It's about saving CPAs time and money and making the regulation of CPAs more effective (protecting the public interest).

What if you had to file for a separate CPA license in every state that you did business in? Even just filing an individual tax return?

In addition to the licensure, you would also have to meet all other provisions like CPE requirements, special ethics requirements, and anything else in those specific state laws.

Do the math – every CPA who signs tax returns in other states x license fees = a lot of money, then add time spent researching and filing for applications plus additional CPE requirements – you get the picture.

Just a few years ago that was the reality that faced US CPAs as California announced that all CPAs filing tax returns int the state would have to have a California license. Interestingly, there were almost 40 states that had or created similar provisions. It was an attempt by regulators in the post-Sarbanes-Oxley era to regulate the “electronic practices” of CPAs.

As we watched the crazy quiltwork of regulations begin to form, the State CPA Societies, AICPA, NASBA, and a coalition of large firms came together around this concept called “mobility”.

Mobility is really about four principles to help CPAs and regulators with a simple and clear way of regulating multi-state practices (this has been compared to driver's licensing):

1. No notification – The CPA does not need to notify a state that they are practicing temporarily
2. No fees – There should be no fees charged (or applications) for practicing temporarily
3. No add-ons – No additional state requirements like CPE, state-specific ethics or other requirements
4. No escape – The CPA agrees automatically upon practicing that they are bound by the rules ot the state they are entering and the state they are resident licensed in.

The good news is that the concept of “mobility” was contained in another major collaborative effort called the Uniform Accountancy Act(“UAA”), an effort by the CPA profession (AICPA & State CPA Societies) and the regulatory community (NASBA & STate Boards of Accountancy) to make licensing, regulations, and enforcement uniform across state lines. Using the concept of states that are “substantially equivalent” to the national standard for CPA licensure in the UAA was the way temporary practice could be enabled.

Substantial equivalency is defined as the 3″Es” for licensure:

1. Education – 150 hours education requirement
2. Examination – complete the Uniform CPA examination
3. Experience – minimum of 2,000 hours (1 year) experience

A CPA must either come form a state that has these MINIMUM licensing requirements or individually meets or exceeds these requirements. Then they are deemd to be “substantially equivalent” and can take advantage of mobility provisions in states.

Unprecedented Success – mobility in the US

Back to mobility. As of this post, there are 34 states that have passed mobility (23 in the last year and a half). That means CPAs do nothave to file for additional licenses in all of these states (solid gold & solid yellow on the map above). Last year you will recall that we fought hard against opposition by unlicensed accountants (Maryland Society of Accountants) to pass this critical legislation for CPAs in Maryland. See our posts titled, Lots of work to do on final day of the General Assembly  Check out our Town Hall handout for up-to-date listing of the “mobility” states (page 3)  Download Town Hall Fall 2008 Handouts.

So now do you understand mobility better? and have you hugged you Professional Associations (AICPA, MACPA and your home state CPA societies)?

Additional Resources:

AICPA resources for Mobility can be found at this link

MACPA's legislative/regulatory resource center can be found here(members only login required)

See our article – CPA Mobility passed in Annapolis

Blog post – Sine Die – CPAs had a successfdul session!