How lowering the accounting education requirement risks CPA mobility

To become a licensed CPA in the United States, candidates must earn a bachelor’s degree with 150 credit hours, gain one year of professional experience, and pass a national examination. This universal pathway is accepted by all 55 jurisdictions, allowing CPAs to easily perform services across state lines, whether virtually or in person. This uniformity also assures the public that regardless of where CPAs practice, they will uphold the highest professional and ethical standards.

The Minnesota Society of CPAs recently advanced a bill that would allow candidates to meet the education requirement through two alternative options: 1) earning 120 hours and two years of experience; or 2) obtaining 120 hours of college education, one year of experience, and 120 hours of continuing professional education (CPE) within one year of applying for a license. While the Society’s decision was largely driven by the good intention of improving the profession’s shrinking pipeline, reducing the education requirement does not mean that students will rush to sit for the CPA exam and work toward a CPA license, or be more interested in working in the areas of audit and assurance.

What the bill will do immediately upon passage, however, is upend mobility for CPAs and firms licensed in Minnesota, create unnecessary burdens for cross-state practice and careers, and complicate regulatory oversight. Students may also choose to earn their initial license in a neighboring state, where career opportunities won’t be limited by inconsistent and confusing regulations.

Like the state CPA societies, the AICPA is laser-focused on attracting and retaining talent. We firmly believe the solution should not open up risks to CPA licensure. The profession’s pipeline is driven by a number of complex factors—including an overall decline in college enrollment, rising education costs, and shifting expectations regarding work culture and starting salaries.

Any solutions must maintain the rigor needed to protect the public while providing flexibility for candidates of all backgrounds. Instead of opening doors for accounting students and CPAs, the Minnesota bill will quite literally close them.

The AICPA and National Association of State Boards of Accountancy (NASBA) hosted a webinar in mid-February to explain the bill’s consequences and answer questions from stakeholders. Watch the video to understand what’s at stake:

• Loss of mobility: Minnesota CPAs would no longer be able to practice in another state without first having their qualifications reassessed, and in most cases, applying for a new license.

• Client limitations: Minnesota public accounting firms would need to provide advance notice and gain a practice permit before signing any client engagement agreement or providing services.

• Unexpected fees: Minnesota CPAs and firms would incur expenses related to license applications, meeting CPE requirements, and additional administrative work.
  

Students and CPAs are encouraged to fill out this quick survey, which will help inform the AICPA’s advocacy work and pipeline initiatives.