The CPA Ethics Exam: Not One Exam, and Gone in California

Most guidance on becoming a US CPA still tells candidates that California requires the PETH ethics exam. It does not. The requirement was discontinued in 2024.

That is one instance of a wider problem: there is no single "CPA ethics exam". There are several distinct requirements wearing similar names, administered by different organisations, with different pass marks, and in at least one state no longer existing at all.

First, two things that are not the same

The ethics exam is an initial licensure requirement in some states. You sit it once, on the way in.

Ethics CPE is a recurring requirement to maintain a licence — typically four hours per cycle, three in Ohio, with the hours often needing board-specific approval.

Candidates and employers routinely conflate them, and the consequence is either a missed licensure step or hours bought against the wrong requirement. They are separate obligations with separate rules.

California: the requirement was removed

California's Office of Administrative Law approved an order in May 2024 to discontinue the requirement for CPA candidates to pass the Professional Ethics Exam for Certified Public Accountants. In its place, licensees complete a two-hour Regulatory Review continuing education course at first renewal.

The Board's stated reasoning is worth noting, because it is the sort of argument that tends to travel: that professional ethics are already tested within the CPA Exam itself, and that there was insufficient evidence to prove the PETH exam met professional and technical standards.

The change is visible in the Board's own regulations, where the relevant section applies only "Until July 1, 2024" and its successor provision is marked to become inoperative on 1 July 2026.

Two cautions. First, the exam's removal as a licensure requirement does not settle whether it survives for other purposes such as licence reissuance — we could not confirm that either way, and the Board and society pages that would resolve it were not retrievable. Second, California's licensure requirements are separately changing from 1 January 2027, with a transition period through 2028, so a candidate reading older guidance is likely to be wrong on more than just ethics.

Texas runs its own exam, and also requires a course

Texas is the clearest example of why "do I need the ethics exam" has no general answer. The State Board of Public Accountancy requires candidates to "Pass an exam on the Board's Rules of Professional Conduct, which will be emailed to you after you submit the application for issuance."

So it is a board-administered exam on that board's own conduct rules, not a national product — and it is delivered by email after application rather than booked at a test centre.

Separately, Texas requires a three-semester-hour board-approved ethics course as part of the education requirement. Two different items, both mandatory, routinely treated as one. We could not establish the passing score or format for the Texas exam from the Board's published material.

The AICPA course: useful, and explicitly not universal

The AICPA's comprehensive professional ethics course is the closest thing to a common standard, and it carries two features that matter.

The pass mark differs by purpose: a score of 90 percent or higher is required for licensure, against 70 percent or higher for maintaining a licence. A candidate who passes at 75 percent has satisfied a maintenance threshold and not a licensure one.

And the AICPA itself publishes the caveat that undermines any assumption of portability: "Many states do not accept the AICPA course to meet the ethics requirement for earning or maintaining a CPA license."

That is the provider of the course telling you not to assume it works in your state. It is also, in practice, the only safe general statement available on ethics exams across the United States.

Why the answer is necessarily state-specific

US licensure is a state function. Each board sets its own education, examination and experience requirements, and ethics sits across all three — as an education component in some states, an examination component in others, and a continuing requirement almost everywhere.

We verified the ethics exam position for California and Texas. We did not verify it for the remaining forty-eight jurisdictions, and we would rather say so than publish a fifty-state table built on secondary sources. If you are advising a candidate, the board's own licensure page is the only authority, and anything older than mid-2026 should be treated as suspect given how much has moved.

What has moved, briefly

The ethics position is changing inside a much larger shift. Since 2025, more than forty jurisdictions have made statutory or rules changes to open an additional route to licensure — a bachelor's degree plus two years of experience plus the Uniform CPA Examination, as an alternative to the traditional additional-thirty-credit-hours route.

One correction worth making explicitly, because it circulates widely: that route is not competency-based. A competency-assessment concept was discussed during consultation; what the AICPA and NASBA actually approved as model legislation in May 2025 is an experience-based pathway. If a guide describes it as competency-based, it is describing something that was not enacted.

Effective dates are the part to check rather than assume. Texas's second pathway took effect 1 August 2026. California's new requirements apply from 1 January 2027, with either set usable during 2027 and 2028 and the current route closing at the end of 2028. For most of the other jurisdictions, published trackers give the signing date rather than the effective date — and the two are frequently years apart.

Practical sequence

For a candidate, the order that avoids wasted effort is: confirm which board will license you, read that board's current licensure page, establish whether it requires an ethics exam at all, and only then decide which course or exam to take. For ethics CPE after licensure, the question changes to whether your board reserves approval of ethics providers — several do.

Our guide to ethics CPE for CPAs covers the recurring requirement, and who decides whether your CPE counts explains why the board and not the state society is the authority on acceptance. For the licensure routes themselves, see our overview of the 150-hour rule and the 120-hour pathway.