Regulatory reform legislation a major 2018 trend

With the 2018 legislative sessions well underway, states are seeing multiple trends that impact the CPA profession, including regulatory reform and temporary licensure interstate compacts. In the wake of the U.S. Supreme Court case North Carolina State Board of Dental Examiners v. the Federal Trade Commission, many states are looking to address regulatory reform through legislation.

Fifteen states have active legislation concerning, among many issues, active supervision, legislative oversight and the reduction of regulatory authority. Several states, including Arizona and South Dakota, introduced bills that establish a temporary licensure interstate compact. Both state’s bills failed to make it out of committee, though both could possibly turn into study bills. The AICPA does not expect this issue to go away anytime soon and will continue to monitor it for implications on the profession.

States are also moving forward with profession priority legislation. Four states – Alaska, Hawaii, New Hampshire and New Jersey - are pursuing legislation to adopt the comprehensive definition of attest. New Hampshire’s bill passed the first house. Five states – Kentucky, Massachusetts, Michigan, New Hampshire and New Jersey – are examining legislation to provide for full CPA firm mobility. Kentucky, Michigan and New Hampshire’s bills have all passed the first house.

Connecticut, Michigan and New Jersey are considering legislation to adopt CPE reciprocity. Michigan’s bill passed the first house. In New York, the legislature is considering legislation related to CPA firm ownership. The bill requires a simple majority of the firm’s owners to be CPAs.