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AICPA FAR : CPA Financial Accounting and Reporting Exam

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Exam Number : FAR
Exam Name : CPA Financial Accounting and Reporting
Vendor Name : AICPA
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FAR exam Format | FAR Course Contents | FAR Course Outline | FAR exam Syllabus | FAR exam Objectives

Within the Blueprints, you will find the following information for each exam section:
Content organized by Area, Group and Topic along with score weighting
Sample task statements that represent what you may be asked to do when testing
Skill levels at which tasks are tested
Reference materials that support the sample task statements
Number of item types you must complete (multiple-choice questions, task-based simulations and written communication tasks)
Score weighting of each item type

Content area allocation Weight
I. Conceptual Framework, Standard-Setting and Financial Reporting 2535%
II. Select Financial Statement Accounts 3040%
III. Select Transactions 2030%
IV. State and Local Governments 515%

Each exam section is delivered in five smaller sections called testlets. Each testlet features different item types (see below) used to test your knowledge and skills. To learn more about how each section is organized, including when you can take a break, review the CPA exam structure.

Exam Item Types
You will be tested during the CPA exam using three types of test items that appear within specific testlets in each section.

Multiple-Choice Questions (MCQ)
The multiple-choice portions are presented in the first two testlets of each exam section.

Task-Based Simulations (TBS)
Task-based simulations are condensed case studies that test accounting knowledge and skills using real life, work-related situations. All task-based simulations are intended to assess knowledge and skills that are appropriate for an entry-level accountant. There are three TBS testlets in the AUD, FAR and REG sections, and two TBS testlets in the BEC section.

Written Communication Tasks
Written communication tasks appear only in the BEC section of the CPA Exam. For each of three written communication tasks, you must read a scenario and then write an appropriate document relating to the scenario. The instructions state what form the document should take (such as a memo or letter) and its focus. Your response should provide the correct information in writing that is clear, complete and professional.

Each of the four exam sections is broken down into five smaller sections called testlets. These testlets feature multiple-choice questions (MCQs) and task-based simulations (TBSs). In the case of BEC, you also have to complete three written communication tasks. The number of MCQs and TBSs tested varies depending upon the specific section taken. You will receive at least one research question (research-oriented TBS) in the AUD, FAR and REG sections. To complete them, you will have to search the related authoritative literature and find an appropriate reference.

During each exam section, you will be offered a 15-minute break after the first TBS testlet. This is about midway through the section (two hours). You may accept this break and pause the exam timer or you may continue testing. To accept the break, click the Take a Break button. During this break, you must leave the testing room and follow all Prometric security rules. The exam timer will restart when the 15-minute break ends.

In addition to the 15-minute break, you may also take optional breaks after all other testlets but you cannot pause the exam timer. The timer will continue to run.

The Financial Accounting and Reporting (FAR) section of the Uniform CPA Examination (the Exam) assesses the knowledge and skills that a newly licensed CPA must demonstrate in the financial accounting and reporting frameworks used by business entities (public and nonpublic), not-for-profit entities and state and local government entities.
The financial accounting and reporting frameworks that are eligible for assessment within the FAR section of the exam include the standards and regulations issued by the:
Financial Accounting Standards Board (FASB)
U.S. Securities and Exchange Commission (U.S. SEC)
American Institute of Certified Public Accountants (AICPA)
Governmental Accounting Standards Board (GASB)
International Accounting Standards Board (IASB)
A listing of standards and regulations promulgated by these bodies, and other reference materials that are eligible for assessment in the FAR section of the Exam are included under References at the conclusion of this introduction.
Content organization and tasks
The FAR section blueprint is organized by content AREA, content GROUP and content TOPIC. Each group or Topic includes one or more representative TASKS that a newly licensed CPA may be expected to complete in practice.
Tasks in the FAR section blueprint are representative. The tasks are not intended to be (nor should they be viewed as) an all-inclusive list of tasks that may be tested in the FAR section of the Exam. Additionally, it should be noted that the number of tasks associated with a particular content group or topic is not indicative of the extent such content group, Topic or related skill level will be assessed on the Exam. For example, the Topic titled Notes to financial statements in Area I includes two tasks that are intended to encompass the required disclosures for any Topic in the FASB Accounting Standards Codification, while the group titled Leases in Area III includes eight tasks that are limited to the accounting requirements in the Leases Topic of the FASB Accounting Standards Codification. The number of tasks included in the blueprint for this

