The Uniform CPA Examination is the examination that individuals must pass in order to qualify for licensure as Certified Public Accountants in any of the 55 U.S. jurisdictions (the 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, and the Commonwealth of Northern Mariana Islands).
The Uniform CPA Examination is one of the "Three Es" - Education, Examination, and Experience - that are required for licensure as a CPA. Consequently, passing the Examination is not, in itself, sufficient to meet requirements for licensure.
Licensure requirements vary by jurisdiction, and are described on the websites of all Boards of Accountancy. Links to Board of Accountancy websites are available at http://www.nasba.org/nasbaweb.nsf/exam
According to the CPA Examination Mission Statement, the purpose of the Examination 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."
The Uniform CPA Examination is provided on behalf of the Boards of Accountancy who have the ultimate licensing authority. The Examination is offered jointly by three organizations: NASBA (The National Association of State Boards of Accountancy), the AICPA (American Institute of Certified Public Accountants), and Prometric. The AICPA is responsible for developing and scoring the Examination, NASBA for the National Candidate Database, and Prometric for examination delivery at authorized test centers.
The Examination is offered at authorized test centers located throughout 54 U.S. jurisdictions. (The Examination is not yet offered in the 55th jurisdiction, the Commonwealth of Northern Mariana Islands)
The Examination will be offered in selected countries beginning in the third quarter of 2011.
No. The Examination is offered only in English
The Examination is offered 5 (and sometimes 6) days per week during two months of every quarter. (These periods are known as "testing windows.") Testing is available in January & February; April & May; July & August; and October & November. Testing is NOT available in: March, June, September, and December.
The Uniform CPA Examination consists of four sections:
Auditing and Attestation (AUD). This section covers knowledge of auditing procedures, generally accepted auditing standards and other standards related to attest engagements, ethics, and the skills needed to apply that knowledge.
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.
Financial Accounting and Reporting (FAR). This section covers knowledge of generally accepted accounting principles for business enterprises, not-for-profit organizations, and governmental entities, and the skills needed to apply that knowledge.
Regulation (REG). This section covers knowledge of federal taxation, ethics in tax practice, professional and legal responsibilities, and business law, and the skills needed to apply that knowledge.
No. As a rule, Boards of Accountancy permit eligible candidates to take any sections of the Examination in any testing window and in any order they wish. However, candidates may not take any single section twice in the same testing window. Candidates should check their board's requirements for the exact rules that will apply to them.
These requirements are determined by Boards of Accountancy. Once candidates pass one Examination section, most boards allow 18 months for passing the remaining three sections. Candidates should refer to the requirements of their boards for the rules that will apply to them.
The Uniform CPA Examination Content Specifications Outline provides information about Examination topics. To access the Content Specifications Outline, Click here.
The Examination is composed of testlets - groups of 24 or 30 multiple-choice questions, or condensed case studies known as task-based simulations (TBS). Auditing and Attestation (AUD) and Financial Accounting and Reporting (FAR) consist of three multiple-choice testlets and a single simulation testlet with seven task-based simulations. Regulation (REG) consists of three multiple-choice testlets and a single simulation testlet with six task-based simulations. Business Environment and Concepts (BEC) consists of three multiple-choice testlets and one simulation testlet with three written communication tasks.
The sample tests and tutorial available on line provide an introduction to the format, content and functionality of the Examination. Candidates are responsible for reviewing the Uniform CPA Examination tutorial and sample tests. Thorough familiarity with the examination’s functionality, format, and directions is required before candidates report to test centers. Failure to follow the directions provided in the tutorial and sample tests, including the directions on how to respond, may adversely affect candidate scores. To access the tutorial and sample tests, Click here.
Examination requirements vary from one jurisdiction to another. To obtain information about the requirements in effect in a particular jurisdiction, visit the Board of Accountancy website of the appropriate state or territory. Links to all Board of Accountancy websites are available at http://www.nasba.org/nasbaweb.nsf/exam
Fees also vary from one jurisdiction to another. For information about fees in a specific state or territory, visit the appropriate Board of Accountancy website. Links to all Board of Accountancy websites are available at http://www.nasba.org/nasbaweb.nsf/exam
Special accommodations under the Americans With Disabilities Act (ADA) may be requested as part of the application process. Information about the ADA request procedures are included in the application materials of each Board of Accountancy. Links to all accountancy board websites are available at http://www.nasba.org/nasbaweb.nsf/exam
Candidates must first decide on the jurisdiction to which they will apply. If uncertain about the jurisdiction, candidates may find it helpful to review the requirements of several Boards of Accountancy (access to board websites is available at http://www.nasba.org/nasbaweb.nsf/exam. After selecting the jurisdiction, candidates should obtain application materials, and submit completed applications as directed.
No. Candidates may take the Examination (and qualify as CPAs) only if they meet the requirements of a Board of Accountancy in one of the 55 jurisdictions.
No. The basic application process is the same for all candidates. Like U.S. applicants, international applicants must select the jurisdiction in which they wish to qualify and file an application with the Board of Accountancy in that jurisdiction. Any special instructions for international applicants are specified in board requirements.
Yes. The Uniform CPA Examination Candidate Bulletin provides detailed information about filing applications, scheduling test sessions, and taking the Examination. To access the Bulletin, Click here.
Policy decisions for the Uniform CPA Examination are made by the AICPA Board of Examiners after consultation with appropriate subcommittees and examination stakeholders.
The Uniform CPA Examination consists of four sections:
Auditing and Attestation (AUD)
Business Environment and Concepts (BEC)
Financial Accounting and Reporting (FAR)
The main content areas covered in each section are:
Auditing and Attestation (AUD)
Business Environment and Concepts (BEC)
Financial Accounting and Reporting (FAR)
A compete overview of the content areas covered on the CPA Exam is provided in the Content and Skill Specification Outlines (CSOs/SSOs).
Accounting and auditing pronouncements are eligible to be tested on the Uniform CPA Examination in the testing window beginning six months after a pronouncement's effective date, unless early application is permitted. When early application is permitted, the new pronouncement is eligible to be tested in the window beginning six months after the issuance date. In this case, both the old and new pronouncements may be tested until the old pronouncement is superseded.
Changes in the federal taxation area, the Internal Revenue Code and federal taxation regulations may be included in the testing window beginning six months after the change's effective date or enactment date, whichever is later.
For all other subjects covered in the Regulation (REG) and Business Environment and Concepts (BEC) sections, materials eligible to be tested include federal laws in the window beginning six months after their effective date, and uniform acts in the window beginning one year after their adoption by a simple majority of the jurisdictions.
