Category: The JDA

Does Anyone Care About Fair Value Anymore?

Fair value is a simple enough concept even if you aren’t an accountant: stuff is worth what you could sell it for in the normal course of business, so that’s what you value it as when you’re adding up the value of the stuff you have. Easy, right? Not so easy when it comes to convergence.

The IASB has already expressed distaste for our fair value rules (among other things) and Accounting Onion recently shared some concerns that convergence might require a reasonable definition of “High Quality Accountant Standards” (abbreviated HQAS” by AO) agreed upon by both FASB and the IASB. So far I haven’t seen it, has anyone else?

Wait, AO launches off into it fhan I ever could.

Moreover, if there are some doubts as to what HQAS is, the SEC’s view could have been attended to more closely at the outset of formal convergence efforts (October 2002); for surely the SEC had convergence in mind when they published their congressionally mandated (see the Sarbanes Oxley Act, Section 108(d)) report on the feasibility of “principles-based” accounting standards in August 2003. According to the SEC, the “objectives-oriented” standards they are looking for from a standard setter should possess the following qualities:

“Be based on an improved and consistently applied conceptual framework;

Clearly state the accounting objective of the standard;

Provide sufficient detail and structure so that the standard can be operationalized and applied on a consistent basis;

Minimize exceptions from the standard;

Avoid use of percentage tests (“bright-lines”) that allow financial engineers to achieve technical compliance with the standard while evading the intent of the standard.”

Now, seven years later, the SEC’s battle plans have been subordinated by the din and desperation of convergence wars. Are any new standards from either board “based on an improved and consistently applied conceptual framework”? Obviously not, for nary a single alteration to any conceptual framework document has occurred in the last seven years. The existing definitions for assets and liabilities are like wooden ships sent to battle against nuclear submarines.

A few weeks back, I talked to David Larsen, CPA, Managing Director of global advising firm Duff & Phelps, LLP about this fair value bullshit that complicates my life by requiring comment every few weeks. David participated on the SEC mark-to-market panel in November of 2008 and serves on FASB’s Valuation Resource Group so he’s familiar with what I’m talking about.

David believes public opinion dominates the fair value argument and really doesn’t see what the big deal is. “The goal is to make financial statements more readable,” he said of fair value’s ultimate intention. He’s a fan of transparency on the face of financial statements and more disclosures. Who doesn’t like that?

He says fair value is purely measurement and disclosure, nothing to get upset about.

In my opinion, fair value was our first test to see if we could handle the principles widely used in international accounting “standards” (hopefully “HQAS”) before we actually committed to adopting them and we failed. If you wonder why the IASB wants to hold the floor when it comes to convergence, you only have to stare our treatment of fair value right between the eyes.

It should have worked but our “P for Principles” in GAAP didn’t adequately prepare us to handle it.

CBT-e Strategies: What To Do When You’re Still Sitting for the CPA Exam in 2011

Those of you who graduated in May should already be buried in your review books and planning to sit for some parts – if you haven’t already – but for some of you, the long wait to get your applications processed is anything but over OR you managed to procrastinate up until this point and haven’t even begun the process. I’ll resist the urge to smack you if you promise to submit those as soon as you’re done reading this post. Regardless of where you’re at in the process, chances are you’re tripping about 2011 changes. Not to worry, my big fat brain packed with CPA exam goodness is here to help.


Accounting Is Still Accounting – Even if they are testing IFRS in 2011, debits still go on the left (at least I’m pretty sure they still do under IFRS) and pension accounting is still really annoying. Keep in mind, IFRS isn’t the norm in the wild – at least in the U.S. at this point – and will not be for several years so it would be irresponsible of the AICPA Board of Examiners to heavily test rules that aren’t even widely accepted in practice. So relax, the changes are coming but they aren’t nearly as scary as you think.

FAR – If you are able to, get FAR done this year so you don’t have to worry about it next year. The first two windows of 2011 will say a lot about the AICPA’s strategy but knowing them, I wouldn’t expect 2010’s exam to be completely different from 2011’s. Those questions cost a lot of time and energy to make and the BoE isn’t about to trash all of them just so they can start testing rules that we don’t even use. With me on this one? Calm down.

