CPA 2024 Changes Exploring the Three New Discipline Sections
The accounting profession is on the verge of a transformational shift as theCPA Exam undergoes a significant change with the introduction of the CPA Evolution in January 2024. With this evolution comes a revamped exam structure that includes three new Discipline sections in addition to the Core sections. These new Disciplines—Business Analysis and Reporting (BAR), Information Systems and Controls (ISC), and Tax Compliance and Planning (TCP)—are designed to assess specialised skills and knowledge required for the dynamic landscape of modern accounting. In this blog, we will explore each of these Discipline sections, understanding the subjects and offering a detailed roadmap to success in the new era of the CPA Exam.
1. Business Analysis and Reporting (BAR) Discipline: The BAR Discipline section is designed to gauge candidates' proficiency in a range of fundamental areas that are integral to the modern CPA's role.
Here's a breakdown of what you can expect within this Discipline:
Business Analysis (40-50%): In this section, candidates will immerse themselves in the art of dissecting financial statements. The focus here lies in comparing historical financial results against budgets and forecasts. A critical aspect of aCPA's role, this skill ensures candidates can derive valuable insights from financial data, aiding businesses in making informed decisions.
Technical Accounting and Reporting (35-45%): The technical aspect of accounting takes centre stage here, where candidates will be required to apply the Financial Accounting Standards Board (FASB) and Securities and Exchange Commission (SEC) regulations to complex scenarios. This includes the intricate world of revenue recognition and lease accounting, where a deep understanding of regulations is pivotal.
State and Local Governments (10-20%): This segment sheds light on the distinctive requirements for accounting in the public sector. Candidates will dive into the Generally Accepted Accounting Principles (GAAP) established by the Governmental Accounting Standards Board (GASB) that apply to state and local government entities.
2. Information Systems and Controls (ISC) Discipline: Navigating the Digital Frontier
The ISC Discipline is tailored to equip candidates with the knowledge to navigate the expanding digital landscape and understand the role of CPAs in managing information systems and controls. Here's a detailed breakdown of this Discipline:
Information Systems and Data Management (35-45%): In an era where data is hailed as the new oil, this segment focuses on understanding data life cycles. Candidates will explore how data is collected, stored, and used, and the implications for information systems management.
Security, Confidentiality, and Privacy (35-45%): As the digital realm grows, concerns over data security, confidentiality, and privacy have never been more critical. This section delves into the intricate world of securing sensitive information and understanding the legal and ethical implications of data handling.
Considerations for SOC Engagements (15-25%): SOC engagements, or System and Organization Controls, have become integral to assessing the reliability of service organisations. Candidates will learn how to plan, perform, and report on SOC engagements, including the intricate trust services criteria for security, availability, processing integrity, confidentiality, and privacy.
3. Tax Compliance and Planning (TCP) Discipline: Mastering Tax Strategies
The TCP Discipline provides candidates with a comprehensive understanding of tax compliance and planning, a vital component of any CPA's role. This Discipline can be broken down into the following key areas:
Tax Compliance and Planning for Individuals and Personal Financial Planning (30-40%): This section focuses on navigating the complexities of U.S. federal tax compliance for both individuals and entities. With an emphasis on nonroutine and higher complexity transactions, candidates will develop expertise in tax planning and personal financial strategies.
Entity Tax Compliance (30-40%): Candidates will explore the world of entity tax compliance, delving into the preparation and review of tax returns for different types of business entities.
Entity Tax Planning (10-20%): Understanding the nuances of tax planning for entities is crucial. Candidates will learn to determine the tax implications of various business transactions and structures.
Property Transactions (Disposition of Assets) (10-20%): In this segment, candidates will navigate the intricate landscape of property transactions and their corresponding tax implications.
Strategies for Success: Navigating the Disciplines
To navigate the new Discipline sections effectively, aspiring CPAs must adopt a strategic and focused approach to their exam preparation.
Here's a blueprint for success:
1. Comprehensive Study Resources: The foundation of success lies in the quality of study resources. Choose preparatory materials that are tailored to the specific Discipline you opt for. Reputable review courses like Becker offer comprehensive materials that cover each Discipline's content areas in detail.
2. Practice Makes Perfect: Regular practice is essential to internalise complex concepts. Solve a wide variety of practice questions and simulated exam scenarios to build confidence and enhance familiarity with the exam format.
3. Structured Study Plans: Design a study plan that allots adequate time to each content area based on the allocation percentages provided. This ensures comprehensive coverage and prevents neglecting any crucial topic.
4. Expert Guidance: Enrol in review courses offered by well-known providers like Becker Expert guidance can provide valuable insights and clarification on challenging topics, enhancing your overall understanding and preparation.
As the CPA Exam evolves, Simandhar Education offers tailored study resources, focused practice, and expert guidance to help candidates succeed in these new Disciplines. Join our CPA masterclass on December 10 at 6:30 PM to accelerate your career: https://bit.ly/47HkowI. This is Simandhar Education’s commitment to advancing the CPA profession in business analysis, information systems management, and tax compliance and planning. Are you ready to elevate your career?
