State Board Report

July 2009

A mutual recognition agreement with the New Zealand Institute of Chartered Accountants was approved by the NASBA Board of Directors at their July 17 meeting in Avon, Colorado. This brings the total to six such agreements developed by the NASBA/AICPA International Qualifications Board (IQAB) and recommended to the State Boards for their adoption. An official signing of the agreement is slated for August 12 in New Zealand, which will be attended by IQAB Chair William Treacy, executive director of the Texas State Board of Public Accountancy.

NASBA Chair Thomas Sadler announced at the July Board meeting that State Board representatives Edwin G. Jolicoeur (WA) and David D. Duree (TX) had been appointed to the AICPA’s Auditing Standards Board, and Sheila M. Birch (OH) had been reappointed to the ASB. Chair Sadler also announced that Alicia J. Foster (MD) and Robert G. Zunich (OH) had been appointed as State Board representatives to the AICPA’s Peer Review Oversight Committee.

President David A. Costello told the Board members, “We are in a marathon – not a sprint,” when he described NASBA’s ongoing efforts to have the State Board recognized in the international accounting professional and regulatory communities. NASBA Director of Governmental, International and Professional Relations Linda Biek reported on the contacts she had made with regulators in Switzerland, Canada, France, Germany and Ireland, as she frequently must explain that the State Boards are not part of any professional association of accountants. Both President Costello and Ms. Biek attended an IFAC meeting in London on July 23 (see story on page x).

A three?year strategic plan was presented by President Costello to the Board. He explained that NASBA remains committed to making technological and operational improvements to streamline its processes and procedures while increasing efficiency. The Board approved the operating and capital budgets for fiscal year 2009?2010 as presented by NASBA Treasurer Leonard Sanchez (NM).

Following Senior Vice President Ken L. Bishop’s report on the progress of the work of the AICPA/NASBA Committee on International Delivery of the Uniform CPA Examination, the Board voted to move the project into the next phase of development. He explained that the project would allow candidates to take the Uniform CPA Examination at a foreign test site if they have agreed to become licensed by a US jurisdiction within three years and in addition agree not to use the “CPA” designation in any form not approved by the state. Plans call for the international delivery program to pay its own way, Mr. Bishop explained. Among the benefits to the states he cited were: potential reduction in the cost of the domestic testing program; improvements to the domestic Gateway infrastructure; better protection of the public interest as fewer unlicensed candidates would hold themselves out as CPAs; foreign CPAs would commit themselves to US ethics requirements and CPE; and the influence of the US CPA would be increased throughout the world.

Progress on negotiations on the extension of the computer?based testing examination agreement with the American Institute of CPAs were also reported on by Mr. Bishop. The current discussion would provide for an extension through 2024 with reviews every five years to ensure all parties are doing what they are supposed to be doing, he explained. Issues such as timely disclosures, satisfaction of outstanding obligations, composition of the Board of Examiners and communications with states are all on the table now, he said. Details of the agreement will be discussed at the Annual Meeting.

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