All About the US CPA-FAR Exam
Sat Jul 08 2023
The CPA-FAR Exam section covers topics like financial transactions, financial statements, GAAP, and reporting for nonprofits. Most CPA aspirants consider FAR to be the challenging one among the remaining CPA exam sections because of its length.
This exam is also considered as difficult because it tests the candidate’s understanding of statement presentation, financial reports, and business transactions using US GAAP, and governmental accounting systems. There’s also common to see topics like Consolidation, Equity Method, Bonds, correcting errors in transactions, and calculating fair value figures as well.
FAR Topic Areas & Concepts:
The FAR section is a 4-hour long exam. It includes the below topics:
| Area of Content | Allocation |
|---|---|
| Financial Reporting | 30 - 40% |
| Select Balance Sheet Accounts | 30 - 40% |
| Select Transactions | 25 - 35% |
Financial reporting covers information related to preparing, reviewing, and analyzing financial statements and understanding foundational concepts related to the accounting requirements for state and local governments.
Select balance sheet accounts tests your knowledge related to financial accounting and reporting requirements in the FASB Accounting Standards Codification that apply to balance sheet accounts for both for-profit and not-for-profit entities.
Select transactions covers the financial accounting and reporting requirements in the FASB Accounting Standards Codification related to select transactions for both for-profit and not-for-profit entities.
FAR CPA Exam Structure and Format:
The CPA FAR exam starts with 2 testlests with 25 Multiple-Choice Questions (MCQs) each.; then there will be three testlets with 7 task-based simulations.
| Question Type | No. of Questions |
|---|---|
| Multiple-Choice Questions (MCQs) | 50 (25+25) |
| Task-Based Simulations (TBS) | 7 (2+3+2) |
FAR Section Format:
| Testlets | Question Sets |
|---|---|
| 1 | 25 MCQs |
| 2 | 25 MCQs |
| 3 | 2 TBS |
| 4 | 3 TBS |
| 5 | 2 TBS |
Here you can see FAR Demo Class by Sripal Jain (CFO of Simandhar Education)
Conclusion:
The FAR section is considered a challenging section because of its length, but if you prepare well for the exam, it’s easy to get a good score in the CPA exam. Hope the above article gives you complete insights on the CPA FAR exam. However, if you have any doubts, comment below. Happy Learning!
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