The examination time allocated for each section is as follows:
NOTE: At Prometric test centers, the time allowed for each session is 30 minutes longer than examination time so that candidates may complete the sign-in process and survey without using up any of the time allocated for the examination. (This does NOT mean that examination time is extended for those who finish the sign-in process quickly. Examination time never changes.)
The Examination is composed of testlets - groups of 24 or 30 multiple-choice questions, or task-based simulations (condensed case studies).
No. While each examination covers materials from the Content Specifications Outline (CSO), the questions in each testlet are delivered randomly and do not follow the CSO order.
Task-based simulations are condensed case studies designed to test the knowledge and skills that are required of entry-level CPAs.
Accounting knowledge is tested through a variety of tasks, some of which require searching databases, completing written communication tasks, or working with spreadsheets and forms. The skills that simulations are intended to measure are: knowledge and understanding, application of the body of knowledge, and written communication.
For the research portions of simulations, candidates have access to some sections of the AICPA Professional Standards (in the Auditing and Attestation section), FASB Codification (in the Financial Accounting and Reporting section), and Tax Code (in the Regulation section).
Yes, the reference materials consisting of AICPA Professional Standards, FASB Codification, and the Tax Code are referred to collectively as "authoritative literature."
In written communication tasks, candidates are presented with a situation and instructed to write a letter or memorandum on a specific topic.
Written communication responses are scored on the basis of three criteria:
(1) organization (structure, ordering of ideas, linking of ideas one to another);
(2) development (presentation of supporting evidence); and
(3) expression (use of standard business English). Responses that do not address the assigned topic are not scored. Click here for more information about written communication responses.
In Auditing and Attestation (AUD), Financial Accounting and Reporting (FAR), and Regulation (REG), multiple-choice questions account for 60% and task-based simulations 40% of the score. In Business Environment and Concepts (BEC), multiple-choice questions account for 85% and written communications account for 15% of the score.
A multistage adaptive test delivery model is used for all multiple-choice testlets. This means that the first testlet presented to the candidate is at a level of moderate difficulty. Subsequent testlets - at the same or slightly more difficult level - are then chosen automatically based on the examinee's performance on the previous testlet.
The task-based simulations presented in FAR, AUD, and REG and the written communication tasks do not follow the adaptive model. They are not selected on the basis of prior performance.
Three multiple-choice question testlets are always presented first followed by the task-based simulations (AUD, FAR, REG) or the written communications tasks (BEC).
Within each testlet or task-based simulation, questions may be answered in any order. However, the sequence in which testlets are presented cannot be changed.
Candidates may review and revise their responses only as long as the testlet remains open. Once they complete the testlet and move on to the next, it is not possible to return.
Candidates take different, equivalent Examinations. The questions presented to candidates are drawn from a pool of test questions according to defined specifications. Although candidates take different tests, the specifications ensure that the results are comparable.
The test assembly method and expert reviews ensure that all tests meet content specifications. All test questions are classified according to their content and statistical properties before they are administered on an operational test. The moderate and more difficult testlets meet equivalent content specifications. Test administration software at the test center selects the difficulty level of multiple-choice testlets based on the candidate's performance.
Yes. Examination content will be kept current. Additional changes in test length, structure, and content may be made, subject to the same process as was used to propose and approve the current test format. Changes based on regular practice analyses are part of a critical ongoing program of continuous improvement.
Basic computer skills are needed to take the Examination. Candidates are expected to be familiar with the use of a mouse and keyboard and with basic spreadsheet and word processing functions. Candidates must also be able to use a four-function online calculator.
In order to respond to Examination questions, candidates may need to: (1) select a response from available options by clicking on a radio button; (2) perform standard financial calculations, utilizing a spreadsheet or four-function online calculator: (3) type a memorandum or letter in the written communication section of simulations; (3) perform an authoritative literature search in the research portion of simulations; (4) copy and paste text; (5) use scrollbars; (6) split the screen; (7) re-size or move windows or calculator.
No. The Examination uses word processing and spreadsheet applications that are similar but NOT identical to Word and Excel applications. Candidates are responsible for reviewing the Uniform CPA Examination tutorial and sample tests. Thorough familiarity with the Examination’s functionality, format, and directions is required before candidates report to test centers. Failure to follow the directions provided in the tutorial and sample test, including the directions on how to respond, might adversely affect candidate scores. Click here to access the tutorial and sample tests.
Yes. The Examination is available only in a computer-based format
The passing score is determined by the AICPA Board of Examiners (BOE). Like most other significant BOE decisions, the passing score decision is supported by a strong collaborative effort among the Examination partners. The standard-setting process followed for the computer-based test (CBT) was rigorous, and performed with input from the National Association of State Boards of Accountancy (NASBA), state boards of accountancy, and several consultant psychometricians.
In setting the passing score, the BOE considered many factors, including standard-setting study results, historical trends, any changes in CPA Examination content, and input from the academic community and the profession. The passing score is the basis of the pass or fail decision recommended to boards of accountancy on the advisory score report.
The passing score is 75 on a 0-99 scale. The scale of 0-99 does not represent "percent correct." A score of 75 indicates Examination performance reflecting a level of knowledge and skills that is sufficient for the protection of the public.
Scoring is fully automated for all Examination components except for the written communication tasks. Some written communication responses are scored by a network of readers (CPAs), while others are scored using an automated process. All scoring routines - whether automated or not - are verified at various stages of the scoring process.
The CPA Examination is NOT curved. Every candidate’s score is entirely independent of other candidates’ Examination results.
The CPA Examination is a criterion-referenced examination which means that it rests upon pre-determined standards. Every candidate’s performance is measured against established standards to determine whether the candidate has demonstrated the level of knowledge and skills that is represented by the passing score. Every candidate is judged against the same standards, and every score is an independent result.
The AICPA uses Item Response Theory (IRT) for the objective portion of the Examination. IRT is a well-established psychometric approach to scoring used by licensing and certification examinations that administer many different test forms. IRT scoring ensures that scores and pass or fail decisions based on scores from different Examination forms are comparable. Based on the large amounts of data that are collected in pretesting, the difficulty level as well as other statistical characteristics of Examination questions are known and taken into account in scoring.
IRT scoring takes into account differences in the difficulty of test questions in addition to other statistical properties. IRT scoring uses statistical properties of items, and the pattern of correct and incorrect responses, to calculate scores representing candidates' knowledge and skill levels. These scores are comparable because they have been calculated taking difficulty levels, as well as other item statistics, into consideration.
