CPA Exam BEC Section

The BEC CPA Exam (Business Environment and Concepts) exam section evaluates your understanding of the general business environment and your duties and responsibilities as a CPA towards it. It assesses your ability to recognize and scrutinize situations related to Financial reporting, Financial statement audit and attestation and Tax preparation

This exam section ensures that you are well versed with all business concepts. It also assesses if you possess efficient communication skills to discharge your duty appropriately as a CPA.

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How do I pass BEC?

The BEC exam section is often considered the easiest of all CPA examCPA ExamThe CPA Exam assesses accounting professionals not just on their financial knowledge, but also on their ability to review and seek out key more sections. This ease may be due to candidates’ adequate understanding of general business and accounting concepts as students or professionals. However, please do not underestimate this section.

The inclusion of the written communication (WC) segment in the BEC section differentiates it from other exam sections. The WC contributes to 15% of your overall score. So, brush up on your writing skills. Try to develop a clear and concise writing style.

Apart from that, you should possess exhaustive knowledge about all fundamental economic, accounting, and business concepts to understand the implications of every business undertaking.

Practice with as many different sample scenarios as possible to get a good grasp of TBS and WC segments. To pass the BEC section, keep yourself updated with relevant finance-related topics and business letter formats. 

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BEC Pass Rates

The BEC section currently has the highest pass rate (62.16% in 2021 as per AICPA). The BEC’s second-quarter pass rate of 76.92% in 2020 is the highest ever in every section and quarter in the last few years. 

BEC pass rates were at their lowest during 2006-2011. However, it registered a massive growth from around 46% in 2011 to approximately 65% in 2020. In the first quarter of the 2021 CPA exam, the BEG pass rate stood at 62.16%.

As per AICPA, pass rates depict how well candidates’ performed in that particular year. It has nothing to do with exams being easier or more challenging than in previous years.

BEC Exam Pass Rates in Last Five Years

YearQ1 (rate in %)Q2 (rate in %)Q3 (rate in %)Q4 (rate in %)Cumulative (rate in %)

CPA BEC Exam Format

The BEC exam section is a four-hour exam with a 15-minute optional break. The exam comprises five small blocks or sections called testlets. The BEC exam format classifies the five testlets as follows:

  • Two testlets of multiple-choice questions (MCQ)
  • Two testlets of task-based simulations (TBS)
  • One testlet of written communication (WC)

In the following image, T stands for testlet, and Q stands for questions.


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CPA BEC Exam Testing Process

As per the BEC exam format, you have to take the five testlets consecutively (2 MCQ, 2 TBS, and 1 WC). The AICPA labels the MCQ testlets as either ‘difficult’ or ‘medium,’ depending on their difficulty levels.

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#1 – MCQ Testing Process

AICPA has a three-stage testing structure for the two MCQ testlets. The first testlet is of the same difficulty for all. On the other hand, the second testlet is based on your performance in the first testlet.

If you do not perform well in the first testlet, you get a medium-level second testlet. However, with a good performance, you’ll get a difficult testlet.

The scores for each question are factored in based on the difficulty of that particular question. A medium testlet doesn’t ensure better scores. For more details related to grading, check the section below.

#2 – TBS testing process

The TBS testlets are common for all. You get the TBS testlets only after completing the second MCQ testlet.

#3 – WC testing process

The WC testlet is also common for all. You get the WC testlet after completing the TBS testlets.

Furthermore, the TBS and WC testlets are not dependent on your performance in the MCQ testlets.

CPA BEC Exam Question Types

There are three types of questions in the BEC section.

Multiple-Choice Questions (MCQ)

Multiple-choice questions present multiple answer options, and you have to select the correct one. There are 62 MCQs in the first two BEC testlets (31 each). They constitute 50% of the final score.

Task-Based Simulations (TBS)

Task-based simulations are real-life case studies that test candidates’ ability to apply the principles and concepts learned. There are four questions in the BEC TBS testlets (two each). They constitute 35% of the final score.

