Tag: Prometric

Why Did Prometric Get Fined $300,000 by NASBA in 2010?

David A. Costello, CPA, President & CEO and Michael R. Bryant, CPA, CFO of NASBA jointly and severally stated that NASBA’s 2010 financial statements did not contain any untrue material statements and their auditors, Lattimore Black Morgan & Cain, PC seconded that so obviously the following is all accurate. We looked ourselves. Not being professional financial statement ninjas, however, we invite you to take a peek for yourself here.

The good news for NASBA is that total consolidated revenue in Fiscal 2010 was $33.7 million compared to $31.4 million in Fiscal 2009, an increase of 7.3%. There were more CPA exam candidates as well as a new state added to NASBA’s CPAES program, which does the work of state boards of accountancy by processing CPA exam applications.


Interestingly, though my grandparents have been eating Alpo for the last two years thanks to Ben Bernanke and I’m earning a little under half a percent on my savings, NASBA must have a good investment banker because they did pretty well for themselves in FY 10. The annual report states that revenue from escrow management fees related to the CPA exam increased over the prior year and that higher interest rates, on average, during FY 10 were earned on these funds which are held in fully-insured securities or interest-bearing accounts. Can someone please let me know where these accounts are?! I want in.

But the most interesting part of NASBA’s mostly dull financial statements is the $300,000 “fine” Prometric paid them for violating its CPA exam agreement. Yes, the same agreement that was just renewed through 2024 with much fanfare last year.

The item is reported as “Income from Contract Issue” on NASBA’s consolidated financial statements and buried in note 12 thusly:

Note 12. Income from Contract Issue
As a part of the initial CBT Services Agreement effective May 31, 2002, Prometric was required to obtain and maintain insurance policies for certain specific perils, coverage amounts, terms and conditions naming the Association and its member boards as additional insureds. During fiscal 2010, the Association asserted that Prometric failed to comply with certain applicable insurance requirements. Prometric denied the assertions but, in resolution of the matter, provided evidence that it had come into compliance, agreed to indemnify, hold harmless and defend for any coverage lapses, and paid $300,000 to the Association. In addition, Prometric reimbursed the Association for certain legal and administrative expenses related to the resolution.

It doesn’t appear that NASBA declared the legal and admin expenses it also received so we’re assuming they were either immaterial or just embarrassing. Any financial statement detectives are welcome to come to their own conclusions.

The AICPA, NASBA and Prometric Announce Successful Launch of the New CPA Exam

Even though only two testing days passed from the time CBT-e launched and the time the press release came out, the AICPA, NASBA and Prometric are very excited to announce the successful launch of the new CPA exam.


Via the AICPA:

The American Institute of Certified Public Accountants, National Association of State Boards of Accountancy, and Prometric today launched the new Uniform CPA Examination, called CBT-e, which includes for the first time questions on International Financial Reporting Standards among other sweeping and significant changes.

Changes were approved by the AICPA Board of Examiners based on input from state boards of accountancy in response to an Invitation to Comment, and a Practice Analysis designed to ensure the exam tests the modern knowledge and skills that are relevant for today’s entry-level CPAs. The new IFRS questions and other changes to the exam are the first major revisions since the CPA exam was computerized in 2004.

Overall, more emphasis is being placed on skills assessment using case study-based questions known as Task-Based Simulations. Authoritative literature in the CPA exam incorporates use of new Financial Accounting Standards Board codifications of U.S. Generally Accepted Accounting Principles. Professional responsibilities including ethics and independence have been added to the Auditing and Attestation section.

“The testing of IFRS knowledge and other international standards is a response to change in the business world in which new CPAs operate,” said Craig Mills, vice president of examinations for the AICPA. “We are proud and excited to be introducing innovations in this evolution of the computer-based test that both validate and update the content of the exam and improve the experience for candidates. The exam is one of three key requirements, along with education and experience, that help state boards and the profession maintain the highest standards and protect the public interest.”