In Auditing and Attestation (AUD), Financial Accounting and Reporting (FAR), and Regulation (REG), multiple-choice questions account for 60% and task-based simulations for 40% of the score. In Business Environment and Concepts (BEC), multiple-choice questions account for 85% and written communication tasks account for 15% of the score.
For AUD, FAR, and REG, separate scores are produced for multiple-choice questions and task-based simulations. The two scores are then weighted according to the percentage value of each component, and added together to arrive at a total score. For BEC separate scores are produced for multiple-choice questions and written communication tasks and then added together according to the percentage value of each component for the final score. For more details on scoring, please refer to the paper, How is the CPA Exam Scored?
No. Responses to pretest questions are never taken into account in calculating candidate scores. Pretest questions are included in every Examination (they may be multiple-choice questions, task-based simulations, or written communication tasks) only for the purpose of collecting data. The data are needed to assess the quality of the questions, and to collect scoring information for later use when the questions become operational items.
No. All candidate results are scored using the same process and method to ensure uniformity and the validity of the pass or fail decision. In the rare instances when serious technical problems occur during testing, candidates may be offered a free retest.
Both your score and Candidate Performance Report information assess your Examination performance; however, they present different views of your performance and are separately derived.
Your score – the official result – was obtained using Item Response Theory (IRT)* scoring and was calculated as a whole, taking into account all of your responses**.
Your Candidate Performance Report information was derived separately. Performance results by content area (the first table on your Candidate Performance Report) are calculated using responses to the multiple-choice questions only. Performance results by item type (the second table on your Candidate Performance Report) provide an overview of performance for the multiple choice questions, simulations (AUD, REG FAR) or written communication (BEC). Note that your Candidate Performance Report is provided for your information only, and has no official bearing on your score.
Since the purpose of the Candidate Performance Report is to help you identify the performance areas you should improve in order to pass, your performance is compared to those who have “just passed” – candidates with scores between 75 and 80. Further, the relative performance scale (stronger, comparable, weaker) on the Candidate Performance Report are derived from the range between one-half of one standard deviation above and below the average score of candidates who earned scores between 75 and 80. Performance within the range is considered "comparable," below the range "weaker," and above the range "stronger."
Your score is so close to passing that your performance profile is very similar to the performance of candidates that received a score of 75-80. The fact that you did not pass indicates that there was a weakness in your performance. One possibility is that, you performed poorly in the task-based simulation or written communication sections, which are not reflected in the content area table. Also, keep in mind that candidates who received a score of 75-80 may have done better in some categories which compensated for a weaknesses in others.
It is always best to study everything. If you only study the areas where you are weak, you might do better on those areas, but worse on others when you re-test.
In the testing world, the term “standard error of measurement” describes the imprecision inherent in all performance assessments. An individual's examination performance could differ from one day to the next, based on such factors as study strategy for a given topic. On the CPA Exam the reported score should be viewed as a general indication of performance, recognizing that results may vary if the same examination were given to the same individual several times.
What is score review?
Score review is a service to candidates offering additional assurance that operational quality controls in the scoring process were complete and the scores are accurate. Score review is NOT a re-grading of the examination, or an opportunity to find additional points, review content, or to have alternate responses considered. It is simply an independent verification of a candidate's Uniform CPA Examination score.
The verification for the multiple choice questions and the task-based simulations involves making certain that the approved answer key was used and that it was applied correctly; the verification for the written communication tasks involves making certain that each of the submitted responses was scored.
Why should I request a score review?
If you would like to request that your score be validated by the AICPA, you may request a score review. It might be helpful for you to know that all reported scores are subject to routine quality controls and are, in fact, scored twice before they are reported to state boards. As a result, the likelihood of a score change following score review is exceedingly small, or less than 1 percent of all requested score reviews since the inception of the computer based test.
How and when should I request a score review?
Contact your board of accountancy, or its designated agent, for instructions on requesting a score review, paying the required fee, and meeting the score review request deadline. If you apply after the deadline date, your request will not be processed. The option to apply for a score review is available only for a short period of time after your score has been reported to you.
Each score review cycle begins at the start of the following testing window. For example, the score review cycle for scores reported for the January/February testing window begins at the start of the April/May testing window. Each score review cycle is for scores reported for the most recent testing window only. For example, the April/May review cycle is for scores reported for the January/February testing window only.
How much is the score review fee?
Score review fees may vary from jurisdiction to jurisdiction. Contact your board of accountancy, or its designee, for the fee that applies to you.
How will the score review results be communicated?
After your request is submitted by NASBA to the AICPA, and the AICPA reviews your score, the AICPA will report the result through NASBA to your board of accountancy, or its designee. NASBA, the board, or its designee, will transmit the result to you.
What is an appeal?
In the jurisdictions that allow appeals, the appeal process provides Uniform CPA Examination candidates with the opportunity to appeal failing scores.
Where available, the appeal option enables candidates to view the multiple choice test questions or objective simulation problems that they answered incorrectly together with their responses, and to submit comments online. The appeal does not include the written communication.
The confidentiality of the examination requires that such viewing sessions take place only in authorized locations, under highly secure conditions, and in the presence of a representative of the candidate's board of accountancy or its designee.
Why should I consider requesting an appeal?
You should consider requesting an appeal only if you want to review your incorrect responses because you believe that there is a question or simulation problem that you would like to challenge.
When you review the questions or simulation problems that you have answered incorrectly, you may decide to challenge the validity of one or more items. If you decide to do so, you must be prepared to present a cogent, vigorous, and compelling defense of your incorrect responses.
Please note that you will not be able to submit new responses during an appeal. However, you will have the opportunity to challenge question(s) or simulation problem(s) and defend the response(s) you provided at the examination.
How do I request an appeal?
Contact your board of accountancy, or its designee, to determine whether the appeal option is available in your jurisdiction and, if it is, to obtain detailed instructions. In order to qualify for an appeal, you will be required to submit a formal request, obtain your board's approval, and pay the required fee. Note that the option to apply for an appeal is available only for a short period of time after your score has been reported to you. If you apply for an appeal after the deadline date, your request will not be processed.
What is the fee structure for an appeal?
You must pay the appeal fee when you submit the request to your board. Subsequently, you will be charged a separate fee for each item (question or simulation problem) that you decide to challenge. Contact your board, or its designee, for the exact amounts of these fees.
How will my appeal be processed and the result be communicated to me?
