CPA, CMA and EA glossary

CPA: Certified Public Accountant: the US licence for accounting, audit and tax professionals, issued by a state board of accountancy after you pass the CPA Exam and meet education and experience rules.
AICPA: The American Institute of Certified Public Accountants. It writes and owns the Uniform CPA Examination and sets professional standards. It does not issue licences; state boards do.
NASBA: The National Association of State Boards of Accountancy. It works with state boards on exam administration, candidate registration support and the Notice to Schedule process.
State board of accountancy: The body in each US state or territory that sets eligibility rules, accepts your application, and issues your CPA licence. International candidates choose a board that accepts their credentials.
Credential evaluation: A review of your international degree and transcripts by an approved agency, so your state board can convert them into US-style credit hours.
150 credit hours: The education requirement for CPA licensure in most states: 150 semester hours of college credit, including set amounts of accounting and business subjects. Rules vary by state.
Core sections: The three CPA Exam sections everyone takes: FAR, AUD and REG.
Discipline sections: The CPA Exam lets you choose one of three Discipline sections: BAR, ISC or TCP. You take one on top of the three Core sections, for four exams in total.
FAR: Financial Accounting and Reporting: a CPA Core section on US GAAP for businesses, not-for-profits and governments, including revenue, leases, debt and equity. Candidates often treat it as the heaviest section.
AUD: Auditing and Attestation: a CPA Core section on planning, risk assessment, internal control, evidence and reporting.
REG: Taxation and Regulation: a CPA Core section on federal tax, business law, ethics and professional responsibilities.
BAR: Business Analysis and Reporting: a CPA Discipline section covering advanced financial reporting and data analysis. Suits candidates headed for reporting and corporate finance.
ISC: Information Systems and Controls: a CPA Discipline section covering IT audit, SOC engagements and controls. Suits IT audit and risk careers.
TCP: Tax Compliance and Planning: a CPA Discipline section on advanced individual and entity tax planning. Suits tax careers.
Multiple-choice question: A question with one best answer from several choices. Most exam sections combine multiple-choice questions with task-based simulations. The CMA and EA exams are mainly multiple choice, with CMA essays.
Testlet: A block of questions delivered together. A CPA section has several testlets of multiple-choice questions, followed by task-based simulation testlets.
Task-based simulation: A hands-on question where you work through a realistic scenario by filling a table, researching authoritative literature or completing a calculation. Often shortened to TBS.
Multistage adaptive testing: A format in which the difficulty of later multiple-choice testlets depends on how you did earlier. The CPA Exam uses it for multiple-choice questions.
Scaled score: Your raw performance converted to a common scale so different exam forms are comparable. CPA sections use 0–99 with 75 to pass. CMA uses 0–500 with 360 to pass. The EA SEE uses 40–130 with 105 to pass.
Notice to Schedule: Often shortened to NTS: the authorisation you receive after your state board approves your application, which lets you book a CPA Exam section at Prometric. It carries an expiry date, so book promptly.
Prometric: The test-centre network where the CPA, CMA and EA exams are delivered, including centres in many countries outside the US.
Rolling window: The period in which you must pass all four CPA sections once you pass your first. Many boards allow 18 months; some allow longer. Check your own board’s rule.
CMA: Certified Management Accountant: the IMA credential for management accounting, planning and financial strategy. The exam has two parts and the passing score is 360 out of 500.
IMA: The Institute of Management Accountants: the US body that grants the CMA and runs its entrance requirements and fees.
CMA Part 1: Financial Planning, Performance and Analytics: planning and budgeting, performance management, cost management, internal controls and analytics.
CMA Part 2: Strategic Financial Management: financial statement analysis, corporate finance, decision analysis, risk, investment decisions and ethics.
Essay question: The written section of each CMA part, scored against a rubric of key points. Short, well-structured answers that hit the rubric points score better than long ones.
Enrolled Agent: A US tax professional licensed by the IRS with unlimited rights to represent taxpayers before the IRS. You earn it by passing the SEE and a suitability check. No degree is needed.
SEE: The Special Enrollment Examination: three parts (Individuals, Businesses, Representation) that qualify candidates for the Enrolled Agent credential. Each part has 100 multiple-choice questions.
IRS: The Internal Revenue Service: the US federal tax authority. It sets the SEE and licenses Enrolled Agents.
PTIN: Preparer Tax Identification Number: the number tax return preparers must hold. You need a PTIN before registering for the SEE.
Form 23: The IRS application you file after passing the SEE to apply for enrolment. The IRS also runs a suitability check.
Circular 230: The IRS regulations governing practice before the IRS and the duties of tax practitioners. It features heavily in EA Part 3 and in CPA REG ethics.
US GAAP: Generally Accepted Accounting Principles as used in the United States. The CPA FAR section tests US GAAP in depth.
IFRS: International Financial Reporting Standards, used in many countries outside the US. Useful context for international candidates, though the CPA tests US GAAP.
ASC 606: The US GAAP standard for revenue from contracts with customers, built on a five-step model. A major FAR topic.
ASC 842: The US GAAP leases standard, which puts most leases on the balance sheet as a right-of-use asset and a lease liability. A major FAR topic.
Internal control: The policies and procedures that help an organisation protect assets, produce reliable reports and follow rules. Auditors assess it as part of risk assessment; COSO is the common framework.
COSO: The Committee of Sponsoring Organizations framework for internal control, widely used in audit and by CMA and CPA candidates.
Materiality: The size of a misstatement that could influence the decisions of users of financial statements. Auditors use it to plan work and evaluate findings.
Audit evidence: The information an auditor gathers to support an opinion. Its quality depends on its relevance and reliability.
SOC report: A System and Organization Controls report on a service organisation’s controls. A key topic in the CPA ISC section.
Variance analysis: Comparing actual results to budget or standard to find and explain differences. Central to CMA Part 1.
Budgeting: Turning plans into numbers: sales, production, costs and cash. A core CMA Part 1 topic.
Capital budgeting: Evaluating long-term investments using methods like net present value, internal rate of return and payback. A CMA Part 2 topic.
Question bank: A large set of practice questions with explanations, usually sorted by topic and difficulty. Doing questions and reviewing every explanation is the core of exam preparation.
Mock exam: A full-length practice exam under real conditions, used to estimate readiness and train time management.
Diagnostic test: A short test taken before you start studying, used to find your starting level and weak topics so a study plan can be built around them.
Study plan: A schedule that maps topics and practice to your exam date and weekly hours, ideally adjusting when you fall behind.
Spaced repetition: A technique that schedules reviews of material at growing intervals, just before you are likely to forget it. It improves long-term retention for rules and formulas.
Pass guarantee: A provider promise to refund, extend or give free access if you do not pass under stated conditions. Terms vary, so read the conditions on study time, practice and attempts.

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