional Responsibilities, and Federal Tax Procedures (10-20%)

Ethics and responsibilities in tax practice Licensing and disciplinary systems
Federal tax procedures Legal duties and responsibilities

Business Law (10-20%)

Contracts Agency
Business structure Debtor-creditor relationships
Government regulation of business  

Federal Taxation (60-80%)

Federal taxation of individuals Federal taxation of entities
Federal taxation of property transactions  

How Much Time Do You Have To Complete FAR and How Is It Weighted?

You are given 3 hours to complete the exam. When being graded your exam will be weighted as follows:

What Is The Tested On AUD

Auditing and Attestation (AUD) is considered by many to be the most difficult section of the CPA exam.

It comprehensively covers many different areas of auditing and attestation as follows:

Auditing and Attestation is made up of the following topics:

Ethics, Professional Responsibilities and General Principles (15-25%)

Nature and Scope of Audit and Non-Audit Engagements Ethics, Independence and Professional Conduct Terms of Engagement for Audit and Non-Audit Engagements
Requirements for Engagements Documentation Communication with Management and Those Charged with Governance Communication with Component Auditors and Parties Other Than Management and Those Charge with Governance
A Firm’s System of Quality Control, Including Quality Control at the Engagement Level    

Assessing Risk and Developing a Planned Response (20-30%)

Planning an Engagement Understanding an Entity and Its Environment Understanding an Entity’s Internal Control
Assessing Risks Due to Fraud Identifying and Assessing the Risk of Material Misstatement and Planning Further Procedures Responsive to Identified Risks Materiality
Planning for and using the Work of Others, Including Group Audits, the Internal Audit Function and the Work of a Specialist Specific Areas of Audit Risk  

Performing Further Procedures and Obtaining Evidence (30-40%)

Understanding Sufficient Appropriate Audit Evidence Sampling Techniques Performing Specific Procedures to Obtain Evidence
Specific Matters that Require Individual Attention Misstatements and Internal Control Deficiencies Written Representations
Subsequent Events and Subsequently Discovered Facts    

Forming Conclusions and Reporting (15-25%)

Reports On Auditing Engagements Reports On Attestation Engagements Accounting and Review Service Engagements
Reporting On Compliance Other Reporting Considerations  

How Much Time Do You Have To Complete AUD and How Is It Weighted?

You are given 4 hours to complete the exam. When being graded your exam will be weighted as follows:

What Is The Tested On BEC

Business Environment and Concepts is the shortest of the CPA exam sections and comprehensively covers several different general business areas outside of general accounting.

BEC is made up of the following topics:

Corporate Governance (17-27%)

Economic Concepts and Analysis (17-27%)

Financial Management (11-21%)

Information Systems and Communications (15-25%)

Operations Management (15-25%)

Corporate Governance (17-27%)

Internal control and enterprise risk management frameworks Other regulatory frameworks and provisions

Economic Concepts and Analysis (17-27%)

Financial risk management Economic and business cycles Market influences on business

Financial Management (11-21%)

Capital structure Working capital Financial valuation methods and decision models

Information Systems and Communications (15-25%)

IT governance Role of IT in business
Processing integrity (input/processing/output controls) Systems development and maintenance
Information security/availability  

Operations Management (15-25%)

Cost measurement concepts, methods and techniques Variance analysis
Planning techniques Process management

How Much Time Do You Have To Complete BEC and How Is It Weighted?

You are given 4 hours to complete the exam. When being graded your exam will be weighted as follows:

Ethics Exam

Depending on your state, you may be required to complete Ethics training in order to become a licensed CPA. The most popular Ethics Course is the AICPA's Professional Ethics: The AICPA's Comprehensive Course.

It is an open book self study CPE program that can be completed at any point in your exam.

NOTE: Not all states require you to take the CPA exam, and some require specific Ethics exams other than the exam mentioned above.

In general, you are required to pass your ethics exam within two years preceding initially applying for your CPA certificate.

Next Step In The CPA Exam Process...

Before you get overwhelmed by the massive amount of information tested on the CPA exam, let's discuss what the CPA exam can do for your career.

By passing the CPA exam you automatically set yourself apart from all other accountants.

There are approximately 646,000 active CPA in the United States, so by passing the CPA exam you are part of an elite group of accountants.

The CPA exam is also a universally recognized certificate which will make transitioning to a different career or industry much easier than if you were not a CPA.

There are other non-tangible benefits to becoming a CPA but the biggest tangible result is the monetary advantage you will have over your peers.

It has been shown that CPA's typically make $1,000,000+ over their careers than their non-CPA counterpart.

If you want to be the best accountant you can be, then passing the CPA exam is a no brainer.

Your next step needs to be find the best CPA review course for you.

This is going to be a significant investment and the last thing you want to do is "cheap" out on a course that doesn't give you the tools you need to pass the CPA exam on your first try.

Take our CPA Exam Study Personality Quiz to get started


You can visit our Top CPA Review Courses Comparison page to determine all your options.

Once you have found a CPA review course then it's time to sign up for the CPA exam and start learning HOW to study for the CPA exam.

Here's my step by step CPA exam application process and 21 study tips and strategies to get you started!

Finally, if you have a fear of failure (or have failed a section of the CPA exam) here are my best strategies you can steal to help you overcome failing the CPA exam.

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