Area I: Ethics, Professional Responsibilities, and General Principles 15-25%

• Nature and scope
• Ethics, independence, and professional conduct
• Terms of engagement
• Requirements for engagement documentation
• Communication with management and those charged with governance
• Communication with component auditors and parties other than management and those charged with governance
• A firm’s system of quality control, including quality control at the engagement level

Area II: Assessing Risk and Developing a Planned Response 20-30%

• Planning an engagement
• Understanding an entity’s internal control
• Debtor-creditor relationships
• Assessing risk due to fraud, including a discussion among the engagement team about the risk of material misstatement due to fraud or error
• Identifying and assessing the risk of material misstatement, whether due to error or fraud and planning further procedures responsive to identified risk
• Materiality
• Planning for and using the work of others, including group audits, the internal audit function and the work of a specialist
• Specific areas of engagement risk

Area III: Performing Further Procedures and Obtaining Evidence 30-40%

• Acquisition and disposition of assets
• Sampling techniques
• Performing specific procedures to obtain evidence
• Specific matters that require special consideration
• Misstatements and internal control deficiencies
• Written representation
• Subsequent events and subsequently discovered facts

Area IV: Forming Conclusions and Reporting 15-25%

• Reports on auditing engagements
• Reports on attestation engagements
• Accounting and review service engagements
• Reporting on compliance
• Other reporting considerations

Area I: Conceptual Framework, Standard-Setting, and Financial Reporting – 25-35%

• Conceptual framework and standard setting for nonbusiness entities
• General purpose financial statements: for-profit business entities
• General purpose financial statements: nongovernmental, not-for-profit business entities
• Public company reporting topics
• Financial statements of employee benefit plans
• Special purpose framework

Area II: Select Financial Statement Accounts 30-40%

• Cash and cash equivalents
• Trade receivables
• Inventory
• Property, plant, and equipment
• Investments
• Intangible assets
• Payables and accrued liabilities
• Long-term debt
• Revenue recognition
• Compensation benefits
• Income taxes

Area III: Select Transactions 20-30%

• Accounting changes and error corrections
• Business combinations
• Contingencies and commitments
• Derivatives and hedge accounting
• Foreign currency transaction and translation
• Leases
• Nonreciprocal transfers
• Research and development costs
• Software costs
• Subsequent events
• Fair value measurements
• Differences between IFRS and U.S. GAAP

Area IV: State and Local Governments 5-15%

• State and local government concepts
• Format and content of the financial section of the comprehensive annual financial report (CAFR)
• Deriving government-wide financial statements and reconciliation requirements
• Typical items and specific types of transactions and events: measurement, valuation, calculation, and presentation in governmental entity financial statements

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Area I: Ethics, Professional Responsibilities and Federal Tax Procedures 10-20%

• Ethics and responsibilities in tax practice
• Licensing and disciplinary systems
• Federal tax procedures
• Legal duties and responsibilities

Area II: Business Law 10-20%

• Agency
• Contracts
• Debtor-creditor relationships
• Government regulation of business
• Business structure

Area III: Federal Taxation of Property Transactions 12-22%

• Acquisition and disposition of assets
• Cost recovery (depreciation, depletion, amortization)
• Estate and gift taxation
• Transfers subject to gift tax
• Gift tax annual exclusion and gift tax deductions
• Determination of taxable estate

Area IV: Federal Taxation of Individuals 15-25%

• Gross income (inclusions and exclusions)
• Reporting items from pass-through entities
• Adjustment and deductions to arrive at adjusted gross income and taxable income
• Passive activity losses
• Loss limitations
• Filing status
• Computation of tax and credits
• Alternative Minimum Tax

Area V: Federal Taxation of Entities 28-38%

• Tax treatment of formation and liquidation of business entities
• Differences between book and tax income
• C corporations
• S corporations
• Partnerships
• Limited liability companies
• Trusts and estates
• Tax-exempt organizations

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