What Are the Parts of the CPA Exam? A Breakdown

The Certified Public Accountant (CPA) Exam serves as a gateway for individuals seeking licensure in the United States. This examination evaluates a candidate’s knowledge and skills across various accounting and business disciplines, ensuring they possess the competence required for the profession. Passing the CPA Exam is an important step towards earning the CPA designation, which signifies a high level of expertise and ethical conduct in the accounting field. This licensure protects the public interest by ensuring accounting professionals meet established standards.

The Four Core Sections

The CPA Exam has four distinct core sections, each focusing on a particular area of accounting practice: Auditing and Attestation (AUD), Business Environment and Concepts (BEC), Financial Accounting and Reporting (FAR), and Regulation (REG). Each section tests competencies fundamental to a CPA’s work.

Auditing and Attestation (AUD) assesses understanding of auditing standards, procedures, and their application.
Business Environment and Concepts (BEC) covers general business concepts, economic principles, and information technology.
Financial Accounting and Reporting (FAR) delves into financial accounting standards and reporting for various entities.
Regulation (REG) focuses on federal taxation, business law, and professional ethics.

Content Areas Within Each Section

Each core section of the CPA Exam is broken down into specific content areas and topics for comprehensive assessment.

Auditing and Attestation (AUD)

The Auditing and Attestation (AUD) section evaluates a candidate’s proficiency in areas such as auditing and engagement fundamentals, which includes the nature and scope of auditing, as well as ethics, independence, and professional conduct. It also covers assessing risk and developing a planned response. Performing further procedures and evaluating obtained evidence is another key area. Finally, the AUD section assesses a candidate’s ability to form conclusions and report, focusing on audit reports, reviews, and other attestation engagements.

Business Environment and Concepts (BEC)

The Business Environment and Concepts (BEC) section encompasses a broad range of topics relevant to the business world. This includes corporate governance, which examines the structure and processes by which organizations are directed and controlled. Economic concepts and analysis are also covered. Financial management topics, such as working capital management, capital structure, and financial risk management, are also integral to this section. Information technology is another important component, and operations management focuses on production, quality control, and supply chain management.

Financial Accounting and Reporting (FAR)

The Financial Accounting and Reporting (FAR) section is extensive, covering a wide array of financial accounting principles and practices. This section tests conceptual framework and financial reporting, which includes the objective of financial reporting and the qualitative characteristics of financial information. Select financial statement accounts are a major focus, requiring detailed knowledge of assets, liabilities, equity, revenues, and expenses. Specific transactions and events, such as leases, consolidations, and derivatives, are also evaluated. Governmental accounting, which involves the accounting and financial reporting for state and local governments, represents a significant portion of this section, and Not-for-profit (NFP) accounting, covering the unique financial reporting requirements for non-profit organizations, is also thoroughly tested.

Regulation (REG)

The Regulation (REG) section is designed to assess a candidate’s understanding of taxation, business law, and professional responsibilities. Ethics, professional responsibilities, and federal tax procedures are fundamental, addressing the AICPA Code of Professional Conduct and IRS regulations. Federal taxation of property transactions, including basis, depreciation, and gains and losses, is covered. Federal taxation of individuals covers gross income, deductions, and credits. Federal taxation of entities focuses on corporations, partnerships, and S corporations, and business law, including contracts, agency, and debtor-creditor relationships, is also examined.

Exam Structure and Scoring

The CPA Exam is a computer-based test taken at designated centers. Each four-hour section comprises Multiple-Choice Questions (MCQs) and Task-Based Simulations (TBSs). MCQs typically account for a significant portion of the score, while TBSs require candidates to apply their knowledge to realistic scenarios, often involving research, calculations, and document review. Each section includes pretest questions that do not count towards the score but are used for future exam development.

The exam operates under specific testing windows. In 2025, core sections like FAR, AUD, and REG are available for continuous testing throughout the year. Discipline sections may still have specific testing windows, typically during the first month of each quarter (January, April, July, October). Scores are typically released within a few weeks.

Scores for the CPA Exam are reported on a scaled score from 0 to 99, with a minimum score of 75 required to pass each section. This scaled score is not a direct percentage of correct answers but rather an adjustment that accounts for the difficulty of the questions presented. The scoring process uses psychometric techniques to ensure consistency across different exam versions. The exam is not curved; a candidate’s score is based solely on their performance against a fixed standard, not compared to other test-takers.

Eligibility Requirements

To be eligible for the CPA Exam, candidates must meet specific educational and, in some cases, experience requirements set by individual state boards of accountancy. Most jurisdictions require 150 semester hours of college education, typically including a bachelor’s degree with an accounting or business concentration.

Within the 150 semester hours, most states mandate specific credits in accounting and business-related subjects. Common requirements include 24 to 30 hours in accounting and approximately 24 hours in business-related courses. These accounting credits often cover financial accounting, auditing, taxation, and managerial accounting.

Relevant work experience, typically one to two years, is generally a prerequisite for CPA licensure rather than exam eligibility. This experience often involves accounting, attest, tax, or consulting skills and must be verified by a licensed CPA. Experience requirements vary significantly by jurisdiction.