Public Act 098-0730
 
HB4707 EnrolledLRB098 17321 ZMM 52417 b


  
    AN ACT concerning regulation.
  
 
    Be it enacted by the People of the State of Illinois,
 
represented in the General Assembly:
  
 
 
    Section 5. The Illinois Public Accounting Act is amended  by 
changing Sections 8.05, 14.2, 14.4, 16, and 17.1 as follows:
 
    (225 ILCS 450/8.05)
    (Section scheduled to be repealed on January 1, 2024)
    Sec. 8.05. Accountancy activities.
    (a) Accountancy activities are services performed by a CPA, 
including:
        (1) signing, affixing, or associating the names used by 
    a person or CPA firm to any report expressing an assurance 
    on a financial statement or disclaiming an opinion on a 
    financial statement based on an audit or examination of 
    that statement or to express assurance on a financial 
    statement;
        (2) other attestation engagements not otherwise 
    defined in paragraph (1); or
        (3) offering to perform or performing one or more types 
    of the following services involving the use of professional 
    skills or competencies: accounting, management, financial 
    or consulting services, compilations, internal audit, 
    preparation of tax returns, furnishing advice on tax 
    matters, bookkeeping, or representations of taxpayers; 
    this includes the teaching of any of these areas at the 
    college or university level. 
    (b) If offering or performing accountancy activities using 
the CPA title set forth in paragraphs (1), (2), and (3) of 
subsection (a) of this Section, then:
        (1) the activities identified in paragraph (1) of 
    subsection (a) may only be performed by licensed CPAs;
        (2) the activities identified in paragraph (2) of 
    subsection (a) may only be performed by licensed or 
    registered CPAs; and
        (3) the activities identified in paragraph (3) of 
    subsection (a) are not  restricted to licensed or registered 
    CPAs, subject to the provisions of Section 9 9.02 of this 
    Act. 

(Source: P.A. 98-254, eff. 8-9-13.)
 



    (225 ILCS 450/14.2)



    (Section scheduled to be repealed on January 1, 2024)


    Sec. 14.2. Licensure by endorsement. 

    (a) The Department shall issue a
license as a licensed CPA 
to any applicant
who holds a current, valid, and unrevoked 
license as a certified public accountant issued from another 
state with equivalent educational requirements and examination 
standards, applies to the Department on forms supplied by the 
Department, and pays the required fee,

provided:


        (1) the individual applicant is determined by the 
    Department

to possess
 qualifications substantially 
    equivalent to this State's current
licensing requirements;


        (2) at the time the applicant received his or her 
    license, the applicant possessed qualifications

    substantially equivalent to the qualifications for 
    licensure then in effect in
this State; or


        (3) the applicant has, after passing the examination 
    upon which his or her
license to practice was based, not 
    less than 4 years of
experience as outlined in Section 14 
    of this Act within the 10 years immediately
before the 
    application.

    (b) In determining the substantial equivalency of any

state's requirements to Illinois' requirements, the
Department 
may rely on the determinations of the National
Qualification 
Appraisal Service of the National Association
of State Boards 
of Accountancy or such other qualification
appraisal service as 
it deems appropriate.

    (c) Applicants have 3 years from the date of application to 
complete the application process.  If the process has not been 
completed in 3 years, the application shall be denied, the fee 
shall be forfeited, and the applicant must reapply and meet the 
requirements in effect at the time of reapplication.

    (d) Any individual who is the holder of a current, valid, 
and not previously disciplined license as a certified public 
accountant of any state and has applied in writing to the 
Department in form and substance satisfactory to the Department 
for a license as a licensed CPA may perform accountancy 
activities as set forth in Section 8.05 until the earlier of 
the following dates:
        (1) the expiration of 6 months after filing the written 
    application; or
        (2) the denial of the application by the Department. 
    Any individual performing accountancy activities under 
this subsection (d) shall be subject to discipline in the same 
manner as an individual licensed under this Act. 
(Source: P.A. 98-254, eff. 8-9-13.)