If your board of accountancy determines that you qualify for an appeal, the Board will submit your request to the AICPA through NASBA.
The board, or its designee, will schedule your viewing session for you. Your online comments during this session will be transmitted to the AICPA through NASBA.
After the session, the AICPA will review your responses on the section you are appealing, consider the online comments you submitted, verify your score, and forward the result to NASBA. ( Note: You will not receive detailed information about the question(s) you challenge because of the need to preserve the confidentiality of examination content.) NASBA will report the result to your Board, or its designee, and the result will be transmitted to you.
IMA® is one of the largest and most respected associations focused exclusively on advancing the management accounting profession. IMA offers its members exclusive access to the CMA program. We are committed to helping you – and our network of more than 70,000 members – to expand your professional skills, better manage your organization, and enhance your career.
ICMA® (Institute of Certified Management Accountants) is the certification affiliate of IMA. ICMA is responsible for developing, administering, and grading the CMA exam; establishing the policies and procedures for the CMA program; and for ensuring the program’s overall integrity. The ICMA Board of Regents is responsible for setting the policies, and the ICMA staff is responsible for operations.
The CMA exams are computer-based and administered at hundreds of testing facilities worldwide. With three testing windows each year, you can sit for an exam at a time and place convenient for you.
If you are enrolled in the CMA program and are ready to sit for the exam, here are the steps:
1. Register for the exam
2. Receive confirmation of your registration which provides your authorization number(s), testing window(s), and the instructions for candidates.
3. Schedule your exam appointment(s) with Prometric, our testing partner www.prometric.com.
4. Appear for your scheduled exam appointment(s) with the required identification documents.
To locate a Prometric Testing Center and schedule exam appointments, visit www.prometric.com/ICMA.
2014 PASS RATES
Although they are independent of the activities they audit, internal auditors are integral to the organization and provide ongoing monitoring and assessment of all activities. On the contrary, external auditors are independent of the organization, and provide an annual opinion on the financial statements. The work of the internal and external auditors should be coordinated for optimal effectiveness and efficiency.
Internal and external auditors have mutual interests regarding the effectiveness of internal financial controls. Both professions adhere to codes of ethics and professional standards set by their respective professional associations. There are, however, major differences with regard to their relationships to the organization, and to their scope of work and objectives.
Internal auditors are part of the organization. Their objectives are determined by professional standards, the board, and management. Their primary clients are management and the board. External auditors are not part of the organization, but are engaged by it. Their objectives are set primarily by statute and their primary client — the board of directors.
The internal auditor's scope of work is comprehensive. It serves the organization by helping it accomplish its objectives, and improving operations, risk management, internal controls, and governance processes. Concerned with all aspects of the organization — both financial and non-financial — the internal auditors focus on future events as a result of their continuous review and evaluation of controls and processes. They also are concerned with the prevention of fraud in any form.
The primary mission of external auditors is to provide an independent opinion on the organization's financial statements, annually. Their approach is historical in nature, as they assess whether the statements conform with generally accepted accounting principles, whether they fairly present the financial position of the organization, whether the results of operations for a given period of time are accurately represented, and whether the financial statements have been materially affected.
The internal and external auditors should meet periodically to discuss common interests; benefit from their complementary skills, areas of expertise, and perspectives; gain understanding of each other's scope of work and methods; discuss audit coverage and scheduling to minimize redundancies; provide access to reports, programs and working papers; and jointly assess areas of risk. In fulfilling its oversight responsibilities for assurance, the board should require coordination of internal and external audit work to increase economy, efficiency, and effectiveness of the overall audit process.
INDEPENDENCE: The audit charter should establish independence of the internal audit activity by the dual reporting relationship to management and the organization's most senior oversight group. Specifically, the CAE should report to executive management for assistance in establishing direction, support, and administrative interface; and typically to the audit committee for strategic direction, reinforcement, and accountability. The internal auditors should have access to records and personnel as necessary, and be allowed to employ appropriate probing techniques without impediment.
OBJECTIVITY: To maintain objectivity, internal auditors should have no personal or professional involvement with or allegiance to the area being audited; and should maintain an un-biased and impartial mindset in regard to all engagements.
Independence and objectivity are two critical components of an effective internal audit activity.
"The internal auditor occupies a unique position. He or she is employed by the management but is also expected to review the conduct of management which can create significant tension since the internal auditor's independence from management is necessary for the auditor to objectively assess the management's action, but the internal auditor's dependence on the management for employment is very clear."
Therefore, the internal audit activity should have a mandate through a written audit charter that establishes its purpose, authority, and responsibility to support its independence and objectivity within an organization.
Internal auditors are independent when they render impartial and unbiased judgment in the conduct of their engagement. To ensure this independence, best practices suggest the CAE should report directly to the audit committee or its equivalent. For day-to-day administrative purposes, the CAE should report to the most senior executive (i.e., the chief executive officer [CEO]) of the organization. The CAE should have direct communication with the audit committee, which reinforces the organizational status of internal auditing, enables full support and unrestricted access to organizational resources, and ensures that there is no impairment to independence. This provides sufficient authority to ensure broad audit coverage, adequate consideration of engagement communications, and appropriate action on recommendations. Independence is further enhanced if the CAE reports to the board through its audit committee on the planning, execution, and results of audit activities. The audit committee is also responsible for the appointment, removal, and fixation of compensation of the CAE. The committee should safeguard the independence by approving the internal audit charter and mandate periodically.
Objectivity is a mental attitude that internal auditors should maintain while performing engagements. The internal auditor should have an impartial, unbiased attitude and avoid conflict-of-interest situations, as that would prejudice his/her ability to perform the duties objectively. The results of internal audit work should be reviewed before they are released in order to provide a reasonable assurance that the work has been performed objectively.
Internal auditors should not assume any operational responsibility. Objectivity can be presumed to be impaired when internal auditors perform an assurance review of any activity for which they had any authority or responsibility within the past year or a period significant enough to influence their judgment or opinion. Internal auditors should not accept gifts or favors from others such as employees, clients, or business associates.
The internal auditors should adopt a policy that endorses their commitment to abiding by the Code of Ethics, avoiding conflicts of interest, disclosing any activity that could result in a possible conflict of interest. Staff assignment of internal auditors should be rotated periodically whenever it is practicable.
References: The IIA International Professional Practices Framework; 20 Questions Directors should ask about Internal Audit by Fraser and Lindsa; ECIIA Position Paper on Internal Auditing in Europe; and Practice Advisories 1000-1,1100-1,1110-1,1120-1.