CPA Review Materials – If you haven’t yet committed to a CPA review course, be sure to ask about 2011 materials and how changes affect the course you choose THIS year. A good review course will offer updates to the material but be on the lookout for additional product purchase charges or fees to update your materials. For BEC, REG and AUD the changes are minimal: international audit standards will appear here and there and a few things are moved around but for the most part the largest change in these areas will be the cosmetic change in BEC as written communications are moved out of the other three sections and stuck there. This does not change the content, only how you prepare and the point percentages for this section.

You can find the new 2011 CSOs via the AICPA here if you’d like a better look at what you’re in for next year but as I said, it doesn’t take long to figure out that next year’s exam really doesn’t look all that different from this year’s.

A 5 Step Plan to Passing the CPA Exam for Total Idiots

Disclaimer: I was going to use “for Dummies” in that headline but John Wiley & Sons owns that term. Since they’re also Going Concern advertisers, I figured it would be best not to tick them off. So don’t take my headline personally, call it creative license.

So, you want to pass the CPA exam eh? Here is your 5 step plan to get it done. Pay attention, kids, we’re only goince.

1. Apply early As soon as you are eligible to sit for the CPA exam (or even before if you are trying to bypass some state boards’ long application processing times), get your application, fees and fingerprint cards in. Assuming your accounting program did not prepare you for the exam, check with NASBA’s Accounting Licensing Library or your state board to find out everything you need to know about requirements to sit in your state. Remember the CPA exam is uniform meaning you can sit for any state’s exam in any other state as long as you meet their requirements so if you don’t qualify at home, check out other states to see if you can sit there. Point being, you don’t want to have to juggle the exam, work AND a family so get this thing out of the way before you get engaged, promoted and/or knocked up. Trust us on that one.


2. Study OK, I shouldn’t even have to list this as a step but, uh, I’ve had the fortune of working with some of you for years so I feel it necessary to point out that unless you are some freak with a photographic memory, you are going to have to do some studying to pass. The entire exam can take anywhere between 200 and 1000 hours to study for (based on your familiarity with exam topics going into it) so be prepared to put in plenty of hours with your nose buried in your review books. We’re not suggesting you should develop a sick fascination for Peter Olinto but get comfortable with your CPA review instructor(s), you’re going to get awfully cozy for the next couple months.

3. Make some temporary sacrifices Sure there are the odd cases of CPA exam candidates who managed to pass with just a few hours of studying but for most of you, you’re going to have to accept that your life must change to accommodate the CPA exam process. If this means cutting off your needy girlfriend for a few months, grow a pair and tell her to stop bugging you when you’re focused on the exam. Your friends will be there when you’re done and if they aren’t, maybe you should stick to hanging out with other accountants (oh come on, it’s not so bad). Keep in mind the CPA exam torture is temporary and once you pass, you can drink all you want. In fact, you’re probably going to want to once you start nailing those promotions and putting in 80 hour workweeks. Deal.

4. Learn to plan but learn to accept that sometimes things do not go according to plan Shit happens. If you’re studying for the CPA exam, lots of shit happens. Some things are out of your control (busy season, for one) but plenty of things are completely under your control so worry about those and try not to get too upset about the rest. Learn to create a study plan that includes sufficient study time without sacrificing your own sanity (3 hours a day is plenty). Plan your exams well in advance and schedule in some kind of final review 2 – 3 weeks before exam day to be sure you are ready.

5. If you fall off the horse, get back up and kick the horse in the shins A 74 could be the most devastating CPA exam result of all but the reality is that this exam isn’t a cakewalk and you aren’t a failure just because you’ve failed. You’re only a failure if you allow it to keep you from pursuing your goal of CPA licensure. Get up, dust yourself off, learn from your mistakes (your score report is a huge clue into where you need more work) and schedule a retake as soon as possible. It’s entirely reasonable to feel defeated but no reason to pout so knock it off and suck it up. There’s a reason only 40%+/- of candidates pass on the first attempt, this thing isn’t easy on purpose. If it were easy, any idiot with half a brain would be a CPA.