 
    (225 ILCS 450/14.4)
    (Section scheduled to be repealed on January 1, 2024)
    Sec. 14.4. Qualifications for licensure as a CPA firm.  The 
Department may license as licensed CPA firms individuals or 
entities meeting the following requirements:
        (1) A majority of the ownership of the firm, in terms 
    of financial interests and voting rights of all partners, 
    officers, shareholders, or members, or belongs to persons 
    licensed or registered in some state.  All partners, 
    officers, shareholders, or members, whose principal place 
    of business is in this State and who have overall 
    responsibility for accountancy activities in this State, 
    as defined in paragraph (1) of subsection (a) of Section 
    8.05 of this Act, must hold a valid license as a licensed 
    CPA issued by this State. An individual exercising the 
    practice privilege afforded under Section 5.2 who performs 
    services for which a firm license is required under 
    subsection (d) of Section 5.2 shall not be required to 
    obtain an individual license under this Act.
        (2) All owners of the CPA firm, whether licensed as a 
    licensed CPA or not, shall be active participants in the 
    CPA firm or its affiliated entities and shall comply with 
    the rules adopted under this Act.
        (3) It shall be lawful for a nonprofit cooperative 
    association engaged in rendering an auditing and 
    accounting service to its members only to continue to 
    render that service provided that the rendering of auditing 
    and accounting service by the cooperative association 
    shall at all times be under the control and supervision of 
    licensed CPAs.
        (4) An individual who supervises services for which a 
    license is required under paragraph (1) of subsection (a) 
    of Section 8.05 of this Act, who signs or authorizes 
    another to sign any report for which a license is required 
    under paragraph (1) of subsection (a) of Section 8.05 of 
    this Act, or who supervises services for which a CPA firm 
    license is required under subsection (d) of Section 5.2 of 
    this Act shall hold a valid, active licensed CPA license 
    from this State or another state considered to be 
    substantially equivalent under paragraph (1) of subsection 
    (a) of Section 5.2.
        (5) The CPA firm shall designate to the Department in 
    writing an individual licensed as a licensed CPA under this 
    Act or, in the case of a firm that must have a CPA firm 
    license pursuant to subsection (b) of Section 13 of this 
    Act, a licensee of another state who meets the requirements 
    set out in paragraph (1) or (2) of subsection (a) of 
    Section 5.2 of this Act, who shall be responsible for the 
    proper licensure of the CPA firm. 

(Source: P.A. 98-254, eff. 8-9-13.)
 



    (225 ILCS 450/16)  (from Ch. 111, par. 5517)


    (Section scheduled to be repealed on January 1, 2024)

    Sec. 16. Expiration and renewal of licenses; renewal of 
registration;
continuing education; peer review.
    (a) The expiration date and renewal period for each license 
or registration
issued under this Act shall be set by rule.

    (b) Every holder of a license or registration under this 
Act may renew such license or registration before the 
expiration date upon payment of the required renewal fee as set 
by rule.

    (c)  Every application for renewal of a license by a 
licensed CPA who has been licensed under this Act for 3 years 
or more shall be accompanied or supported by any evidence the 
Department shall prescribe, in satisfaction of completing, 
each 3 years, not less than 120 hours of continuing 
professional education as prescribed by Department rules. Of 
the 120 hours, not less than 4 hours shall be courses covering 
the subject of professional ethics. All continuing education 
sponsors applying to the Department for registration shall be 
required to submit an initial nonrefundable application fee set 
by Department rule.  Each registered continuing education 
sponsor shall be required to pay an annual renewal fee set by 
Department rule.  Publicly supported colleges, universities, 
and governmental agencies located in Illinois are exempt from 
payment of any fees required for continuing education sponsor 
registration.  Failure by a continuing education sponsor to be 
licensed or pay the fees prescribed in this Act, or to comply 
with the rules and regulations established by the Department 
under this Section regarding requirements for continuing 
education courses or sponsors, shall constitute grounds for 
revocation or denial of renewal of the sponsor's registration.
    (d) Licensed CPAs are exempt from the continuing 
professional education requirement for the first renewal 
period following the original issuance of the license.
    Failure by an applicant for renewal of a license as a 
licensed CPA to furnish the evidence shall constitute grounds 
for disciplinary action, unless the Department in its 
discretion shall determine the failure to have been due to 
reasonable cause.  The Department, in its discretion, may renew 
a license despite failure to furnish evidence of satisfaction 
of requirements of continuing education upon condition that the 
applicant follow a particular program or schedule of continuing 
education.  In issuing rules and individual orders in respect of 
requirements of continuing education, the Department in its 
discretion may, among other things, use and rely upon 
guidelines and pronouncements of recognized educational and 
professional associations; may prescribe rules for the 
content, duration, and organization of courses; shall take into 
account the accessibility to applicants of such continuing 
education as it may require, and any impediments to interstate 
practice of public accounting that may result from differences 
in requirements in other states; and may provide for relaxation 
or suspension of requirements in regard to applicants who 
certify that they do not intend to engage in the performance of 
accountancy activities, and for instances of individual 
hardship.
    The Department shall establish by rule a means for the 
verification of completion of the continuing education 
required by this Section.  This verification may be accomplished 
through audits of records maintained by licensees; by requiring 
the filing of continuing education certificates with the 
Department; or by other means established by the Department.
    The Department may establish, by rule, guidelines for 
acceptance of continuing education on behalf of licensed CPAs 
taking continuing education courses in other jurisdictions.


