CPA FAR study guide

CPA FAR · Work through your exam, one topic at a time.

The CPA Financial Accounting and Reporting (FAR) section is one of the core divisions of the Uniform CPA Examination, the licensing exam that state boards of accountancy use to qualify candidates for a CPA license in the United States. FAR is designed for accounting graduates, staff accountants, and audit or reporting professionals who need to demonstrate technical command of U.S. generally accepted accounting principles and the presentation of financial statements. The section tests how well a candidate can measure, recognize, and disclose items across the major financial statement areas, including revenue, assets, liabilities, leases, income taxes, pensions, equity, and earnings per share, along with consolidated reporting, foreign currency, and the unique reporting model used by state and local governments. The CPA FAR study guide has 3 sections and about 1,024 words.

Financial Reporting: Statement Mechanics, EPS, and Disclosure Judgments

Financial reporting questions reward precision about where and when an item appears. Know the four primary statements plus comprehensive income presentation (one-statement or two-statement approach), the components of other comprehensive income (pension adjustments, foreign currency translation, unrealized gains on available-for-sale debt securities, cash flow hedges), and the requirement to reclassify OCI items into net income.

357 words, about 2 min 02

Select Transactions: Acquisition Method, Leases, Taxes, and Compensation

Select transactions tests discrete, rule-driven topics: business combinations, consolidation, leases, derivatives and hedging, stock compensation, income taxes, pensions, foreign currency, investments, and revenue with multiple performance obligations. Each has a decision model that must be applied in order.

364 words, about 2 min 03

State and Local Governments: Fund Accounting and the Two Measurement Focuses

Governmental questions usually hinge on knowing which statements you are reading. Government-wide statements (statement of net position and statement of activities) use the economic resources measurement focus and full accrual, include governmental and business-type activities, and exclude fiduciary funds.

303 words, about 2 min