How can states effectively regulate professional practice that, thanks to the Internet, takes place in their jurisdictions in a matter of only nanoseconds? That is the challenge Sarah G. Blake, 1997-98 chairwoman of the National Association of the State Boards of Accountancy, presented to her colleagues at the 90th Annual NASBA meeting in Maui, Hawaii, last fall. The third edition of the Uniform Accountancy Act--recently issued jointly by NASBA and the American Institute of CPAs--contains the answer, but the document's break with the status quo has caused many regulators to reconsider what regulation is supposed to achieve.
Milton Brown, a member and former chairman of NASBA's UAA committee, explained that the new UAA seeks to codify the concept of "a CPA is a CPA." Anything a CPA does, within any practice, comes within the purview of a state board of accountancy. In addition, as the UAA's substantial equivalency provisions come into play, licensees also would agree to be under the jurisdiction of the boards where they are practicing temporarily. Although a licensee would be required to hold a license only where his or her principal place of business is located, the remote state would be given the power to discipline as well.
Brown said, "We have proposed that NASBA serve as a clearinghouse for substantial equivalency, notifying a jurisdiction of the licensees who anticipate working within its borders." He said some states fear the single-license concept would drain revenues and their own licensees would have to bear all the costs of disciplining out-of-state practitioners. However, he pointed out, "The UAA does not say anything about fees that a board may charge upon notification of a person's practicing in its borders."
The message that Brown and other speakers delivered was that the UAA is a model from which the states can select what suits their own needs. NASBA 1996-97 chairman John M. Greene called the UAA "a suggestion" and advised the states to take only what they need from the new UAA.
Panelists from four accountancy boards were asked to give their opinions about the new UAA. Their views differed dramatically. Patrick D. McCarthy from Louisiana's board asked, "How do I improve the regulation of the profession by weakening the standards?"
Ohio's Sheila M. Birch said she had been troubled by issues of substantial equivalency and nonlicensee ownership of CPA firms. However, she said, "there is no way back. The world marketplace will...