How to become a CPA
While accounting careers range from clerical positions to chief financial officers, in most states only a certified public accountant may audit financial statements any company releases to the public, says Judy Thomas, MBA, a CPA who teaches in the accounting program at the University of Phoenix® Colorado Campus. “Every type of business can benefit from the services of a CPA,” she says.
Here, Thomas explains how to attain this credential:
Know your state’s requirements.
While CPA licensing requirements vary by state, there are commonalities. “Every state requires some blend of the ‘three E’s’: education, experience and the [CPA] exam,” Thomas explains.
To learn the licensing requirements in your state, she suggests contacting your state board of accountancy — sometimes called state board of examiners. The American Institute of CPAs (AICPA) also maintains a summary of CPA requirements by state, updated annually.
Passage of the CPA exam, however, is mandatory in all states and is “uniform throughout the country,” Thomas emphasizes. “It’s written, updated and graded by the AICPA and consists of four parts: auditing and attestation, business environment and concepts, financial accounting and reporting, and regulation.”
Earn your bachelor’s degree.
Virtually all states require CPAs to hold at least a bachelor’s degree — and many now demand additional education, Thomas says.
“Almost all states require a minimum of 120 total [credit] hours of higher education — equivalent to a bachelor’s degree,” she explains, noting that only some of those hours must be accounting-specific — and the amount varies by state.
“Most states also require additional accounting coursework beyond the degree, usually around 30 hours,” for a total of 150 hours to become licensed, she adds.
Take additional accounting courses.
Furthering your education is mandatory in many states, but even when not required, Thomas stresses that it’s a good idea.
“The more education you have, the better prepared you’ll be for the CPA exam,” she says, recommending that you pursue a master’s degree in accountancy. “If you’re going to do more coursework to prepare for the exam anyway, you might as well apply it to a graduate degree.”
Get work experience.
Most states require one to two years of accounting experience under a CPA’s supervision as part of the licensing process. “The CPA you work under has to certify your accounting work before you can become licensed,” Thomas explains.
Study for the CPA exam.
“[The test] is extremely difficult,” Thomas says, and takes a lot of preparation to pass on the first try. She recommends dedicating a month of studying 10 hours per week for each part of the exam — a total of four months.
She also strongly suggests taking a CPA exam preparation course. “Most of the exam-prep courses include sample tests, which you really need to practice because the CPA exam is administered on a computer using specialized accounting tools,” she explains. “If you haven’t practiced ahead of time, you’ll be lost. The CPA exam costs about $1,000 per attempt, depending on your state.
Take and pass the exam.
You register for the exam and submit your other required coursework and experience through your state accounting board, Thomas explains, noting that the National Association of State Boards of Accountancy administers the process for many states.
“You don’t need the CPA credential to work in accounting, but having it opens so many doors,” Thomas stresses. “[Personally], I could never have worked as director of finance for two multinational corporations without it.”