CPA Pass Rate
A CPA exam tests a candidate’s competency to meet the rigorous accounting industry standards. Over the past decade, the CPA exam pass rate has hovered around 50% (including 2020 and 2021). A pass rate of just 50% acts as a deterrent to most aspiring candidates.
The American Institute for Certified Public Accountants (AICPA) coordinates with the National Association of State Boards of Accountancy (NASBA) to conduct the Uniform CPA exam. The exam is considered to be one of the most challenging exams. The AICPA follows a stringent scoring process.
The low pass rates reflect the complex nature of the exam and the strict scoring process. It may also be an indicator of the lack of preparation of candidates appearing for the exam.
The pass rates usually vary from year to year. According to the AICPA, this does not mean that the exam was easier or harder to pass in a particular year. It just shows how better the candidates performed as compared to previous years.
With the introduction of the continuous testing model, the AICPA conducts the exam throughout the year. However, it releases the pass rates for each section quarterly. As a candidate, you have to score at least a 75 on a scale of 0 to 99 in each of the four sections to pass.
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2020 CPA Exam Pass Rates
2020 had been undoubtedly a roller-coaster ride for all of us owing to COVID-19. The Prometric test center closed down due to the pandemic. However, in terms of the 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 abilities., the ride was quite joyous! As compared to 2019, more CPA candidates got through the passing mark in 2020.
- AUD – Auditing and Attestation
- BEC – Business Environment and Concepts
- FAR – Financial Accounting and Reporting
- REG – Regulation
As good as the pass rates look in the chart above, the year 2020 started with many hurdles. Due to the shutting down of Prometric test centers in the wake of COVID-19, candidates couldn’t take the scheduled exams.
However, the State Boards of Accountancy granted automatic credit extensions for candidates about to complete their 18-month period. With the Prometric centers resuming testing in May, things got better. However, candidates continued to face scheduling and booking issues.
But, as they say, all is well that ends well, and it indeed ended well for the CPA candidates too. All four exam sections registered higher pass rates as compared to 2019. Especially, the Q2 and Q3 pass rates turned out to be remarkable.
The pandemic turned into a blessing in disguise. It turned out that candidates staying at home and getting more time to prepare resulted in higher than usual scores.
Analysis of 2020 CPA Exam Pass Rates
Q1 – Rough Start
- Generally, Q1 has lower pass rates than the year’s cumulative average, and Q1 2020 was no different.
- BEC CPA exam candidates fared well and managed to get a pass rate of more than 60%
- The REG CPA exam pass rate was the lowest compared to the other quarters at 55.42%.
- The only thing a bit satisfying was that the Q1 2020 pass rate was still better than Q1 2019.
Q2 – An impressive turn of events
- Usually, Q2 has higher pass rates than other quarters, but this year it surpassed all expectations.
- Q2 saw one of the best pass rates in over a decade.
- The number of candidates who took the exam was very low due to the COVID-19 pandemic.
- BEC candidates performed exceptionally well. Not only did the BEC surpass the cumulative and Q1 pass rates, but it also saw the highest pass rate in 2020.
- Every section’s highest pass rate is registered in Q2.
- You will find at least 10% growth in every section as compared to Q2 2019.
Q3 – The trend continued
- The impressive trend continued in Q3.
- A special mention goes to REG, which surged by 8% (from 58.41% in 2019 to 66.12% in 2020).
- AUD and BEC Q3 pass rates also increased compared to 2017, 2018, and 2019.
- As far as FAR is concerned, its Q3 pass rate (55.67%) was higher than its cumulative pass rate (49.98%).
Q4 – A not-so-good-not-so-bad performance
- A huge disappointment for FAR candidates in Q4 2020 as the pass rates were the lowest.
- What came as a bit of relief was that the BEC and REG recorded higher Q4 pass rates than Q4 2017, 2018, and 2019.
Prediction about the Future Pass Rate
The syllabus of each exam section influences a candidate’s preparation and test success rate. Since the success rate is closely related to the curriculum, a candidate must closely monitor any changes in the curriculum.
