California Governor Jerry Brown signed a law Thursday allowing CPAs from outside California to practice across state lines without needing an additional license.
The law brings California into conformance with the laws of 48 other states and the District of Columbia. It takes effect on July 1, 2013.
"The change in the law makes the playing field even for California CPAs and eliminates the possibility of retaliatory action by other states that could reduce opportunities outside our state for California CPAs," said Johanna Sweaney Salt, chair of the 40,000-member California Society of CPAs, in a statement.
Under the new law, out-of-state CPAs may provide many services to their California clients without obtaining a license or paying a fee to the California Board of Accountancy.
Most other states have similar laws, CalCPA noted, and California CPAs have been able to provide most services to their clients in those states without registering with the appropriate board of accountancy. Currently, however, CPAs from other states need permission from the CBA to practice here.
The new law still protects consumers, CalCPA noted. Out-of-state CPAs practicing in this state still will be subject to the jurisdiction of the CBA, and California CPAs will be subject to the jurisdiction of the accountancy boards in other states when representing clients there.
CPA firms from outside the state still must register with the CBA before they may audit firms based in California. Such firms also will need to register with the CBA to provide compilations and reviews of entities headquartered in California. Consumers will be able to access licensing information for out-of-state CPAs through the California Board of Accountancy.
“This legislation has been a long-term goal of CalCPA,” said Salt. “Nowadays even relatively small businesses may have offices or representatives in other states, let alone in other nations. With passage of this law, California CPAs will be better able to serve clients with multi-state locations.”
Hawaii is the only remaining state that has not passed legislation providing similar privileges to out-of-state CPAs.
The American Institute of CPAs praised the passage of the California mobility law. “I applaud California Governor Jerry Brown for signing the bill passed unanimously by the California legislature that permits cross-border mobility for CPAs," said AICPA president and CEO Barry Melancon in a statement. "It is a significant benefit to CPAs with valid licenses in other jurisdictions who already practice in California or who would like to do so.Congratulations to the California Society of CPAs for its sustained efforts to achieve this milestone and to all the CPA firms and individual CPAs who contributed so tirelessly to the effort."