It was only a couple days ago that the Journal of Accountancy published an interview with NASBA CEO and President Ken Bishop in which Bishop sternly warns states against even thinking about lowering the CPA licensure requirement to 120 units, something something mobility blah blah. To save you a click, here’s a relevant snip of that JofA article and his comments, published February 10:
“Should any state or jurisdiction lower the licensure requirement to 120 hours, their CPAs would no longer be automatically substantially equivalent and would no longer enjoy the mobility and reciprocal practice privileges they currently are afforded,” NASBA President and CEO Ken Bishop said in an interview with the JofA. “Lowering the bar to 120 hours is only one of the alternatives we have heard that has been discussed and considered. Others, including lowering the cut score for passing the CPA Exam, have the potential and risk of creating the perception of dumbing down the profession. No one is talking about, for example, lowering the bar to become an attorney, and they’re also suffering from lack of entry.”
Bishop said the NASBA board vote was prompted by “a few state society staff members but not the profession in general” considering action that would create different pathways to CPA licensure. Bishop understands the sentiment behind the consideration but stressed that any changes on the state level that don’t align with the UAA would be counterproductive for the profession.
“If I was a society CEO and I had some members who were having trouble hiring CPAs knocking on my door, I would be trying to react. We’re not saying don’t react; we’re saying let’s do it in a uniform way,” Bishop said. “What really gets our attention is something that has an opportunity to disturb or completely adulterate the substantial equivalency, mobility, reciprocal licensure — things that we’re working to protect and maintain.
Given this, it is our pleasure to inform you that bills have been introduced to the Minnesota legislature — HF 1749 and SF 1660 — that would add an alternative pathway of 120 units and two years experience, while leaving the option to go down the state’s existing 150 hour path as well.
MNCPA calls it “broadening the path to licensure” and from their perspective, it’s not a dumbing down at all. And if those opposed to the change think it is, then those people are saying that 30 arbitrary units of education do more to prepare the entry level CPA than two years of experience in the field under the supervision of a CPA.
Some points provided by MNCPA to clarify concerns about the change:
- The MNCPA does not believe that legislation to broaden the licensing requirements is a magic solution and candidates will flock to the CPA exam. It is one part of a multi-layered campaign to promote the accounting profession and make it an attractive career choice to students. [Ed. note: We agree. The 150 hour rule is not a dam holding back a flood of people who would become CPAs if only 150 weren’t blocking the way. Tweaking the rule does, however, remove a barrier thereby letting in a few more people who are deterred by 150.]
- The MNCPA initiative does not eliminate 150-college credit hours with one year of work experience as a path to licensure. That should remain an option for candidates who have the means and time to take the additional credits.
- The MNCPA initiative does not lower the bar to become a CPA. More than 40 states allow candidates to sit the for the CPA exam with 120 college credits. The CPA exam, which all candidates must pass, is the unifying qualification to become a CPA. Additionally, all states have education, ethics and work experience with varying requirements.
- Each state determines their rules to become a CPA, maintain a CPA certificate and regulate the activities of CPAs. While there is a set of model rules, no state has fully adopted them and there currently exists a variety of differences between states. For example, some states require a candidate to have 150 college credits before sitting for the exam. Most allow sitting with only 120 college credits. Even with this difference, states are considered substantially equivalent.
Understand that this is a big deal. Also understand that TPTB are not happy about this (TPTB being the AICPA, NASBA, and especially Ken Bishop who just got clowned after that big passionate, suspiciously timed speech for JofA). There are many conversations to be had about mobility of course, we’ll keep an eye out for those. For now, this is only just now coming up in the legislature, it’s not a guarantee the rules will change. It certainly opens the floor for further discussion.
Anyway, here’s the bill in full, you already got the TL;DR. Old language has been struck, new language is underlined. It’s so nice to be able to use strikethrough for something other than snide comments for once.
A bill for an act
relating to certified public accountants; amending standards for required education
and experience; amending Minnesota Statutes 2022, section 326A.03, subdivisions
3a, 6.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
Section 1. Minnesota Statutes 2022, section 326A.03, subdivision 3a, is amended to read:
Subd. 3a. Early examination. Notwithstanding any contrary provision in this section,
the board may adopt rules to permit a person under certain circumstances:
(1) to apply for the examination within 180 days prior to the person’s anticipated
completion of the education requirements as defined in subdivision 6; and
(2) to take all or a part of the examination within 90 days of the anticipated completion
of the education requirements. No credit shall be given for any part of the examination taken
before completion of the education requirements in subdivision 3 unless:
(i) the education requirements in subdivision 3 and adopted rule requirements are met
within 120 days after taking any part of the examination; and
(ii) documentation of completion of education requirements is received by the board
within 150 days of the person taking any part of the examination.
EFFECTIVE DATE. This section is effective July 1, 2023.
Sec. 2. Minnesota Statutes 2022, section 326A.03, subdivision 6, is amended to read:
Subd. 6. Certificate; required education and experience. (a) On or after July 1, 2006
2023, a person who has passed the examination required in this section must be granted a
certificate as a certified public accountant provided the person provides one of the following
certifications; the board verifies the certification; and the person complies with requirements
for initial issuance of the certificate as a certified public accountant as prescribed by the
board by rule:
(1) the person certifies to the board that the person has completed at least 150 semester
or 225 quarter hours at a college or university that is fully accredited by a recognized
accrediting agency listed with the United States Department of Education, or an equivalent
accrediting association, and has completed at least one year of experience of the type
specified in paragraph (b);
(2) the board verifies the certifications; and (3) the person complies with requirements
for initial issuance of the certificate as a certified public accountant as prescribed by the
board by rule. the person certifies to the board that the person has completed at least 120
semester or 180 quarter hours at a college or university that is fully accredited by a recognized
accrediting agency listed with the United States Department of Education, or an equivalent
accrediting association, and has completed at least two years of experience of the type
specified in paragraph (b); or
(3) the person certifies to the board that the person has completed 120 semester or 180
quarter hours at a college or university that is fully accredited by a recognized accrediting
agency listed with the United States Department of Education, or an equivalent accrediting
association, and has completed at least one year of experience of the type specified in
paragraph (b), and completed 120 hours of professional education within one year of applying
for licensure as provided for in 326A.04, subdivision 4. Professional education hours
completed under this clause must be taken by a provider accredited by the National
Association of State Boards of Accountancy or as defined in board rules for professional
education and shall not qualify to meet professional education hours required after initial
licensure.
(b) An applicant for initial issuance of a certificate under this subdivision shall show
that the applicant has had one year of meet the experience requirements as defined in
paragraph (a), clause (1), (2), or (3). Acceptable experience includes providing any type of
service or advice involving the use of accounting, attest, compilation, management advisory,
financial advisory, tax, or consulting skills, as verified by a licensee and meeting requirements
prescribed by the board by rule. Acceptable experience may be gained through employment
in government, industry, academia, or public practice. Experience as an auditor in the Office
of the Legislative Auditor or State Auditor, as verified by a licensee, shall be acceptable
experience.
EFFECTIVE DATE. This section is effective July 1, 2023.