About BEC CPA Exam
[Updated for 2023 - 2024]
The Business Environment and Concepts (BEC) section of the CPA Exam covers all business concepts as well as the importance of a CPA's professional obligations and responsibilities in the greater context of the business environment. Like all the other sections of the CPA Exam, BEC is administered by the American Institute of Certified Public Accountants (AICPA).
BEC is the only section that requires candidates to prepare and submit three Written Communication responses (WC). Many CPA candidates consider BEC to be the easiest section of the CPA Exam. However, BEC pass rates have historically been only slightly higher than those for other sections, and the exam still requires a serious study effort.
What is the 2023 BEC CPA Exam Format and Structure?
Multiple-choice questions, task-based simulations, and written communication assignments make up the BEC exam. There are five testlets in the BEC Exam: two testlets of multiple-choice questions (MCQs), two testlets of task-based simulations (TBSs), and one testlest containing written communication (WC) questions. While the MCQ component of the BEC exam accounts for 50% of the exam score, the TBS and WC sections account for 35% and 15% respectively for the remaining 50%.
Pre-Exam
Before you begin testing at the Prometric Testing Center, you will be given two welcome screens. The first of these displays will ask for confirmation of your name, ID, exam portion, and launch code. Before moving on, you must accept the confidentiality declarations on the next screen. It’s vital to remember that if you don’t finish these screens in under 5 minutes, your exam will be canceled and you won’t be able to continue.
Exam
Like the other three sections of the CPA Exam, BEC is organized into five testlets, which include both operational and pretest questions. Pretest questions are not scored, but operational questions are. There are three basic question types on the BEC exam, and each testlet contains questions from only one of these question types:
- Multiple-Choice Questions (MCQ) – One question with four potential answers. MCQs make up the majority of the exam.
- Task-Based Simulations (TBS) – Questions that require you to apply practical knowledge. This could include filling out a document or finishing a research question.
- Written Communication – Questions that require properly composed written essay responses. This question type is unique to the BEC exam.
The MCQs are divided into two testlets, each with 31 questions. Following the MCQ testlets, there are two testlets containing two TBSs each, for a total of four TBSs. The final testlet has three Written Communication questions, one of which is pre-tested, that require a written response in memo format.
Post Exam
Following completion of the BEC exam, you will be asked to complete a 5-minute survey in which you will be asked your thoughts about the exam.
How to Manage Your Time in the BEC CPA Exam?
Understanding how much time you have to complete each portion of the CPA Exam and the timing of scheduled breaks will help you construct a smart game plan for exam day.
- The BEC CPA Exam section has a 4-hour time limit.
- There are optional breaks between each testlet. However, during these optional breaks, the timer continues to run and count towards your total exam time.
- There is a 15-minute optional standard break that occurs after you complete the third testlet. At this time, you can pause the timer on your exam. It is highly recommended that you take advantage of this break.
To ensure you keep a pace that ensures you finish the entire exam on time, here is our suggested per-question time allotment for each question type:
- 62 MCQs: 1.25 minutes each.
- 4 Task-Based Simulations: 18 minutes each
- 3 Written Communications: 25 minutes each
It is important to understand time management systems like this to effectively allocate time for the BEC section on exam day. The chart below is a sample time strategy breakdown to consider for the BEC CPA Exam.
| Testlet | Question Type | Suggested Time |
|---|---|---|
| Testlet 1 | 31 MCQ | 38 Minutes |
| Testlet 2 | 31 MCQ | 38 Minutes |
| Testlet 3 | 2 TBS | 36 Minutes |
| 15 minute break (does not count toward total exam time) | ||
| Testlet 4 | 2 TBS | 36 Minutes |
| Testlet 5 | 3 WC | 75 Minutes |
| Extra Time | 17 minutes | |
| Total Time | 240 minutes | |
Once you sit down to take the exam, write down your countdown timings right away. This will help you maximize your time during the exam. We recommend:
- After Testlet 3, aim to be around halfway through your time.
- Take the 15-minute scheduled break.
- To stay on pace, keep in mind the estimated time per question time:
- 75–84 seconds for MCQ
- 15-20 minutes for TBS (general)
- 20-25 minutes for TBS (Complex)
- 10 minutes for research questions
- 15-20 minutes for written communication
What Topics Are Tested in the 2023 BEC CPA Exam?
The AICPA CPA Exam Blueprints contain the knowledge, skills, and subject themes that candidates are tested on within the CPA Exam. It also contains information about the exam changes that will be implemented each year. The CPA Exam Blueprints provide a detailed description of each exam section, allowing applicants to better understand what they need to study in order to pass the exam.
The Business Environment and Concepts section of the CPA Exam comprises enterprise risk management, internal controls and business processes, economics, financial management, information technology, and operations management. The content areas tested under the BEC section include the following five content areas:
- Internal control and enterprise risk management frameworks
- Other regulatory frameworks and provisions
- Economic and business cycles
- Market influences on business
- Financial risk management
- Capital structure
- Working capital
- Financial valuation methods and decision models
- IT governance
- Role of IT in business
- Information security/availability
- Processing integrity (input/processing/output controls)
- Systems development and maintenance
- Cost measurement concepts, methods, and techniques
- Variance analysis
- Process management
- Planning techniques
What Skills Are Tested on the 2023 BEC Exam?
