Indiana updates CPA exam rules

An official rule change will allow aspiring accountants from Indiana to sit for the CPA exam with 120 credit hours, effective Nov. 2. 

The rule change is expected to help alleviate the financial burden caused by the 150-credit-hours requirement and reduce barriers for students from underrepresented communities. Furthermore, the CPA exam will no longer have testing windows, which will allow continuous testing and new attempts on failed sections. 

According to Indiana CPA Society president and CEO Courtney Kincaid, it was particularly challenging to implement this rule change in Indiana because, contrary to other states, it needs a special exemption from the governor. One year after Governor Eric Holcomb signed the bill into law, Indiana has joined the other 47 jurisdictions that allow candidates to sit for the exam with 120 credit hours, while still requiring 150 credit hours for licensure. 

"Our government advocacy team worked with our lobbyists to introduce legislation that would compel the Indiana Board of Accountancy to change the rule around when a candidate would be eligible to sit," said Kincaid. "This new rule resulted in more success and higher pass rates for those who pass the exam closer to graduation. Now, we have the opportunity to improve those numbers even more." 

According to the 2021 AICPA Trends Report, the logistical issues that students face when studying for the CPA exam are among the reasons the talent pipeline keeps shrinking. The report found that the restraints of sitting for the exam in limited time frames, which have been worsened by capacity restrictions during COVID-19 lockdowns, are also at fault. 

The brand-new CPA exam has been designed to align with the new CPA Evolution Model Curriculum, with a new focus on future technologies, and is set to launch in 2024. In Indiana, students who complete at least one part of the exam before graduation are far more likely to pass all sections and become licensed CPAs. 

"Taking sections of the exam just after studying the material intensely during their college coursework will be a huge help for students," said Diane Sturek, INCPAS board chair, in a statement. "Further, it will be easier to make studying for the exam a part of their schedule before they start working full time."

INCPAS has worked with the Indiana Register, Indiana Board of Accountancy, Indiana Professional Licensing Agency, AICPA and National Association of State Boards of Accountancy to have this rule change reflected across agencies.

"Most states have already adopted this rule, so this removes a competitive challenge," said Tom Bayer, INCPAS government relations advisory council member, in a statement. "Now more Indiana students will be able to come out of college with the CPA exam partially or fully completed, which will be a win for our profession statewide."