Effective prioritization involves staying in sync with the organization's risk priorities and taking a risk-based approach to internal audit planning. By continuously monitoring organizational changes that might alter the plan, the CAE should be well equipped and positioned to make informed and educated recommendations to management and the board on the most effective use of internal audit resources.
Given the potential size of the audit universe, the related scope of work, and the need for efficient use of limited internal audit resources, it is critical to prioritize and plan audit engagements based on an annual risk assessment that is viewed from the perspective of organizational goals and objectives.
Most models used by CAEs for prioritization of their audit work take into consideration such factors as financial impact, asset liquidity, management competence, quality of internal controls, degree of change or stability, time of last audit engagement, complexity, and strategic risks. In conducting audit engagements, methods and techniques for testing and validating exposures should consider the risk materiality and likelihood of occurrence.
Although the annual audit plan's subject areas will vary as a result of the internal audit activity's risk assessment and related drivers, it should always address two critical areas:
Once a risk-based audit plan is developed, the CAE should communicate the internal audit activity's plans, resource requirements, and related limitations to senior management and to the appropriate governing body for review and approval.
Changes in management direction, objectives, emphasis, and focus should be reflected by changes to the audit universe and related audit plan, which might require frequent (quarterly) updating. All significant changes should be submitted to the oversight entities for review and approval.
Ultimately, the audit plan should address and support the most effective use of internal audit resources. Aligning internal audit activities with the organization's operational and strategic goals and objectives through a risk assessment will ensure efficient utilization of internal audit resources while providing management with valuable insights on risk management activities.
References: PA 2010-1: Planning; PA 2010-2: Linking the Audit Plan to Risk and Exposures; PA 2020-1: Communication and Approval; PA 2120.A1-1: Assessing and Reporting on Control Processes
The IIA believes that:
The responsibility for establishing and overseeing the scope and performance of internal auditing cannot be outsourced.
Internal auditing is the responsibility of an organization's board — or equivalent governing body — and senior management.
Internal auditing should be managed within the organization by a chief audit executive who is accountable to the organization's board and chief executive officer.
If an internal audit activity is outsourced, the chief audit executive within the organization should be responsible for overseeing the service contract and the overall quality assurance of these activities, reporting to senior management and the board regarding internal audit activities, and following up on engagement results.
Internal auditors may be internal employees, external resources, or a combination thereof based on the specific needs of the organization.
Internal auditing should be performed by competent professionals in full compliance with the International Standards for the Professional Practice of Internal Auditing (Standards) and Code of Ethics.
Whether an organization is required to have an internal audit activity or not depends on the respective regulatory requirements that govern the organization. In the United States, the New York Stock Exchange (NYSE) requires publicly traded companies to "maintain an internal audit function to provide management and the audit committee with ongoing assessments of the company's risk management processes and system of internal controls." This requirement was effective October 31, 2004. Stock exchanges throughout the world have their own norms governing such companies, and some have implemented requirements similar to those of the NYSE.
Although private companies — those not publicly listed — are not required to have internal auditing, many of them have established an internal audit activity as one of its core organizational governance elements.
A well functioning, adequately resourced internal audit activity that works collaboratively with management and the board is a key resource in identifying risks and recommending improvements to an organization's governance, risk management, internal controls, and operations. The internal auditors' unique perspective of independence and objectivity, knowledge of the organization, and understanding and application of sound consulting and audit principles make them ideal for this role.
Helpful IIA References: Guidance on "Internal Auditing's Role in Section 302 and 404 of the US Sarbanes Oxley Act of 2002" "Establishing an Internal Audit Shop" "The Role of Internal Audit in Corporate Governance and Management"
CAEs must have strong skills in business processes and management, leadership, and communication to effectively reinforce an organization's commitment to strong internal controls. They must focus on quality, improvement effectiveness, and efficiency; and model independence, objectivity, ethics, integrity, and professionalism.
In order to perform proficiently in the role of chief audit executive, an internal audit practitioner must possess many admirable personal traits and professional competencies. Below are some of the more critical attributes and skills necessary for a CAE to be effective in today's global business, technology, and audit environments.
A broad range of skills and expertise and ongoing professional development are critical to the formation and maintenance of an effective internal audit activity. Essential elements include in-depth knowledge of the organization's industry and internal audit standards and best practices; technical understanding and expertise; knowledge of skills for implementing and improving processes in both financial and operational areas; strong communication and presentation skills; and professional certification, e.g. CIA.
Although some co-sourcing and outsourcing might be necessary when unique competencies and specialty skills are not affordable or available, the oversight and responsibility for the internal audit activity cannot be outsourced.
Today's internal auditors must provide to their audit committees explicit assurance on organizational governance, as well as meet ever-increasing demands of management and other stakeholders. They must excel as internal control and risk management experts to ensure the controls over key systems and business processes are robust and effective. To meet these high expectations, a solid staffing strategy is essential. It is the responsibility of the CAE to establish an effective program for selecting and developing the internal audit team.
The skill mix, depth, and size of the audit team should be determined by the services expected by the audit committee and management in order to meet organizational needs. The resulting audit plan should be based on an assessment and ranking of risks, critical systems, and processes across the organization, and should consider the organization's long-term business objectives, expansion plans, and growth strategies; as well as short-term changes in the control environment such as M&A activities, major system implementations, and reengineering of business processes.
The maturity of the control environment, level of management accountability, and extent to which the organization depends on internal auditing to drive improvements will affect the resourcing outcome. Benchmarking against comparable organizations can provide useful insights into appropriate staffing.
When staffing an internal audit activity, management s options include:
NOTE: The IIA believes the internal audit activity should never be fully outsourced, but should be managed from within the organization, preferably by a competent CAE.
The staffing option taken should result in an internal audit team that possesses the skills necessary to meet the group's objectives. Ideally, the audit activity should comprise individuals with diverse backgrounds, skill sets, and experience to provide adequate control assurance to support the business on a broad range of risk and internal control matters.
Increasingly, internal audit activities are performed by multi-disciplinary teams that include engineers, accountants, management graduates, and even environmental specialists who reflect a broad range of today s assurance needs. Also, information technology audit experts are a core component of modern-day internal audit activities. It very well might not be possible to accommodate all the requisite technical skills in-house. Therefore, the CAE should be empowered to obtain assistance and support from experts outside the organization as needed.
