State Board Report
About 15 years ago, when I retired from my career in law enforcement and became the director of the Missouri State Board of Accountancy, my predecessor in Missouri, Bill Boston, left me a lengthy letter that outlined his thoughts on the importance of the job. There was a lot of good advice in that letter, but three recommendations stood out for me – then and now: First, he said to remember that the protection of the public was the reason we exist. Second, he stressed the importance of having a strong and trusting relationship with the State Society. Third, he emphasized the importance of “the three-legged stool” of CPA licensure: education, examination and experience. Bill’s advice has served me well.
Today, the three-legged stool looks much different than it did 15 years ago. The Uniform CPA Examination then was a conditioned paper-and-pencil test with first-time pass rates in the teens. The experience requirement was for multiple years including attest work in a CPA firm under the supervision of a licensee, and the education requirement had recently been raised to 150 hours, to increase the overall standards of entry into the accounting profession. While we could have interesting discussions about all three elements of the “stool,” this Memo is focused on the education requirement.
I remember well the arguments for raising the education bar to 150 hours. It was challenging and controversial for many states, and only in the past few years have all jurisdictions adopted the 150-hour requirement. The myriad of reasons for the increase included: achieving the academic background needed to support a CPA’s learning over a career span, enhancing communications and interpersonal skills, and acquiring greater accounting expertise. All were valid then and they are now. NASBA has steadfastly supported the 150-hour requirement and its nexus to public protection.
Recently, we have witnessed dramatic changes in the way post-secondary education has been delivered and measured. Historically, accounting education was delivered in bricks-and-mortar colleges and universities, using strict hour requirements of class time, homework and evaluations. In more recent years, we have seen an increase of on-line education availability. While the method of delivery changed, the requirement of prescribed courses with testing remained fairly constant. However, now a variation of education that drastically changes the traditional format has become apparent.
In the past year, we have seen the advance of “competency-based” education into the sphere of CPA licensure. Educators have been talking about competency-based learning for years, but that has only lately had an impact on what CPA candidates are actually presenting to the Boards of Accountancy. It is too early to say whether that is a good or bad thing, but it is certainly different. Big players, such as the Western Governors University, are attracting thousands of students and are granting accredited degrees to students based on “life experience” that is somehow translated into knowledge, skill and ability. As traditional colleges and universities are threatened by the loss of students (and related dollars), they too are beginning to give college credit for “experience” in order to remain competitive. Again, it is too early to say this is bad, but it sure is different.
A quick comparison of contrasting scenarios, based on real candidates: Traditional Student A has attended college for five years and has his/her transcript evaluated for sitting for the Uniform CPA Examination (and ultimate licensure) and is determined to be missing a mandated business course. Student A is required to return to college for an additional semester to meet the requirement. Student B enrolls in a competency-based college and, based on an assessment of his/her experience, knowledge and skills, is determined to have achieved a “value” of 150 hours, and therefore has met the requirements for sitting for the CPA Examination and for licensure in less than six months total time. Most states have statutes that recognize the degrees and transcripts of colleges accredited by a list of acceptable accrediting bodies. In the comparative scenario described, both colleges were accredited and met the requirements of the applicable state statutes.
NASBA’s Chair, Walter C. Davenport (NC), and the NASBA Board of Directors have concluded that this matter needs to be studied and understood. Chair Davenport has appointed an Education Committee, chaired by Dr. Robert Cochran (vice chair of the Virginia Board of Accountancy), which includes an unprecedented eight Ph.D.s with State Board experience, who will be undertaking the review. We will be sharing our thoughts with AICPA leadership and our State Society Relations Committee, and will be reporting back to our State Boards, including presentations at our Regional Meetings. NASBA will also be meeting with accepted accrediting bodies to understand how they are monitoring and/or reacting, and we will also fund research into this matter.
Again caution! We have not yet determined, nor are we implying, that the changes in education are necessarily bad. Remembering that the protection of the public is our primary reason for existing, and “the three-legged stool” is a critical element of that undertaking, we are being prudent to make sure it does not become lopsided and topple.
Semper ad meliora. (Always toward better things.)
— Ken L. Bishop
President and CEO
- MEMBER CENTER
- Member Portal
- Member Products & Services
- Meetings & Events
- Legislative Support
- PROC Resources
- Enforcement Tools
- NASBA Awards
- ED Login