Practice Privileges. Effective July 1, 2013, non-resident CPAs in good standing can exercise practice privileges in California without filing a form or paying a fee to the California Board. However, the provision of certain services may require firm registration with the California Board. Also there are certain disqualifying factors that must be considered before exercising practice privileges in California. Please review CA Bus. & Prof. Code § 5096 through § 5096.22.
General Requirement An individual whose principal place of business is not in this state and who has a valid and current license, certificate, or permit to practice public accountancy from another state may, subject to the conditions and limitations in this article, engage in the practice of public accountancy in this state under a practice privilege without obtaining a certificate or license from the California Board if the individual satisfies one of the following: - The individual has continually practiced public accountancy as a certified public accountant under a valid license issued by any state for at least four (4) of the last ten (10) years.
- The individual has a license, certificate, or permit from a state which has been determined by the board to have education, examination, and experience qualifications for licensure substantially equivalent to this state's qualifications. California considers all U.S. jurisdictions to be substantially equivalent for mobility purposes except the U.S. Virgin Islands. See 16 CCR § 5.5.
- The individual possesses education, examination, and experience qualifications for licensure which have been determined by the board to be substantially equivalent to this state's qualifications under CA Bus. & Prof. Code § 5093.
- Individual must apply to CredentialNet to obtain verification of their individual qualifications prior to exercising practice privileges in California if they have not continually practiced public accountancy as a certified public accountant under a valid license issued by any state for at least four of the last ten (10) years, or do not hold a license issued by a state that is listed in subdivision (a) of 16 CCR § 5.5.
Please Note: In order to sign any attest report, the holder of the practice privilege must meet the attest experience requirement of CA Bus. & Prof. Code § 5095, which requires a minimum of 500 hours of experience, satisfactory to the board, in attest services.
An individual who qualifies for the practice privilege under this section may engage in the practice of public accountancy in this state, and no notice, fee, or other requirement shall be imposed on that individual by the board.
Firm Registration May Apply (See CA Bus. & Prof. Code § 5061) An individual who qualifies for the practice privilege under this section may perform the following services only through a firm of certified public accountants that has obtained a registration from the California board: - An audit or review of a financial statement for an entity headquartered in California.
- A compilation of a financial statement when that person expects, or reasonably might expect, that a third party will use the financial statement and the compilation report does not disclose a lack of independence for an entity headquartered in California.
- An examination of prospective financial information for an entity headquartered in California.
Consent to Jurisdiction An individual who holds a practice privilege in California: - Is subject to the personal and subject matter jurisdiction and disciplinary authority of the board and the courts of California.
- Shall comply with the provisions of California’s accountancy law, board regulations, and other laws, regulations, and professional standards applicable to the practice of public accountancy by the licensees of California and to any other laws and regulations applicable to individuals practicing under practice privileges in California except the individual is deemed, solely for the purpose of practice privileges, to have met the continuing education requirements and ethics examination requirements of California when the individual has met the examination and continuing education requirements of the state in which the individual holds the valid license, certificate, or permit on which the substantial equivalency is based.
- Shall not provide public accountancy services in California from any office located in this state, except as an employee of a firm registered in California. This paragraph does not apply to public accountancy services provided to a client at the client's place of business or residence.
- Is deemed to have appointed the regulatory agency of the state that issued the individual's certificate, license, or permit upon which substantial equivalency is based as the individual's agent on whom notices, subpoenas, or other process may be served in any action or proceeding by the board against the individual.
- Shall cooperate with any board investigation or inquiry and shall timely respond to a board investigation, inquiry, request, notice, demand, or subpoena for information or documents and timely provide to the board the identified information and documents.
- Shall cease exercising the practice privilege in California if the regulatory agency in the state in which the individual's certificate, license, or permit was issued takes disciplinary action resulting in the suspension or revocation, including stayed suspension, stayed revocation, or probation of the individual's certificate, license, or permit, or takes other disciplinary action against the individual's certificate, license, or permit that arises from any of the following:
- Gross negligence, recklessness, or intentional wrongdoing relating to the practice of public accountancy.
- Fraud or misappropriation of funds.
- Preparation, publication, or dissemination of false, fraudulent, or materially incomplete or misleading financial statements, reports, or information.
- Shall cease exercising the practice privilege in this state if convicted in any jurisdiction of any crime involving dishonesty, including, but not limited to, embezzlement, theft, misappropriation of funds or property, or obtaining money, property, or other valuable consideration by fraudulent means or false pretenses.
- Shall cease exercising the practice privilege if the United States Securities and Exchange Commission or the Public Company Accounting Oversight Board bars the individual from practicing before them.
- Shall cease exercising the practice privilege if any governmental body or agency suspends the right of the individual to practice before the body or agency.
- Shall notify the board of any pending criminal charges, other than for a minor traffic violation, in any jurisdiction.
Notice Required to the California Board An individual to whom, within the last seven (7) years immediately preceding the date on which they wish to practice in California, any of the following criteria apply, shall notify the board, on a form prescribed by the board, and shall not practice public accountancy in California through practice privileges until the board provides the individual with written permission to do so if they have: - Been the subject of any final disciplinary action by the licensing or disciplinary authority of any other jurisdiction with respect to any professional license or has any charges of professional misconduct pending against him or her in any other jurisdiction.
- Had his or her license in another jurisdiction reinstated after a suspension or revocation of the license.
- Has been denied issuance or renewal of a professional license or certificate in any other jurisdiction for any reason other than an inadvertent administrative error.
- Has been convicted of a crime or is subject to pending criminal charges in any jurisdiction other than a minor traffic violation.
- Has otherwise acquired a disqualifying condition as described CA Bus. & Prof. Code § 5096.21.
CA Bus. & Prof. Code § 5096 further describes conditions which will disqualify the non-resident CPA from exercising practice privileges in California. These sections also set forth reasons for revocation of the California practice privilege. Please read this information in detail before exercising practice privileges in California.
More information regarding pre-notification conditions and reporting requirements can be viewed on the Practice Privilege Reporting Requirements page of the CBA website.
For mobility purposes, "CPA license" means a CPA license granted by the state board after all education, exam and experience requirements have been met. A CPA performing services through mobility may only perform the same level of services (attest or non-attest) in the mobility jurisdiction as they are permitted to perform in the home jurisdiction. Please note the following if you are coming from one (1) of the jurisdictions listed: - An Alabama certificate holder may not hold out or practice as a CPA in a mobility jurisdiction.
- A Connecticut certificate holder may not hold out or practice as a CPA in a mobility jurisdiction.
- An Illinois certificate or registered certificate holder may not hold out or practice as a CPA in a mobility jurisdiction.
- Both a Hawaii CPA license and permit are required in order to hold out or practice as a CPA in a mobility jurisdiction.
- A Kansas certificate holder may not hold out or practice as a CPA in a mobility jurisdiction.
- Both a Nebraska CPA certificate and permit are required in order to hold out or practice as a CPA in a mobility jurisdiction.
- An Oklahoma registrant must hold an active permit In order to hold out or practice as a CPA in a mobility jurisdiction.
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