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What You Need to Know for the REG Exam (Including Strategies to Pass Before April 1)October 11, 2016
Introductions
• Denise ProbertCPA, CGMAWiley Director of Curriculum,Accounting Test Prep
• Julie SnowWiley CPAexcel Product Support
Webinar Agenda
• Current format of the REG exam• Current content tested on the REG exam• Format and content changes expected to the REG exam on
and after April 1, 2017• Tips and techniques for passing REG• Raffle• Ask the Expert
Testlet 124
MCQs
Testlet 224MCQs
Testlet 324
MCQs6 TBSs
Current Format of the REG Exam
60%40%
% of Exam Contents15 - 19% Ethics, Professional, and Legal Responsibilities
17 – 21% Business Law
11 – 15% Federal Tax Process, Procedures, Accounting, and Planning
12 – 16% Federal Taxation of Property Transactions
13 – 19% Federal Taxation of Individuals18 – 24% Federal Taxation of Entities
Current Content Tested on the REG Exam
AICPA Disclosure Question
Shore, a paid tax return preparer, was given three partnership Schedule K-1 forms by client Fuller. Fuller is a limited partner in each of the partnerships. The K-1s disclosed small pass-through losses allocated to Fuller. Fuller had passive income in excess of these losses from other partnerships. According to the AICPA Statements on Standards for Tax Services, assuming that no at-risk limitations apply, what is Shore's professional responsibility regarding the reporting of these partnership losses on Fuller's federal income tax return?
Copyright © 2014 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosure Question (cont.)
A. To verify the client’s basis by examining client’s records from the initial investment to the present.
B. To accept the information without further inquiry unlessShore has reason to believe that the information is incorrect.
C. To verify the initial investment in each partnership entity unless Shore has reason to believe that the information is incorrect.
D. To request the complete partnership returns of the partnership entities unless Shore has reason to believe that the information is incorrect.
Copyright © 2014 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosure Question
Which of the following types of conduct renders a contract void?A. Mutual mistake as to facts forming the basis of the contract. B. Undue influence by a dominant party in a confidential
relationship. C. Duress through physical compulsion. D. Duress through improper threats.
Copyright © 2013-‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosure Question
What is the due date of a federal estate tax return (Form 706), for a taxpayer who died on May 15, year 2, assuming that a request for an extension of time is not filed? A. September 15, year 2.�B. December 31, year 2.�C. January 31, year 3.�D. February 15, year 3.
Copyright © 2013 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosure Question
A sole proprietor of a farm implement store sold a truck for $15,000 that had been used to make service calls. The truck cost $30,000 three years ago, and $21,360 depreciation was taken. What is the appropriate classification of the $6,360 gain for tax purposes? A. Ordinary gain.B. Section 1231 (Property Used in the Trade or Business and
Involuntary Conversions) gain.C. Long-term capital gain.D. Short-term capital gain.
Copyright © 2014 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosure Question
Randolph is a single individual who always claims the standard deduction. Randolph received the following in the current year:
What is Randolph’s gross income?
Copyright © 2013-‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosure Question (cont.)
A. $22,000B. $28,425C. $32,000D. $32,425
Copyright © 2013 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosure Question
Which of the following statements about qualifying shareholders of an S corporation is correct? A. A general partnership may be a shareholder. B. Only individuals may be shareholders. C. Individuals, estates, and certain trusts may be shareholders.D. Nonresident aliens may be shareholders.
Copyright © 2011 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation
Copyright © 2012 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation (cont.)
Copyright © 2012 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation (cont.)
Copyright © 2012 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation (cont.)
Copyright © 2012 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation—Answers
Copyright © 2012 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation—Answers (cont.)
Copyright © 2012 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation—Answers (cont.)
Copyright © 2012 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation
Copyright © 2011 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
AICPA Disclosed Task-Based Simulation—Answer
Copyright © 2011 -‐ 2016 by the American Institute of Certified Public Accountants, Inc., is reprinted and/or adapted with permission.
REG Exam – April 1, 2017
• Major Exam changes:– Focus on and enhance the testing of higher-order
cognitive skills– Reallocate skills and content– Increase number of task-based simulations (TBSs) and
increase in MCQs for REG– Replace content specifications outlines (CSOs) with
blueprints – Increase in testing time – Change structure of Exam– Redistribute score weighting for TBSs and MCQs
Higher-Order Cognitive SkillsThe Next CPA Exam
Evaluation
Analysis
Application
Remembering and Understanding
Current Exam Focus
Next Exam Focus
Higher-Order Cognitive SkillsRegulation
Evaluation
Analysis
Application
Remembering and Understanding
Current Exam Focus
Next Exam Focus
Higher-Order Cognitive Skills
SKILL LEVELS
Evaluation The examination or assessment of problems, and use of judgment to draw conclusions.
Analysis The examinationand study of the interrelationships of separate areas in order to identify causes and find evidence to support inferences.
Application The use or demonstration of knowledge, concepts or techniques.
Remembering and understanding
The perception and comprehension of the significance of an area utilizing knowledge gained.
Source: AICPA Next Exam Structure – White Paper
Higher-Order Cognitive SkillsRegulation
SKILL LEVELSEvaluation The examination or assessment of problems,
and use of judgment to draw conclusions.Analysis The examinationand study of the
interrelationships of separate areas in order to identify causes and find evidence to support inferences.
Application The use or demonstration of knowledge, concepts or techniques.
Remembering and understanding
The perception and comprehension of the significance of an area utilizing knowledge gained.
Source: AICPA Next Exam Structure – White Paper
Reallocation of Higher-Order Cognitive Skills
Section Remembering and Understanding
Application Analysis Evaluation
Current Exam
ALL 50% 50% N/A N/ANext Exam
REG 25%-‐35% 35%-‐45% 25%-‐35% N/A
Reallocation of REG Content
I. Ethics, Professional and Legal Responsibilities
15% -‐ 19% I. Ethics, Professional Responsibilities and Federal Tax Procedures
10% -‐ 20%
I. Business Law 17% -‐ 21% II. Business Law 10% -‐ 20%
III. Federal Tax Process, Procedures, Accounting and Planning
11% -‐ 15% III. Federal Taxation of Property Transactions
12% -‐ 22%
IV. Federal Taxation of Property Transactions
12% -‐ 16% IV. Federal Taxation of Individuals 15% -‐ 25%
V. Federal Taxation of Individuals 13% -‐ 19% V. Federal Taxation of Entities 28% -‐ 38%
VI. Federal Taxation of Entities 18% -‐ 24%
AUD Exam Score Weighting
60%
40%
MCQs
TBSs
Current Exam
50%50%
MCQs
TBSs
Next Exam
Source: AICPA Next Exam Structure – White Paper
Tips and Techniques for Passing REG!
• Commit to your study planner• Life is too short – do it now• Be optimistic• Work as many questions as you can –
answer explanations are important to your understanding
• Do include a final review • Time management• Answer every question on the exam• Be confident!
Photo Credit: Probert, 2016
Raffle Time!
And the winner is…
We are awarding aWiley CPAexcel Test Bank REG Section Retail value: $150
• 1,200+ REG CPA Exam Questions with Detailed Answers
• 40 Task-based Simulations, including New DRS
• Replicates the Prometric Interface
Ask the Expert