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| [ Introduced ] | [ Engrossed ] | [ Senate Amendment 001 ] |
91_HB2194enr HB2194 Enrolled LRB9104858ACtm 1 AN ACT to amend the Public Accounting Act. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The Illinois Public Accounting Act is amended 5 by changing Sections 5, 9.1, and 14 and by adding Sections 6 14.2 and 14.3 as follows: 7 (225 ILCS 450/5) (from Ch. 111, par. 5506) 8 Sec. 5. Certification of out-of-State accountants. 9 (a) The Board may issue a certificate as a certified 10 public accountant, without examination, to any applicant who 11 holds a valid unrevoked certificate as a certified public 12 accountant issued under the laws of any other state or 13 territory of the United States or the District of Columbia, 14 provided: 15 (1) that the state that issued the certificate has 16 certification requirements that have been determined by 17 the Board to be substantially equivalent to the 18 certification requirements of Illinois and grants similar 19 rights to those that Illinois grants to certificate 20 holders; 21 (2) that the state that issued the certificate has 22 certification requirements that the Department has 23 determined not to be substantially equivalent to the 24 certification requirements of Illinois or does not grant 25 similar rights to Illinois certificate holders, but the 26 Board determines that the individual applicant possesses 27 personal qualifications substantially equivalent to 28 Illinois' certification requirements; or 29 (3) that the applicant does not qualify under 30 subsections (1) or (2) above, but the following 31 conditions are met: HB2194 Enrolled -2- LRB9104858ACtm 1 (A)(a)the certificate was granted to the 2 applicant on the basis of the Uniform Certified 3 Public Accountant examination; and 4 (B)(b)the educational qualifications of the 5 applicant for a certificate, at the time of the 6 written examination, were equivalent to the 7 educational qualifications then required of 8 applicants for admission to the Illinois examination 9 for certified public accountant or, the applicant 10 has, after passing the examination upon which his or 11 her certificate was based, not less than 5 years of 12 experience in the practice of public accounting 13 within the 10 years immediately preceding this 14 application, otherwise reasonably considered 15 acceptable by the Board. 16 (b) In determining the substantial equivalency of the 17 requirements for certification or the rights granted to 18 certificate holders pursuant to this Section, the Board may 19 rely on the determinations of the National Qualification 20 Appraisal Service of the National Association of State Boards 21 of Accountancy or any other qualification appraisal service, 22 as it deems appropriate. 23 (Source: P.A. 88-36.) 24 (225 ILCS 450/9.1) (from Ch. 111, par. 5510.1) 25 Sec. 9.1. Temporary practice. 26 (a) An individual who has passed the Uniform CPA 27 Examination and who holds a valid, unrevoked license or 28 permit to practice as a public accountant from a state or 29 United States territory in which he or she resides or has his 30 or her principal place of business, and who does not reside 31 or have his or her principal place of business in this State, 32 may practice public accounting within this State without the 33 need to obtain a license under this Act. Such practice shall HB2194 Enrolled -3- LRB9104858ACtm 1 be conducted in accordance with the relevant provisions of 2 this Act and rules and regulations adopted hereunder. 3Licensed certified public accountants of other States and4Territories of the United States or the District of Columbia5who do not reside or have an office in this State may6temporarily practice public accounting in this State on7professional business incident to their regular practice8without licensure pursuant to this Act. Such temporary9practice must be conducted in accordance with the relevant10provisions of this Act and rules and regulations adopted11hereunder, including provisions relating to disciplinary12action.13 (b) A foreign accountant who holds a license, 14 certificate, or degree in a foreign country constituting a 15 recognized qualification for the practice of public 16 accounting and who does not reside or have an office in this 17 State may temporarily practice public accounting in this 18 State or professional business incident to his or her regular 19 practice without licensure under this Act provided the 20 standards, including examination, governing issuance of the 21 foreign license, certificate, or degree are substantially 22 equivalent to those in Illinois, and the foreign jurisdiction 23 in question grants equal recognition to Illinois accountants. 24 (Source: P.A. 88-36.) 25 (225 ILCS 450/14) (from Ch. 111, par. 5515) 26 Sec. 14. Qualifications. The Department shall license as 27 public accountants the following: 28 (a) All persons who have received or who hereafter 29 receive certificates as certified public accountants from the 30 Board, who have had at least one year of full-time experience 31 , or its equivalent, providing any type of service or advice 32 involving the use of accounting, attest, management advisory, 33 financial advisory, tax, or consulting skills, which may be HB2194 Enrolled -4- LRB9104858ACtm 1 gained through employment in government, industry, academia, 2 or public practice.either on the professional staff of a3practicing public accountant of this or any other state or in4a responsible audit position including work of a type5normally directed toward the expression of an independent6opinion on financial statements in a governmental agency7either: (1) in auditing the books and accounts or financial8activities of partnerships, corporations or other persons9engaged in 3 or more distinct lines of commercial or10industrial business in accordance with generally accepted11auditing standards; or (2) in auditing the books and accounts12or financial activities of 3 or more distinct governmental13agencies or independent organizational units, not an employer14of the applicant, in accordance with generally accepted15auditing standards, and in which the results of such auditing16are reported to a third party; or (3) in reviewing financial17statements and supporting material covering the financial18condition and operations of entities engaged in 3 or more19distinct lines of commercial or industrial business to20determine the reliability and fairness of the financial21reporting and compliance with generally accepted accounting22principles and applicable laws and governmental regulations;23or who provide satisfactory evidence to the Committee,24established herein, of such other experience or employment as25the Committee may consider substantially equivalent thereto.26 If the applicant's certificate was issued more than 4 27 years prior to the application for an internal license under 28 this Section, the applicant shall submit any evidence the 29 Department may require showing the applicant has completed 30 not less than 90 hours of continuing professional education 31 acceptable to the Department within the 3 years immediately 32 preceding the date of application. 