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State Board Report

May 2016

Changes to Model Rules related to the forthcoming revision of the Uniform CPA Examination and a change to the Uniform Accountancy Act to enable additional recognition of international professionals were approved for exposure for comment at the April 22, 2016 meeting of the NASBA Board of Directors. The change to Section 6 of the Uniform Accountancy Act would enable international auditors who hold designations that have been evaluated by the NASBA/AICPA International Qualifications Appraisal Board (IQAB) to be substantially equivalent to the U.S. CPA to be eligible for a quicker pathway to state licensure – without requiring mutual recognition of U.S. CPAs by their home country’s licensing body.

"We know there are qualified professionals who are in the United States, but who cannot sign audit reports because they are not licensed as CPAs. While they may be doing the work, someone else in the firm has to sign off on the report," IQAB Chair Ted Lodden explained. "If they are working here, we want them to be regulated by the State Boards. In a global economy, international accountants are a valuable asset to U.S. accounting firms and we want that asset to be available to them and the U.S. clients they serve." The expectation is that other countries will want to recognize U.S. CPAs. "The ultimate goal is mutual recognition agreements covering professionals around the world," Mr. Lodden said.

The modifications being proposed for Model Rules 5-3, 5-4, 5-5, 5-6 and 5-7 would provide for changes in support of the revised Uniform CPA Examination. Among these are clarification that the Examination tests for the knowledge and skills required for a "newly licensed" CPA and that the Examination is "one component" of qualifying for a license. The changes would delete specification of the total number of sections comprising the Examination. They also state candidates could test for at least two months in each quarter, but they would still be prohibited from retaking the same section within one testing window. The changes were proposed by the CBT Administration Committee, chaired by Richard N. Reisig (MT), and the NASBA/AICPA UAA Committee and presented to the Board by NASBA UAA Committee Chair J. Coalter Baker (TX). The comment period will run 90 days from the exposure date.

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