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State Board Report

October 2015

NASBA/AICPA International Qualifications Appraisal Board (IQAB) Chair Telford A. Lodden (IA), NASBA Chair Walter C. Davenport (NC) and NASBA President & CEO Ken L. Bishop met with the Chartered Accountants of Ireland Chief Executive Pat Costello, Director of Education Ronan O’Laughlin, Chair Tony Nicholl and Director of Regulation and License Heather Briers in September to consider how to continue to have an agreement when the current mutual recognition agreement (MRA) comes up for renewal. When first developed by IQAB and the CAI over five years ago, experience earned in the United States was to have been given exemption to the local audit experience requirement for CPAs who sought to gain audit rights in Ireland. However, since that time, the European Communities Statutory Audits Directive came into effect in Ireland that requires any person who qualified as a chartered accountant outside the European Union to have two years of audit experience in the EU to gain audit rights in Ireland. Though the quality of the CAI program did not change, nor did that of the U.S. CPA, the agreement was not assisting U.S. CPAs.

Speaking to the IQAB members on September 30, President Bishop observed: "The most interesting thing about our discussion with CAI was that both sides would hate to see the MRA go away without significant effort to resolve the differences. Any new agreement would have to spell out that to obtain audit rights in Ireland additional experience would have to be obtained there. Similarly, a new agreement would spell out the competency requirements for a chartered accountant to sign an audit report in the U.S. The agreement would also need to include the pledge that the parties would work to have the EU recognize U.S. experience as it recognizes experience among EU member states."

To enable additional time for drafting a new agreement, IQAB voted to extend the deadline for the current agreement until March 31, 2016. President Bishop told the IQAB members that while other pathways for bringing qualified experienced professionals into the United States are under consideration, the MRA remains "the highest priority for both sides."

IQAB Chair Lodden reported he had spoken to a representative in the U.S. Trade Representative’s office and was advised that, while the USTR is trying to work through trade barriers, they want IQAB to continue to work through recognition in the accounting profession.

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