CPA Exam Considerations for Non-US Candidates
A US CPA license is the most widely recognized professional accounting certification in the world. However, that does not mean that it is always the best choice for accounting professionals outside of the United States. There are issues connected to the content of the Exam, eligibility, taking the Exam, getting your license, and the investment of time and money, all of which need to be carefully considered before deciding to pursue becoming a CPA.
I have been teaching candidates outside the US to pass the CPA Exams since the year 2000, but I always want to make certain that each candidate we help is taking the CPA Exam for the right reasons. The five most important questions that a candidate from outside the US needs to ask and think about before deciding to pursue the US CPA are:
Is CPA the right certification for you?
Before starting any professional certification, you need to be certain that it is the right professional certification for you. This question is even more important for individuals outside the US who are considering the US CPA Exam because of the potentially large investment of both time and money that is required given the additional difficulties of qualifying and taking the exam from outside the US (discussed below).
Determining if the US CPA is right for you revolves largely around the question of why you are taking the CPA Exam, i.e. what is your goal in becoming a CPA? If being a CPA is required for a specific job that you would like to have in the future, then you will need to become a CPA for that position. However, even if the position you want requires being a CPA, if you are not eligible to take the Exam or get your license (discussed below), then you will not even be able to become a CPA.
One specific issue in assessing whether CPA is the right certification for you is the fact that the content of the CPA Exam is US-oriented. The FAR Exam covers US GAAP. The REG Exam covers US tax law and US business law. The Audit Exam covers US audit standards. If you will not be working with US GAAP, US tax or business law, or US auditing standards, then the CPA Exam will not be preparing you for your job. If you are studying topics that you will not be using in your career, it also becomes harder to study these topics because you are not motivated by the practical application to your work.
Are you eligible to take the Exam?
If you have determined that the US CPA is the right certification for you, the next step is to determine if you will be eligible to take the Exams.
While every state has its own requirements for eligibility for the CPA Exam, most states require the equivalent of a Master’s Degree in Accountancy from a US university. In addition to the education requirements, some states also require US citizenship and/or residency.
Even though most states require a Master’s Degree in Accountancy, there are a handful of states that do not have this requirement. These are the states that most foreign candidates register in. Some of these states require the equivalent of 5 years of university credit to be eligible and some require only 4 years. Most states also have requirements about the minimum number of accounting hours, non-accounting business hours, and auditing or business law hours that must be completed in order to be eligible.
All of this is to say that if you do not have at least a 4-year Accounting degree, it will be very difficult to be eligible to take the CPA Exam.
Will you meet the experience requirement to get your license?
In addition to making certain that you are eligible to take the Exam, you also need to confirm that you will be able to get your license after you pass the Exams.
Most states require 2 years of experience under a licensed CPA in public accounting (external audit or taxation). Some states allow non-public accounting experience, but usually more than 2 years, and some states do not require that all work have been supervised by a CPA.
The state in which you plan to apply for your license must be the same state in which you registered for the Exam. You cannot register for the Exam in one state and then apply for your license in another.
Where will you take the Exam?
Assuming that you qualify to take the Exams and be licensed, in order to calculate how much it will cost to take the Exams, you need to identify where you will be able to sit for the Exams.
The CPA Exam is available in only a few countries outside of the United States: India, Nepal, Japan, South Korea, Brazil, Bahrain, Egypt, Jordan, Kuwait, Lebanon, and the United Arab Emirates.
Additionally, there are restrictions about who is able to take the exam in each of these locations. You can see who is able to take the Exam in each of these countries here: https://nasba.org/internationalexam/
If you are not a resident of the countries listed, you will have to sit for the exam in the US.
The main issue of the location of the Exam is the additional cost. If you will need to travel to take the Exam, you will have the costs of travel and hotel each time you go. If you plan to take one Exam at a time and you end up failing 2 Exams, you would have 6 trips associated with passing the CPA Exam.
Have you calculated the financial and time investment required?
The investment required to earn your CPA license is not only the financial costs of registration, preparation, and potentially travel, but also the investment of your time to prepare.
- The cost of registration varies by state, but $1,500 would be a reasonable average (for all four exams).
- The cost of preparation can be between $500 and $5,000, depending on how you prepare.
- The cost of travel will depend on a number of factors, but can become very expensive depending on where you live and where you need to go.
While these costs will be different for each candidate, it will probably cost at least $3,000 to prepare for and register for the Exams, not including any necessary travel expenses.
In terms of time, you should expect to spend at least 300 hours studying for the Exams. Depending on your educational background and experience, it could be as many as 500 hours.
It is difficult to put a financial value on 300-500 hours (or more) of your time, but you need to remember that in order to get the benefit of being a CPA you must pass all of the Exams and get your license. If you pass only two of the Exams, run out of money, or cannot retake an Exam that needs to be retaken, the time and money that you invested in passing some of the Exams will be wasted.
While the financial and time investment that you will need to make to become a CPA is an essential part of the decision, only you can determine if the CPA Exam is what you need, if you will be eligible to take it, if you will be able to get your license, and where you will be able to take the Exams.
Choosing the correct professional certification is always a difficult process. As detailed above, for candidates outside of the United States, there are significant questions to be answered before making a decision to pursue the CPA Exam. First, make certain that the CPA will help you achieve your personal and professional goals. Then, make certain that you will be able to prove eligibility, that you will have the required experience, and that you will be able to travel to take the Exams, if needed. The final step is the cost/benefit analysis of the required investment to pass the Exams. If you do not have confident answers for all of the questions discussed above, then the US CPA Exam is probably not the best professional certification for you.
If you have any questions, please do not hesitate to ask us. At HOCK we want to help make certain that you pursue the best exam for your personal and career goals.
Brian Hock, CMA, CIA