Complying with CPA CPE Requirements - 10 Things To Consider

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A CPA, or Certified Public Accountant, is a title designated for accountants in the United States who have passed the CPA examination. This designation denotes subject matter competence. Accountants are qualified by the CPA to provide services to the general public. The CPA qualification is treated seriously since only the most knowledgeable accountants qualify.

Continuing Professional Education, or CPE, is a requirement for all CPAs to keep their licenses. CPE for CPA requirements differ depending on where you live. Generally, forty hours of CPE for CPA are required. Furthermore, at least four of those hours must be spent on professional ethics.

Although it can seem like a hassle, CPE is a crucial component of any profession. Many professions would be forced to use outmoded knowledge if this criterion didn't exist and would therefore commit mistakes that might be readily avoided. Every professional has to keep up with their expertise through top-notch continuing education courses in order to avoid that.

Even while it can seem like a lot of effort, it's simpler than you would imagine to obtain CPE credits and comply with CPA regulations if you take the following 10 considerations in mind. Let's look at it!

1. Approvals from Governing Authority

You must research the authorizing bodies for CPE credits to understand their link to CPAs. They must follow the rules established by their state of registration. Additionally, you must confirm that NASBA is recognizing your CPE sponsor.

The 55 State Boards of Accountancy are served by NASBA, a national organization that administers an accreditation program for CPE sponsors and issues them with an ID number that indicates how many CPE hours are attributed to their authorized courses. Their objective is to keep an eye on the accounting industry and provide important stakeholders with a forum for discussing new developments and trends.

Then there's the AICPA. In addition to developing and grading the Uniform CPA Exam, they regulate compliance and ethics regulations in the accounting profession.

Illumeo is a NASBA-approved continuing education provider, valid in all 50 states and worldwide

2. CPE Requirements

The reporting period for AICPA members begins on January 1 of the first full calendar year after their membership. The AICPA requires CPAs to complete 120 hours of CPE for each three-year reporting period. 50 minutes of continuing education equals 1 CPE credit.

In terms of the amount of CPE credits that must be earned each year, each state has different requirements. Many state accounting boards (such as Alabama and Connecticut) require them to acquire 40 CPE credits every year. Check the NASBA website for specific state regulations.

3. Ethics

Before enrolling in an ethics course, you must check that your state board has approved it. If you're unsure, you may always look it up on their website or contact them through email.

Despite the fact that many states accept a generic Regulatory Review or Ethics course, certain states demand additional approval and define what must be addressed in their state ethics courses. Furthermore, several states accept only courses recognized by their own state board of ethics.

Illumeo hosts ethics courses for every state.

4. Qualifying Courses

Members must get CPE credits through Qualifying Programs established by qualified professionals, which add to members' competency and are formally presented. In-house training programs, university lectures, conferences, trade shows, and online learning providers are examples of qualifying programs.

You may just be considering technical accounting courses for CPE. Keep in mind that some non-technical courses can also be used to earn credits.

Personal development and behavioral skills are examples of non-technical training. These components of professional growth are known as soft skills, although they may be both demanding and rewarding. They may not be immediately relevant to your accounting firm, but they can be the difference between success and failure for some people.

State boards determine whether non-technical courses count for CPE hours. There may also be limitations on the number or proportion of non-technical courses that can be taken within each reporting period.

5. Carry Forward Credits

Some states allow you to carry forward credits from one compliance period to the subsequent one if you earned more credits than was required during the previous compliance period.

For instance:

  • States like Wisconsin, Connecticut, and others enable credits to be carried forward.
  • States like Alabama, Alaska, Arizona, etc. prohibit the carrying over of credits.

6. Learning Resources

Through a variety of CPE programs certified by the AICPA or NASBA, CPAs can earn CPE certification to advance their skills, increase their chances of landing a job, and expand their horizons. However, before delving far into these techniques, make sure you adhere to your state's BOA regulations.

A few learning avenues for CPAs to get CPE credits are listed below:

  • Live Webinars

  • Self-Study courses

  • Certificate Courses

  • Virtual conferences

  • Tailored Packages

7. Subject Restriction

States may stipulate a requirement that a minimum amount of CPE be taken in the fields of accounting and taxation or technical courses. A rule may specify that a minimum amount of CPE must be obtained through live classes since they are participatory, or that only half of the credits may be obtained through self-study programs. Personal development, communication, marketing, software, management, and other non-technical areas are not accepted for CPE by several State boards. Additionally, several jurisdictions limit the total amount of CPE credits that can be earned in the areas of communication, marketing, software, management courses, spirituality, and technology.

8. Reporting Deadline

Typically, professional CPAs must submit their credits and hours by the deadline of December 31. However, each state has a different set of credits and hours. Your license's expiration date might vary based on a number of things, including the day it was first granted, your birthday, any COVID-19-related state-specific extensions, and other elements.

It's essential for you to determine what your personal requirements so you don't miss your deadline. 

9. Record Documentation

The amount of CPE credits that CPA members have acquired must be reported accurately and correctly at all times. This covers document retention as well as proof of participation with and accomplishment of learning goals.

CPE credits, which are equivalent to 50 minutes of program time, are the accepted measuring unit. The AICPA reminds members that, while measuring and reporting credits is important, the main emphasis should always be on education and skill development, not just amassing credits.

Document preservation is crucial in case CPA members need to provide verification of their ongoing education to regulators or other organizations.

10. Reporting CPE Credits

CPAs must follow correct reporting procedures in addition to record retention and proof.

Even if a CPA feels that the program should have offered more credits, they may never claim more CPE credits than those that the CPE program provider recommends. It is advised to speak with the NASBA immediately if this circumstance occurs.

CPAs have a lot of latitude to take part in the sponsored program they choose, but they should only give themselves credit for activities that really advance their professional competence.

It is crucial to confirm that your CPE credits meet the standards established by the AICPA and your particular State Board of Accountancy. Only CPE credits obtained from accredited CPE providers will count toward your total.