But you aren’t just any idiot, are you? Go get ’em, killer!

Did I Start Studying For the CPA Exam Too Early?

Friendly reminder: Going Concern’s own Adrienne Gonzalez will be chatting with CPA exam candidates over at CPA Exam Club on 8/3. We’ll be talking about the exam process, study strategies and all things CPA exam so if you haven’t already, head over to CPA Exam Club to RSVP for the chat if you have questions that you’re just dying to get answered.

Today’s reader question is probably one that some of you are more than familiar with… you graduate and jump right in to CPA review hoping your state board will process your application quickly and assume you’ll be ready to sit in a matter of weeks, only to discover that state boards aren’t nearly as quick as we wish ’s the sitch:

I recently graduated from Yeshiva University with a BS in Accounting. The week after I graduated, I started a Becker course (started with FAR) and planned to take the test at the end of July. Since then, my NTS has taken forever, so I prob. won’t get it for a couple weeks.

I recently started a full time position (hours are not regular, only staying 2-3 hours late a couple days a week) and am in the middle of moving apartments so my studying habits have been, for lack of better word, shite. [creative edit on our part]

The Becker AUD course starts on Tuesday. Would you say that sitting in on the course, while simultaneously studying for FAR is a bad idea? And also, assuming I’m starting from square 1 with FAR all over again, planning on taking it in the end of August, is this enough time, IYO, to be prepared to pass? (Obv with a structured study schedule of about 3 hours per day).

First of all, for those of you who haven’t already made this mistake, please keep in mind when you are plotting out your exam strategy that just because you are ready to take the exam doesn’t mean the state board is ready to process your application. A general rule is it can take anywhere from 4 – 10 weeks from the time you send in your application, fees and transcripts to the time you are actually ready to schedule your first exam. If you are 100% sure you meet the requirements to apply in your state, it’s safe to start your review a few weeks after you apply.

For our friend here who jumped the gun, however, it’s a little late so let’s see what we can do.

I’m going to say no on starting with Audit simply because I’m somewhat familiar with Becker’s repeat requirements (some of the strictest and most expensive in the exciting world of CPA review) and chances are you are going to need that class later on down the road. Our humble advice is to keep studying FAR and hope you can schedule yourself for that section in the final window of the year. The last window is always the hardest to schedule but we’re anticipating additional scheduling problems this year because of the rush to get exam parts in before the CPA exam changes in 2011 so be prepared to pick an alternate Prometric center or adjust your desired dates/times. As long as you’re open to that, you should be fine.

You can, of course, start studying Audit now and plan to take that one in the last window along with FAR but again, you’re likely to run into some serious scheduling trouble for Q4. Normally we’d tell you to go for it but this year is special and you’ll be lucky to get in one section let alone two before 2011 so worry about cramming in additional sections come January. Simultaneously studying is fine but we’re betting you won’t be able to get in to take both in the last quarter so save yourself the time and trouble by focusing on FAR for now.

Be honest, have you studied for FAR at all? Starting from scratch you can put in anywhere from 80 – 150 hours of studying so even between full-time job and a move it can be done but it sounds like what you need more than my advice on Audit is a study strategy that actually works for you. My biggest piece of advice is to take this process seriously and put off any other unnecessary drama (like an apartment move), if possible until after you have passed.

What Would the Nonprofit Sector and Community Solutions Act Accomplish?

Representative Betty McCollum is upset that small businesses have the Small Business Administration but nonprofits don’t get a Nonprofit Administration to evaluate, build and monitor the capacity of America’s vital nonprofits. She believes nonprofits are an invisible but vital part to the economy and overlooked by Washington, DC except when it comes to tax issues.

