State Board Report
A uniform path for allowing older CPAs to continue to use their title although they no longer comply with all continuing professional education requirements was approved by the NASBA Board of Directors on July 22. Many State Boards have moved to allow CPAs who are no longer practicing to be licensed and use a modified title that retains their CPA designation but makes clear to the public that they have ceased to meet all requirements.
The AICPA/NASBA Uniform Accountancy Act Committee began discussion of this topic several years ago, when it was first brought to their attention by some State Boards. Initially slight modification of the Model Rules was recommended to the Board of Directors, but as more questions arose as to exactly what a CPA-retired could do without stepping into active practice, the Committee determined more specific guidance was needed. Sticking with the previous language in the UAA would theoretically allow an unskilled laborer to volunteer to provide tax advice through the IRS VITA program, but would prohibit a retired CPA from doing the same. UAA Committee members were asked: Was this strict limitation in the best interests of the public?
The new language added to UAA Section 6 (d) states:
In addition, inactive CPAs, at least 55 years of age, may, in lieu of "inactive", place the word "retired" adjacent to their CPA title or PA title on any business card, letterhead or any other document or device, with the exception of their CPA certificate or PA registration, on which their CPA or PA title appears. Nothing in this section shall preclude an inactive CPA, at least 55 years of age, from providing the following volunteer, uncompensated services: tax preparation services, participating in a government sponsored business mentoring program, or serving on the board of directors for a nonprofit or governmental organization, or serving on a government-appointed advisory body. Licensees may only convert to inactive status if they hold a license in good standing.
The UAA Committee had considered all the comments submitted during the exposure period, which ranged from questions about the age specification, to permissible employment, to and acceptance of per diems. This resulted in some modifications of the proposed Model Rules, which now allow for some minimal compensation to cover costs. However, "retired" is applicable only to those who meet the 55-year age threshold. In addition, the rules do not allow a CPA engaged in teaching to meet less than the CPE requirement for active practice. The Committee’s decisions are reflected In Model Rule 6-7.
In the commentary to the UAA, the Committee explained: "…for CPAs who go inactive because they are at the end of their careers, this provision offers an exception to ensure that they can continue to offer a limited number of volunteer, uncompensated services to the public (such as participation in the Internal Revenue Service’s Volunteer Income Tax Assistance (VITA) program and the Small Business Administration’s SCORE program). These services are narrow in scope, may be offered by non-CPAs, and the provision acknowledges that these CPAs still have much to contribute to their communities during retirement. In order to protect the public the board of accountancy may consider requiring these CPAs to affirm their understanding of the limited types of activities in which they may engage while in inactive CPA status and their understanding that they have a professional duty to ensure that they hold the professional competencies necessary to offer these limited services."
"We are trying to get states to use consistent language, in the area of CPAs-retired as well as others," UAA Committee Chair J. Coalter Baker said. "The baby boomer generation has reached retirement age and State Boards are seeing more CPAs who want to step back – but without losing the respect engendered by the CPA title they worked hard to achieve. We think we have come up with a good solution that allows for such recognition and for the retired CPAs’ continuing ability to provide volunteer services in which they remain competent to benefit the public."
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