33 The Committee shall be the sole and final judge of the 34 qualification of experience under this section. HB2194 Enrolled -5- LRB9104858ACtm 1 (b) All partnerships, limited liability companies, or 2 corporations, or other entities engaged in the practice of 3 public accounting in this State and meeting the following 4 requirements: 5 (1) (Blank)At least one partner, member of a6limited liability company, or shareholder in a7corporation must be licensed as a public accountant by8the Department under the provisions of this Act and must9be a holder of an effective unrevoked registration card;10and each partner, member of a limited liability company,11or shareholder of a corporation personally engaged in12this State in the practice of public accounting and each13person in charge of an office of the firm in this State14must be so licensed and must be a holder of such a card. 15 (2) A majority of the ownership of the firm, in 16 terms of financial interests and voting rights of all 17 partners, officers, shareholders, members, or managers, 18 belongs to persons licensed in some state, and the 19 partners, officers, shareholders, members, or managers 20 whose principal place of business is in this State and 21 who practice public accounting in this State, as defined 22 in Section 8 of this Act, hold a valid license issued by 23 this State.Each partner, member of a limited liability24company, or shareholder of a corporation not personally25engaged in this State in the practice of public26accounting must be a certified public accountant or be27otherwise authorized to practice accounting in some State28or Territory of the United States, in the District of29Columbia or in a foreign country or a political30subdivision thereof.31 (3) It shall be lawful for a nonprofit cooperative 32 association engaged in rendering an auditing and 33 accounting service to its members only, to continue to 34 render that service provided that the rendering of HB2194 Enrolled -6- LRB9104858ACtm 1 auditing and accounting service by the cooperative 2 association shall at all times be under the control and 3 supervision of public accountants. 4 (4) The Department may adopt rules and regulations 5 as necessary to provide for the practice of public 6 accounting by business entities that may be otherwise 7 authorized by law to conduct business in Illinois. 8 The Director shall appoint a Public Accountant 9 Registration Committee as follows: 7 persons who shall be 10 appointed by and shall serve in an advisory capacity to the 11 Director. Six members must be licensed public accountants, 12 in good standing, and must be actively engaged in the 13 practice of public accounting in this State, and one member 14 of the public, who is not licensed under this Act, or a 15 similar Act of another jurisdiction, and, who has no 16 connection with the accounting or public accounting 17 profession. Members shall serve 4 year terms and until their 18 successors are appointed and qualified. No member shall be 19 reappointed to the Committee for more than 2 terms. 20 Appointments to fill vacancies shall be made in the same 21 manner as original appointments, for the unexpired portion of 22 the vacated term. The membership of the Committee should 23 reasonably reflect representation from the geographic areas 24 in this State. 25 The members of the Committee appointed by the Director 26 shall receive reasonable compensation, to be determined by 27 the Department, for the necessary, legitimate, and 28 authorized expenses approved by the Department. All expenses 29 shall be paid from the Registered Certified Public 30 Accountants' Administration and Disciplinary Fund. 31 The Director may terminate the appointment of any member 32 for cause. 33 The Committee shall present an annual report to the 34 Department the content of which shall be specified by rule. HB2194 Enrolled -7- LRB9104858ACtm 1 The Director shall consider the advice and 2 recommendations of the Committee on questions involving 3 standards of professional conduct, discipline and 4 qualifications of candidates and licensees under this Act. 5 (Source: P.A. 88-36.) 6 (225 ILCS 450/14.2 new) 7 Sec. 14.2. Licensure by endorsement. (a) The Department 8 shall issue a license as a public accountant to any applicant 9 who holds a valid unrevoked license or permit to practice as 10 a public accountant issued under the laws of any other state 11 or territory of the United States or the District of 12 Columbia, provided: 13 (1) the individual applicant is determined by the 14 Department to possess personal qualifications 15 substantially equivalent to this State's current 16 licensing requirements; 17 (2) at the time the applicant received his or her 18 current valid and unrevoked license or permit, the 19 applicant possessed qualifications substantially 20 equivalent to the qualifications for licensure then in 21 effect in this State; or 22 (3) the applicant has, after passing the 23 examination upon which his or her license or other permit 24 to practice was based, not less than 4 years of 25 experience in the practice of public accounting within 26 the 10 years immediately before the application. 27 (b) In determining the substantial equivalency of any 28 state's requirements to Illinois' requirements, the 29 Department may rely on the determinations of the National 30 Qualification Appraisal Service of the National Association 31 of State Boards of Accountancy or such other qualification 32 appraisal service as it deems appropriate. HB2194 Enrolled -8- LRB9104858ACtm 1 (225 ILCS 450/14.3 new) 2 Sec. 14.3. Additional requirements for firms. In 3 addition to the ownership requirements set forth in 4 subsection (b) of Section 14, all firms licensed under this 5 Act shall meet the following requirements: 6 (a) All owners of the firm who are not licensed shall be 7 active participants in the firm or its affiliated entities. 8 (b) An individual who supervises services for which a 9 license is required under Section 8 of this Act or who signs 10 or authorizes another to sign any report for which a license 11 is required under Section 8 of this Act shall hold a valid, 12 unrevoked license from this State or another state and shall 13 comply with such additional experience requirements as may be 14 required by rule of the Department. 15 (c) The firm shall require that all owners of the firm, 16 whether or not certified or licensed under this Act, comply 17 with rules promulgated under this Act. 18 (d) The firm shall designate to the Department in 19 writing an individual licensed under this Act who shall be 20 responsible for the proper registration of the firm. 21 Section 99. Effective date. This Act takes effect upon 22 becoming law.