What is CPE (Continuing Professional Education)?

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CPE is ongoing training for certified professionals to remain certified in certain fields. All accounting professionals certified as CPAs or CMAs need to complete a specific number of CPE credit hours every year in order to maintain their credentials. It is to force professionals to continuously update their knowledge of relevant information to improve their ability to provide valuable services to their clients. The state boards of accountancy require a certain amount of CPE for CPAs (Certified Public Accountants). CPE or Continuing Professional Education is designed for professionals to help maintain their competency and skill sets as providers of professional services.

CPA designations in the U.S. are issued at the state level. Therefore, Certified Public Accountants need to comply with the standards and requirements set out by the state in which they are registered. NASBA serves the interests of state-level boards, while AICPA serves the interest of individual CPAs.

The training requirements vary from state to state but the general requirements include:

  • Taking 40 hours of training per year, and 120 hours of CPE for each three years of the reporting period, with some minimum number of hours spent on accounting or auditing subjects.
  • Taking an ethics course every other year, which in some cases must pertain to the specific ethics requirements of the relevant state board of public accountancy.

CPA has to make up the missing training time in case if he/she does not meet the CPE requirements of the governing state board of public accountancy. CPA certificate is revoked if a CPA does not complete the requirements within a reasonable period of time.

There are a number of ways to fulfill the CPE requirement. A number of CPE providers registered with NASB (National Association of State Boards of Accountancy) or the applicable state board of accountancy provide CPE classes in form of online self-study training, online webinars, and in-person training etc. A recent change in rules has introduced nano learning, often covering specific topics related to a certain task. Completion of each 10-minute chunk would count for one-fifth credit. Some proportion of a person's CPE hours can also be earned by teaching classes or writing relevant professional articles or books.

CPE system not online focuses on professionals but also cater to the needs of organizations concerned with the performance of those professionals. Clinics or firms are good examples where some professionals practice in partnership organizations, where an employer is concerned with altering services and improving the likelihood for profits using CPE. The quality of Continuing Professional Education may also be a high priority for organizations that depend on professionals and their performance, without employing them, to achieve their organizations' purposes.

CPE Requirements

The reporting period for AICPA members is from 1st January after joining. According to AICPA, CPAs must complete 120 hours of CPE for each three-year reporting period.

NASBA has specific state requirements mentioned on their website.

The number of CPE credits earned by approved programs are; 50 minutes = 1 CPE credit

If members take programs that do not indicate the number of hours, they can calculate it as the number of minutes spent completing the program divided by 50. The figure should be rounded down to the closest whole hour.

Qualifying CPE Programs

Activities that qualify for CPE include technical and managerial training. It is important that this training must be directly applicable to the job practice areas related with the certification for the attainment of a proper balance of professional development. The qualifying programs are developed by experienced professionals and are offered formally, and it is a must for members to earn CPE credits from those qualifying programs. In-house training programs, conferences, university classes, e-learning providers are all examples of types of qualifying programs. Only those CPE hours are accepted for on-the-job activities that fall into a specific qualifying professional education activity.

CPE Compliance

It is mandatory for CPA members to follow all CPE requirements set out by their relevant state licensing bodies and other government entities and other professional bodies.

Occasionally, members may also enroll in non-approved educational programs or CPE solutions offered by providers that are not approved by AICPA or NASBA. Individual should retain all relevant information and documentation from such programs and speak to their respective state-level board to apply for eligibility, as a certain number of such hours may be eligible for CPE credits.

CPE Evidence and Documentation

CPA members are responsible for maintaining accurate reporting of the number of CPE credits they have earned. Evidence of participation, completion of learning objectives, and documentation retention provides confirmation about measuring and reporting credits. However, according to AICPA, members should not only focus on accumulating credits but on education and skills development.

In order to prove their continuing education to regulators or other organizations, asking for proof, the CPA members are required to retain documents supporting their continuing education. The records should be kept for at least five years after the completion of the educational development program.

Reporting CPE Credits

It is important for CPAs to perform proper reporting practices in addition to document retention. CPA members can only claim CPE credits recommended by CPA program sponsor. With the liberty of participating in preferred sponsored programs, CPAs should only claim credit for activities that they have completed, and that literally improved their professional competency.