CPA CFE Study Guide 2026

Everything you need to pass the CPA CFE exam in one place: the exam format, every topic to study, real practice questions with explanations, flashcards, and full-length practice tests. Free, no sign-up needed.

📋 CPA CFE Exam Format at a Glance

100

Questions

240 min

Time Limit

65%

Passing Score

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📚 CPA CFE Topics to Study (39)

Ethics and Professional Responsibility · 7 cards Ethics and Professional Responsibility · 7 cards Ethics and Professional Responsibility · 7 cards Audit and Assurance · 6 cards Audit and Assurance · 6 cards Audit and Assurance · 6 cards Audit and Assurance · 6 cards Audit and Assurance · 6 cards Audit and Assurance · 6 cards Finance · 6 cards Finance · 6 cards Finance · 6 cards Finance · 6 cards Finance · 6 cards Finance · 6 cards Financial Reporting · 6 cards Financial Reporting · 6 cards Financial Reporting · 6 cards Financial Reporting · 6 cards Financial Reporting · 6 cards Financial Reporting · 6 cards Management Accounting · 6 cards Management Accounting · 6 cards Management Accounting · 6 cards Management Accounting · 6 cards Management Accounting · 6 cards Management Accounting · 6 cards Strategy and Governance · 6 cards Strategy and Governance · 6 cards Strategy and Governance · 6 cards

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✍️ Sample CPA CFE Questions & Answers

1. A company has a defined benefit pension plan. Under IAS 19, what is included in the net defined benefit liability on the balance sheet?

✓ The present value of the defined benefit obligation minus the fair value of plan assets

Under IAS 19, the net defined benefit liability (or asset) is the present value of the defined benefit obligation less the fair value of plan assets. If plan assets exceed the obligation, a net asset is recognized (subject to an asset ceiling test).

2. What is the auditor's responsibility regarding going concern under CAS 570?

✓ To evaluate management's assessment of the entity's ability to continue as a going concern and conclude whether a material uncertainty exists

CAS 570 requires the auditor to evaluate management's going concern assessment, determine if events or conditions cast significant doubt, evaluate the adequacy of disclosures, and consider the impact on the audit report. The auditor assesses but does not predict future outcomes.

3. In strategic management, what does the value chain analysis identify?

✓ The primary and support activities that create value and can provide competitive advantage

Value chain analysis, developed by Michael Porter, breaks down a firm's activities into primary activities (inbound logistics, operations, outbound logistics, marketing and sales, service) and support activities (firm infrastructure, HRM, technology, procurement) to identify sources of competitive advantage.

4. What is the purpose of the audit committee's oversight of the external audit?

✓ To enhance auditor independence, ensure the quality of the audit, and serve as a communication link between the auditor and the board of directors

The audit committee oversees the external audit to protect auditor independence, ensure audit quality, facilitate communication of significant audit findings to the board, and address any disagreements between auditors and management. This strengthens the overall governance framework.

5. The CPA Canada Code of Professional Conduct states that CPAs owe their primary duty to the public interest. This means that when a client's interests conflict with the public interest, the CPA must:

✓ Prioritize the public interest and refuse to subordinate their professional judgment to the client

The CPA profession exists to serve the public interest, and when this conflicts with a client's wishes, the CPA must not subordinate their professional judgment and must uphold the public interest.

6. Under the pecking order theory of capital structure, what is the preferred order of financing?

✓ Internal funds (retained earnings) first, then debt, then external equity as a last resort

The pecking order theory suggests that firms prefer internal financing first (least information asymmetry), then debt (moderate information asymmetry), and finally external equity (greatest information asymmetry and adverse selection). This minimizes the costs associated with information asymmetry.

🎯 Free CPA CFE Practice Tests

Ethics and Professional Responsibility · 7 questions Ethics and Professional Responsibility · 7 questions Ethics and Professional Responsibility · 7 questions Financial Reporting · 6 questions Strategy and Governance · 6 questions Strategy and Governance · 6 questions Management Accounting · 6 questions Audit and Assurance · 6 questions Audit and Assurance · 6 questions Strategy and Governance · 6 questions

📖 CPA CFE Guides & Articles

Your CPA CFE Study Path

1. Learn with Flashcards → 2. Drill Practice Tests → 3. Take the Full Exam Simulation

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