As the CPA Evolution 2024 is the following big news in the F&A world, it attempts to change the CPA licensure model by gearing CPA professionals with new-age accounting skills to meet the future demands of the F&A industry. Let’s dive into knowing the significance of FAR (Financial Accounting & Reporting) amidst this transitioning phase.
FAR as a Subject
Of the four core sections under the CPA course FAR is a voluminous, complex, and detailed section. The FAR exam covers extensive topics ranging from the conceptual framework, standard-setting, and selecting financial statements & transactions to prepare financial reports and consolidation of local and state governments. This also means it needs die-hard preparation as it involves more math content.
Approach to FAR Exam
The FAR section is more comprehensive in nature, it is more intimidating than the other sections, hence it requires a die-hard exam preparation strategy of 80-100 hours of study.
Having a schematic study plan is good, but to support your learning style follow a VARK (video, audio, reading, and kinesthetic) approach to meet realistic expectations.
Taking up quizzes, mock tests, and practice regulations, information, and security is key to cracking the tough syllabus as the pass rate swings between 44 and 50%.
As the FAR exam comprises 50% of MCQs and 50% of TBS, sound knowledge of the US GAAP before attempting the four-hour FAR exam is a must.
Since the grading system in FAR depends on the complexity of the questions, try attempting the tougher ones as it can improve your performance & chance of scoring more.
As the FAR exams need immense focus as the syllabus is subject to change and the government accounting section might only be 20%, it would be wise to attempt FAR first.
Understanding the distinctions between IFRS and US GAAP as reconciliation between the two is a painful exercise.
Skills tested under FAR
Retention and comprehension, application, analysis, and evaluation skills form the bottom line to cracking the FAR exam. To master these traits, you need to –
- Thoroughly read every concept in the FAR CPA study material.
- Watch live online webinars, lectures, guest talks, cracking mock tests, and concept-based flashcards to supplement your reading of theories.
- Time management is critical in cracking the FAR exam as you need to take up mock tests and quizzes regularly to overcome exam pressure.
- Read the explanations after answering the questions as it deepens your understanding and makes you exam-ready.
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