Control self-assessment, facilitation, and risk and internal-control training are increasingly falling under the purview of internal auditors. As such, to be their most effective, they must demonstrate:
An annual review of the staffing strategy by the CAE should be based on defined parameters such as the audit committee's assurance needs, management's expectations, business growth and strategies, dispersion of operations, achievement of audit objectives, compliance to regulations, and staff turnover. The CAE should assess the skills and requirements of team members and promote continuing professional development to maintain professional designations and enhance knowledge, skills, and competencies in all relevant areas.
Not having adequate and competent staff in the internal audit activity is a risk that exposes the organization to inadequate evaluation of the effectiveness of risk management, control, and governance processes.
Finally, The IIA's Certified Internal Auditor® (CIA®) is the only globally accepted certification for internal auditors and remains the standard by which individuals demonstrate their competence and professionalism in the internal audit field. The IIA also offers several specialty certification programs, including Certification in Control Self-Assessment® (CCSA®); Certified Government Auditing Professional® (CGAP®); and Certified Financial Services Auditor® (CFSA®). ISACA offers the Certified Information Systems Auditor (CISA) certification; the Association of Certified Fraud Examiners offers the Certified Fraud Examiner (CFE) certification; and the Board of Environmental, Health and Safety Auditor Certifications (BEAC) offer the Certified Professional Environmental Auditor (CPEA).
References: 20 Questions Directors should ask about Internal Audit, The IIA Research Foundation; Internal Auditor, Oct 03, Staffing today's internal audit function: Audit executives need a realistic strategy for obtaining top talent to handle growing demands by Paul McDonald; The International Professional Practices Framework, January 2004, The IIA Research Foundation; Guide to Internal Audit — Frequently Asked Questions about the NYSE Requirements; Developing an Effective Internal Audit Function, Protiviti, 2004
ERM is a structured and coordinated, entity-wide governance approach to identify, quantify, respond to, and monitor the consequences of potential events. Implemented by management, ERM is evaluated by the internal auditors for effectiveness and efficiency.
The practice of managing risk, which is a key element of governance, traditionally has been within individual business units and/or parts of business units; and to a lesser extent across the organization. ERM takes a broader portfolio approach and deals with risks and opportunities affecting the creation or preservation of organizational value.
ERMis defined as a process, effected by an entity's board of directors, management, and other personnel; applied in a strategy setting and across the enterprise; designed to identify potential events that may affect the entity; and manage risk to be within its risk appetite to provide reasonable assurance regarding the achievement of entity objectives.
Everyone in the organization plays a role in ensuring successful enterprise-wide risk management but management bears the primary responsibility for identifying and managing risk and for implementing ERM in a structured, consistent, and coordinated approach. The board, or its equivalent, has an overall responsibility for monitoring the risks and for gaining assurance that they are managed at an acceptable level. Internal auditors, in both their assurance and consulting roles, contribute to the management of risk in a variety of ways. They play a key role in evaluating the effectiveness of — and recommending improvements to — ERM. IIA Standards specify that the scope of internal auditing should encompass risk management and control systems.
The internal auditors' varied roles in and emphasis on ERM are dependent on the maturity of the ERM process in the organization. The safeguard that should be put in place before the internal auditors carry out their ERM-related roles is to ensure that the entire organization fully understands management's responsibility for risk management.
The internal auditors' core ERM role is to provide objective assurance to the board and senior management on the effectiveness of the ERM activities in helping ensure key business risks are managed appropriately and the system of internal control is operating effectively.
Internal auditing's key ERM-related roles and assurance activities include:
Additional legitimate internal audit roles and consulting activities may help to protect the internal auditors independence and objectivity when accompanied by adequate safeguards. They include:
The roles the internal auditors should NOT undertake are:
References: Executive Summary of ERM Integrated Framework, issued by COSO - Sept 2004; IIA Position Paper — The Role of Internal Audit in Enterprise-wide Risk Management, Sept 2004; IIA UK: "Position Statement on Risk-Based Internal Auditing"
Performed by professionals with an in-depth understanding of the business culture, systems, and processes, the internal audit activity provides assurance that internal controls in place are adequate to mitigate the risks, governance processes are effective and efficient, and organizational goals and objectives are met.
The IIA has developed the globally accepted definition of internal auditing as follows:
Internal Auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.
Independence is established by the organizational and reporting structure. Objectivity is achieved by an appropriate mind-set. The internal audit activity evaluates risk exposures relating to the organization's governance, operations and information systems, in relation to:
Based on the results of the risk assessment, the internal auditors evaluate the adequacy and effectiveness of how risks are identified and managed in the above areas. They also assess other aspects such as ethics and values within the organization, performance management, communication of risk and control information within the organization in order to facilitate a good governance process.
The internal auditors are expected to provide recommendations for improvement in those areas where opportunities or deficiencies are identified. While management is responsible for internal controls, the internal audit activity provides assurance to management and the audit committee that internal controls are effective and working as intended. The internal audit activity is led by the chief audit executive (CAE). The CAE delineates the scope of activities, authority, and independence for internal auditing in a written charter that is approved by the audit committee.
An effective internal audit activity is a valuable resource for management and the board or its equivalent, and the audit committee due to its understanding of the organization and its culture, operations, and risk profile. The objectivity, skills, and knowledge of competent internal auditors can significantly add value to an organization's internal control, risk management, and governance processes. Similarly, an effective internal audit activity can provide assurance to other stakeholders such as regulators, employees, providers of finance, and shareholders.
As the primary body for the internal audit profession, The IIA maintains the International Standards for the Professional Practice of Internal Auditing (Standards) and the profession's Code of Ethics. IIA members are required to adhere to the Standards and Code of Ethics.
References: The International Professional Practices Framework, The IIA Research Foundation, January 2004
Internal auditors support management's efforts to establish a culture that embraces ethics, honesty, and integrity. They assist management with the evaluation of internal controls used to detect or mitigate fraud, evaluate the organization's assessment of fraud risk, and are involved in any fraud investigations.
Although it is management's responsibility to design internal controls to prevent, detect, and mitigate fraud, the internal auditors are the appropriate resource for assessing the effectiveness of what management has implemented. Therefore, depending on directives from management, the board, audit committee, or other governing body, the internal auditors might play a variety of consulting, assurance, collaborative, advisory, oversight, and investigative roles in an organization's fraud management process.
Competent professional internal auditors are highly proficient in techniques used to evaluate internal controls. That proficiency, coupled with their understanding of the indicators of fraud, enables them to assess an organization's fraud risks and advise management of the necessary steps to take when indicators are present.