She writes in the Hill:

This legislation represents a significant step toward creating a more effective partnership between the federal government and the nonprofit sector. H.R. 5533 establishes a new United States Council on the Nonprofit Sector. The Council will be a forum for leaders of nonprofits, foundations, businesses and government to discuss strategies for strengthening the nonprofit sector. The bill also creates an Inter-agency Working Group on the Nonprofit Sector. This group will ensure that high-level representatives from cabinet agencies and other key agencies coordinate and improve federal policies pertaining to nonprofit organizations. Finally, the legislation directs Federal agencies to collect and publish better data on nonprofits AND to support research that will lead to smarter Federal policy.

The goals of the Nonprofit Sector and Community Solutions Act are to build a stronger nonprofit sector, craft smarter federal policy, and create more vibrant communities in every state across the country.

Listen, we love working groups as much as the next cube-dweller but haven’t yet seen a copy of the Bill so can’t say either way at this point. What we do know is that the nonprofit sector is large enough to be in need of some help beyond whatever pestering they get from our friends at the IRS.

According to a 2009 Congressional Research Service report, nonprofits (mostly charities) make up over 5% of U.S. GDP. Charitable organizations are estimated to employ more than 7% of the U.S. workforce, while the broader nonprofit sector is estimated to employ 10% of the U.S. workforce. In 2009, nonprofits filing form 990s with the IRS reported approximately $1.4 billion in revenue and nearly $2.6 billion in assets.

Those numbers do not include the estimated 215,000 charities who have neglected (or completely blown off) their 990 responsibilities.

Update: Ms McCollum’s office was kind enough to get in touch and provide us with more information and a direct link to the Bill. We look forward to seeing how this works out.

Career Options: Masters in Taxation, MBA or CPA Exam?

We’re often asked which way to go when it comes to pursuing additional education or tackling the CPA exam before moving on to grad school (if you’re in one of those awesome 120 states or somehow loaded up on units after graduation) so let’s see if we can offer some insight on the matter.

Reader question is as follows:

Hello, I am looking at a public accounting career in tax and will graduate with a bachelors and 150 credit hours after 4 years. I am wondering if there are benefits to a Masters in Tax or MBA versus entering the workforce.


Funny you ask, have you checked with Going Concern contributor Joe Kristan? He can tell you all about taking the Masters route AND tax work so hit him up (you’re welcome, Joe) for more insight. “I think if you have good grades otherwise, a M.Acc can give you an edge in getting hired, especially with big firms. For me it gave me a huge edge – my M.Acc beats my B.A. in history with CPA firms everywhere,” he told us awhile back. Somehow we’re not surprised to hear his history degree wasn’t useful once it came time to find a sweet number-crunching gig.

Back to School
I think your payoff depends on what exactly you’re trying to get out of your career and which direction you plan to go. An MBA offers you flexibility (which comes in handy when the economy is in the can and jobs are scarce) while a Masters would keep you tethered to whatever path you take but either would make you more desirable to employers – depending on who you are applying with.

Keep in mind that for some employers, an over-qualified, well-educated candidate also means someone who will need to be paid more and could (in a normal job environment completely unlike the one we’ve got going now) easily find a better, more well-paid position with any number of employers. People may be desperate nowadays but the economy will recover eventually and employers have to consider that when deciding to offer you a position.

The Real World – CPA
The advantage to heading straight into the workforce out of school is that you can get the CPA exam out of the way and then, should you want to, choose to head back after you have been licensed and pursue a Masters. The advantage to this is that you are less of a threat to employers once you actually have your CPA since they don’t have to worry about you leaving after 2 years to the day once you have your experience requirement met so you can leverage your additional education to land a better job. Then again, the advantage to staying in school – for the moment, at least, job market being what it is – is that you can buy yourself some time, make yourself more of an asset and hope that things look better from a hiring standpoint once you have completed your Masters program. Many are taking this route simply because they’re afraid of the job market (for good reason).

