How Canadian Accountants can save money and time getting US CPA

This article is intended for Canadian professional accountants who are pursuing their CPA designation in the United States. Getting the CPA license is a serious commitment that requires an enormous investment in both time and money. It is very important to have the right mindset from the get go and plan it out before you fully commit. I would like to share my story and the lessons I learned along the way, so people in similar situations can fast track to their CPA license without breaking their piggy bank!

When I moved to the United States two years ago, I wanted to change my career and get into public accounting. Like many people, I had a misconception that I could apply for licensure reciprocity with my Canadian accounting designation. To my surprise, you qualify for this process ONLY if you are a chartered accountant (CA) in Canada. Since 2013, Canada has unified various accounting professional designations into one, the CPA, but mutual credential recognition agreement only exists between the CICA and the CPA in the United States. NASBA currently has mutual recognition agreements with the following governing bodies.

• Institute of Chartered Accountants in Australia
• Canadian Institute of Chartered Accountants
• Canada, Mexico, and United States Memorandum of Understanding
• Chartered Accountants Ireland (formerly the Irish Institute of Chartered Accountants)
• Instituto Mexican de Contadores Publicos
• New Zealand Institute of Chartered Accountants
• Hong Kong Institute of Certified Public Accountants

If your designation is not included on this list, you need to go through a more complicated process and it can be overwhelming if you don't know where to start. After spending a lot of money, wasting many weekends, and going through "meltdowns", I came up with a system and broke it down into steps to guide you through this process.

Step 1. "Set your mind to it" - Why am I getting the CPA license?

Getting the CPA requires discipline and commitment. Having a clear goal in mind will help you focus better and push through tough periods. If you do not want to work in a CPA firm and practice public accounting, you do not need a CPA license to do accounting/finance related work. If you are not sure about what you want to do and just like to have another three letters after your name, I recommend you to get more clarity on your "Why". A good place to start is The Bean Counter by Andrew Argue. Andrew obtained his CPA license through the conventional method (going through a 5-year bachelor-master program and one more year for the CPA license). He shares on his website everything there is to know about interviewing for Big4 and what it's like working in the public/private accounting industries. He's since moved on to other ventures and now he doesn't update the site as often, but it is still a great career resource for anyone starting out.

Step 2. "Understand your situation" - What do I need in order to sit for the exams?

Now that you have clarity, you need to first make sure that you have enough education credits. If you earned your degree in a foreign country, you need to have your transcript evaluated at CED. Having your undergraduate degree in Business does not guarantee that you have enough credits. In my case, despite majoring in Finance, I was short on audit and tax course credits. Your degree evaluation usually takes about 2 weeks and you will find out if you need to take more courses before you apply to sit for your CPA exam with NASBA.

Step 3. Do you have enough credits to sit for the CPA exam? If Yes, skip to step 4.

If you need to take more courses like me, there are many ways you can fulfill this requirement.

• Private schools are expensive and generally not a good return on investment at this stage of your career.

I went for the more expensive route and took classes at a local private university that's well known for their accounting program. I paid premium prices (~$7K) to be a part time student so I could have access to their career networking opportunities. In hindsight, it wasn't a great investment. While I learned directly from industry professionals, it did not translate into actual career opportunities. Private colleges also don't offer great career services to part time students with work experiences. My career councilors told me they have never encountered anyone like me in the last 30 years and did not know what she could do to help. Bottom line is, if you are a mid-stage professional, you are better off going to networking events and marketing yourself.

• Community College is cheaper, but not always acceptable

Another option is to take community college courses, but you must check with your State Board to see if they accept those credits. Based on my research, most states don't and even if they do, it's on the condition that you transfer these credits to another accredited four year degree program. It is not straight-forward, so make sure to double check before you sign up for classes.

• Best option if you want to save $$$$ and time!

When you work full time, your best option is online course. There are many online courses available, but the cheapest one I've found to date are through the accounting prep program at the University of Alabama. Each course costs about $450 and you can take it at your own pace. Only state that does not accept credits from this school is New York. (sorry New Yorkers!) The entire curriculum is designed to help with your CPA exam preparation, so you can earn university credits while studying for your exam.

• Re-evaluate your transcripts when you have enough credits!

Once you complete the courses, you need to submit your transcripts for re-evaluation at the CED and have them send in your documents directly to NASBA. You can now submit your application to sit for the CPA exam. You will be issued a jurisdiction ID and NASBA will notify you when you become eligible for the exams.

Step 4. You are now eligible to write your CPA exams, formulate a game plan!

Remember, you have 18 months to finish all four parts and there are four months (Mar, June, Sep, and Dec) in the year that are black out windows. When you work full time at a CPA firm, it's almost impossible to get any studying done during tax season. It's crucial to plan out your time.

Before you schedule for your exams on prometric, you need to get your NTS (notice to schedule) from the NASBA. Some people tried to save money and applied to sit for all four parts at the same time. Your NTS is only valid for 6 months, which means you need to pass one exam every month. Simple math is this, you don't save $$$ if you can't finish all 4 parts in 6 months! You need to give yourself buffer room. Generally speaking, doing two exams in 6 months is manageable on a full time work schedule. Every time you fail an exam, you need to re-apply for NTS at NASBA, which costs around $200 for every application.

