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American Institute of CPAs®
An Overview of CPA Firm Mobility
Gary McIntoshAICPA Co-Chair, Uniform Accountancy Act Committee
September 9, 2014
American Institute of CPAs®
Mobility: A Short History
Prior to the Profession’s Individual CPA Campaign, CPAs often had to hold multiple reciprocal state licenses
Bureaucratic Compliance Nightmare
Inconsistent Standards Across the States
American Institute of CPAs®
Mobility: A Short History
Approximately a decade ago, profession leaders joined together to try to resolve the problem
Idea launched to treat a CPA license like a driver’s license – portable across state lines
American Institute of CPAs®
Mobility
Basic concept • No notice • No fee • No escape (strong protections)
American Institute of CPAs®
Mobility
Additionally, a CPA license, like a driver’s license, must be predicated on substantial equivalency• A CPA = a CPA = a CPA• 150 hours of education, CPA Exam passed, 1 year of
experience
American Institute of CPAs®
Uniform Accountancy Act
Individual CPA Mobility Language was inserted into the Uniform Accountancy Act (UAA) in 2006• UAA is the profession’s model state act• Written jointly by AICPA and NASBA• States then model their accountancy statutes off of the UAA
American Institute of CPAs®
Mobility
The original plan allowed full individual and CPA firm mobility• Concerns arose, however, about how the new concept would
work in practice• Untested• Particular interest in being cautious about the attest function
Final proposal changed to allow individual CPA mobility and CPA firm mobility for non-attest services• Attest services would still require the registration of a CPA firm
in any state where attest services are offered, however the firms’ CPAs could operate without reciprocal licenses
• Additional concerns at the time about peer review, use of firm names, and CPA ownership standards – mostly now resolved
American Institute of CPAs®
The Campaign Begins
A True Partnership of the Entire Profession• State CPA Societies• State Boards of Accountancy• AICPA• NASBA• CPA Firms and individual CPAs
American Institute of CPAs®
Today the Individual CPA Campaign is nearing its end…
American Institute of CPAs®
American Institute of CPAs®
Mobility
Only 3 Jurisdictions Remain• Hawaii (Discussions occurring regarding a 2015 push)• Guam (legislation expected in Summer/Fall 2014)• Commonwealth of the Northern Mariana Islands (legislation
expected in Summer/Fall 2014)
American Institute of CPAs®
Mobility
Additionally, AICPA and NASBA have established resources for CPA Firms and Individual CPAs• CPAMobility.org
American Institute of CPAs®
American Institute of CPAs®
An Incredible Success Story
Statutes modernized to reflect actual way CPAs practice around the country
No complaints about enforcement by state BOAs
Bureaucratic red tape and fees that don’t serve public interest eliminated
Envy of other professions
American Institute of CPAs®
Mobility
Nonetheless, some minor implementation issues remain
Some states still have a few state-specific provisions (ex. casinos, ag audits)
Massachusetts and Georgia have “quid pro quo” provisions
American Institute of CPAs®
Firm Mobility
Profession now revisiting CPA Firm Mobility for attest
Completion of a promise made in 2006
Timely after successful history with individual mobility
American Institute of CPAs®
Uniform Accountancy Act Initiative on CPA Firm Mobility for Attest
Multi-year project
Exposure draft with 90 day comment period
Approximately 3 dozen comment letters received
Language approved Spring 2014 by AICPA and NASBA
States being asked to look at the new language
American Institute of CPAs®
Firm Mobility Model for Attest Services
Same as individual mobility• “no notice, no fee, no escape”
Already in place for non-attest services
States will gain additional explicit authority to go after unregistered firms
American Institute of CPAs®
Firm Mobility: Public Protections
To be eligible, must comply with peer review and CPA ownership requirements of mobility state
If not in compliance, then must seek to register as an ‘out-of-state’ firm
American Institute of CPAs®
Firm Mobility
14 states already have CPA firm mobility and it appears to be working well
States like OH and VA have had firm mobility for over a decade
American Institute of CPAs®
Firm Mobility
This new language will not be a concerted campaign.
Commitment not to push like with individual CPA mobility
Reasons:• Individual CPA mobility is too new in some states• Other pressing state issues needing to take precedent• Boards and societies need to review the concept, discuss with
stakeholders and members, consider if appropriate
American Institute of CPAs®
Firm Mobility
What are the biggest obstacles and concerns in regard to CPA Firm Mobility?• Same common concerns we heard in regard to individual
mobility in the past• Need to educate, discuss, and develop a comfort level among
our partners
American Institute of CPAs®
Firm Mobility
Lessons from the UAA Comment Period on the CPA Firm Mobility Language • State Societies and CPA Firms all broadly supportive• State BOAs mixed, some strongly supportive, others opposed or
had questions or concerns• States BOAs with CPA firm mobility already in place often
proved to be the most supportive of other states joining them
American Institute of CPAs®
Firm Mobility
Common Concerns That Needed to be Examined
• Understanding the peer review protections • Potential Insufficient Information without registration/notification • Questions about enforcement • Inconsistency between states (e.g. compilations) • Concerns about insufficient information or study of the issue.• Potential Loss of Revenue from Out-of-state Registration Fees
American Institute of CPAs®
Questions?