CPA BEC Exam Tips: Pass Rate Trend + My 5 Strategies

cpa bec exam

This [Business Environment and Concepts] section covers knowledge of general business environment and business concepts that candidates need to know in order to understand the underlying business reasons for and accounting implications of business transactions, and the skills needed to apply that knowledge in performing financial statement audit and attestation engagements and other functions normally performed by CPAs that affect the public interest.”   – The Uniform CPA Exam Website

BEC will have the Most Changes in April 2017

There will be a new CPA exam on April 1, the first day of the second testing window in 2017. Here are the reasons why you should take BEC before the changes:

The following is an overview of the existing BEC exam:

CPA BEC Exam: An Overview

Many CPA candidates find CPA BEC exam the easiest (or rather, least difficult) exam. It is certainly the shortest and comprises only 3 testlets of 24 multiple choice questions, i.e. 72 questions all-together, and 3 written communications.  There is no task-based simulation in this exam section.

Given my background in Economics I also find BEC to be a more relaxing part of the exam. Having said that, for those who are fresh out of college or are unfamiliar to how businesses are run in real life, it could come as a nasty surprise… as shown below.

CPA BEC Exam Topic Areas and Weighting

It is a test of miscellaneous business concepts and topics applicable to an accountant:

1. Corporate Governance: Role of Board of Directors, audit committee and other stake holders in corporate governance. 16%-20%
2. Economic Concepts and Analysis: Inflation, deflation, interest rates, exchange rates, foreign currencies and their impact to businesses. 16%-20%
3. Financial Management: Financial modeling e.g. EVA, DCF, NPV, IRR, and financing options (cost of capital and derivatives), loan rates and loan covenants.
4. Information Systems and Communications: Role of business information system, roles within IT functions, IT basics, disaster recovery and business continuity. 15%-19%
5. Strategic Planning: Planning, projection, budgeting, performance and cost measures. 10%-14%
6. Operations Management: cost accounting  12%-16%

CPA BEC exam topics

Historical CPA BEC Exam Pass Rate

BEC is historically one of the lowest performing parts in the CPA exam. Encouragingly, the pass rate has seen marked improvement and is the only part with pass rate above 50% in 2012, reaching 57% in 2015.



Source: AICPA

CPA BEC Exam Tips

Tackle the Different Topics One by One

BEC is a basket of miscellaneous business, economics and financial concepts. They don’t relate to each other, which makes the materials difficult to retain for some candidates. It is best to tackle each topic one by one.

1. Corporate Governance

This is an important topic and it ties with other parts of the CPA exam, particularly AUD. Special attention should be paid on the role of Board of Directors and the Audit Committee. It is not a difficult topic but questions could be tricky.

2. Economics

If you’ve had course work in Economics, the questions should be straightforward because the exam covers only elementary micro and macro economics. Even if you’ve never seen it, the concepts shouldn’t be too difficult. Candidates can “guesstimate” by common sense.

The strategy is to go through the textbook or DVD fairly quickly and focus the time in practice tests. You will be surprised to see how many wrong answers you may get — yes, that’s how tricky the CPA exam can be, and how they manage to have such a low passing rate. Don’t get discouraged! Once you get used to the format of the questions you will do much better.

3. Financial Management

I work in the strategic planning department and this is easy topic for me, but I understand it could look very complex for people who haven’t done any financial modeling.

The trick is to really understand how the calculation works, and you should not memorize anything more than the basic formula. If you can’t figure it out, ask the instructor in your class, or call/email Cindy Simpson if you are taking Yaeger CPA review.  She has never disappointed my readers when answering their questions.

4. Information Technology

IT is a huge topic, and no CPA review course can ever cover all the content. IT is important in real life though: accounting nowadays does involve a lot of IT — all the journal entries are posted to the “System” that generates everything from monthly statements to management reports. As a result of its importance, an accountant must learn how to maintain the integrity and security of this system.

Having said that, studying all these for the CPA exam is extremely boring… I know, I have been there, and the reading took forever…

The good news is that this IT section involves mostly facts and terminology, and therefore questions are rarely too tricky. Most candidates are fine after reading over the materials once and spend the rest of the time working on practice questions.

5. Strategic Planning and Operational Management (Cost Accounting)

Many of you may have learned cost accounting in college, but for those who haven’t, this could be a very difficult section. This could be an area where you need extra help, e.g. call up the instructor to really understand the concepts behind it.

I think I still don’t really “get” cost accounting, but I know it well enough to pass the exam. If you really can’t figure it out, work extra hard on the rest of the BEC section and you should be okay.

My Recommendation and Tips

1. Do NOT underestimate BEC. Some candidates pass the other 3 parts on first try but stuck with BEC forever. It is easier for most candidates but not all candidates.

2. Work on your weakest area(s), be it cost accounting or financial modeling,  work on plenty of practice questions.

3. Don’t give up. Don’t panic if you think BEC is difficult while everybody seems to have a breeze with it. Did you know that BEC had the lowest passing rate back in 2009? It’s not supposed to be easy.

4. Get Prepared for the Written Responses. You are going to face 3 questions, each asking you to write a business writing (a memo, a letter to the client for example). There is no need to write in flowery words and instead be relevant, concise and organized.

More Tips?

Written Responses (formerly known as Written Communications)

General guide

Strategies for other exam sections

Get the Best Prep for Your BEC Exam!

Lesson your load with these state-of-the-art learning tools:


About the Author Stephanie Ng

I am the author of How to Pass The CPA Exam (published by Wiley) and the publisher of this and several accounting professional exam prep sites

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  • Laurie Johnson says:

    Thanks so much for passing on your expertise and knowledge of what to expect in the BEC section of the exam. Helpful information!