Under the getting your CPA now route, you have the advantage of getting to know your profession before committing to a specialty – that means being able to change your mind before you’ve given up another year of your life and the costs associated with a Masters (or MBA) program. I don’t want to talk you out of what you’ve decided to be when you grow up but there’s something to be said for real-world experience (and I’m sure more than one old timer can tell you they wish they knew what they were getting into before they did).

Keep in mind also that if you’re looking at an MBA, work experience may be a requirement for admission so you might not have a choice in the matter. Take the CPA/work route and come back later when you have a little experience under your belt and more insight to allow you to make an informed decision on where you want to go with your life.

Have You Considered Becoming an Accounting Professor?

We already did a series on credentials for accountants if you’re looking for add letters to the end of your name but if you’re not looking to take that route or looking to get out of it after you’ve gotten some experience under your belt, you may want to look into a PhD in accounting. We’re serious.

The Accounting Doctoral Scholars program, a joint project by 70+ accounting firms, several state societies of CPAs and the AICPA, wants to help you. $15 million has gone into their efforts to fill a much-needed gap in accounting education and if you don’t quite fit in to the cube, you may be one of the chosen ones.


That means they have money to help you through school so get in touch with them if this sounds like you:

If you are someone who loves learning, generating new ideas, and setting your own agenda you may want to seriously consider pursuing a doctoral degree in accounting. While all academicians can make their mark in a field, those with a Ph.D. in accounting have the opportunity to influence both accounting education and public accounting practice.

The ADS Program will provide funding for selected individuals, with recent meaningful experience in public accounting in auditing and tax, to help them make a permanent transition to teaching and research at the university level. The funding will support application to doctoral programs in accounting and also provide a stipend of $30,000 per year for up to four years of enrollment to individuals committed to teaching and research in auditing and tax—the areas of greatest need—upon completion of their doctorates. The Program will support its third class of Accounting Doctoral Scholars for Fall 2011.

No one can tell you how far to take your education. We know CPAs with PhDs who love teaching and we know teachers who have their CPA and don’t realize they practice education. It is difficult enough to decide between a Masters in Accounting and an MBA (or so we hear), how many of you are really thinking of a PhD?

If just one of you are, hopefully this helps. We’d be curious to hear what career paths you plan to take if you are and always defer you to friend of Going Concern Professor David Albrecht if you want to talk to someone who does it for a living.

This does mean you’ll actually have to teach.

Last year, AccountingWEB identified 5 reasons why we’re so desperate for PhDs in Accounting including the lifestyle change required to pursue one and the economic cost of funding it.

The New York Society of CPAs’ CPA Journal gets into what is required and what to expect if you take this route here and you can check out earlier posts that GC did on the pros and cons of the career move into academia. Good luck!

How a New Graduate Can Pass the CPA Exam (Almost) Before May 2011

This CPA exam candidate changes her name too often on Twitter to be linked to but asks us the following:

I am graduating this fall from [University of San Francisco] with an undergraduate degree in Accounting. My goal is to study and pass the test by May 2011.

I appreciate your input and advice.

First off, I love specific questions like this. If you have them you are, as always, welcome to send them in for future columns. If you have a particular goal (like passing before the 2011 changes or learning how to balance work, family and the exam), I feel better about wasting my time yelling at you because you’re much more likely to succeed. ROI, we all want one.

Anyway.


– Let’s start with the California Board of Accountancy. If you call their exam unit, they will tell you to expect a wait of 4 – 6 weeks for your application to be processed and you’ll get really excited when they cash the $100 application fee check three days after you mailed it. Don’t get excited, that’s the first thing they do (duh, it’s California). In reality, you can expect to wait about 8 weeks from the date you submit your application if you’re freshly graduated and applying with many other accounting grads in the state at the same time. Expect to wait 10 days for your payment coupon and 10 days for your Notice to Schedule once you get your ATT (Authorization to Test). So let’s say your school already posted your degree to your transcripts and you sent in your application today (7/16). You may not get approved until 9/16. Best case scenario they get you approved quickly and you get your ATT on 8/16 (don’t count on it).