The AICPA regularly updates the accounting curriculum for the CPA exam to keep it abreast with the requirements of the changing world. Over the years, the varying exam pass rates depict the effect of frequent revisions in the grading process and exam syllabus.
FAR has been demonstrating a decrease in the pass rates for a long time. However, recently, there is a reversal in this trend. The rest of the sections are witnessing an increase in the pass rates. This trend is expected to continue.
The AICPA has revised the curriculum for the exam that will be effective since July 1, 2021. There is a considerable addition to the contents in the AUD and BEC sections. However, there is a reduction in the contents of the FAR and REG sections. For more details, check CPA Exam Blueprints.
In the wake of these significant changes, candidates will opt to take the AUD and BEC exam sections before July 2021. This will affect not just the respective sections’ pass rates but also the other ones. The AICPA has released the CPA pass rates for Q1 2021. It shows a positive trend.
Adopting the continuous testing model is also expected to positively affect the pass rates as the candidates can reappear for a failed exam section in the same quarter.
CPA Exam Pass Rates Overview (last 10 years)
Needlessly, the period of 2010-2020 has witnessed a significant surge in the cumulative pass rate of every section recording an average growth of at least 2%.
During the past decade, BEC pass rates registered the best growth among all sections in all quarters. The BEC cumulative pass rates improved from around 46% in 2010 to about 66% in 2020.
The AUD and FAR cumulative pass rates hovered in the range of 46-48%. However, AUD exhibited moderate growth, with the cumulative pass rates passing the halfway mark in the last three years.
The cumulative pass rates for FAR fluctuated in the same range except for 2020 (49.98%). REG witnessed fluctuations in the decade. However, the last three years saw remarkable growth in the REG pass rates, with 2020 witnessing around 62% cumulative pass rate.
For the past decade, the general trend was lower pass rates in Q1 and Q4 and high pass rates in Q2 and Q3. The reasons for it have been discussed below.
The Q1 pass rates didn’t yield much potential for AUD (47% in 2010 to 48% in 2020). However, the BEC registered a significant growth (47% in 2010 to 62% in 2020). Q1 FAR pass rates fluctuated in the range of 42 to 47%. Q1 REG rates showed an increasing trend crossing 50%.
Q2 was like a breath of fresh air for almost every year, throughout 2010-2020. However, 2020 takes the cake here as it registered the highest pass rates in all four sections across the entire period.
During 2010-2020, the Q3 pass rates for AUD improved significantly (49-57%). BEC recorded a staggering 70% in Q3 2020, higher than any previous rates throughout 2010-2019. FAR Q3 pass rates continued to fluctuate over the years. However, REG raised the bar considerably.
The Q4 pass rates for AUD were stagnant throughout 2010-2020. Moreover, from 44% in 2010 to 61% in 2020, Q4 BEC rates indeed came a long way. The Q4 FAR pass rates didn’t show any improvement over the years. However, Q4 REG fared quite well.
Pass Rates Section-Wise (last 10 years) and its Analysis
#1 – AUD – An unknown future
Till 2010, everything was fine, with the AUD cumulative pass rates registering around 48%. However, things went downhill for this section in 2011 with the introduction of the Computer-Based Testing evolution (CBT-e).
Since then, the rates stayed around 46% till 2017. From 2018, AUD pass rates increased from the mid-40s to early-50s.
#2 – BEC – Going well
Recording a massive growth from 47% in 2010 to 66% in 2020, the performance of this section was undoubtedly impressive. Though it tumbled a bit in 2017, the next three years proved to be extraordinary for BEC. BEC is currently the exam section with the highest pass rates (66% cumulative pass rate 2020).
#3 – FAR – A hard nut to crack!
Take a look at its pass rate, and you will know why this section is regarded as the toughest one to crack. The period of 2010-2014 saw FAR pass rates lingering around 48%. But after that, it continued to decline further till 2019.
The year 2020 was a bit satisfying with a 50% cumulative pass rate and 63% Q2 pass rate. Otherwise, all you can see are numbers ranging from 40-48, with only a few attaining 50 or greater than that. FAR is the exam section with the lowest pass rates.
#4 – REG – On the brink of getting good!
