Financial Definition of CPA
What It Is
A Certified Public Accountant (CPA) is an accounting professional who has passed the Uniform CPA examination and has also met additional state certification and experience requirements.
How It Works
To become a CPA, a person must: A) complete a college-level accounting program, B) pass the Uniform CPA Examination, and C) have a certain amount of professional work experience in accounting -- typically one year.
The CPA examination is developed and graded by the American Institute of Certified Public Accountants. The exam has four sections: auditing and attestation, financial accounting and reporting, regulation, and business environment and concepts. Nearly 14 hours long in total, the CPA examination also includes a writing skills exercise, multiple choice questions and case studies.
Once a person becomes a CPA, they can specialize in one specific area of finance or a wide range of services, including:
Tax Preparation and Planning
CPAs are required to complete a minimum number of continuing professional education (CPE) courses in order to retain the CPA designation.
Other countries have different designations for the CPA qualification. The Canadian equivalent to a CPA is a Chartered Accountant (CA).
Why It Matters
The CPA designation is granted by the American Institute of Certified Public Accountants in order to maintain industry-wide, professional standards.
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