    • Stephanie says:

      Hi Laurie,
      You are most welcome! And I look forward to update this page with 2011 exam changes at the beginning of next year. It should provide more value-add to candidates then! Stephanie

  • Divya says:

    I DO NOT recommend Yaeger. I failed it horribly. I have been using Roger and lets put it this way – he knows his stuff. Even after spending rigorous amount of time memorizing the tactics by Yaeger – I did horrible. DONT skip the questions Yaeger tells you too unless you like surprises.

    • Stephanie says:

      Hi Divya,
      Thanks a lot for your sharing. This is helpful — because almost everyone has been saying good things on Yaeger and I do want some opposite views. I will let other readers know of your thoughts. Stephanie

  • PNguyen says:

    I’m using yaegar and my test is tomorrow for BEC. Am I screwed?!

    • Stephanie says:

      Hi PNguyen,
      Probably too late for me to give you the assurance… but no, many people pass BEC and other sections with Yaeger. The same applies to the top 10 cpa exam review courses. Please remember that your own ability is also (if not more) important than the course materials. Relax and good luck! Stephanie

  • Kelly says:

    I sat for BEC today, I am pretty confident that I did well, let’s see when grades show up, this is my first time and I used Wiley book and Bisk software, Wiley was overwhelming and unnecessary, none of the two pragraph problems were on the test and looking at time allotted I don’t know how they can test for problems requiring long calculations, stick to basic and understanding the subject matter and you will do fine in BEC, on to next one.

  • Shirley says:

    Hi Stephanie,
    Can you tell me if 2011 BEC will include the topics of business structures and cost management in the exam? It seems like corporate governance and operations management have been added to the exam, but I’m not sure what topics have been removed. Thank you.

  • Manny says:

    Business Structures have been removed from the 2011.

  • Nir says:

    Hi Stephanie,

    with the upcoming changes in CPA exam in 2017 spring, I’m planning to take BEC & REG first.

    After reviewing a CPA review course comparison on your website, I’ve purchased Roger CPA review and have completed 70% in 3 weeks by putting 3 hours daily and 5 at weekend.

    They have a good bank of IPQs but do you recommend to buy another CPA test bank for more practice. They suggest it’s not needed. But, as I said I’m planning to watch 100% lectures including class Questions & majority of their practice questions by end of this month leaving me extra 40 days to do cram course + revise the material & practice more to appear my first exam BEC on 8-Sep.

    Can you please advise if it’s worth investing in extra CPA test bank or IPQs provided in review course are enough for practice?


    • Stephanie Ng says:

      Nirav, that’s great progress! My readers said Roger’s practice questions are too easy, but that is before they upgrade their IPQs. So not sure if this is the case.

      Because of this earlier observation though I would be nice to get a supplement if you don’t mind the extra cost. I think it’s worth it, since you have the time. Either Gleim test prep or Exammatrix will be good choice in my opinion because they should be quite different from Roger’s sets. Let me know how it goes!

  • Neer says:

    Thanks for the reply, Stephanie. I’ll surely check that out.

    Also, I’m not sure about pre-upgrade, but post upgrade IPQs are not easy for sure at least I can tell because they’re plain adaptation from previous CPA exams so it’s definitely tricky. I’m also PMP certified & I can kind of co-relate it with CPA from the exam Qs stand point. Many a times, the concepts are easy to understand but they ask you in a different/tricky way to incline you to make mistake.

    I’ll seek your help at regular interval for honest opinion/guidance in my CPA journey until next Summer. Where can I register on your website for the exam tips, experience shared by other CPA candidates/blogs etc? (can you please share link?)

  • Neer says:

    Hi Stephanie,

    I received the score of my BEC section today which is 70. How can I retrieve the break up section- wise to review my performance?

    Let me start from the beginning;

    I started prepping for my 1st CPA exam BEC from July 1st with Roger CPA Review & completed all video lectures, read book, practiced IPQs by July 31st. I started Roger CRAM course on Aug 1st which I completed by Aug 20th with the repetition of practice questions.

    By Aug end, I also took 3 simulation exam tests from Roger which the score of 90, 85, 84 respectively. For more practice & to avoid repeat questions, per your suggestion, I bought yet another test bank from Exam matrix to practice another 600 MCQs before I appear for my BEC exam on Sep 8th. Barring few overlapping questions between Roger & Exam matrix, I indeed found the level of MCQs from Exam matrix to be higher which shows from the fact that I took 2 tests from Exammatrix & I scored 73 the highest.

    In the final exam, due to anxiety of being my 1st CPA exam + some of initial intricate questions (+ probably psychological factor of unable to score 75+ in recent Exam matrix software), I was off in my time management from 1st Testlet by 20 min, which I recouped to some extent in 2 & 3rd Testlets leaving only 33 minutes for me to complete my 3 WCs. Specially the last one I completed in 8 minutes!

    Considering above, beyond time management (which is definitely one thing I’ll be working on) what additional piece of advice do you offer for me to prepare, when to re-take BEC again, what area should I focus more, did you find any discrepancy in my prep method knowing above?

    After my BEC exam, I also ordered your book ‘how to pass CPA exam’ & completed half of it by now.

    I already started preparing for my REG with a hope of taking exam by Dec 10th but now Plan B has kicked in. I intend to pass both BEC & REG by next spring before the new format kicks in.

    Your candid guidance is highly solicited to tweak my prep methodology, area of focus for the 2nd attempt of BEC. I believe I’m almost there, maybe ‘good’ but not ‘good enough’

    Never been in the situation before of having mixed feelings of despite scoring distinction 70 but still on receiving end.

    Please help!


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