After the introduction of the CBT-e for the CPA exam in 2011, the REG pass rates dropped at an alarming rate (from 51% in 2010 to 44% in 2011). However, it picked up in 2012 and continued to increase over the years, reaching 47% in 2017.
From 2018-2020, there has been an immense growth in this section from 47% (2017) to 62% (2020). REG is considered to be a tough exam section. But as per the recent trends, it is emerging as one of the top contenders.
CPA Pass Rate Seasonal Trends
Over the years, we can witness a unique seasonal trend with respect to the pass rates. With the NASBA moving on from the Testing Window model to the Continuous Testing model, the influence of seasonal trends on pass rates may reduce.
Under the new model, a candidate can take the exam any time during the year and can also reappear for a failed exam section within the same quarter. This will ensure the leveling off of the pass rates over the year.
However, there are external environmental factors that may perhaps continue to affect the exam pass rates. Traditionally, Q1 and Q4 are lean seasons with low pass rates, while Q3 and Q4 are seasons witnessing high pass rates.
Here are some of the seasonal trends observed before 2020 and the reasons for them.
Q1 (January-March): High hopes, Low pass rates
As per the analysis mentioned above, you can see that this quarter usually registers the lowest scores. The reason may be that this is the time for handling year-end taxes for the clients.
Many CPA candidates are full-time employees, handling logistics, heavy workload, and the pressure to crack the exam take a toll on them. The lower pass rates in this quarter reflect this trend.
Q2 (April-June): Era of better scores
Now, this is important for all the college freshmen out there! They usually start preparing for the CPA exam during this time. It means that their motivation and enthusiasm are relatively high during this period.
Also, it is the time when even the accountants, auditorsAuditorsAn auditor is a professional appointed by an enterprise for an independent analysis of their accounting records and financial statements. An auditor issues a report about the accuracy and reliability of financial statements based on the country's local operating laws., tax experts, etc., finally take out some time to sit for this exam. This results in better pass rates. That is why even a pandemic could not falter the candidates’ hopes last year, and they did amazingly well.
Q3 (July-September) – Highest chance of success!
By now, you must have understood that Q3 is like a miracle period for the uniform CPA examination witnessing the highest pass rates. Now, it does not mean that Q3 exams are simple!
The real reason is the extra time students and employees get for studying. Many ambitious and smart candidates might target this specific time of the year as they know the success rate is relatively high this time.
Q4 (October-December) – A moderate one!
Q4 is like a reasonable period where neither the success nor the failure rate is so high. Credit goes to the upcoming holiday season.
Please note that the pass rates are just here to imply how more and more study time can better the scores. So, it depends upon your priorities, timetable, and the amount of dedication you put into clearing this exam.
CPA Exam Rate by Age
Going by the statistics, the pass rate of successful candidates in their 20s is more. As per the National Association of State Boards of Accountancy (NASBA), the average age of qualified candidates in 2016 was 28.9 years at one of the examinations. In 2015, a NASBA report observed that the mean age of successful candidates was 29, with the median age being 25 years.
It also specified that the performance of candidates in previous examinations declined with age. The following image from the report throws more clarity on the CPA exam’s pass rates by age.
This may be because the candidates in their early 20s take the exam soon after completing the necessary college requirements. This ensures they remember all they have studied and have better chances of passing.
This by no means reflects that people above 30 or 40 should not try. With their relevant work experience, they also have a good chance of passing provided they brush up on their knowledge. They must set aside additional time to study or join an online prep course.
What do CPA Pass Rates mean to you?
Yes, pass rates of the CPA exam can give you some sleepless nights, but it just means how well the previous candidates performed. Thousands of people pass this exam, and if you give your 100%, you can be one of them.
Getting an idea of these pass rates is essential for you to decide the right timing and order to take up exam sections. So, keep these numbers in mind, but don’t let them overwhelm you.
Always remember that no law of average can guarantee your chances of failure or success for the examination. Not these statistics, but a consistent and intelligent study plan is the key to earning a CPA title.
This has been a guide to CPA Exam Pass Rate. Here we discuss the pass rate for the CPA exam section-wise for past 10 years as well as the seasonal trend. You can learn more about the CPA exam by reading the following articles –