The questions on the BEC Exam are divided between the following skill levels: remembering & understanding, application, and analysis.
From the AICPA website, you can access a complete list of the content group and topics organized by abilities and representative tasks.
What Are The Changes In 2024 BEC CPA Exam?
The AICPA designed the 2024 CPA Exam Changes in association with NASBA. The new structure is called the “core + discipline model.” The initiative’s purpose is to preserve the exam’s high standards while keeping up with the ever-changing criteria for CPAs in a technology-driven business landscape. As part of this model, all candidates will take the following three core CPA Exam sections:
- Auditing and Attestation (AUD)
- Financial Accounting and Reporting (FAR)
- Taxes and Regulation (REG)
Along with the three core sections, candidates will select one discipline section. Each discipline is an extension of one of the core sections, allowing candidates to take a deeper dive into an area that aligns with their strengths. The three disciplines to choose from are:
- Business Analysis and Reporting (BAR) – an extension of the accounting core
- Information Systems and Controls (ISC) – an extension of the auditing core
- Tax Compliance and Planning (TCP) – an extension of the tax core
Under this new model, the BEC CPA Exam will no longer exist in 2024. However, much of the content will still be tested, as it will be distributed among several of the core and discipline sections.
Also note that the 18-month rule will still apply to the 2024 CPA Exam. Furthermore, there is an 18-month extension that has been adopted by most states to account for the transition between the current and 2024 CPA Exams. Under this rule, CPA Exam sections passed before January 1, 2024 will not expire until June 30, 2025. This includes the BEC CPA Exam. Therefore, if you pass BEC in 2023, you can avoid taking one of the new discipline sections.
Many candidates caught in the transition have the opportunity to decide if they will take BEC in 2023, or wait to take one of the new disciplines. Continue on to learn about each of the new disciplines to choose from.
Business Analysis and Reporting (BAR)
BAR focuses on topics like data analytics, financial risk management, and financial planning techniques. So, candidates who want to create an advanced knowledge base in these subjects can pursue the BAR discipline. In addition, BAR covers areas of advisory services, financial statement analysis, technical accounting, and financial and operations management. Complex technological accounting and reporting issues are also addressed in BAR, such as the evaluation of revenue recognition and leasing, company combinations, derivatives and hedge accounting, and financial statements for employee benefit plans.
Information Systems and Controls (ISC)
The ISC discipline focuses on technology and business controls. CPA candidates who are interested in providing assurance or consulting services for business processes, information systems, information security, governance, and IT audits are encouraged to choose this discipline. This discipline focuses primarily on IT and data management, testing internal controls, and information system security, such as network security, software access, and endpoint security.
Tax Compliance and Planning (TCP)
The TCP discipline focuses on tax topics that involve more advanced individual and business tax compliance. For example, personal financial planning and entity planning, gross income inclusions and exclusions, and gift tax compliance and planning could all be covered. Coverage of advanced entity tax compliance could consist of:
- Consolidated tax returns.
- Tax issues that involve more than one jurisdiction.
- Transactions between an entity and its owners.
How is the BEC CPA Exam Scored and Graded?
The BEC Exam is scored on a scale of 0 to 99, and candidates need a score of 75 to pass. These aren't percentages, and they shouldn't be treated as such. Scaled scores on exam questions are determined using algorithms that take into account whether the question was successfully answered as well as the difficulty level of each question.
The higher the value of a question, the more difficult it is. As a result, a candidate who answers 10 difficult (higher value) questions correctly will receive a higher score than a candidate who answers 10 easy (lower value) questions correctly.
Answering 75% of the questions on the exam correctly does not translate into a score of 75. There are many factors that go into your CPA Exam score, which can be accessed at How the CPA Exam is Scored.
The BEC section score is a weighted average of the results from multiple-choice questions (50 percent of the exam), task-based simulations (35 percent of the exam), and written communication (15 percent of the exam).
For the purpose of scoring the BEC exam, consider the MCQ and the TBS/WC as two different exams. The grades from each are added together (as shown by the 'weight' percentages above) to give you an overall score. Although it would appear that properly answering 75% of the MCQs and scoring 75 or above on the TBS/WC would result in a passing mark, this is not the case due to question pretesting and the varied point values provided to each question. Learn more about CPA Exam scoring and pass rates on the AICPA website.
BEC CPA Exam Pass Rates
BEC is considered by many candidates to be the least intensive section of the CPA Exam. It is also the CPA Exam section with the highest cumulative passing percentage. BEC has an excellent pass rate in 2022 as well, nearly 60%.One explanation for the higher BEC pass rates could be that candidates typically appear for this section of the exam last, restricting the pool of candidates to those who have completed the previous three parts successfully.