Written Communication Tasks (WC)

The BEC WC tasks are essay-type answers that require a candidate to draft a memo, letter, or short passage on a given real-life workplace scenario. There are three questions in the BEC WC testlets. WC constitutes 15% of the final score. The main focus is on writing skills. You should write as professionally and clearly as possible.


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All BEC exam questions (MCQ, TBS, and WC) are either pretest or operational.

  •  Operational questions – The operational questions are the ones that contribute to your overall score. There are 50 operational questions in MCQ, three in TBS, and two in WC.
  • Pretest questions – Pretest questions are not scored. The AICPA puts them in the exam to see their viability in future exams. These pretest questions are likely to be seen in the forthcoming exams. There are 12 pretest questions in MCQ, one in TBS, and one in WC.

It is essential to keep in mind that you cannot identify such a classification in the exam, so attend every question with due diligence. Also, remember that once you submit a testlet, you can’t revisit it. Hence, review thoroughly before final submission.

How is CPA BEC Graded?

The scores of BEC exam segments (MCQ, TBS, and WC) are scaled and weighted according to the AICPA’s policy. On a scale of 0 to 99, you must score a minimum of 75 (not 75%) to pass.

The overall BEC score is a weighted combination of scaled scores of all five testlets (MCQ, TBS, and WC).  The scaled scores are arrived at considering the accuracy and complexity of the questions in the testlets. The MCQ contributes 50%, TBS 35%, and WC 15% to the final BEC Exam score.


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MCQs carry weightage according to their difficulty. If you perform well in the first testlet, you have to face a difficult testlet in the next round. A difficult testlet implies that the questions carry higher weightage. It means you can score more with a difficult testlet.

However, AICPA does not score TBS and WC sections according to the difficulty of the questions or performance of the earlier sections. In a case where the candidate’s WC score is just close to the passing mark, human scorers review and re-grade it.

Some TBS questions have partial credits. There is no negative marking. Hence, never leave a question unanswered!

CPA BEC Exam Content

The AICPA divides the entire BEC exam syllabus into areas, groups, and topics. Each section has a separate weightage. The following table details the break-up of the content as described in the AICPA CPA Exam Blueprints :

S No.Content AreasTopicsWeightage
1.Enterprise Risk Management, Internal Controls and Business Processes• Enterprise risk management (ERM)
– Purpose and objectives
– Components and principles
Internal controlsInternal ControlsInternal control in accounting refers to the process by which a company implements various rules, policies, or procedures to ensure the accuracy of accounting and finance information, safeguard the various assets of the business, promote accountability in the business, and prevent the occurrence of frauds in the more
– Purpose and objectives
– Components and principles
Sarbanes-Oxley ActSarbanes-Oxley ActThe Sarbanes-Oxley Act (Sox) of 2002 was enacted by the US Federal Law for increased corporate governance, strengthening the financial and capital markets at its core and boost the confidence of general users of financial reporting information and protect investors from scandals like that of Enron, WorldCom, and more of 2002
• Business processes
2.Economics• Economic and business cyclesBusiness CyclesThe business cycle represents the expansion and contraction of the economy that occurs due to ups and downs in the gross domestic product (GDP) of a country. It is experienced over the long term and goes parallel with the natural growth more — measures and indicators
• Market influences on business
• Financial risk management
– Market, rate of interest, liquidity and currency issues, risks related to credit and price, etc.
– Means for addressing, managing and controlling various financial risksFinancial RisksFinancial risk refers to the risk of losing funds and assets with the possibility of not being able to pay off the debt taken from creditors, banks and financial institutions. A firm may face this due to incompetent business decisions and practices, eventually leading to more
3.Financial ManagementCapital structureCapital StructureCapital Structure is the composition of company’s sources of funds, which is a mix of owner’s capital (equity) and loan (debt) from outsiders and is used to finance its overall operations and investment more
• Working capital fundamentals and key metrics of working capital management
– Strategies for managing working capital
• Financial valuation methods and decision models
4.Information Technology• Understanding of information technology (IT)
• Risk associated with IT
– Risk assessment
– Change management
– Security, availability, confidentiality and privacy
• Controls that respond to risks associated with IT
– General IT controls
– Logical and physical controls
– Business resiliency
• Data management and relationships
– Governance
– Extract, transform and load data
– Visualization
5.Operations Management
• Financial and non-financial measures of performance management
Cost accountingCost AccountingCost accounting is a defined stream of managerial accounting used for ascertaining the overall cost of production. It measures, records and analyzes both fixed and variable costs for this more
Cost measurement concepts, methods and techniques
Variance analysis
• Process management
– Approaches, techniques, measures, benefits to process- management driven businesses
– Management philosophies and techniques for performance improvement
• Planning techniques
– Budgeting and analysis
– Forecasting and projection


