By Michael D. Colgan, CEO and executive director
On Sept. 23, 2017, long-awaited new regulations proposed by the Pennsylvania State Board of Accountancy (SBOA) were published in The Pennsylvania Bulletin. With this publication, the two most recent amendments to the Pennsylvania CPA Law (Act 73 of 2008 and Act 15 of 2013) as well as a clarification of civil penalties for CPE violations have been implemented. Included are revisions to the CPE requirements for all licensees and clarification on how a CPA candidate’s experience is verified. The new regulations will be effective Jan. 1, 2018, so they will not impact the current biennial license renewal due Dec. 31, 2017.
With respect to CPE requirements, the new regulations eliminate the minimum eight-hour tax requirement for all licensees, and will require 24 hours (increased from 16) of accounting and auditing credits only for those licensees participating in attest activities. Licensees not participating in attest activities will have no A&A minimum. The four-hour biennial ethics requirement remains in place for all licensees. These changes allow licensees to select and complete CPE in areas most related to their current professional development needs. The regulations also outline a schedule of civil penalties for licensees who fail to comply with the biennial CPE requirements.
In Act 15 of 2015, a general experience requirement replaces the previous requirement that every licensee obtain 25 percent of his or her required experience in attest services. Under the new regulations, CPA licensees who supervise attest services, and sign or authorize another to sign an accountant’s report for attest services, must meet at least one of the following: at least 400 hours of attest experience within the previous five years and at least 24 hours of CPE in accounting, auditing, or attest during the immediately preceding 24 months of issuing a report; or be a member of, or employed by, a firm registered with the Board that has met the peer review requirements.
The regulations also clarify the types of general experience permitted by Act 15 to meet the requirement for CPA licensure. They clarify who can verify an applicant’s experience: an individual who possesses a current CPA license during the entire period of the verification, either employs or is employed by the same employer as the candidate, or has a relationship approved by the SBOA prior to the period of verification. This final provision provides an opportunity for candidates who work for entities that do not employ another licensee to seek approval from the SBOA to allow a different relationship to verify their experience.
If you would like to review the proposed regulations in detail, you can check out the Schedule of Civil Penalties or the Act 73 and Act 15 Amendments.
If you have any questions or need additional clarification on the new regulations, please feel free to contact me.
Listen to Mike explain the details of the changes, when they will take effect, and what they mean for Pennsylvania CPAs in this CPA Conversations podcast.