Establishing a culture of integrity is a critical component of fraud control. Executive management must set the tone at the top and model the highest level of integrity. The internal auditors may advise management on methods to ensure integrity and may become involved in communicating or interpreting those methods. They also may help develop training related to integrity policies and fraud.
As a part of their assurance activities, internal auditors watch for potential fraud risks, assess the adequacy of related controls, and make recommendations for improvement. They also can help benchmark statistics related to the probability of occurrence and consequences of fraud.
Because the internal auditors are exposed to key processes throughout the organization and have open lines of communication with the executive board and staff, they are able to play an important role in fraud detection. In many organizations, the chief audit executive (CAE) is responsible for responding to issues raised on the ethics hotline or through another process that may lead to detection of fraud.
When developing their annual audit plan, the internal auditors consider the organization's assessment of fraud risk, and periodically might make assessments of management's fraud detection capabilities. They design tests that use audit techniques like data mining to ensure the controls in place are effective.
Internal audit skills relate to gathering evidence, analysing the breakdown in controls that could enable a fraud, and making recommendations for improvement. And reporting directly to the board or governing body provides the internal auditors with a level of independence and objectivity necessary for them to undertake investigations of a sensitive nature.
Although the internal auditors may either have a direct role in investigating fraud incidents, or act as a resource to those responsible, they generally are not expected to have the expertise of those whose primary responsibility is detecting and investigating fraud.
When the internal auditors have the primary responsibility for fraud they must have the key competencies for this work — typically obtained through specialized training and related experiences. They also may be certified as fraud or forensic investigators.
References: International Professional Practices Framework: Practice Advisories on Fraud
The internal auditors provide to the audit committee objective assessment on the state of the organization's risk, control, governance, and monitoring activities.
The internal auditors should regularly report to the audit committee significant risk exposures and control issues, corporate governance issues, and other requested information. Additionally, the internal auditors can act as an advisor and provide critical services that are integrated into each of the audit committee's activities and processes. To accomplish this, a strong working relationship, mutual trust, and robust dialogue between the internal auditors and the audit committee is essential.
The internal auditors should provide the following to the audit committee on a regular basis:
Further references: Practice Advisory 2060-2: Relationship with Audit the Committee, February 12, 2004
To ensure transparency and thwart collusion and conflicts of interest, best practice indicates that the internal audit activity should have a dual reporting relationship. The CAE should report to executive management for assistance in establishing direction, support, and administrative interface; and to the organization's most senior oversight group — typically, the audit committee — for strategic direction, reinforcement, and accountability.
Appropriate reporting relationships are absolutely critical if internal auditing is to achieve the independence, objectivity, and organizational stature necessary to fulfill its obligations and mandate to effectively assess internal controls, risk management, and governance. As the independent eyes and ears of the audit committee or equivalent, it is important that the internal audit activity is structurally independent, and free from coercion by management. The requirement for the CAE to be truly independent is endorsed globally, and companies are working to bring reporting lines into line with The IIA s International Standards for the Professional Practice of Internal Auditing (Standards).
The Standards require that the CAE report to a level within the organization that allows the internal audit activity to fulfill its responsibilities. To achieve necessary independence, best practices suggest the CAE should report directly to the audit committee or its equivalent. For day-to-day administrative purposes, the CAE should report to the most senior executive (i.e., the chief executive officer [CEO]) of the organization.
According to The IIA's 2004 GAIN survey, 70 percent of CAEs report to the audit committee, an increase from 53 percent in the prior year. As the internal audit profession's role as one of the pillars of good corporate governance is increasingly understood, the trend of the CAE reporting to the audit committee for direction and accountability, and to the CEO for administrative interface and support, is increasingly becoming the norm.
Direction and Accountability Reporting Line
This reporting line for the internal audit activity is the ultimate source of its independence and authority. As such, best practice recommends that the CAE directly report to the audit committee, board of directors, or other appropriate governing authority. When this is achieved, the governing authority:
Administrative Reporting Line
Administrative reporting is the relationship within the organization's management structure that facilitates day-to-day operations of the internal audit activity and provides appropriate interface and support for effectiveness. Administrative reporting typically includes:
Exclusively reporting to management might appear to work well when companies are prosperous and have no issues. This reporting line quickly becomes untenable, however, when there are serious issues that need to be elevated to the audit committee or other governing body. If a dual reporting structure is not in place, management may be able to unduly influence the audit plan, scope, and whether issues are reported appropriately. This presents a serious conflict, limits the scope, and compromises the effectiveness of the internal audit activity.
Any reporting relationship that impedes independence and effective operations of internal auditing should be viewed as a serious scope limitation, and should be brought to the attention of the board, the audit committee, or equivalent.
References: Practice Advisory 1110-2; Auditwire Volume 25, IIA Inc.
As part of The IIA's International Professional Practices Framework (IPPF), the International Standards for the Professional Practice of Internal Auditing (Standards) outline the tenets of the internal audit profession. Other applicable guidance, pronouncements, and regulations also may have an impact on how internal auditing is performed; and may provide clarification and delineation of acceptable and recommended processes.
The IIA is the internal audit profession's acknowledged leader, recognized authority, and principal educator. Although the practice of internal auditing is not regulated, The IIA provides comprehensive guidance for the profession through its International Professional Practices Framework (IPPF). The IPPF comprises the official definition of internal auditing, the International Standards for the Professional Practice of Internal Auditing (Standards), the Code of Ethics, Practice Advisories, Position Papersm and Practice Guides, developmental and practice aids. Conformance with the Standards and the Code of Ethics is mandatory for all members of The IIA and Certified Internal Auditors (CIAs). The IIA also provides guidance on assessing, maintaining, and improving quality within the internal audit activity.
Public sector auditors are required to comply with specific governmental guidelines. For example, in the U.S., government audits are performed in accordance with the General Accounting Office's Government Auditing Standards (the Yellow Book); government auditors in the United Kingdom comply with the HM Treasury's Government Internal Audit Standards; and in Canada, government auditors perform in accordance with the Office of the Auditor General's Comprehensive Auditing Manual. In addition, many public sector audit groups are members of the International Organization of Supreme Audit Institutions (INTOSAI), and thus adhere to the auditing standards promulgated by INTOSAI.
