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The 150-hour rule is on shakier ground by the day.
KPMG is the first Big Four firm to publicly come out against what’s popularly known as the “150-hour rule”: the requirement that CPA candidates complete 150 credit hours of coursework. That’s 30 more hours than are needed for a bachelor’s degree, or the equivalent of a fifth year of college.
“The cost of becoming a CPA has become too high,” Paul Knopp, KPMG US chair and CEO, wrote in a post on LinkedIn, “including both the cost of the extra education and the opportunity cost of spending an extra year in school.”
A growing number of stakeholders have voiced opposition to the 150-hour rule, especially in light of the current shortage of accounting talent. Eleven states are mulling alternative pathways to CPA licensure that wouldn’t require post-bachelor’s coursework; Minnesota lawmakers introduced a bill to that effect.
And last month, the AICPA and NASBA proposed an alternative pathway to licensure that would allow candidates to substitute relevant work experience for the additional 30 hours.
KPMG is “advocating for developing” experience-based avenues to licensure, Knopp wrote, which could help give candidates more “real-world, hands-on experience” with data and technology.
In his LinkedIn post, Knopp acknowledged that establishing new pathways to licensure could put CPAs’ mobility—or ability to practice across state lines—at risk. Currently, all state boards of accountancy recognize the 150-hour pathway. If only some states accepted alternative pathways, CPAs could face “a patchwork of licensing requirements” that could prevent them from working across state lines, he wrote, adding, “We believe it’s essential that preserving mobility is top-of-mind through automobility provisions.”
Deloitte also in favor: Deloitte spokesperson Dan Mucisko told CFO Brew his firm also supports alternatives to the 150-hour rule. “Attracting more CPAs is good for our profession and serves the public interest, so as an alternative to the current fifth year education requirement for CPA licensing, Deloitte is supportive of experience-based pathways to licensure,” he said in a statement. “As a national firm, we also believe that any changes should support automatic mobility to ensure that all CPAs are able to practice across all US jurisdictions regardless of the pathway pursued to licensure.”
A PwC spokesperson told CFO Brew their firm didn’t have comments at this time.