Before studying CPA, Let's know about CPA. What is CPA? What CPA stands for ?
CPA stands for Certified Public Accountant. A trusted financial advisor who helps individuals, businesses, and other organizations plan and reach their financial goals. All CPAs are accountants, but not all accountants are Certified Public Accountants. Becoming a Certified Public Accountant is often a challenging journey, but this is the one that reaps big rewards for those who choose to pursue it.
a. To become a Certified Public Accountant, these 3 E's are required
b. Education
c. Exam or Uniform Certified Public Accountant Examination
d. Experience
The laws & rules for each state or jurisdiction are different. State Boards of Accountancy determine the laws and rules for each state/jurisdiction. Click on this to know the state requirements.
Education:
a. Most of the states now require 150 semester hours
b. Number of accounting hours (in the 150 total) is dependent on state requirements. Requirements vary by State/Jurisdiction.
Note: Currently six jurisdictions do NOT have the 150 hour requirements. These places are: California, Colorado, Delaware, New Hampshire, Vermont and the Virgin Islands.
Exam or Uniform CPA Examination: According to the Certified Public Accountant Examination Mission Statement, the purpose of the Exam is "To admit individuals into the accounting profession only after they have demonstrated the entry-level knowledge and skills necessary to protect the public interest in a rapidly changing business and financial environment."
This is Computer based examination. It consists four sections :
1. Auditing and Attestation (AUD). This section covers knowledge of auditing procedures, generally accepted auditing standards(GAAS) and other standards related to attest engagements, and the skills needed to apply that knowledge.
2. Business Environment and Concepts (BEC). This section covers knowledge of general business environment and business concepts that candidates need to know in order to understand the underlying business reasons for and accounting implications of business transactions, and the skills needed to apply that knowledge.
3. Financial Accounting and Reporting (FAR). This section covers knowledge of generally accepted accounting principles(GAAP) for business enterprises, not-for-profit organizations, and governmental entities, and the skills needed to apply that knowledge.
4. Regulation (REG). This section covers knowledge of federal taxation, ethics, professional and legal responsibilities, and business law, and the skills needed to apply that knowledge.
This test is same in all centers no matter where it is taken, and the Passing score is 75 on a 0-99 scale. And the questions which will be asked in this examination includes multiple choice, simulation and written communications. But, eligibility to sit for the exam depends on each state's rules & laws differently (Click on this to know the state requirements.)
Click here for more information about exams
Note: There are 19 states which allow candidates to sit at 120 hrs, but require
150 hours for certification. They are: Alaska, Arizona, Connecticut, Florida, Georgia, Hawaii, Idaho, Indiana, Kentucky, Maine, Minnesota, Michigan, Montana, North Carolina, New Jersey, Pennsylvania, Rohde Island, South Carolina, Virginia)
Experience:
i. A candidate is an applicant for a Certified Public Accountant license.
ii. Many states require the candidate to have 1 – 2 years experience under a CERTIFIED PUBLIC ACCOUNTANT
iii. Additional requirements vary by the candidate’s:
Education – e.g., Graduate degree vs. 150 hours of undergraduate
Employer(s) – e.g., Public accounting firm vs. industry
Type of work – e.g., Tax professional vs. auditor
Licensure:
i. After passing the CPA exams. All that stands between you and your career as a practicing CPA is a state-issued license. The license mainly serves as an official checklist for accomplishments and qualifications you’ve already satisfied i.e. starting with passing the CERTIFIED PUBLIC ACCOUNTANT examinations. In addition to passing the exams, here are some other considerations you must comply.'
ii. The bare minimum: Bachelor’s degree
iii. Most states require at least a bachelor’s degree to be eligible for becoming a CPA.
iv. Experience requirements
v. Most states require at least two years of experience in public accounting before allowing you to practice as a CPA. Many also accept accounting experience in other areas such as industry or government, but that usually means they require that you practice for more years.
vi. One-tier or two-tier?
vii. Some states require that you pass the Certified Public Accountant exam and simply meet the experience requirements to obtain your certificate and license at the same time. Those are called “one-tier” states. In two-tier states, you receive a certificate once you pass the exam, and the license comes separately, once you fulfill the experience requirements. The best idea is to contact your state board to understand exactly what you need.
viii. The 150-hour requirement
ix. Many states in the US now require Certified Public Accountants to have 150 semester hours of education to receive certification. This doesn’t necessarily mean that you need a master’s degree, although that certainly helps. You can also meet the requirement at the undergraduate level, or earn your bachelor’s degree and take a few courses at the graduate level.
x. Check with your state
xi. Remember, passing the Certified Public Accountant exam only means that you have passed a major milestone on the way to being licensed. From there, it’s between you and the state in which you want to practice and every state is different. Your best bet is to check with them directly.
xii. Now that you're well on your way to Certified Public Accountant, see what your life could look like once you receive your license.
So, after knowing all about Certified Public Accountants, lets know about practicing it with H4 visa
In order to do that, you need to get overcome these two common requirements:
a. Social Security Number
b. Fulfilling the experience requirement, since work supervised by US CPA is required.
1. Social Security Number (SSN)
The Certified Public Accountants is a regulated industry, and Social Security Number is the best way for the state board to track and regulate these licensees. Therefore, most states require their CPA exam candidates to submit their SSNs in the application form.
In some cases, the state board allows exemption to this rule if there is a valid reason. Some states request that you write a letter to explain the situation, while others may have an existing waiver form or an affidavit to fill in. You need to take the initiative to ask them and double check the procedure by email. Because of this, the issue of Social Security Number is likely less of a concern.
2. Work Experience
As part of the “3E” as specified in above paragraphs, candidates need to fulfill the experience requirement in order to get the license. 1 or 2 years of experience is required and this experience must be supervised and verified by an active U.S. CPA.
This makes things inconvenient for H4 visa holders because you are in the US, you are not allowed to work. One of the solutions is to select a state that allows verification instead of strictly supervision of experience. As of now, Montana and Washington are two examples. There are other states also, but they may not offer Social Security Number waivers.
For instance, if you used to work as a Chartered Accountant in India and you have someone who is a U.S. CPA, then you can ask him/her to verify your previous experience in India for you. The same works for Washington but this verifier must be a U.S. CPA licensee in good standing for at least 5 years.
Note: There is one Possible State named "North Dakota" where you don’t need SSN to apply for this state and once you pass the CPA exam, you can get your experience verified by a supervisor (or former one in your home country). This person does not need to be a U.S. CPA.
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