Monday, April 27, 2009

Studying for the CPA

On Thursday I officially got my CPA license in the mail. It’s a flimsy plastic card that states I’m a Certified Public Accountant. It’s weird almost since so much value is placed into something so seemingly insignificant. Society at large now considers me somewhat at a financial expert. As this thing essentially took me 2 years of test taking and 6 years of schooling I thought it would be appropriate to reflect on it.

Studying Strategy

At Texas A&M they made us study the parts as follows: BEC (business law), REG (tax and ethics), AUD (audit), FIN (everything ridiculous thing you can think of) I think. See I don’t know for sure because I dropped the class after the first series was complete. The classroom program I took (Becker CPA) sucked. We all filed into a room twice a week where a three hour video was placed into a dvd player and played. No additional instruction was given. I didn’t personally pay for the class so I wasn’t dramatically upset, but man what a waste a time. A much better way to study is at your own pace in chunks. You’ll retain more.

Order I Would Take the Test

In difficulty I think it goes as follows: FINC, REG, AUD, and super easy BEC. If I was studying on my own I would take the test in the following order FINC, REG, BEC, AUD. Financial is voluminous in information covered and ridiculously long. It takes the most study time and is the least appetizing material. I would get this one out of the way as opposed to doing it at the end when you are about studied out. I would save audit for the end since if you are going in to auditing as a career field, your entry level training will cover some of the material.

Some people I know took it as follows REG, BEC, FINC, AUD to go from least likely to most likely to be used in their career as an auditor. It’s just a matter of preference. I think it’s good to stick BEC in the middle somewhere as it is significantly easier than the others and almost like taking break.

When You Have No Time

Let’s say you’re like me and have not been able to study as much as you would have liked. You have just a few days to study and need to get through the material. I have developed the slacker study plan to hopefully enable you to pass. Utilizing this plan I was able to pass FINC with roughly 16 hours of study time (I did watch a lot of the videos before hand, but they didn’t really help).

First and foremost understand the test. The test is going to be comprised of around 100 or so multiple choice questions. A LOT of people waste too much time learning how to calculate some weird and difficult accounting material. If you don’t have a lot of a time, don’t waste your time on something like this. The workout questions will make up about 20% at the very most of your test, but can take up 80% of your study time. Learn the hard stuff last.

Slacker Study Plan for Becker Material

Do these from top to bottom as you have time. The farther down the list you go the more likely you are to pass. Note most of my examples will be for Financial because it is the most difficult.

1) Do easy questions a lot until you get at least 90 % for all major sections. When you miss a question read the section in the book that corresponds to the question missed so you can understand why you missed it.

2) Do questions for minor sections until you get 90% (an exception would be in financial when you are reviewing really hard material for very few points e.g. Benefits, difficult bonds sections etc.)

3) Take a practice test (skip the simulations) and see which sections you still have trouble with.

4) Watch video for things that you are very unfamiliar with (not for profit and governmental; you MUST know these sections as there tend to be tons of questions to come out of here)

5) Take a practice test again and re-troubleshoot areas you still are having trouble with.

6) Watch the rest of the videos.

7) Do the difficult and hard to understand workout problems.

8) Go through the simulation examples by reading the answers and seeing how the problem is worked.

I never did a simulation example the entire time I was studying for the CPA, and I always got a better score on my simulations than I did my multiple choice test. The simulations always have a way to at least get some points relatively easily, and studying for your multiple choice section will carry over to the simulation. That said if you get incredibly nervous or are terrible at writing then I would take a practice test.
I don’t study well at all. It’s just not something I excel at. Though by the end of the process I had refined my process to the point where I was able to confidently execute a study plan and see success. At the end of the day you know how you study best. Make sure and do it your way and use the practice test to gauge your results.

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