Post-Graduate Educational Requirements and Entry into the CPA Profession

Document Type

Article

Publication Date

3-1-2006

Publication Title

Journal of Labor Research

DOI

10.1007/s12122-006-1012-1

ISSN

1936-4768

Abstract

Forty-one states require educational requirements for CPA licensure to include 30 credit hours beyond the baccalaureate degree. This study, using state-level panel data of CPA examination pass rates, examines two hypothesized effects of this requirement: one, it improves the quality of new CPAs, and two, it restricts entry into the profession reducing the supply of potential CPAs. Empirical findings reveal that raising minimum educational requirements increases the success rate of first-time CPA exam takers, leading to improved entrant quality. However, increased success rates are associated with significant declines in the number of exam takers and, hence, reduced supply.

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