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State Board Report

April 2014

With representatives from Canada, Mexico and the U.S. Trade Representative’s office, the NASBA/AICPA International Qualifications Appraisal Board (IQAB) met on March 28 and continued to consider how best to move forward with recognition in this country of non- U.S. accounting professionals. Six mutual recognition agreements developed by IQAB continue to be in place but progress on additional agreements has spanned years and some international accounting regulators have not shown any interest in entering into this type of agreement.

One idea that has been posed is developing recognition standards that would only cover those non-U.S. professionals who are licensed to audit public companies in their own countries and who have met entry-level requirements that are substantially equivalent to those of a U.S. CPA’s. Proponents of the idea say this would enable additional, well–qualified auditors to sign financial reports in the U.S. By the State Boards’ recognition of those professionals, it would also bring them under the Boards’ authority.

Those who support mutual, rather than unilateral, recognition, believe permitting those who have other designations to be considered substantially equivalent to the CPA without reciprocal recognition from the other country would undermine the value of the CPA. IQAB is discussing how to get to an equitable solution that provides for public protection and does not unintentionally undermine the value of the CPA . Monitoring IQAB’s discussions, NASBA and AICPA leadership and staff are working to come up with a plan that maintains the high quality standards on which to recognize additional non-U.S. professionals. Mutual recognition agreements with four additional international designations remain on the table, but no new evaluations are being conducted until a course is determined by NASBA and AICPA leaders.

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