For CPAs renewing their licenses in California, the CPE requirements have become increasingly complicated over the last years. I wrote this article to help Californian CPAs better understand their annual continued education responsibilities and maintain their active license status.
Starting with the most general requirement, all California CPAs are required to complete 80 CPE hours in the two years leading up to the applicant's renewal date, with at least 20 hours completed EACH YEAR. Meaning no cramming 80 CPE hours into the week before you apply for renewal... They're onto us.
Now of the 20 CPE hours required each year, 12 of those hours must be in technical fields defined by in Section 88(a)(1) of the CBA requirements. "Technical" is defined as accounting, auditing, fraud, taxation, consulting, financial planning, ethics (as defined by Section 87 (b), computer & IT (no word processing folks), and specialized industry or government practice training. Basically as long as the training focuses on the maintenance and enhancement of your skills, knowledge, & competency. If you notice, by fulfilling your technical requirement, you also meet the 24/80 Accounting & Auditing or Governmental requirements. Nicccce.
In addition to enacting minimum annual CPE requirements, the California Accountancy Act requires all active CPAs who perform the majority of field work on financial/compliance audits of governmental agencies (Governmental Requirement), or provide attestation services (Accounting & Auditing Requirement) to complete 24 of 80 CPE hours in fields related to financial reporting. Now if you're a sucker for efficiency like myself, you'll be able to knock out the 24/80 requirement utilizing your 12 annual "technical" hours. However, If you are subject to the 24/80 requirement, an additional 4 hours of fraud CPE is mandated each renewal period. Just to clarify, you are responsible for 4 fraud CPE hours IN ADDITION to the 24 financial reporting CPE hours completed. This will have to be done separate from your 12 annual "technical" hours.
The California Board of Accountancy also requires 4 hours of ethics CPE every renewal period. Basically, just make sure you fit some ethics courses into your 12 annual "technical" CPE hours. Also renewing CPAs are required to complete a board-approved two-hour "Regulatory Review" course every six years (based on the old ethics reporting cycle). This course covers the California Accountancy Act, California Board of Accountancy regulations, and enforcement of the Act.
If you're like me, this babushka doll of requirements makes your head spin... here's a checklist laying it all out.
80 CPE hours each renewal period -24 related to financial reporting*
Tyler Logsdon is a CPA and Registered Securities Representative located in Newport Beach, California. He is actively employed in the blockchain industry.
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