Step 5. Decide in what order you will take your exam

It's better to tackle the most difficult exam first.By getting the hardest exams out of the way, you give yourself room for failures. If you don't know which exam is the hardest, Jeff from Ninja CPA makes beautiful charts summarizing quarterly CPA test scores. You can see from his pretty charts which exam had the lowest pass rate. Most people find FAR and REG hard, I do recommend to take these two exams first. However, everyone is different, I actually passed REG and FAR on first attempts, but failed audit. Rule of thumb is to schedule exam on subjects you struggle the most.

Step 6. Pick a study guide that fits your learning style

Before we dive in, CPA exams are changing in 2017 with more focus on task simulations. I personally find theory applications easier than MCQs, but no one knows how much more difficult the new exam versions will. If you already purchased study materials for 2016, schedule your exams as soon as possible because the new changes will affect your study materials.

On that note, there are many study guides out there, each has its own advantage and you should find one that works best with your learning style. I used Becker as my main guide and supplemented it with study modules from other resources. Bryce walker does a very job comparing different paid CPA study materials on Crush the CPA exam. I will share my personal experience with Becker, Ninja MCQ and Roger Review.

• Becker was comprehensive, but a big time waster if you watch all their videos

What I liked the most about Becker is its structured learning environment. However, Becker tried catering to all types of learners, so they offer class videos, study notes and more summary notes. You don't need to use all of them. I personally wasted a lot of time watching all the class videos when I studied for my first exam. For my second exam, I just used study notes from Becker and practiced a lot of questions, this approach reduced my study time by almost half and I got better score.

• Key to pass CPA exam is doing more practice questions, enter Ninja MCQ!

I bought more practice questions on Ninja MCQ ($40/section), it was tremendously helpful. Jeff's questions were all from previous CPA exams, he went back as far as 10 years. You start noticing patterns after you do enough of those questions. I even came across exact same questions on my CPA exams, big bonus points!

• Roger review saved me 3 weeks in study time!

If you are in a time crunch, I also recommend audio tapes from Roger Review ($110). In my humble opinion, Roger review does a much better job summarizing study materials. His review materials are concise. I used the audio tapes for my FAR exam because I only had two weeks to cram. The $110 I spent on the audio saved me almost 3 weeks of study time. I was able to pass the exam after studying for two weeks while working full time.

Step 7. Get your company to reimburse you for study materials

Most CPA firms will pay for your study materials, so don't be cheap on getting a good study guide. When used effectively, a good study material can save you $$$ and most importantly, time. Let's face it, nobody wants to study on their weekends. If you have family, you'd rather spend quality time with them than getting yourself familiarized with US GAAP. Your time is your most value commodity, do whatever you can to pass your exam on your first attempts and cut down inefficient study time!

Step 8. Check Education and experience requirement before you apply for your CPA license

Most states require 150 hours, now this does NOT mean you need to have a master degree. Thanks to this recessions, market's saturated with young and hopeful accountants with master degrees, you want to stand out from the competition by offering tangible results in your work. Having a master degree is not going to teach you how to do a complex partnership return at a CPA firm. I'm not against pursuing after higher education, but just like taking your CPA exam, you need to evaluate this as an investment of your time and money. Is the return going to be worth it?

After you pass your exams, you will get a congratulatory letter from NASBA. You have three years counting from the date you received the letter to complete all your education and experience requirement. If you need to take more accounting courses like me, refer back to step 3.

In terms of experience requirement, audit hours are not mandatory if you don't need to sign off on financial statements. Having worked both in private and public accounting, public accounting definitely offers more challenges and you learn a ton, but private industry has more money. It all depends on what you value the most and what stage in your career you are at.

Step 9 Submit your license application to NASBA and get your membership with AICPA!

Once you complete your education requirement, resubmit your transcripts for another evaluation at CED and have them sent directly to Nasba. You can now submit your application for licensing at NASBA, they will request you to send other documents such as your photo ID, recommendation letters and proofs of work experiences. Get all your paperwork ready and double check before you send them off. (I knew someone who had to restart their application because their profile picture was not taken properly.) Once NASBA approves your application, you will be awarded your CPA license

Step 10 Congratulations, you are now a licensed CPA! The world is your oyster!

I hope this guide sheds some lights on the steps involved getting your CPA license in the US. I personally don't know many people in similar situations, but I would love to connect with you and offer you my help in any way I can. For my fellow Canadian professional friends who are thinking of getting their US licenses, I hope this clarifies a few things. Please comment below if you think I missed anything and pass this on if you know someone who may find this helpful. I wish I had a thorough guide like this when I decided to get my CPA license because I definitely wasted a lot of time and $$$ earning it the hard way. On a final note, it's never too late to go after your dream. Starting over is not easy, but don't stay at the bottom any longer than you have to. Be resourceful, learn from others, you will always find a way! Good luck!