Several professional organizations offer certification programs. The IIA s Certified Internal Auditor® (CIA®) is the only globally accepted certification for internal auditors and remains the standard by which individuals demonstrate their competence and professionalism in the internal audit field. The IIA also offers several specialty certification programs, including Certification in Control Self-Assessment® (CCSA®); Certified Government Auditing Professional® (CGAP®); and Certified Financial Services Auditor® (CFSA®). ISACA offers the Certified Information Systems Auditor (CISA) certification; the Association of Certified Fraud Examiners offers the Certified Fraud Examiner (CFE) certification; and the Board of Environmental, Health and Safety Auditor Certifications (BEAC) offer the Certified Professional Environmental Auditor (CPEA).
The audit committee of the board of directors and the internal auditors are interdependent and should be mutually accessible, with the internal auditors providing objective opinions, information, support, and education to the audit committee; and the audit committee providing validation and oversight to the internal auditors.
The IIA recognizes that audit committees and internal auditors have interlocking goals. A strong working relationship is essential for each to fulfill its responsibilities to senior management, the greater board of directors, shareholders, and other stakeholders. Appropriate reporting lines for the internal auditors are critical if they are to achieve their requisite independence, objectivity, and organizational stature needed to effectively assess the organization's internal control, risk management, and governance processes. Best practice recommends that, to achieve necessary independence, the internal auditor should report directly to the audit committee or its equivalent.
Five activities are integral to an effective relationship between the audit committee and the internal auditors. The CAE should:
A direct channel of communication between the CAE and the audit committee is essential. This typically includes provisions for the CAE to have access to the audit committee chair and to attend audit committee meetings to present the audit plan, report on the results of major audits and key audit findings or other matters, and discuss internal auditing's observations on risk and internal controls within the organization. The relationship can further be strengthened through explicitly allowing out-of-session communications between the CAE and the audit committee chairperson, particularly in the case of critical circumstances such as serious fraud and other material risk events.
The CAE and the audit committee should meet at regular frequencies without management and the external auditors present. These discussions should focus on assurance that internal auditing's scope is not being limited, concerns the CAE might have about a member of senior management, any necessary administrative matters, and other items either party wishes to bring to the table.
Further references: Practice Advisory 2060-2: Relationship with Audit the Committee, Dec. 3, 2002; Practice Advisory 1110-2: Chief Audit Executive (CAE) Reporting Lines, Dec. 3, 2002
The audit committee, or other appropriate independent oversight subset of the board of directors, the key oversight group of the internal auditors, is critical to ensuring the organization has strong and effective processes relating to independence, internal control, risk management, compliance, ethics, and financial disclosures.
An audit committee typically serves as the liaison among the board of directors, external auditors, internal auditors, and financial management. Generally, the audit committee's purpose is to assist the board in overseeing the:
To foster and encourage this type of oversight, The IIA recommends that every public company have an audit committee organized as a standing subcommittee of the board of directors. This is also recommended for other types of organizations, including not-for-profit and governmental entities.
The role of the audit committee is expanding globally to include oversight of whistle-blowing mechanisms, enterprise risk management, related party transactions, and interaction with the entity's legal function. It serves to improve the board's oversight of company management by allowing for:
References: Practice Advisory 2060-2, Relationship with the Audit Committee; Internal Auditing and the Audit Committee: Working Together Toward Common Goals; IIA Article; Position Paper on Internal Auditing in Europe (ECIIA); Basel Committee: Regarding Audit Committee Charter
A cornerstone of strong governance, internal auditing bridges the gap between management and the board, assesses the ethical climate and the effectiveness and efficiency of operations, and serves as an organization's safety net for compliance with rules, regulations, and overall best business practices.
Management is responsible for establishing and maintaining a system of internal controls within an organization. Internal controls are those structures, activities, processes, and systems that help management effectively mitigate the risks to an organization's achievement of objectives. Management is charged with this responsibility on behalf of the organization's stakeholders and is held accountable for this responsibility by an oversight body (e.g. board of directors, audit committee, elected representatives).
Organizations that do not have an internal audit function are therefore missing out on the valuable benefits that professional internal auditors provide. In addition, they are also running the risk of relying on management who may not be in the best position to provide skilled, independent, and objective opinions on internal controls.
Some organizations assign internal auditing on a part-time basis to an existing staff member who has other responsibilities. When this occurs, the person does not have the professional internal audit training or experience necessary for optimal effectiveness. Such organizations run the risk of poorly performed audits and reviews, and this individual, who may be relatively junior in the organization, may lack the organizational status and stature to achieve positive results. In this environment, high-risk processes may not be identified for reviews and serious internal control deficiencies may be overlooked.
A primary lesson from the financial failure and collapse of numerous organizations is that good governance, risk management, and internal controls are essential to corporate success and longevity. Because of its unique and objective perspective, in-depth organizational knowledge, and application of sound audit and consulting principles, a well-functioning, fully resourced and independent internal audit activity is well positioned to provide valuable support and assurance to an organization and its oversight entities.
An enrolled agent is a person who has earned the privilege of representing taxpayers before the Internal Revenue Service. Enrolled agents, like attorneys and certified public accountants (CPAs), are generally unrestricted as to which taxpayers they can represent, what types of tax matters they can handle, and which IRS offices they can represent clients before.
Follow these steps to become an EA:
*Certain IRS employees, by virtue of past technical experience, are exempt from the exam requirement.
Review the Candidate Information Bulletin (pdf) to get started.
There is a $109 fee paid at the time of appointment scheduling. The test fee is non-refundable and non-transferable. Please refer to the Candidate Information Bulletin to read the policy on rescheduling appointments.
Failure to timely file tax returns or to pay your taxes may be grounds for denying an application for enrollment. The Return Preparer Office will review all of the facts and circumstances to determine whether a denial of enrollment is warranted.
Form 23 takes 60 days to process. If you haven’t received a response after 60 days, send an email to email@example.com or call (855) 472-5540. Please be sure to include your full name and address.
A replacement card may be obtained by calling (855) 472-5540. You may also request a replacement card by e-mail at firstname.lastname@example.org or by fax at (855) 889-7959. If requesting the card via e-mail, please do not include your SSN. The request should include your name, contact information, such as your daytime phone, and your enrolled agent number.
Generally, enrolled agents must obtain a minimum of 72 hours per enrollment cycle (every three years). Additionally, they must also obtain a minimum of 16 hours of continuing education (including 2 hours of ethics or professional conduct) each enrollment year. Review detailed information about continuing education for enrolled agents.
Yes, all applicants must have a Preparer Tax Identification Number (PTIN) issued by the Internal Revenue Service (IRS) in order to register to take the examination. Obtain a PTIN at www.irs.gov/ptin.
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