Review of Related Literature and Studies

The literature and studies cited below are about the assessment of the performance of the
accountancy graduates in the CPA Licensure Examination.
Related Literature

The latest CPA board exam result is quite intriguing in terms of the passing percentage
that made some accountants ponder. At 27% overall passing rate, thats way too low in
comparison to previous exam results. In recent occasions, the passing rate has gone from 30% to
40% on average and not below this range. I also think that the last May 2013 exam is special
which I will let you know later. And so I made a summary of the previous exam results and try to
look for a pattern of some sort or maybe a trend from which we could attribute this sudden
change in passing rate. I think 10 years or 20 exams would be appropriate as our data. Personally,
I would also want to know how things have changed ever since I took the exam years ago.From
the above summary, the following are the CPA Board Exam results and numbers for the past
decade plus some interesting trivia.

 When it comes to the top spot, there is no clear dominance of any school except for UP and
DLSU. Other top schools are also represented.
The lowest passing rate for the past decade is 20% back in the year 2003. In addition, ten years
before that, it was only 17% in 1993.
October 2010 has the highest passing rate at 48.36%.
In May 2008, twin brothers made it to the top ten Charles Bryan Marinas Tan was number 8
and his brother Christopher Ryan Marinas Tan was number 10.
For the past decade, the number 1 spot has been tied twice. That was in October 2009 by two
candidates from two different schools and in October 2012 by two candidates from UST.
The number 1 in the most recent CPA exam last May 2013 is also a registered nurse.
Interestingly, he was also a topnotcher placing number 6 in the Nursing board exam last 2007.
What makes the May 2013 special is that it recorded the highest change or variation that
occurred in passing percentage, dropping a whopping 20%. Thats from 47.78% in October 2012
to 27.41% in May 2013.
And finally, if you look closely, you will notice the great disparity of passing percentages
between the May and October exams. It seems that the May exams have the lowest passing rates.
This has created the perception from accountants that the May exams are harder than the October
which is obviously debatable.
Overall, theres really no pattern or trend we could construct here except that there has been a
considerable increase in the number of takers and passers every year with a slight increase in
passing rate as well. We can expect a sudden increase in passing percentage this coming October
2013. I would predict between 40% to 50% and base on the increasing number of exam takers,
we might have over 10,000 takers this time.

Related Studies

The study analyzed the performance of CABEIHM graduates in the CPA Licensure
Examinations given by the Professional Regulation Commission (PRC). The ratings obtained in
the seven subject areas of the CPA board exam, namely, Theory of Accounts, Business Law and
Taxation, Management Services, Auditing Theory , Auditing Problems, Practical Accounting
Problems I, and Practical Accounting Problems II.
1.1. Theory of Accounts
Their study showed that the highest mean of 76.31 was achieved in October 2007 and
the lowest mean of 69.18 was attained in May 2004. The composite mean from October 2003
October 2008 is 72.71. The graph shows a fluctuating trend from October 2003 until October
2005, but reflected an improvement of performance from October 2005 up to its peak, October
2007. The improvement of the performance could be attributed to the intensified retention policy
(Qualifying Exams and maintaining grade) that has been strictly implemented by the
Department.
1.2. Business Law and Taxation
According to their studies, the highest mean of 74.40 was achieved in May 2008 while
the lowest mean of 69.33 was obtained in October 2005. The BS Accountancy graduates
performance in the CPA Licensure Examinations covering October 2003 October 2008
recorded a composite mean of 72.5. The graph shows a continuous fluctuation of Business Law
and Taxation result but the ranges are not far from each other, In general, October performance is
better than May performance probably because the October examinees are fresh graduates and
have full time review while some of the May examinees are summer graduates, some are already
working, and other repeaters cannot afford to have another full time review.
1.3. Management
Services
The result showed that the highest mean of 79.58 was recorded in May 2007. On the
other hand, the lowest mean of 71.04 was obtained in October 2004. The composite mean from
October 2003-October 2008 is 75.02. This area is usually the strength of the BS Accountancy
graduates, perhaps because the subject matters are simpler than those of accounting, auditing
theory and problems and business and taxation subjects.
1.4. Auditing Theory
The study revealed that the highest mean of 73.17 was achieved in May 2007 while the
lowest mean of 67.55 was attained by the first batch of examinees in October 2003. The
composite mean from October 2003 October 2008 is 70.79. This is the lowest composite mean
among all CPA Board subjects and considered to be the thorn of thorns of the exam. Some
examinees failed because of this subject. They have already attained the passing average but
unfortunately got a grade lower than 65 on this subject.
1.5. Auditing Problems

Results showed that the highest mean of 75.64 occurred in May 2005 and the lowest
mean of 67.86 in May 2006. As can be noted in Figure 6, there is a gradual increase in the
performance of examinees in this subject until it reached its peak in May 2005. The rising trend
in performance was broken in May 2006, the CPA Board Examination when the BSU examinees
garnered the lowest mean. The reason behind this drop in performance was due to the revision of
the format of the caselette. The three to five questions were increased to about 10 to 12 questions
for every item, making it trickier and a bit more difficult for examinees to comprehend. Then
effective October 2005 there was a change in the board of examiners. Certainly, a change in the
composition of the board of examiners can mean change in style in the examination items,
concentration and type of examination.
1.6. Practical Accounting Problems
It shows that the highest mean of 88.11 happened in October 2005. Conversely, the
lowest mean of 71.17 occurred in May and October 2007. The graph shows a rather less erratic
change as compared to the other subjects. It also discloses that the performance of CABEIHM
graduates in this subject does not vary drastically as compared to other subjects. Since Practical
Accounting I is the heart of accounting for it is concerned with preparation of financial statement
and accounting for Assets, Liabilities and Stockholders Equity, examinees are well trained
regarding these topics. In the undergraduate level, the discussions in this subject are thorough,
making the candidate ready and equipped with sufficient knowledge and skills.
October 2005 proved to be fruitful because the CABEIHM examinees garnered the
highest mean. The commendable performance of CABEIHM examines was due to the big
number of examinees during this period who were repeaters. Further, this examination involved
short questions with a single unknown making it easier for examinees to answer and accumulate
points.
1.7. Practical Accounting
Problems II
It is evident from the graph that the highest mean of 77.23 was obtained in October
2007. It could be said that the candidates who took the exam in October 2007 were better
prepared for the questions in the licensure examination. Another reason may be the period of
examination. Since October is the second exam of the year, a greater number of candidates are
repeaters. This group of examinees has already been exposed to the type of questions in the CPA
licensure examinations; hence they have an edge over the first timers.
However, October 2008 examination yielded the lowest mean (73.00) because new
standards and concepts were introduced in the topics comprising these subjects, thereby creating
a change in the questions and applications of the concepts. Candidates were less prepared for
these changes. Furthermore,
Practical Accounting II subjects, though procedural in nature, are more analytical and critical.
References: http://batstate-u.edu.ph/media/cabeihm%20research/research%20journal%206-2.pdf

http://memoentry.com/cpa-board-exam-results-and-numbers-for-the-past-decade/