Furthermore, AICPA’s CPA Exam Blueprints comprehensively details the topics covered under the BEC exam section while also discussing the required skills.

How hard is it to pass BEC?

There are three skill levels a candidate should master in order to ace the BEC exam section.

Remembering and UnderstandingAll five content areas15% – 25%
ApplicationAll five content areas50% – 60%
AnalysisAll five content areas (except IT)20% – 30%

To pass the BEC section, you have to possess a solid understanding of the fundamental concepts of business and accounting. This knowledge would enable you to identify the business and accounting implications of all transactions involved.

A candidate with a firm grasp of economic and accounting formulas, along with impressive business writing skills, may find this section comparatively easy.

When should I take BEC?

Experts consider BEC exam section to be an easy exam as compared to other sections due to the following reasons:

  • Most students and working professionals have a good hold on business fundamentals.
  • BEC has the least number of MCQs (62) as compared to other sections.
  • There are only four TBS as compared to eight in the other sections.
  • Written communication comes easy to most candidates.

Of course, there is no hard and fast rule on when to take up this section. Since BEC is a relatively easy section, most people suggest taking it up at the end due to the following reasons:

  • Its content includes a little bit of everything from all other sections.
  • You can finish your CPA exam fatigue with a comparatively easy section.

However, you can make it your first, second, or third choice according to your needs and preferences. If you want to boost your confidence, give it a shot first. Or, if you want a breather between the exams, you can take it up after two difficult sections.

Please note that the AICPA has revised the curriculum that will be effective since July 1, 2021. There is a considerable addition to the BEC section, especially in the information technology area. In the wake of these significant changes, you can opt to take the BEC exam section before July 2021.

BEC CPA Exam Time Management

Let’s understand this by dividing the total time (4 hours or 240 minutes) by the five testlets. Below is an approximate estimation of the exam time management.

TestNo. of QuestionsMinutes per QuestionTotal time taken
(in minutes)
Testlet 131131
Testlet 2311.547
Testlet 3215-2030-40
Testlet 4215-2030-40
Testlet 5320-2560-75
Total (in minutes)198-233
Extra Time (in minutes)42-7
Extra Time (in minutes)240

Going this way, it would take you 198-233 minutes to complete the entire examination. If you take the minimum allotted time, you will have 42 minutes left. However, if you take the maximum allotted time, you will have just seven minutes left. You can use this extra time for the final review. 

How do I prepare for BEC?

Consider the following tips to pass the BEC CPA exam section:

What is the best way to study for the BEC CPA Exam section?

The best way to study for BEC CPA Exam is by using AICPA’s CPA Exam Blueprints, getting familiar with the test through AICPA’s sample papers, and following the above-mentioned preparation tips. Moreover, you can take professional help by enrolling in top-rated CPA Review courses.

Make a study plan and try to stick to it. Finish the entire course within a certain number of days and then leave a few days for quick revision. Start preparing for the most challenging topics first, and then move on to the easier ones.

This has been a guide to BEC CPA Exam Section. Here we provide you with complete guide on BEC CPA exam format, pass rate and how to prepare for it. You can learn more about finance exams from the following articles –

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