group and this Topic is not intended to suggest that Leases are more significant to newly licensed CPAs or will be tested more than the Notes to financial statements. Similarly, examples provided within the task statements should not be viewed as all-inclusive.
Content allocation
The following table summarizes the content areas and the allocation of content tested in the FAR section of the Exam:
Overview of content areas
Area I of the FAR section blueprint covers FASBs Conceptual Framework, FASBs standard-setting process and several different financial reporting topics. The financial reporting Topics include the following:
General-purpose financial statements applicable to for-profit entities, not-for-profit entities and employee benefit plans under the FASB Accounting Standards Codification
Disclosures specific to public companies including earnings per share and segment reporting under the FASB Accounting Standards Codification and the interim, annual and periodic filing requirements for U.S. registrants in accordance with the rules of the U.S. SEC
Financial statements prepared under special purpose frameworks as described in AU-C Section 800 of the Codification of Statements on Auditing Standards Area II of the FAR section blueprint covers the financial accounting and reporting requirements in the FASB Accounting Standards Codification that are applicable to select financial statement accounts.
To the extent applicable, each group and Topic in the area is eligible for testing within the context of both for-profit and not-for-profit entities. If significant accounting or reporting differences exist between for-profit and not-for-profit entities for a given group or topic, such differences are in representative not-for-profit tasks in the blueprint.
Area III of the FAR section blueprint covers the financial accounting and reporting requirements for select transactions that are applicable to entities under the FASB Accounting Standards Codification and the IASB standards. The testing of content under the IASB standards is limited to a separate group titled, Differences between IFRS and U.S. GAAP.
To the extent applicable, the remaining groups in the area are eligible for testing within the context of both for-profit and not-for-profit entities. If significant accounting or reporting differences exist between for-profit and not-for-profit entities, such differences are in representative not-for-profit tasks in the blueprint.
Area IV of the FAR section blueprint covers GASBs conceptual framework as well as the financial accounting and reporting requirements for state and local governments under the GASB standards and interpretations.
Section assumptions
The FAR section of the exam includes multiple-choice questions, task-based simulations and research prompts. When completing questions in the FAR section of the Exam, candidates should assume that all of the information provided in each question is material. In addition, candidates should assume that each question applies to a for-profit business entity reporting under U.S. GAAP unless otherwise stated in the fact pattern for a question. For example, questions that apply to not-for-profit entities specify the nature of these entities
as not-for-profit or non-governmental, not-for-profit. Questions that apply to IFRS include phrases such as under IFRS or according to IFRS. Questions that apply to the state and local governments include phrases such as local government, state, municipality or city.
Skill allocation
The exam focuses on testing higher order skills. Based on the nature of the task, each representative task in the FAR section blueprint is assigned a skill level. FAR section considerations related to the skill levels are discussed below.
Skill levels
Evaluation The examination or assessment of problems, and use of judgment to draw conclusions.
The examination and study of the interrelationships of separate areas in order to identify causes and find evidence to support inferences.
Application The use or demonstration of knowledge, concepts or techniques.
Remembering and Understanding The perception and comprehension of the significance of an area utilizing knowledge gained Remembering and Understanding tasks are in all four areas of the FAR blueprint. These tasks, such as identifying transactions and financial reporting requirements, frequently require newly licensed CPAs to demonstrate their comprehension of accounting concepts and standards. Area IV has the highest concentration of remembering and understanding tasks.
Application tasks are in all four areas of the FAR blueprint. These tasks, such as preparing journal entries and financial statements, frequently require newly licensed CPAs to use accounting concepts and standards to measure and recognize financial statement amounts.
Analysis tasks are in Area I, Area II and Area III of the FAR blueprint. These tasks, such as reconciling account balances, interpreting agreements and detecting financial reporting discrepancies, frequently require newly licensed CPAs to demonstrate a higher level of interpretation. Area I and Area II have the highest concentration of analysis tasks.
The representative tasks combine both the applicable content knowledge and the skills required in the context of the work that a newly licensed CPA would reasonably be expected to perform. The FAR section does not test any content at the Evaluation skill level as newly licensed CPAs are not expected to demonstrate that level of skill in regards to the FAR content.

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a way to put together students Now for the CPA Evolution | FAR exam Questions and Dumps

The CPA Evolution initiative it really is slated to launch on January 1, 2024, will trade the content material of the CPA licensure examination from four core add-ons to three core sections: audit, taxation and accounting, with know-how and digital acumen included into every. Candidates additionally can be required to choose one in all three specialized tracks: company analysis and Reporting (BAR), Tax Compliance and Planning (TCP) or suggestions methods and Controls (ISC). The association of foreign licensed expert Accountants (AICPA) and the country wide affiliation of State Boards of Accountancy (NASBA) plan to finalize and announce a draft blueprint for the exam in the summertime of 2022, at the earliest, earlier than publishing the closing blueprint at the start of 2023. 

