As you likely already know, CPAs maintain their licenses by complying with their state’s board of accountancy. Though the exact requirements vary between states, CPAs will generally be expected to maintain and augment their skills through continuing professional education (CPE) programs.
However, the policies regarding CPE reporting and CPA licensing are changing, beginning in January of 2023. Here’s a summary of the changes you can expect and how you can respond to them if you’re a current CPA.
CPE Changes for 2023
There are three major areas of change for CPAs in 2023, and each of them will go into effect on the same date: September 1, 2023. However, all license holders will need to report their CPE hours to their state’s board of accountancy by December 31 of each calendar year.
CPA Reinstatement
Under the current requirements, CPAs who fail to report their hours enter into an expired status, where they can be reinstated by reporting their required CPE hours to their state’s board of accountancy.
Under the new changes, CPAs will no longer be reinstated. Instead, they will enter into revoked status, where the only means of reclaiming a CPA license will be to complete the program all over again, including reapplying, paying all required fees, and passing the CPA examination.
Surplus CPE Hours
The current policy does not allow CPAs to “roll over” their CPE hours from year to year, but the changed policy would allow CPAs to report excess CPE hours the following year. For example, if you completed an additional ten hours of CPE during the current calendar year, you may report those hours as part of your requirements the following year.
However, there are limits to this. Most accounting professionals can report only ten hours or less, though a certified internal auditor (CIA) can report up to 20.
Grace Period
Thankfully, CPAs and other license holders do not automatically enter into revoked status and instead first enter into a grace period. During this period, they may not display their certification after their name nor use any benefits associated with their license. However, they may return to active status once they report their CPE requirements to their state’s board of accountancy.
Under the current requirements, this grace period only lasts for one year, but under the new requirements, the grace period is extended to two years. Remember, though, that after that grace period expires, any outstanding CPAs will enter into revoked status, meaning they’ll need to recertify to regain their license.
Hardship Exemptions
The Professional Certifications Board (PCB) allows exemptions to be made on a case-by-case basis. If you are a CPA in jeopardy of entering into revoked status and wish to qualify for an exemption, a hardship exemption request and a support case must be submitted through a valid CCMS account.
Make sure to include any and all supporting documentation to strengthen your case. You also must submit your exemption request prior to the renewal deadline (December 31 of each calendar year).
Understanding Your Status
Once the changes go into effect, your specific course of action will depend on your current status. Here’s what you can expect.
Active Status
If you are currently in active status, it means that you are up-to-date on your CPE requirements. To retain your status, you’ll need to maintain your CPE requirements and report their completion by December 31, 2022, as well as by the close of every calendar year. As long as you remain active, you may continue using your certification after your name and using all the benefits associated with your license.
Grace Period
If you have entered the grace period, it means that you have not yet reported your CPE requirements. If you have only recently entered the grace period, the new requirements will give you up to two years to report your CPE hours.
However, once your license is revoked, you will not have this option, so make sure to report your CPE hours as soon as possible to prevent entering revoked status. During the grace period, you are not permitted to use the certification after your name or invoke any benefits associated with your license.
Revoked Status
If you have entered revoked status, it means that you have not reported your CPE requirements, and your grace period has expired. It also means that you are prohibited from displaying your certification after your name or from using any benefits of your license.
Unfortunately, the new requirements will mean that your only option is to recertify. You’ll need to re-apply for a program, retake the exam, and pay any associated fees before you receive a new license. Once you do, make a plan to report future CPE to prevent losing your license in the future.
The Importance of CPE
While reading this article doesn’t count toward your continuing education, consider this a valuable lesson in changes to policy. Staying up-to-date with your CPE can make you more knowledgeable and agile regarding the financial industry, and more practically, it will ensure that you maintain your license according to established regulations.
Learn More: Controllers Council Partnership with Illumeo CPE
Never stop learning. If you are looking to keep up with your licensure or want to put your position for professional growth, look no further than the Controllers Council. Earlier this year, we announced a partnership with Illumeo to provide Controllers Council Members with discounted CPE courses—as well as a few free ones every once in a while.
To claim, simply click here and the discount will be applied automatically on checkout. Or use code CONTROLLERSCOUNCIL10.
Additional CPE Resources
The CPE Challenge: Affording Your Continued Education and Focusing on What Matters
