The gap between the number of new CPAs and accounting professionals entering the workforce and the growing demand for their services is creating challenges for current professionals, the consumers they serve and the ongoing protection of the public interest.

Several factors are intensifying these challenges: demographic and generational shifts, an evolving labor market, tech advancements, and changing perceptions of higher education. In response, accounting organizations and regulatory bodies are developing strategies to attract and retain candidates in the profession.

One key effort involves creating flexible pathways to CPA licensure. The AICPA, NASBA and individual states, including California, are considering alternative licensure paths that would offer more flexibility and better align with the profession’s current realities, while maintaining the benefits of a cohesive inter-state licensing system.

While the interconnectedness of state licensure requirements, cross-border practice rules and the profession’s need to meet client and consumer needs seamlessly makes change complex, initial concepts and frameworks are beginning to take shape, with potential state actions and changes to the national licensure framework expected later this year.

While the exact nature of these changes is still unknown, it’s clear that significant changes are on the horizon.

To ensure California has a voice in the discussions, CalCPA has created the California Pipeline Advocacy Group (CPAG) to evaluate potential changes to the CPA licensure framework, provide feedback, assess the impact of proposed changes on California students, candidates, CPAs and consumers, and guide updates to modernize the California CPA licensure framework.

The CPAG includes perspectives from across the profession, with members representing firms of all sizes, academia, various demographics and different career stages. The CBA is also involved as key stakeholders to offer regulatory insights and context.

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So where do things stand?

The AICPA formed the National Pipeline Advisory Group (NPAG) to develop a national strategy to address the decline in accounting graduates and CPA candidates. NPAG created working groups focusing on different career stages to understand why interest in accounting is dropping and develop strategies to attract and retain accounting professionals.

NPAG’s report, available at accountingpipeline.org, examines the latest pipeline data, the reasons behind the profession’s attrition and potential solutions. The recommendations focus on six key themes: promoting more compelling stories about careers in accounting; making the college experience more engaging for accounting majors and potential majors; reducing the time and cost of education; increasing support for CPA Exam candidates; expanding access for underrepresented groups; and transforming employer cultures and business models.

The goal is to phase in these changes gradually, ensuring minimal disruption to the cohesive cross-border practice ecosystem.

NASBA has formed the Professional Licensure Task Force to explore new ideas for CPA licensure and consider updates to the current model. The Task Force sought feedback on a new concept called the Structured Professional Program (SPP). This program offers an alternative pathway to CPA licensure by combining education, documented experience and other professional elements to meet the equivalent of the current requirement of 30 additional semester units.

It would use a to-be-developed competency rubric to evaluate and assess a candidate’s demonstrated understanding of various tasks and skills.

To align the efforts of the two groups, a joint working group from both organizations will explore concepts to create a unified model and strategy for implementing any necessary changes. The group is expected to share more information later this fall.

In California, the CBA has been actively involved in these national discussions. The proposed framework before the CBA aims to make licensure requirements more flexible, particularly in education, to better suit diverse state populations and demographics. It also seeks to modernize the definition of mobility, to allow for more licensing model concepts. For instance, redefining mobility provisions allows for the consideration of pathways to licensure that do not rely solely on 150 units of education.

The framework approach received positive feedback from the CBA and they asked staff to further refine and collect more data and stakeholder feedback as they continue to contemplate. It’s important to note that the CBA’s work is a first step in adding the California perspective to the national conversation. Interested members can follow the CBA’s discussions at its July meeting (cba.ca.gov).