A Certified Public Accountant, or CPA, is the most prestigious license an accountant can earn. To achieve this goal in California requires meeting high standards of educational excellence, passing the Uniform CPA examination, and completing a specific amount of accounting experience. The two most important goals to focus on in your quest to become a CPA are meeting your licensure requirements and passing your CPA exam, and it all begins with education.
First and foremost, make sure your school is accredited as accepted by the State of California before you take the courses you'll need to become a licensed CPA. According to the California Board of Accountancy (CBA) you'll need a minimum of a Bachelor's degree as well as 150 semester hours in courses specific to accounting before you can sit for the CPA licensure exam. While the Bachelor's degree can be in any subject the 150 course hours must include a minimum of 24 units of accounting, 24 units of business, 20 units of accounting study, and 10 units of ethics.
The requirements are narrowed even further by detailing the following subjects be taken in each area of study:
Accounting Subjects: 24 Semester Hours
- Financial Reporting
- Financial Statement Analysis
- External & Internal Reporting
Business Subjects: 24 Semester Hours
- Business Administration
- Business Communications
- Business Management
- Business Law
- Business-related law courses offered at an accredited law
- Computer Science & Information Systems
Accounting Study Subjects: 20 Semester Hours
- Minimum six semester units in accounting subjects (as listed above)
- Maximum 14 semester units in business-related subjects (as listed above)
- Maximum nine semester units in other academics relevant to business and accounting work with a maximum 3 units from any one area
- Maximum four semester units in internships or independent studies in accounting or business subjects
- Skills-based courses in Communications, English, Journalism, and the Physical, Life, Natural, and Social Sciences
- Foreign Languages/ Cultural & Ethnic Studies
- Industry-based courses, which are courses with the words “administration” or “industry” in the title as well as courses in the following disciplines: Architecture, Engineering, and Real Estate
Ethics Study Subjects: 10 Semester Hours
A minimum of 3 semester hours in accountants’ professional responsibilities or accounting ethics at an upper division level or higher is required.
- Maximum seven semester hours in courses in any of the following subject areas: Auditing
- Business, Government and Society
- Business Law
- Business Leadership
- Corporate Governance
- Corporate Social Responsibility
- Human Resources Management
- Legal Environment of Business
- Management of Organizations
- Organizational Behavior
- Professional Responsibilities
In addition, the Ethics portion may be comprised of a maximum three semester hours in courses from the following disciplines:
But the course title must contain one of the following words or terms:
- Introduction; General; Fundamentals of; Survey of; Introductory; Principles of; Foundations of
This course requirement list is quite strict and credits cannot be used to qualify more than once. For example, if you take a three credit hour course titled "Business, Society, and Government" you could use all three credit hours towards your Business or Ethics requirement or split the hours with one going towards Business and two going towards Ethics requirements but not use the class as three hours towards Business as well as three hours towards Ethics requirements.
If you have earned your Master's degree in accounting it will satisfy the 20 semester hours of accounting study, and the hours completed in the fulfillment of the master's degree can be counted toward the other three educational areas: 24 semester units of accounting subject, 24 semester units of business-related subjects, and 10 semester units of ethics study. In addition, completion of a Master of Accounting, Taxation, or Laws in Taxation is equivalent to the 20 semester hours of accounting study.
You may sit for the exam once you have earned your Bachelor's degree and have completed the 24 semester hours each in Accounting and Business. The California CPA exam is overseen by the California Board of Accountancy (CBA) so your first step will be to start the application process on their website. Your school transcripts must be submitted directly to the CBA so that should be your first step after creating an application account. Keep in mind that most schools allow two to six months until degrees are posted on official transcripts and another 10 to 15 days to process a transcript request so there may be an extended time frame from when you start the process and when you are eligible to sit for the test.
Make sure all information is correct on your application, and keep your account information updated if you move during the process. The initial application fee is $100.00 and if you need to reapply at a later date the fee is $50.00. The CBA does comply with Title II of the Americans with Disabilities Act, so if you require reasonable accommodations if you have a physical or mental disability or medical condition you should let them know in advance.
The exam itself is comprised of four sections and you may take them separately or all at once:
- The Auditing and Attestation (AUD) section covers generally accepted auditing standards and procedures as well as the skills needed to apply them in auditing.
- The Business Environment and Concepts (BEC) section assesses your knowledge of professional responsibilities as well as the legal implications of business transactions as they relate to accounting and auditing.