Once you have that, it could be another 3 weeks until you are actually scheduling your exams. This year (since your goal is 2011, we’re assuming you’re starting as early as possible before new exam changes hit), the last window of the year will be especially hard to schedule. We’re just guessing on that since everyone seems afraid of CBT-e. It will be interesting to see the actual numbers once they are released.

Get the Hard Stuff Out of the Way – If you can get in one part this year, great. If you had to ask me which one you should take I’d usually say the one that will be hardest for you (since your rolling 18 month window doesn’t start until you actually sit for and pass that first one) but because of the 2011 changes I’m telling most candidates to take FAR. A lot of them are also trying to squeeze in BEC – I imagine they don’t like the idea of written communications and more economics but I could be wrong. Don’t take the easy route, you’ll regret it when you’re trying to pass that last really difficult section you put off and end up losing scores because 18 months came and went.

Don’t Be an Overachiever – I know the old timers will pipe in on this and say back in their day they didn’t have calculators and had to walk uphill both ways in the snow to get to the exam center twice a year to take all 4 parts over 19 1/2 hours but we humbly suggest sitting for no more than two parts per testing window. If you can get in for Q4 2010, you will have one exam done then take two more in Q1 2011 and the last one Q2 2011. So you may not exactly hit your May target but it’s OK to adjust your plans (don’t get mad at the Board of Accountancy but if you want a shortcut around their 8 week application time, get in touch with me) and you can still say you reached your goal.

The only other issue is getting those extra units to actually be licensed under Pathway 2 (the best idea for your own mobility) since you are an undergrad but you can get those in anything and have five years to meet the licensure requirements before you lose your exam scores.

Worry about that later. As for how to study, we’ve talked about CPA review courses, study strategies and things not to do in previous posts. Good luck!

Reno’s “Hot August Nights” Goes For-Profit and Skips Town?

Though the connection between the non-profit Hot August Nights organization that’s been putting on Reno’s biggest party for 24 years and the newly-registered for-profit Hot August Nights of Las Vegas is unclear, what is clear is that part of the event will be held in Long Beach this year due to “horrific” costs to put the event on in Reno.

Reno, if you don’t already know, is in pretty bad shape. I used to live there so I know that it always was but it’s in really bad shape right now. With the iconic Fitzgerald’s Hotel and Casino indefinitely boarded up directly under Reno’s “Biggest Little City in the World” sign as a direct result of the Corus Bank failure 1,500 miles away in Chicago back in late 2009, downtown looks more destitute than ever. I take full artistic license for use of the word “iconic.” This is Reno we’re talking about.


You’d think Reno city commissioners would want to encourage fun and leisure, mostly through the only event any of us with the big money to the West are familiar with (Hot August Nights) but all signs point to the city losing it.

On the same day paperwork was filed in Nevada to establish the for-profit, non-profit Hot August Nights officials announced part of the event would be held in Southern California in 2011.

There’s been a bunch of bitchfighting in Reno (and neighbor Sparks, who gets some of the tourism run-off for the event) and it continues.

We don’t expect you to be familiar with the Reno area (unless you happen to work for Deloitte or E&Y in town, though we don’t like those odds) so for a little background on Hot August Nights, it’s a yearly car show stamped as family fun for everyone. The event costs $700,000 to put on each year according to organizers who swear they aren’t looking to move the show to Long Beach in 2012.

The Reno Gazette-Journal breaks down the non-profit side:

In the 2004 tax year, Don Schmid, then listed as executive director, was paid $93,962 in salary.

On the nonprofit corporation’s 2008 income tax return, current executive director Bruce Walter is listed as collecting $256,890 in salary and $11,940 for a housing allowance, resulting in total compensation of $268,830.

Yes, I’m sure it’s the costs of putting on the event that are inspiring a move. Anyone been to a convention in Reno lately? It’s got to be the cheapest place in the country if you don’t count middle states. You’re telling me it’s cheaper to host the event in Long Beach?

