January 2001

Canada Reports Rise in New Students Taking and Passing CA Exam

As U.S. organizations warn of a decline in the number of students enrolled in college-based accounting curricula, the Canadian Institute of Chartered Accountants (CICA) announced an increase this year of eight percent over the 1999 figures for first-time takers of the Uniform Final Examination (UFE), the profession’s standard entrance exam in Canada. This is the first year the Institute has been able to report an increase since 1991.

By comparison, the U.S. exam showed only a five percent increase on the November 1999 exam and a two percent increase on the May 1999 exam over those taken in the prior year (figures for the 2000 exam are not yet available), according to Candidate Performance on the Uniform CPA Examination, 1999 and 2000 editions, published by the National Association of State Boards of Accountancy (NASBA).

NASBA reports that 41 percent of the more than 70,000 students who took the November 1999 Uniform CPA Examination in America were first-time takers. Yet, despite the rise in 1999, first-time takers of the American exam, at 41 percent, make up considerably less of the total than Canadian first-time writers, at 72 percent.

This can be attributed in part to the higher number of Canadian students who pass the exam on their first try. Fourteen percent of American first-time examinees passed in November 1999. At 73.2 percent, this year’s pass rate for first-time writers in Canada is unprecedented in the history of the modern exam.

Although the number of first-time takers in both Canada and the United States has increased in the past year, it is too early to determine whether this is the beginning of a trend or an anomaly. The American Institute of CPAs–sponsored Taylor study reported a decrease in the number of accounting majors at both the high school and college levels in the United States, from four percent in 1990 to two percent in 2000.

According to John McReynolds of the CICA, accounting firms in Canada hired a greater number of entry-level employees a few years ago, qualifying more candidates for the exam, which requires a term in public practice.

“It’s a matter of supply and demand,” McReynolds said.

NYSSCPA Recruitment for CPA Careers Committee Chair Marc Zand provided a possible explanation for the increase in first-time exam takers within the general decrease in the number of young CPAs.

“Everyone taking the Uniform CPA Examination is not necessarily doing so to enter the public accounting profession,” Zand said. “Many use it as a stepping stone to a more lucrative job opportunity on Wall Street.

“They take the exam to get experience with a CPA firm, then move on to private accounting. For example, I hired someone who stayed six months, said he liked it here at Shapiro & Lobel, and then left for Brooks Brothers.”