The CPA Evolution will affect existing faculty newbies and sophomores, as they may be the primary cohorts to take the new exam. Educators and academics should no longer stay up for the blueprint before updating their curricula and getting ready their college students, as they can instantly start to contain huge themes and ability units identified within the CPA Evolution model Curriculum launched past this 12 months. most importantly, educators should still incorporate important thinking, difficulty fixing, information administration and analysis, digital acumen, multiplied inside controls center of attention and repair company control (SOC) engagements. 

here is what educators can do now to prepare for 2024, from least difficult to most difficult.

Audit-focused alterations: SOC, chance, Controls and methods

The audit component of the Evolution exam may have an extended focal point on SOC engagements and company hazards, systems and controls. Educators should still handle these themes at an introductory stage in class by way of discussing the following: 

  • What are SOC engagements? 
  • How are they carried out? 
  • What do auditors need to do to assess a SOC record from a carrier auditor?
  • What are the responses if the SOC report identifies handle deficiencies with the provider corporation? 
  • technology-focused alterations: information analysis and management and Digital Acumen

    records evaluation and administration skills are extra complicated for educators to construct into their curricula. Digital acumen is a brand new addition to the examination and specializes in candidates’ identification of and capacity to reply to emerging applied sciences in accounting. The mannequin Curriculum requires candidates to “bear in mind” or “establish” a lot of rising applied sciences, trends and applications. fortunately, recalling and deciding upon is less difficult than “applying” or “implementing,” so these potential are less difficult to comprise into lots of courses. 

    These discovering goals will also be met by means of explaining various accounting applied sciences to students and describing their use instances. college students can expand their advantage by using taking part in case studies that describe an audit, financial reporting or tax circumstance, thereby enabling them to determine the premiere accounting know-how to make use of and clarify why that expertise is finest. for instance, students might clarify which workflows they would create all over journal entry checking out on an audit by way of listing the parameters they might set and what know-how they would deploy to operate the examine.

    Educators need not create a separate direction to address records analytics and administration skills. as a substitute, as a result of know-how will be integrated throughout all exam materials, educators may still take a similar strategy within the lecture room and combine know-how and information evaluation equipment across the curriculum. Introductory courses may still begin with the aid of incorporating Excel, whereas intermediate classes should consist of assignments involving Alteryx, Tableau, Microsoft power BI or other in a similar fashion advanced tools. Robotic procedure automation equipment are ideally fitted to be added in audit (e.g., observe handle testing over signatures or three-manner matches) and tax compliance (e.g., pulling facts from the same supply for input onto a tax return or schedule). upper-level courses and graduate courses might expand upon these tools to raise expertise or proceed to incorporate the latest emerging applied sciences to fulfill the “consider” or “identify” projects within the model Curriculum.

    despite the strategy, educators should not are expecting their college students to turn into consultants in a single day in records analytics and digital acumen. 

    “some of the optimum studying will occur when students work through difficulties on their personal and have in mind the solution sufficient to walk different students in the course of the problem without the professor,” talked about Jack Castonguay, vp of strategic content material development at Surgent Accounting and fiscal schooling. 

    The breadth of useful resource guides, video clips and guide manuals offered via providers of rising expertise will supply college students abundant components to finished tasks without a lot of direct involvement from educators. really, faculty can hone college students’ difficulty-fixing knowledge via having them remedy the case analyze, task or project on their personal using the product’s materials. This unbiased getting to know and troubleshooting will additional prepare college students for the daily calls for of working for an accounting company, as many senior enterprise body of workers and partners are not likely to be experts in the same emerging technologies the frontline team of workers are using. firms will are expecting their employees to take the initiative and study to adapt, an expectation educators can foster in the classroom.

    competencies-concentrated changes: crucial pondering and problem fixing

    some of the most sought-after knowledge are those that are hardest to train, akin to important thinking and issue solving. To handle these advantage, educators deserve to discover the right way to stream beyond strict binary-alternative content material. as a substitute of inquiring for journal entries of an operating lease, supply college students the fact pattern for the hire and let them check its classification and annual expense. Or, ask them to verify, given definite debt covenants, how a corporation would ideally need to structure their rent. These initiatives require extra important pondering and less memorization of accounting rules. moreover, incorporating rising accounting applied sciences into the curriculum presents many opportunities for students to problem resolve devoid of clear suggestions. For these assignments, center of attention less on the reply and extra on the concept manner that led the student to the reply, for you to hone important thinking. knowing the “why” and “how” turns into greater vital than the “what.” 


    The CPA Evolution will certainly change which content educators teach, how new content material is mixed with legacy content material and the prevalence of digital acumen and expertise content material across the curriculum. Educators and college can start making changes to curriculum now to prepare for the new exam in 2024. chew-sized introductions and self-paced tasks could be the most advisable except the ultimate blueprint is launched.

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