Reproduced with permission. Published Aug. 8, 2019. Copyright 2019 by The Bureau of National Affairs, Inc. (800-372-1033) <http://www.bna.com>.
By Amanda Iacone
As Seen In Bloomberg Tax
Technology is rapidly altering the accounting profession, and the CPA license is about to change with it.
The American Institute of CPAs and the National Association of State Boards of Accountancy want to hear from accountants on what changes to education, experience, and exam requirements would result in a tech-savvy, relevant certified public accountant, cementing the profession’s trusted status for the 21st century.
The two groups have published a set of five guiding principles and supporting concepts that will help the profession’s leaders develop a new set of CPA licensing requirements. The deadline to comment is Aug. 9, but conversations will continue through the fall and likely into next year.
“We’re worried that as time goes on that the potential for there to be fewer and fewer CPAs really does become problematic and presents a public interest conundrum,” said Susan Coffey, the AICPA’s executive vice president for public practice. “We want to make sure that the CPA designation is reflective of what the market needs a CPA to do. And if that’s expanding those skills sets, we need to address that.”
Software Developers Won’t Be CPAs
The intention isn’t to turn software developers into CPAs, but to expand the pathways to the license, said Colleen Conrad, NASBA’s executive vice president and chief operating officer.
The goal is to give students more flexibility in how they gain the technology and data analysis skills they will need as the profession evolves, she said.
“CPA firms are looking over the shoulder of their clients on a much more frequent basis, monitoring their systems and the controls around them,” Conrad said. “That’s where the profession is going and that is very appealing to a lot of students when they look out at what their career could be. It’s not the traditional green-eye-shade accountant sitting there counting debits and credits. It’s much wider ranging than that.”
The largest public accounting firms increasingly hire non-CPAs, including engineers, computer scientists and data scientists. Often those technology staers work side by side with CPAs, and they receive training on core accounting, audit and business risk environment necessary to do their job. But that might be only a short-term solution.
“Up until now, we’ve been able in many instances to audit around the computer,“ said Pat Cummings, chief risk officer and managing partner of industries at accounting firm Citrin Cooperman. “I think that’s going to be impossible in the future. As CPAs, we’re going to need to really understand the technology in order to perform the audit and issue an audit report and be comfortable as a partner signing off on that audit report. It’s going to be harder and harder for me to do my job without having those sharp technology skills.”
Technology has also created new business opportunities for accounting firms. Citrin Cooperman is growing its cybersecurity practice, has hired an ethical hacker, offers system controls attestation, and provides accounting and finance help to clients with their own staffing and technology challenges, Cummings said.
The license must be built on a foundation of both accounting and technology in order to preserve the trust and public protection the CPA represents, she said.
The last big change to CPA requirements came almost two decades ago when required college credit hours increased from 120 to the current 150 hours. Some of those credit hours must be spent on core accounting and auditing classes, but the number varies from state to state, Conrad said.
The AICPA revises the national exam every few years to mesh with accounting standard or tax law changes. A 2017 overhaul reflected changing technology practices, and efforts are underway for another update, Conrad said.
But if the college coursework requirements change, the certification test must too. And some testing areas may need to be dropped to make room for others, Conrad said.
Building Consensus for Change
The proposed five guiding principles are based on a year-long outreach effort. The next step is to get feedback on those principles and make sure there is enough consensus to begin designing a new set of license requirements, Coffey said.
If the leaders of the AICPA and NASBA agree on a new license model this fall, work on drafting new license requirements could begin next year, Conrad said.
Any changes to the license requirements could take several years to roll out to give 55 states and territories time to update regulations or make legislative changes. Colleges and universities would need to update curricula and students would need time to prepare for the shift in requirements.
“There’s a lot of moving parts here,” Conrad said. “Once we agree to a path forward, then we will be aggressively marching toward it.”
To contact the reporter on this story: Amanda Iacone in Washington at email@example.com