PCPA study guide
PCPA · Work through your exam, one topic at a time.
The PCPA designation is a professional certification in accounting and related advisory work. Because the acronym is used by more than one credential program, the first practical step for any candidate is confirming which certifying body's PCPA you are pursuing and downloading that body's current candidate handbook, since the syllabus, assessment structure, and administrative rules differ between programs. The PCPA study guide has 5 sections and about 1,583 words.
01Financial Accounting and Reporting
Financial accounting translates economic events into general-purpose statements under a chosen framework (US GAAP or IFRS). A candidate must know, at minimum: accrual accounting and adjusting entries (deferrals, accruals, estimates); the five-step revenue model (identify the contract, identify performance obligations, determine the transaction price, allocate it, recognize as obligations are satisfied); inventory costing and lower-of-cost-or-market; depreciation and impairment; lease classification; deferred taxes; stock compensation and EPS; consolidation with intercompany eliminations; and statement of cash flows presentation.
326 words, about 2 min02Auditing, Attestation, and Assurance
Audit and attestation work is graded by the level of assurance provided. An audit of financial statements gives reasonable (high but not absolute) assurance and a positive opinion; a review gives limited assurance, primarily through inquiry and analytical procedures, expressed as negative assurance; a compilation provides no assurance.
320 words, about 2 min03Taxation and Regulatory Compliance
Taxable income begins with pretax book income and is adjusted for differences. Permanent differences (municipal bond interest, life insurance proceeds, fines and penalties, certain meals) never reverse and affect only the effective tax rate.
303 words, about 2 min04Business Environment, Economics, and Finance
This domain combines managerial finance, microeconomics, macroeconomics, and performance measurement. Expect: time value of money (present and future value, annuities), capital budgeting (payback, discounted payback, NPV, IRR, profitability index), cost of capital and WACC, capital asset pricing model, break-even and cost-volume-profit analysis, contribution margin, leverage, working capital management, and the common ratio families (liquidity, activity, solvency, profitability).
314 words, about 2 min05Ethics, Professional Responsibilities, and Governance
The ethics domain rewards a conceptual understanding of the threat-and-safeguard framework. Independence has two dimensions - independence in fact (the actual state of mind) and independence in appearance (how a reasonable informed third party would perceive it).
320 words, about 2 min