- The Regulation (REG) section evaluates your knowledge of principles and procedures for federal income, managerial accounting, estate, and gift taxation, and accounting for governmental and not-for-profit organizations.
- The Financial Accounting and Reporting (FAR) section covers knowledge of generally accepted accounting principles for businesses, including financial accounting concepts and standards as well as their application in public accounting engagements.
Because the exam sections may be taken individually you will pay separately for each section as follows:
- AUD $208.40
- FAR $208.40
- REG $208.40
- BEC $208.40
It will take about a week to process your payment, at which time you'll receive your Notice to Schedule (NTS). You'll need the NTS for admittance to the exam so keep it in a safe place.
The test is given in three month windows with the first two months of each window being the time frame for sitting for the exam. They are as follows:
You may take one or all four test sections in any given window but may not take the same section twice in the same window. The test is given at Prometric Testing Centers throughout California so you'll be able to choose a testing center convenient to your location. When you arrive at the testing center you are required to have your NASBA issued NTS and two forms of valid, current identification (ID) including one with a photograph. You will not be allowed to sit for the exam if you do not meet these requirements, and these are the only items you'll be allowed to carry into the exam room. All other possessions will be stored in a locker during the testing period.
Test scores are released approximately two weeks after the exam is completed and can be found on your CBA account, which is updated daily. A score of 75 or higher is a passing grade, and you have an 18-month window to complete and pass all four sections of the exam. Failure to complete all four exams successfully within the 18-month time frame will result in having to take one or more exams over, even though you passed that section in the past.
To apply for your California licensure you'll have to meet other criteria such as experience. You'll need to verify a minimum of 12 months experience in a type of service involving the occupation of accounting, such as accounting advisory, attest, accounting, financial advisory, or tax skills. Your experience must be documented on a specific form from the CBA that is supervised and signed by a licensed individual. Note, there are different experience forms for private and not-for-profit organizations.
Experience in academia also qualifies if it is an accounting subject such as auditing, internal or external reporting, accounting, taxation, or financial statement analysis. This type of experience must be documented and signed by the dean or chair of the department that has oversight.
Military experience and education is also accepted as long as it conforms to requirements and is properly documented.
California CPA Licensure Requirements
Before you apply for your CPA license you'll also need to pass an ethics exam. In California the CBA only accepts the PETH exam as administered by the California CPA Education Foundation.
- PETH examination topics include:
- Ethics in business
- Basic concepts and philosophy of professional conduct
- Code of Professional Conduct
- Independence, integrity and objectivity
- Interpretation of Securities and Exchange Commission rules
- Commissions and fees
- Form of practice and name
- Advertising and solicitation
- Tax Services
- Accountancy Act and CBA Regulations
You'll also need to provide your social security number, fingerprints, and a Criminal Conviction Disclosure Form as part of the licensing process. In California the fingerprint process is the Live Scan Service which is an electronic format which interfaces with the background check system.
The CPA licensure application fee is $250.00 and the hard copy fingerprint processing fee is an additional $49.00. Because your license expiration date is your birth month once your application is reviewed and accepted you will be given a license fee prorated to the length of time it is valid.
Once your application is complete and you've paid the fees you'll receive an acknowledgment card noting your application was received. In 30 days you'll receive a status update that will outline any missing information you need to submit to complete your application; if all necessary information has not been provided within 60 days you'll receive a status notification and your status will be placed on a pending list.
Once all documents have been successfully submitted you'll receive a notice that your license application is under review. Within four to six weeks you should receive your notice of acceptance.
Current military personnel, honorably discharged veterans, and spouses and domestic partners of California-based active military members all receive expedited service on their applications; proper documentation must be provided.
License renewal and continuing education
Your CPA license is valid for a two-year period, and it expires every other year at midnight on the last day of your birth month. The renewal fee is $120 and you must provide proof of continuing education requirements (CE) when you renew your license.
Your CE courses must be completed within the past two-year time frame and a minimum of 12 hours must be in non-technical subject areas such as the following:
- Auditing and Accounting
- Computer and information
- Financial planning
The other eight hours of CE will be in non-technical subjects such as:
- Communication skills
- Negotiation skills, and motivational techniques
- Marketing and sales
- Office management, practice management, and personnel management
- Word processing
Because continuing education requirements may change you should keep abreast of the subject through CPA organizations and associations as you work in the field.