For-profit Hot August Nights corporation created in Vegas [The Reno Gazette-Journal]

If You Want to Screw Up the CPA Exam, Here are 5 Ways to Do It

I spend a lot of time yelling at you kids trying to tell you what to do: schedule early for the last window of the year, don’t overload yourself by trying to take on too many exam parts at once and be sure to bring your ID to Prometric (lay it out like your clothes on the night before the first day of school so you don’t forget).

Nag, nag, nag. I do it because I care and I want to see every accouig CPA dreams achieve their goal, even when that means a major risk for capital markets (you know who I am talking about, there are some people who shouldn’t be allowed within 50 feet of a balance sheet).

But let’s put all of that aside for now and talk about ways to blow it. I mean really blow it. Unlike most of my tips, if you follow these you’re pretty much guaranteed to fail.


Schedule too many exam parts in one window This is a common mistake, mostly for newbie CPA exam candidates. You get all excited and have three months to waste before starting work in the fall and decide to take as many parts as you can in a window just to get it over with. Great. Of course, you realize halfway through the first chapter of REG that you have too much on your plate and end up blowing all three. Congrats, you’ve just learned an important lesson: take it easy. We say no more than two exam parts per window and unless you will get fired if you don’t get this stupid CPA in the next 6 weeks, stick to that rule.

Put your social life (substitute “work life” for social life here if you don’t have one) ahead of the exam If you have a life, congratulations, but it’s going to have to get back burnered for a minute while you tackle this thing. You don’t have to break up with your girlfriend but if she isn’t in accounting and going through the same misery as you, you may have to cut her off for awhile so you can concentrate. You know, only if she’s that kind of girlfriend. Your friends will get over it. Try surrounding yourself with other, equally-miserable CPA exam candidates like yourself. They’ll never be available and will only pester you via text when they are procrastinating.

Study only when you feel like it This one is great for totally blowing it and if that’s your goal, all you have to do is tell yourself you’ll study after work or when you get a chance or maybe after the game is over. Without a solid study schedule, you’ll quickly realize you never feel like it.

Blow off the multiple choice and just watch CPA review videos Hey listen, in a former life I pawned CPA Review wares 60+ hours a week and let me tell you, we liked it when students got addicted to videos, it pays the bills. But we liked it better when students also did the homework because that meant they passed and failing students don’t help our numbers nor testimonials. So go ahead and stick with the “I’m going to watch FAR thirteen times until it totally sticks in my brain” method, it means more money for repeats and we liked that too.

Spend every moment obsessing over things that aren’t often tested or worth much (like research) Want a surefire way to fail? Focus on the minute details and obsess over rarely-tested information, ask questions in Live class about your own 401(k) instead of pensions and get really bent out of shape over tiny punctuation errors in your review texts. Chances are if this is your strategy, you’ll not only fail miserably but piss off a few CPA review instructors in the process. Good luck with that. Really.

How the ACFE is Promoting CFE Awareness

After Caleb forced me to write a few posts on Credentials for Accountants meant specifically for those of you who still do not know what you want to be when you grow up, I managed to bumble one so badly I was contacted by Scott Grossfeld, CFE CPA and Cttp://www.acfe.com/”>Association of Certified Fraud Examiners. See, it appears I made a typical media mistake in using fraud and forensics as interchangeable fields within the industry and Scott felt compelled to speak up.

This wasn’t exactly wrong (I was being lazy actually) but as CEO of the ACFE, he’s got a responsibility to make sure the media represent the field of fraud examination correctly, especially when it comes to giving forensic accountants credit for what he and his fellow CFEs do out there. Thankfully, we had a nice little chat and cleared up that little point.


Additionally, Scott promised us access to recent salary survey information available shortly that will give us a better idea of what CFEs make. For now, he told us that the data confirms a 22% pay premium for individuals with the CFE compared to individuals in the same position without the CFE. We liked this approach and wish more organizations would take an active role in monitoring and engaging in the conversation, as Scott was obviously doing by reading our series on credentials.

