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Just Eliminate the Extra 30 For CPA Licensure Requirement!

a person with books for a head in library, question mark

By Sharon Lassar, PhD, CPA (Florida)
John J. Gilbert Professor and Director of the School of Accountancy, University of Denver

Thank goodness for the Connecticut Society of CPAs! Without their posting, it would have taken me longer to learn about the latest half-baked idea by NASBA regarding the education requirements to become a CPA. It seems NASBA wants to keep this under wraps. I could not find mention of this exposure concept on NASBA’s website, and certainly no link for comments. I suppose they only want to hear from the echo chamber. Requesting comments during busy season was not safe enough, I suppose, to keep them from possibly hearing things they don’t want to hear.

What is NASBA up to now? They have formed a task force to look at the licensure model and their first idea is to further weaken, rather than repeal, the worthless education requirement of an extra 30 hours of course work. There are no educators on the task force. Not only does NASBA not want to hear from CPAs who are not members of the entrenchment club, but they also don’t want an educator’s voice in a discussion of the education requirements.

To become a CPA, one must meet the requirements of three Es: education, exam, and experience. The AICPA and NASBA want to retain the 150-hour education requirement that has been questioned repeatedly by rigorous peer-reviewed academic studies, by the Center for Audit Quality, and on these pages from the multiple perspectives including diversity and learning efficacy. Many potential CPA candidates never enter the pipeline due to the tuition cost and time involved to obtain an extra 30 credit hours. Rather than proposing to do away with the extra-30 requirement that has no demonstrated value, the AICPA created an Experience, Learn, and Earn (ELE) program. I have previously questioned the wisdom of the ELE approach. ELE candidates work for a sponsoring firm in a benefited position while enrolling in low-cost fully online courses where they earn credit hours on a transcript. Low cost might mean low value. A determinant of low value might be low effectiveness. We don’t know. ELE is currently promoted as a pilot program.

Ideally a pilot program would inform us about the efficacy of the pathway. Will ELE candidates complete the credit hours in a reasonable time frame? Will they pass the CPA exam in one 30-month window? Will they stay in the profession even a year beyond what might be required to not repay tuition benefits under their sponsoring firm’s employment contract? I would bet 20 to 1 that we’ll never know.

We won’t know for two reasons. The AICPA will not collect and report the relevant information. Secondly, NASBA and the AICPA will push through an alternative scheme that makes questions about the current form of ELE moot. NASBA is focusing discussions on an equivalent path to licensure without the need of having those extra 30 hours on a transcript. Instead, candidates could complete a “structured professional program” while they work. Hmm. That sounds like an experience equivalent to me.
Why not simply allow students who hold a bachelor’s degree to become CPAs with an additional year of experience over students who hold a master’s degree?

Oh, I know! Allowing bachelor’s degree holders to become licensed after two years of experience would remove the need for a “structured professional program” and the fees that such a program could generate for AICPA and NASBA. ELE could be offered solely by the AICPA. There would be no need for a university partner who would charge tuition. The AICPA could capture enrollment fees. And, who would certify a program as “structured”? That sounds like a potential revenue stream for NASBA. Like how CPE providers pay to join NASBA’s National Registry of Sponsors, firms that provide structured professional programs could pay to have their programs approved by NASBA.

Enough already! NASBA’s exposure concept of creating a structured professional program would evidently require legislative action in at least some states. If a “solution” that requires legislative action is being proposed, that solution should be to change the education and experience requirements to be what they once were in many states – license with a master’s degree plus one year of experience, or license with a bachelor’s degree and two years of experience.

7 thoughts on “Just Eliminate the Extra 30 For CPA Licensure Requirement!

  1. Stomp your feet and pout much? How about instead of claiming why you are correct, start by revisiting the reason for why the hour requirement was established, and why it is so wrong…oh, you thought of that but you can’t take that position, so you won’t go there….gotcha!

    So, you’re an educator who argues for less education — maybe look into that and consider politics instead…or perhaps you have, and this is why.

    Hey — what happens when you remove the education requirement and then find out less people are passing – whoopsie, guess the exam is too hard then….time to make the exam easier, silly goose! You do seem to have allllll the answers. Or none, but either way.

  2. 150 is a red herring. What’s the answer to this?

    “nonaccounting majors perceived an accounting career as being monotonous and less fulfilling, less interesting, and less intellectually challenging.” – a survey of 1200 college freshmen pursuing a degree in business.

    Profession has a real image problem.

  3. I would be fine with this as long as the extra hours + 1 year experience is still an option for people who did the extra credits and are currently working towards the license. I have 150 credits and passed the CPA exam and just started working a staff-level industry job that will get me the experience requirement. I would like the 1 year experience requirement since I already bought the extra credits from the university.

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