Academic journal article Journal of Accountancy

National Mobility Campaign Adds California and D.C.: What Does This Mean, and What Are the Next Steps?

Academic journal article Journal of Accountancy

National Mobility Campaign Adds California and D.C.: What Does This Mean, and What Are the Next Steps?

Article excerpt

As California and the District of Columbia reach major milestones related to individual CPA mobility laws, profession leaders pause to reflect on what this means and assess the next steps in promoting cross-border practice.

California Gov. Jerry Brown on Sept. 20 signed legislation that facilitates cross-border mobility for out-of-state CPAs seeking to practice in the state. This makes the Golden State the 49th state to enact so-called "mobility" legislation.

Passage of the California law, which goes into effect July 1, 2013, was followed by another major mobility milestone. On Oct. 1, the District of Columbia's CPA mobility law took effect. These victories mean that the only U.S. jurisdictions without an individual CPA mobility law are Hawaii, Guam, Puerto Rico, the Virgin Islands, and the Northern Mariana Islands.

Under the model language written and supported by the AICPA, the National Association of State Boards of Accountancy (NASBA), and state boards of accountancy, CPAs can temporarily practice across state lines without obtaining a reciprocal license if they are deemed to be substantially equivalent to CPAs already practicing in that state. This generally means that the CPA has 150 hours of education, has passed the CPA exam, and has at least one year of experience.

Out-of-state CPAs do not need to give notice or pay fees when they enter a state with such a law, but they must agree to over-sight by the board of accountancy in that state while they are practicing there. Most states have adopted laws with these high-level guidelines, although some variations exist from state to state.


Profession advocates have begun to take stock of the new laws. Work continues in the one state and the territories that have yet to pass mobility laws. And some jurisdictions without mobility laws still have other barriers to address before they can turn to mobility proposals. For example, Puerto Rico needed first to pass legislation that made its CPA licensure requirements substantially equivalent to those of the Uniform Accountancy Act, the profession's model state law. Puerto Rico's Colegio de Contadores Publicos Autorizados, the island's CPA society, was successful on that front last year, when it persuaded the legislature to pass a one-year experience requirement. On Sept. 14, Gov. Luis Fortuno signed the legislation.

Hawaii is likely to consider the issue in its 2013 legislative session. The other three island territories may also see legislative efforts in 2013.

Even with the national mobility campaign almost fully implemented, a few states with mobility laws have presented challenges to CPAs trying to understand requirements as they cross into states to practice. According to the joint AICPA-NASBA tool at, for example, many states still require firm registration for CPAs coming into a state to provide attest services.

NASBA and the AICPA have been trying to resolve those challenges by comparing services CPAs can provide under mobility laws with existing state-specific restrictions.

The mobility campaign has not been without critics. The California Society of CPAs had to address the Center for Public Interest Law's concerns that accepting the out-of-state policies might lower existing standards in California. Tackling the group's initial opposition to mobility was vital to the bill's ultimate unanimous support by lawmakers in Sacramento.


The next few years will demonstrate whether CPAs continue to develop confidence in the mobility regime, dropping reciprocal licenses and operating seamlessly across state lines. State boards of accountancy will also gather more data to see whether the early signs that they are able to exercise effective regulatory oversight of out-of-state CPAs hold true. …

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