Sunil Kumar wrote a piece called "CPA Exam Passing Rates and CPA Salaries on the Rise" for Accounting Today the other day that offers up a few theories on why CPA exam pass rates are up these days. Among Kumar's ideas why numbers are up:
- Pre-2003, the CPA exam was a pen and paper exam spanning two full days. A CPA candidate was required to take all four parts at once.
- The testing timeframes were much shorter and there was very little flexibility in exam scheduling, thus making it difficult for candidates to plan around the CPA exam preparation process.
- In 2004, the Uniform CPA Exam transitioned to a Computer-Based Testing examination, allowing more flexibility in terms of preparing for and scheduling the CPA exam.
- CPA candidates are no longer required to take all four parts of the exam in one sitting and can space out each part over the course of 18 months.
- The Sarbanes-Oxley Act was established in 2002, increasing the need for CPAs more than ever.
Now, it doesn't take a rocket scientist to figure out the first four reasons are probably BS. Pass rates are up because the AICPA thinks there should be more CPAs out there, THAT'S IT. Yes, CPA exam candidates, next time you study your little butt off only to get a 74, you can rest easy knowing you're probably not a total loser but instead simply undershot a 75 and the AICPA decided there wasn't room for you among the future CPA elite.
The flexibility offered by the computerized exam probably has helped candidates perform better on the exam and feel better about committing their lives to passing it but at the end of the day, there will always be as many new CPAs per year as the AICPA allows. Period. Lucky for them, there are usually so many underachieving candidates that they can easily fail most of the borderline candidates if they feel too many are sneaking through.
We could sit here all day and try to figure out why more people are passing the CPA exam than ever but really, we all know the real reason is that demand for CPAs is up. That's it. No super studiers, no improved CPA exam review materials, no more committed candidates. More people are passing the CPA exam because we need more CPAs. According to the AICPA, 75 percent of all CPAs in the U.S. will be to be retiring or nearing retirement by 2018, so you guys can pretty safely assume those borderline 74s will magically turn into 75s for years to come.
Congratulations, underachievers, this is your lucky decade!