However, BEC pass rates have generally been slightly higher than other portions, and the test still necessitates a significant amount of study time. While many people pass it, many also fail it. So don’t underestimate the BEC section and not give it enough of your time and effort. Here are the Top 5 Most Difficult Topics for BEC exam candidates. Below are the historic pass rates for the BEC exam.
It's no secret that the CPA Exam is one of the most difficult professional tests to pass; success necessitates commitment, dedication, and well-designed CPA study resources. UWorld Roger CPA Review has helped hundreds of thousands of students achieve their goals with a 94 percent pass rate.
The AICPA publishes the average CPA Exam pass rates, broken down by section, every quarter. The overall pass rates vary slightly by region and quarter, but it tends to settle around 45-55 percent. View the pass rates for each section of the CPA Exam from prior years in CPA Exam Pass Rates
How to Study for the BEC Section of CPA Exam?
The BEC exam is often dismissed because it has a reputation for being the easiest portion of the CPA Exam. Don’t fall into this trap. While the overall breadth of content is less than other CPA Exam sections, BEC will still be challenging! Here are some tips on how to best study for this exam.
According to the National Training Laboratory’s Learning Pyramid, students only retain 5-10% of the information delivered in traditional passive learning styles, such as lectures and reading from a textbook. We recommend students implement an active-learning methodology to prepare for the CPA Exam. Consequently, students who are actively engaged in the learning process can increase their retention to the 75-90% range. When it comes to preparing for the CPA Exam, the doing comes from practicing real CPA Exam questions. Therefore, in the UWorld Roger CPA Review course, the bulk of the learning happens through our high-quality question bank.
The BEC section is an accumulation of many of the topics that are covered in the other four CPA Exam sections and how these concepts are applied in a business environment. So when you are working through the material, you will gain a deeper understanding of the content if you approach it from that lense. There’s a wide range of topics covered on this exam, including some topics that are more difficult than others. This includes one of accounting students’ least favorite topics from school, Cost Accounting. For more, checkout our blog on the Top 5 Most Difficult Topics on the BEC Exam.
BEC CPA Exam Study Tips
If you're ready to begin preparing for the BEC CPA Exam right now, we recommend using some of the study techniques listed below.
- The BEC exam is an endurance test. Commit to spending the time necessary to properly comprehend the content.
- Make a study regimen or a game plan and stick to it with the aid of our Study Planners.
- By saying "no" when you need to study, you may safeguard your study time.
- Consider blocking Internet access, turning off alerts, and notifying family, friends, and coworkers that you will be absolutely unreachable during your specified study periods.
- Solicit help from relatives and friends.
- Get plenty of rest, eat healthy, and exercise often.
- Turn a stroll, workout, or time waiting in line into a study session by using mobile devices.
- Study more effectively by avoiding poor study approaches, such as working through endless practice questions and not actually taking the time to learn.
- Practice the mnemonics not just to memorize them, but also to comprehend them—recite them while describing what each part means and how it fits into the broader picture in your own words.
- Keep your sights set on the finish line and remember why you're on this adventure.
Tips for the Written Communication Section of BEC
The Written Communication portion of BEC not only tests your proficiency in articulating a problem and solution through well-thought-out content, but also your technical use of standard English and professional documentation creation. So here are a few pointers to keep in mind as you construct your entire written communication strategy:
- Spelling, grammar, and Standard English should all be followed.
- Use whole sentences and write clearly and simply.
- Include an introduction, body, and concluding paragraph.
- Bullet points, acronyms, charts, and graphs should all be avoided.
- Stay on topic. It is critical that your written response is relevant, on-topic, and addresses the query.
- Incorporate keywords into your response. For instance, you may include terms like "changing accounting principle," "change in estimate," and "retrospective." It depends on the nature of the query. In any case, be sure to include some of the question's primary components in your response.
What should I focus on in the WC part of the BEC CPA Exam?
The BEC Exam is an endurance test. Commit to spending the time necessary to properly comprehend the content. The written communication portion of the BEC exam is graded for both technical content and writing skills. In order to do well on written communication questions, it is important to know what the graders are looking for in a well-written response:
- Clear
- Concise
- On topic
- Proper grammar
- Complete sentences
- Organization
- Supporting details
- Proper formatting
- Introductions and conclusions
FAQs
How hard is the BEC section of the CPA Exam?
When should I take the BEC?
Can you study for BEC in a month?
What is tested on the BEC section?
Can I receive partial credit on Written Communications (WCs) and Task-Based Simulations (TBSs)?
Yes, you can receive partial credit on WCs and TBSs. A candidate’s BEC score consists of 50% MCQs, 35% TBSs, and 15% WC. Of the 62 MCQs, 50 are operational, meaning they count toward the exam score, while 12 are pretested and do not count toward the exam score. Of the four TBSs, three are operational and one is pretested. Of the three WCs, two are operational and one is pretested.
For the purpose of scoring the BEC exam, consider the MCQ and the TBS/WC as two different exams. The grades from each are added together to give you an overall score. Although it would appear that properly answering 75% of the MCQs and scoring 75 or above on the TBS/WC would result in a passing mark, this is not the case due to question pretesting and the varied point values provided to each question.