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Most Aren’t Ready for IFRS on the CPA Exam

Posted on by Adrienne Gonzalez

Last year, the AICPA Board of Examiners made it clear that though a roadmap for IFRS adoption in US financial reporting might be a ways off, it intended to start testing IFRS in Financial Accounting and Reporting (mostly, we’ll get to that in a second) in the first window of 2011. Just a friendly reminder, that’s only three testing windows away.

But what gives? According to the 2009 KPMG-AAA Faculty Survey, only 8% of respondents felt as though at least half of their accounting faculty were qualified to teach IFRS. Meanwhile, 70% of professors said their most significant challenge to teaching IFRS was finding room for it in the curriculum.

As far as I am aware, State Boards of Accountancy have not shown a desire to require IFRS coursework to be eligible to sit for the CPA exam at this time.

The Big 87654 committed to pushing IFRS in college classrooms as early as May of 2008 (months before the SEC announced an IFRS adoption roadmap) and they are still tossing millions at the initiative.


In December of 2008, The Summa’s Professor Albrecht insisted that the Big 87654 had certainly chosen the right candidate, lobbying Obama to accomplish their IFRS goals. Why? “Obscene profits,” he says, pointing to campaign contributions and Obama’s subsequent pro-IFRS SEC Chair pick as signs that IFRS doomsday is upon us. A little over a year later, the SEC appears too busy chasing “crime” and playing catch up to issue a clear directive on IFRS in the US.

So? How can the AICPA BoE insist on testing information that A) accounting students still aren’t being taught and B) isn’t widely understood or practiced by most CPAs in the US?

I certainly get what the AICPA is trying to do and if nothing else, they probably want to show off that their awesome psychometric CPA exam technology is OMGamazing! and ready to adapt in a timely and efficient manner. But pushing IFRS on unsuspecting CPA exam candidates isn’t really the way to demonstrate that.

Is it just a coincidence that now the AICPA is prepared to reevaluate their scoring process after the first two testing windows of 2011? Even they know this is an awful idea.

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CPA Exam Memory Aids, Do You Need Them?

For some, lease accounting comes easy and you don’t need a catchy tune to help you remember title-transfer, bargain purchase and 75% of its useful life. But for most of us, retaining the information critical to getting through a multiple choice question every minute or minute and a half requires either divine intervention or a really excellent collection of memory aids. Since some of you may be atheists, let’s talk memory aids. Pay attention, especially those of you taking FAR who need help getting through such a huge mess of information.


Post its are your friend! Are you having trouble remembering present value tables or the three necessary components of an audit opinion? Not to worry, just grab a pack (or 20) of sticky notes and start writing down mnemonics or calculations and sticking them everywhere you might see them; your fridge, the bathroom mirror, your car’s rearview mirror (don’t forget to take it down before you drive), your desk, and especially on top of the PlayStation. Swap out your old notes for new ones every couple of days as you add new information and be sure to read them every time you pass the note. If you’re one of those folks who has this stuff down but just needs a little encouragement, you can also use this trick to get a much-needed boost of confidence by writing your name, CPA and slapping them all over the house. Talk about motivation!

You have a few minutes and some scratch paper at the exam, so use it! While the Powers That Be may discourage using the 10 minutes before you actually get into the exam as a brain dump, there is no reason you can’t use 2 or 3 of those minutes to scratch out everything you can on the scratch paper you are given at Prometric. Mnemonics, keywords, formulas, FASBs, whatever, just start writing everything down before you actually launch the exam. You can help yourself out by bringing your review book with you to the test center (but not inside!) and reviewing it one last time in the car before you go in. But be careful, if you use the whole 10 minutes and don’t get through the screens, you’ll blow the whole exam and have to reschedule! 5 minutes tops!

Flashcards are your friend! No, I’m not talking about overpriced CPA review materials that your firm is nice enough to pay for, I am talking about a good old pack of 3x5s that you mark up yourself. I once had a student who claimed his homemade flashcards were what helped him through FAR even though his handwriting was so atrocious that even he couldn’t read it. Just the very act of writing down key topics helped him remember those areas when crunch time came and he was struggling at the exam. Of course this works best if you can actually read your own handwriting but don’t let that keep you from using this important tool to help in your retention of key areas. You can use them to quiz your study buddy or simply make a stack of hard-to-remember topics for your own review. Again, slip these in the car the night before you head to Prometric and flip through quickly before you walk in to take your exam.

Here’s the deal, the CPA exam isn’t meant to be easy and you aren’t supposed to be an expert on dozens if not hundreds of topics. You need to know a little bit about a lot so with the help of some simple tricks to train your brain to work in exam mode, you’ll be breezing through exam parts like no one’s business. Good luck!