    (e) For renewals on and after July 1, 2012, as a condition 
for granting a renewal license to CPA firms and sole 
practitioners who perform accountancy activities outlined in 
paragraph (1) of subsection (a) of Section 8.05 under this Act, 
the Department shall require that the CPA firm or sole 
practitioner satisfactorily complete a peer review during the 
immediately preceding 3-year period, accepted by a Peer Review 
Administrator in accordance with established standards for 
performing and reporting on peer reviews, unless the CPA firm 
or sole practitioner is exempted under the provisions of 
subsection (i) of this Section. A CPA firm or sole practitioner 
shall, at the request of the Department, submit to the 
Department a letter from the Peer Review Administrator stating 
the date on which the peer review was satisfactorily completed.
    A new CPA firm or sole practitioner shall not be required 
to comply with the peer review requirements for the first 
license renewal.  A CPA firm or sole practitioner shall undergo 
its first peer review during the first full renewal cycle after 
it is granted its initial license.

    The requirements of this subsection (e) shall not apply to 
any person providing services requiring a license under this 
Act to the extent that  such services are provided in the 
capacity of an employee of the Office of the Auditor General or 
to a nonprofit cooperative association engaged in the rendering 
of licensed service to its members only under paragraph (3) of 
Section 14.4 of this Act or any of its employees to the extent 
that such services are provided in the capacity of an employee 
of the association.
    (f) The Department shall approve only Peer Review 
Administrators that the Department finds comply with 
established standards for performing and reporting on peer 
reviews. The Department may adopt rules establishing 
guidelines for peer reviews, which shall do all of the 
following:

        (1) Require that a peer review be conducted by a 
    reviewer that is independent of the CPA firm reviewed and 
    approved by the Peer Review Administrator under 
    established standards.
        (2) Other than in the peer review process, prohibit the 
    use or public disclosure of information obtained by the 
    reviewer, the Peer Review Administrator, or the Department 
    during or in connection with the peer review process. The 
    requirement that information not be publicly disclosed 
    shall not apply to a hearing before the Department that the 
    CPA firm or sole practitioner requests be public or to the 
    information described in paragraph (3) of subsection (i) of 
    this Section.
    (g) If a CPA firm or sole practitioner fails to 
satisfactorily complete a peer review as required by subsection 
(e) of this Section or  does not comply with any remedial 
actions determined necessary by the Peer Review Administrator, 
the Peer Review Administrator shall notify the Department of 
the failure and shall submit a record with specific references 
to the rule, statutory provision, professional standards, or 
other applicable authority upon which the Peer Review 
Administrator made its determination and the specific actions 
taken or failed to be taken by the licensee that in the opinion 
of the Peer Review Administrator constitutes a failure to 
comply. The Department may at its discretion or shall upon 
submission of a written application by the CPA firm or sole 
practitioner hold a hearing under Section 20.1 of this Act to 
determine whether the CPA firm or sole practitioner has 
complied with subsection (e) of this Section. The hearing shall 
be confidential and shall not be open to the public unless 
requested by the CPA firm or sole practitioner.
    (h) The CPA firm or sole practitioner reviewed shall pay 
for any peer review performed. The Peer Review Administrator 
may charge a fee to each firm and sole practitioner sufficient 
to cover costs of administering the peer review program.
    (i) A CPA firm or sole practitioner shall not be required 
to comply with the peer review requirements if:
        (1) Within 3 years before the date of application for 
    renewal licensure, the sole practitioner or CPA firm has 
    undergone a peer review conducted in another state or 
    foreign jurisdiction that meets the requirements of 
    paragraphs (1) and (2) of subsection (f) of this Section. 
    The sole practitioner or CPA firm shall, at the request of 
    the Department, submit to the Department a letter from the 
    organization administering the most recent peer review 
    stating the date on which the peer review was completed; or
        (2) Within 2 years before the date of application for 
    renewal licensure, the sole practitioner or CPA firm 
    satisfies all of the following conditions:
            (A) has not accepted or performed any accountancy 
        activities outlined in paragraph (1) of subsection (a) 
        of Section 8.05 of this Act; and
            (B) the firm or sole practitioner agrees to notify 
        the Peer Review Administrator within 30 days of 
        accepting an engagement for services requiring a 
        license under this Act and to undergo a peer review 
        within 18 months after the end of the period covered by  
        the engagement; or
        (3) For reasons of personal health, military service, 
    or other good cause, the Department determines that the 
    sole practitioner or firm is entitled to an exemption, 
    which may be granted for a period of time not to exceed 12 
    months.
    (j) If a peer review report indicates that a CPA firm or 
sole practitioner complies with the appropriate professional 
standards and practices set forth in the rules of the 
Department and no further remedial action is required, the Peer 
Review Administrator shall, after issuance of the final letter 
of acceptance, destroy all working papers and documents related 
to the peer review, other than report-related documents and 
documents evidencing completion of remedial actions, if any, in 
accordance with rules established by the Department.
    (k) (Blank).
(Source: P.A. 98-254, eff. 8-9-13.)