Along the way, however, I discovered that the ACFE is also on top of things by promoting the credential, interacting with their audience and reaching potential new members through new avenues like blogging and social media. The ACFE is excited to be launching a new social media campaign shortly that we can only hope rivals that of the AICPA’s total social media genius (except for that whole Feed the Pig thing, which still creeps us out but is brilliant and weird enough to get a pass).

The strategy of having a CFE on staff is akin to carrying insurance on your home or car, and diversifying a company’s staff can mean the difference between a lawsuit and a slap on the wrist thanks to our favorite unnecessary accounting legislation of all time, Sarbanes-Oxley. “If you look at the CFE, originally the idea behind it was that we had accountants who really didn’t know how to investigate and investigators who don’t know accounting so we were able to bring those two together,” he said. “If you look now, Enron was the big thing that really changed perspective… here’s a big financial risk but you could lose your company if you’re not careful (with SOX) and I think that really raised awareness. Before that fraud work was sort of like insurance, you knew you needed it but you couldn’t always justify it.”

But CFEs do justify their price from a prevention standpoint, assuming fraud to be a risk all companies are exposed to. “5 – 7% of the company’s revenue is lost to fraud, that’s where the fraud examiner pays for themselves,” he told us.

But how does the ACFE promote the usefulness of a 20 year old credential like the CFE? By getting to the kids when they’re still undecided, of course.

“It used to be that the CFE was a secondary credential. [Promoting the credential is the goal of] the higher education partnership we provide to educators. We have 300 colleges and universities in that program. Now it’s part of the discussion; risk is on the radar in terms of what companies are looking for. What we typically see is fraud being an elective type class though there are a few schools that specialize in fraud and or forensics.”

The ACFE also promotes its mission by encouraging those interested in pursuing a career in fraud-fighting to join the organization as a student member for something like $20 a year. Student Associate membership is open to undergraduate students enrolled in 9 semester hours (or equivalent), or graduate students enrolled in 6 semester hours (or equivalent) in an accredited college or university. We agree with this approach, as surrounding yourself with like-minded folks gives you a chance to expose yourself to those already on your desired path. There’s plenty of opportunity for mentorship, commiserating and gaining insight into what the credential actually means for your career.

All in all we approve of what the ACFE is doing and look forward to seeing whatever else they have up their sleeve unfold in the months and years ahead. Let’s face it, they’re pretty much guaranteed a job forever. We like.

Is a Month Long Enough to Study for Regulation?

We’ve given you plenty of tips on studying for REG but let’s go over it one more time, shall we?

NBAinmyDNA asks:

Is 1 month enough time to study for Regulation? I haven’t studied yet and I have the exam scheduled for beginning of August.


Regulation should take about 80 and 100 hours to study for, since we don’t live your life we can’t tell you how much other stuff you would have going on in a month so it’s up to you to figure out how to fit that time in. In a general sense, it can be done in a month but you might be better off taking slightly more time just so you aren’t overloading on information. Regulation isn’t a huge or overly-complicated section but if you’re trying to do all your studying in one month, you’re going to have to cut out just about any chance you might have at a social life between now and then.

When trying to “cram” for a CPA exam section, it is easy to over-study in an attempt to get in as much studying as possible within a short period of time. So this is a good time to point out that your brain learns in layers and gets bored easily so don’t study for more than 3 hours at a time without taking a long break. If you plan on spending your weekends studying, stick to the 3 hour rule and try to plan something moderately enjoyable for yourself in between (renting a movie is OK, going out and getting wasted is NOT).

Studying 3 hours a day for 28 days will clock you in at about 84 hours, which is on the low end of study targets for this section and kind of exhausting. If you can buy yourself a few more weeks and put off your exam, you can stick to 1 – 2 hours a day and still have a life. Be diligent about creating a study schedule and sticking to it as you’re short on time to study as is, you can’t afford to miss 2 or 3 study sessions.

Adrienne Gonzalez is the founder of Jr. Deputy Accountant, a former CPA wrangler and a Going Concern contributor. You can see more of her posts here and all posts on the CPA Exam here.