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What is the high-level strategy for BEC?

The BEC section of the CPA is often considered as the “easiest” exam by candidates. While the pass rates for BEC are historically higher than other sections, this does not mean BEC is “easy”. Candidates that think they can cruise through BEC by simply flipping through the pages and answering a few MCQs are in a for a rude awakening. So if you were to ask for me advice, I would say, “take BEC seriously”.

Candidates that successfully pass BEC are able to move beyond memorizing all of the calculations and formulas in BEC. It is easy to get overwhelmed with the sheer amount of calculations and formulas that are frequently tested in BEC, but you need to focus on the bigger picture.

Think about why someone out there in the world would want to calculate the weighted average cost of capital, the materials price variance, or the days payables outstanding. The AICPA is more focused on whether you as a CPA can interpret the result of the calculation or formula.

If you aren’t already aware, BEC is the only section that has written communication. Basically, the exam will give you a prompt and you will have to write a short response in a memo format. You can learn more about written communication and a winning strategy for written communication here.

Otherwise, the exam has 62 multiple choice questions split between two testlets. You will then have 2 testlets with 2 task-based simulations.

High-Level Guidance by Chapter

Chapter 1) Financial Management

There are a lot of different formulas for different ratios or calculations, but really try to understand “why” someone would want to calculate a ratio. The exam likes to focus on net present value (NPV) and weighted average cost of capital. Additionally, working capital management is an area where you could see conceptual MCQs and simulations. There are 30+ formulas in financial management, but if you can tackle the conceptual questions, then the calculation questions will be much easier to attack!

Chapters 2 and 3) Operations Management

Chapters 2 and 3 all fall under cost accounting, which is basically accounting methods that a company can use to assess and run a business (i.e., “managerial accounting”). The exam focuses heavily on variance analysis, as well as budgeting and forecasting techniques. It is very common to see a simulation on variance analysis and/or process costing.

Chapter 4 ) COSO, ERM, Business process, etc.

The exam loves to test COSO and ERM, which are the same concepts that you would have seen in AUD. In BEC, there is more of a focus on business risk and how a business can eliminate risks by implementing proper controls in their business processes. You can expect to see a lot of MCQs on the topics in this chapter and likely a written communication prompt.

Chapter 5) Economics

Economics isn’t tested as much as it historically has been, but you can expect to see a handful of MCQs and possibly a simulation. Market supply and demand (Module 3) is the area that is usually tested the most. 

Chapter 6) Information Technology (IT)

IT is the last section and this topic is all over the place. Candidates have told the team at Universal that the IT content helped prepare them well for the exam, but candidates are still reporting they are seeing IT MCQs on topics that aren’t covered by any review course. The Universal team has been taking note of these topics and adding them to the BEC material. Typically you will get a lot of MCQs on IT. You are also likely to get a written communication on IT. 

Final Thoughts

Overall, candidates that fail BEC focus too much on memorizing. It is easy to get caught up with all of the formulas and calculations and forget to take a step back and understand why all of it matters.

If you are hard pressed for time with BEC, I would spend a majority of your time on the MCQs and simulations and less time on the lectures or study guides. The simulations in BEC often combine a wide range of topics, so it can be helpful to confirm your understanding of the big picture. Throughout BEC, the Universal team will help you understand how these topics fit into the real business world.

Definitely take the AICPA practice test, especially if this is your first exam. We have already included a majority of the MCQs and simulations in the BEC material since the AICPA practice test gives very brief explanations. You can find a link to the practice test here.

Matt and Joey will be your captains throughout BEC! If you haven’t used the Universal platform before, you can signup for a free trial here.


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