 



    (225 ILCS 450/17.1)  (from Ch. 111, par. 5518.1)


    (Section scheduled to be repealed on January 1, 2024)


    Sec. 17.1. Restoration.  
    (a) Any registered CPA who has permitted his or her 
registration to expire or who has had his or her registration 
on inactive status may have his or her registration restored by 
making application to the  Department and filing proof 
acceptable to the Department as defined by rule of his or her 
fitness to have his or her registration restored, which may 
include sworn evidence certifying to active practice in another 
jurisdiction satisfactory to the Department and by paying the 
required restoration fee.

    (b) Any licensed CPA who has permitted
his or her license 
to expire
or who has had his or her license on inactive status 
may have his or her license restored
by (1) making application 
to the Department and filing proof
acceptable to the
Department 
as defined by rule of his or her fitness to have his or her 
license restored, including
sworn
evidence certifying to 
active practice in another jurisdiction satisfactory
to the 
Department, (2) and by paying the required restoration fee, (3)

and by submitting proof of the
required continuing education 
and (4) in the case of a sole practitioner, satisfactory 
completion of peer review outlined in subsection (e) of Section 
16, unless exempt from peer review under subsection (i) of 
Section 16.
    (c) Any firm that has permitted its license to expire may 
have its license restored by  (1) making application to the 
Department and filing proof acceptable to the Department as 
defined by rule of its fitness to have its license restored, 
including sworn evidence certifying to active practice in 
another jurisdiction satisfactory to the Department, (2) 
paying the required restoration fee, and (3) satisfactory 
completion of peer review outlined in subsection (e) of Section 
16, unless exempt from peer review under subsection (i) of 
Section 16.
    (d) If the licensed CPA or registered CPA has not 
maintained an active
practice in another
jurisdiction 
satisfactory to the Department, the Department shall 
determine,
by an evaluation program established by rule, 
fitness to resume active status
and may require the applicant 
to complete a period of supervised
experience.

    Any licensed CPA or registered CPA whose license or 
registration expired
while he or she was (1) in
Federal Service 
on active duty with the Armed Forces of the United States,
or 
the State Militia called into service or training, or (2) in 
training
or education under the supervision of the United 
States preliminary to
induction
into the military service, may 
have his or her license or registration renewed reinstated or 
restored
without
paying any lapsed renewal and restoration fees 
if within 2 years after
honorable termination
of such service, 
training or education except under conditions other than

honorable, he or she furnished
the Department with satisfactory 
evidence to the effect that he or she
has been
so engaged and 
that his or her service, training, or education has been so 
terminated.

(Source: P.A. 98-254, eff. 8-9-13.)