A bill backed by the Minnesota Society of CPAs that would ease the path to a CPA license has moved forward in the Minnesota Senate.
The bill, known as Senate File 1660, advanced on a voice vote Thursday, moving it from the State and Local Government and Veterans Committee to the Minnesota Senate Finance Committee.
It would offer an additional option to licensure with a bachelor's degree (120 credits) and two years of work experience, which had been the requirement in Minnesota until nearly 20 years ago. The bill would also maintain the current 150-hour credit rule.
The
- 150 credit hours and one year of work experience (the current model);
- 120 credits and two years of work experience; or,
- 120 credits and both one year of work experience and 120 CPE credits, earned concurrently.
However, prior to the introduction of the bill, there was an amendment to remove the option for 120 credits and both one year of work experience and 120 CPE credits, earned concurrently. The amended language was adopted at the beginning of the hearing.
The proposal has received pushback from the American Institute of CPA, which sees a
However, several accounting leaders locally and nationally told lawmakers about the impact the legislation could have on the talent pipeline problems facing the profession.
"There are multiple studies that show that the 150-hour requirement has created barriers for students, especially minority students, to becoming CPAs," wrote CliftonLarsonAllen CEO Jen Leary in testimony to the Senate committee. "There is no evidence that the 150-hour requirement has improved the quality of the profession. We have the power to change this. Minnesota's exemplary actions to broaden the pathways and increase accessibility to the accounting profession have the potential to increase the number of CPAs overall and encourage hard-working, diverse talent to join the profession."
The MNCPA pointed out that many other states already have alternative pathways to licensure in place for CPA candidates, and more states are joining the conversation, including Arizona, Virginia and New Jersey. (However, the Arizona Society of CPAs noted that it only conducted a member survey to hear member perspectives on the impact of the 150-hour requirement for licensure but is not currently pursuing legislation related to this law.)
"I can tell you from my own experience, through conversations with colleagues throughout the country and the members of the MNCPA, that we have a significant shortage of CPAs," MNCPA board chair Bob Cedergren told the Senate committee. "The work continues to grow but the supply of CPAs to do the work isn't keeping up. … We need to move forward. The situation is critical."
The bipartisan Senate bill was authored by Sen. Jordan Rasmusson, a Republican, and co-signed by Senate Majority Leader Erin Murphy and Sen. Ann Rest and Zaynab Mohamed, all Democrats.
A companion bill in the Minnesota House, known as House File 1749, has not yet received a hearing date. But CPAs and legislators hope to advance the bill and build the CPA talent pipeline.
"It's been our experience that hiring students with 120-credit hours makes absolutely no difference in their performance versus hiring students with 150 credits," testified Pat Plamann, managing partner at Schlenner, Wenner & Co. in St. Cloud. "This bill is the pipeline for the life of our firm."
Sen. Mark Koran offered Rasmusson his support for the bill eventually being enacted into law.
"Hopefully you'll get it across the finish line," he said.
The AICPA submitted a letter ahead of the hearing expressing its opposition to the Senate bill.
"Ultimately, we believe Senate File 1660 is a premature and unilateral attempt at finding a solution to a national problem," wrote AICPA chair Okorie Ramsey and AICPA CEO of public accounting Sue Coffey. "To appropriately address all facets of the decline in the accounting profession, CPA profession stakeholders formed the National Pipeline Advisory Group to use a data-driven, highly collaborative, and inclusive approach to tackle issues that have led to declining numbers of accounting graduates and CPA candidates. These efforts are taking a holistic look at the pipeline challenges in a holistic manner, including the licensing requirements, associated with becoming a CPA. Additionally, this effort is seeking to balance any new, national licensing requirements with the ability of licensed CPAs to practice across state lines without the need for an additional license."
Ramsey also testified during the hearing about the negative implications of the bill, along with Carl Peterson, a former MNCPA chair who has served on professional licensing bodies and is currently vice president of small firm interests at the AICPA.
