Most people assume that when they hire a CPA, the title means the same thing everywhere. In reality, the U.S. CPA system functions less like one profession and more like 55 parallel jurisdictions. Each state and territory has its own board of accountancy, its own rules for practice, and its own definition of what it means to be "licensed."
This patchwork might seem like an internal professional issue, but it affects everyone who depends on reliable financial reporting — from small businesses and start-ups to nonprofits and individual taxpayers. When rules about who can legally sign an audit report or prepare a tax return differ from one state line to another, both clients and professionals face uncertainty in a time when trust and clarity are already in short supply.
For decades, CPAs have been allowed to cross state lines under what are called practice privileges. The idea is simple: If a CPA holds a valid license in one state with "substantially equivalent" education, testing and experience requirements, they can temporarily serve clients in another without obtaining a second license. In practice, this arrangement is anything but simple.
Providing accounting services in person, by mail or even electronically to a client in another state can still trigger regulatory obligations in that client's jurisdiction. The professional must verify equivalency, confirm active status, and navigate differing ethical codes and registration systems. In theory, mobility laws were meant to remove friction. In reality, they have created new layers of it — an elaborate compliance puzzle that even experienced firms struggle to solve.
When these technicalities are overlooked, the consequences can be severe. Recent state enforcement actions show that even small administrative lapses — working while a license is inactive, failing to renew a firm registration, or misunderstanding local filing rules — can lead to fines of up to $5,000, multiyear probation, or even forced surrender of a CPA certificate. These cases rarely involve fraud or negligence. They reveal how easy it is for competent professionals to fall out of compliance in a system that was never designed for modern, borderless work.
The cost of complexity
The impact of these penalties goes beyond individual careers. Each enforcement action means lost revenue, reputational damage and peer-review findings that can haunt a firm for years. For small practices, even one infraction can push them out of business. And for clients, the disruption can delay financial statements, audits or tax filings that investors and regulators depend on.
This is not an isolated problem. With 55 different sets of rules, 10 overlapping mobility systems and an alphabet soup of local exceptions — from California's tax-education registration to Florida's firm-capitalization rules and Vermont's experience thresholds — professionals must rely on spreadsheets, calendar alerts and manual workflows just to remain compliant. For a field that prides itself on precision, this level of regulatory disarray borders on self-defeating.
A profession trying to evolve
The good news is that reform is finally underway. Several states have adopted new pathway rules for CPA licensure that reflect today's realities. Washington State's updated code, for example, now allows candidates to qualify through multiple routes:
- A bachelor's degree with an accounting concentration or equivalent;
- A post-baccalaureate degree with similar focus; or,
- A bachelor's degree plus 30 additional semester hours of relevant education.
The experience requirements are similarly flexible. Candidates who meet only the bachelor's degree standard must complete two years (4,000 hours) of verified experience, while those meeting the traditional 150-hour requirement or holding a master's degree need one year (2,000 hours).
This approach preserves professional rigor while acknowledging economic and social realities. For many aspiring accountants — especially working adults, first-generation graduates, and immigrants with foreign degrees — the old 150-hour rule was an expensive barrier. By emphasizing experience and competency rather than credit hours alone, the profession sends a signal that ability and ethics matter more than formal seat time.
Why the public should care
The average taxpayer may never think about CPA mobility or licensure pathways, but they should. These rules shape who gets to safeguard the integrity of financial information — who audits charities, oversees public spending or ensures businesses pay their fair share. A system that discourages qualified people from entering or that punishes them for crossing virtual borders ultimately weakens the trust that the CPA designation is meant to uphold.
As the economy grows more digital and geographically fluid, the accounting profession faces a choice. It can continue managing a web of outdated state regulations with spreadsheets and goodwill, or it can embrace a truly national model that maintains accountability while fostering flexibility and inclusion.
Simplifying mobility and broadening entry pathways are not just technical adjustments; they are investments in the profession's future credibility. For a field built on trust, clarity and integrity, the ability to evolve gracefully may be the ultimate audit test.