In related news, I will be speaking with the AICPA this afternoon about the new exam and thanks to your input, will be interrogating them on score releases, potential changes to passing scores, the integrity of the exam (since the old timer paper and pencil folks continue to rag on the new exam as too easy) and the continued evolution of exam content beyond 2011. I’d like to ask them when the hell BEC is going to be more than a junk drawer but having seen some of the new 2011 content on that section, I have to say it looks like they are working on consolidating the most random CPA exam section into a more streamlined piece of psychometric awesomeness. It isn’t too late to get me your questions for the AICPA’s exam unit so if you have one that you haven’t gotten to me yet, get on that or drop it in the comments and I’ll try to sneak it in.

I’ve also spoken to at least a handful of candidates who tested last week and so far feedback is positive on the new format as I suspected it would be. For the love of Excel, please don’t get stressed out over international standards as you shouldn’t expect to receive an exam made up of 70% new content. Try 5 – 10% max.

Update to come on Friday.

Tales From the CPA Exam: Is Gum Really Banned at Prometric?

Directly from CPAnet comes word that gum could possibly be banned by Prometric, although it may only apply if the testing staff are having a bad day. I didn’t see gum on the list of prohibited items either and would assume the rules are not there for interpretation by staff based on the mood they are in.

The test facilitator at Prometric today made me take my gum out before the exam. I rebutted with the fact that the AICPA does not prohibit gum in the list of prohbited items in the AICPA Candidate Bulletin: She then explained that people have left their gum in the testing center and it has been a “mess” to clean up. She seemed irritated and ornery, and I didn’t want to raise my blood pressure any higher before going into the test room… so I conceded and spit out my gum.

Now, I tend to consider myself to be a courteous and responsible gumchewer. I dispose of my gum in its original wrapper that always ends up in a trash can. One reason I like chewing gum while taking a test is b/c it allows me to harness any natural stress and focus on the task at hand. I really could’ve used some gum today, but I didn’t let that ruin my test. However, I will never be able to quantify the effect of my lack of gum on my final score tbd. Does anybody know the official gum rule? I think this lady was just having a bad day…

I didn’t attempt to reach Prometric to confirm this candidate’s story, I believe that our little candidate here IS a responsible gumchewer. Since this was posted on August 3 (assuming the night after the exam), the candidate still has until September 3 to request a rescore though it’s been several years since the AICPA has actually granted one (don’t waste the money).

I believe you can also contest the conditions of your testing center within the same 30 day window so if you absolutely must, go that route. Complain that you were subjected to conditions outside of your control that had a detrimental effect on your performance and see how that works out.

Or hope you passed and don’t bring gum next time. Regardless of why you wanted it, you should have been allowed it since it wasn’t on the list. Hopefully this person checks in and lets us know how it turns out.

How to Avoid ID Problems at the CPA Exam

Although the instructions are pretty clear, this question comes up fairly often so let’s make sure everyone is on the same page when it comes to ID that works at Prometric when taking the CPA exam.

Prometric is very clear about what you should have before you get to the testing center (at least half an hour early, of course, and smokers should make that an hour so they can get in as many as they can before they start – you don’t want to waste those breaks).


First and foremost, check in with them 24 hours before your exam to confirm your appointment. The night before your exam date, set out your NTS and make sure you have two forms of exactly matching ID ready so you aren’t scrambling to find it in the morning.

At least one of your forms of ID must have a recent photograph and both must be valid (i.e. not expired) and signed. Try a credit card and a driver’s license, forget about a Social Security card or a student ID as Prometric will not accept these. A passport is OK but must be accompanied by a secondary ID (like a credit or debit card).

The name on your primary photo ID must match your Notice to Schedule exactly. If you show up and both names are different (foreign candidates who use both an English name and their native name sometimes run into this problem), Prometric will not allow you to test and you will forfeit exam fees. If there are any issues with your ID, contact them in advance to see if an exception can be made or make sure you will be okay come test day. Make sure to do this within your NTS timeframe and no less than 15 days before your exam date so you can at least reschedule without losing your exam fee if need be.

Got it?

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.