CPA FAR Exam: Curriculum, Passing Rate and Study Tips

We at e akhabaar like to tell you about the FAR exam – the syllabus, pass rates and tips. First of all, what does FAR cover? This section covers knowledge of generally accepted accounting principles for business enterprises, not-for-profit organizations, and governmental entities, and the skills needed to apply that knowledge. In other words, examiners expect candidates to compile financial statement, for example, from journal entries to how the data is presented in a financial statement; Identify the different financial accounting and reporting methods; Perform calculations such as bonds and leases; Understand and analyze the information from financial statements, and form a conclusion from financial statements and present findings.

FAR Exam Topic Areas: First, Conceptual Framework, Standards, Standard Setting, and Presentation of Financial Statements, representing 17% to 23%; Financial Statement Accountants involving Recognition, Measurement, Valuation, Calculation, Presentation, and Disclosures, 27% to 33%; Specific Transactions, Events and Disclosures, 27% to 33%; Governmental accounting and reporting, 8% to 12%; and Not-for-profit accounting and reporting, 8% to 12%. Exam format The CPA exam is fully computerized consisting of multiple-choice and task-based simulation questions. Effective April 2017, there will be 5 testlets: 2 testlets with 33 multiple choice each and 3 testlets with TBS, with 2 to 4 questions each. The score weighting of multiple-choice and TBS is 50/50. You will have 4 hours to take this exam, with an optional 15-minute break in between. Historical pass rate The FAR pass rate remains relatively stable with a very slight improvement towards 50%. You can expect the same trend going forward.

We Recommend tackling FAR first. Why? People have different opinions, and it largely depends on your own strength and personality. As a general rule, however, I do recommend you start with FAR. Here are the reasons. First, FAR takes the longest time to study I don’t think FAR is the most difficult, but the coverage is the widest, and the sheer volume of materials can be overwhelming. You’ll be glad to get rid of this biggest beast. Second, the 18-month rule consideration This is a major reason for anyone consider taking FAR first. Since you only have 18 months to take AND pass all the 4 sections of the CPA exam, and that the clock starts to tick once you pass the first one, you might want to tackle the longest or the hardest one first so in case you fail a few times your clock will still wait. Third, double benefits The great thing about FAR is that while it is time-consuming to study, it isn’t the most difficult. If people have enough time to study (well, that’s a big if, given the volume) they will likely pass. You get the double benefits of getting done with the biggest section and getting a quick win.

FAR Exam Tips: First, and a very important point, schedule your study very carefully Many candidates fail FAR because they do not have enough time to study. This is understandable given the huge amount of materials. If you don’t want to repeat their mistakes, plan ahead your study schedule so you won’t run out of time. Specifically, if you allow yourself 3 months to study, try to schedule finish streaming the video (or other materials) in the first 2 months, and set aside the last month for final revision. Chances are that things get delayed, and you’ll need 2 and a half months to finish everything off. Second, don’t skip the difficult concepts and hope they won’t appear in the exam Many candidates find a bond, pension and stockholder equity the most difficult sections. For me, governmental accounting is also a killer. Towards the end of my study, I took the time to understand governmental accounting but running out of time in other topics. I almost wanted to give up but thankfully, decided to set aside one afternoon to tackle bond and pension. It’s worth the effort — I did see a lot of bonds and pensions in my exam. Everyone has their special “blind spots”, which means — again — that leaving some buffer time for your study is very important. Another lesson learned: you never know which part will be on your version of the exam. Unless you don’t mind a retake, don’t risk skipping any part of study materials. Third, make sure you understand journal entries The ability to perform journal entries is the foundation of financial accounting. If you are not an accounting major, or that you haven’t touched journal entries for a long time, put in the extra effort and learn the fundamentals. My Thoughts First of all, rest assured that if you have enough time to study for FAR, you can pass. The questions and answers tend to be computational and clear-cut: you either get it or not. If you are familiar with GAAP and the calculation, this is a section that you can pass with relative confidence. If you really worry about the risk of lagging behind your study and not able to study the entire module on time, you might want to postpone the scheduling of your exam at the Prometric centre. You may run the risk of the centre is full, but you don’t need to force yourself to take the exam when you are not ready. The flexible scheduling is one of the best things about the computerized exams.