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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.
3 Licensed certified public accountants of other States and
4 Territories of the United States or the District of Columbia
5 who do not reside or have an office in this State may
6 temporarily practice public accounting in this State on
7 professional business incident to their regular practice
8 without licensure pursuant to this Act. Such temporary
9 practice must be conducted in accordance with the relevant
10 provisions of this Act and rules and regulations adopted
11 hereunder, including provisions relating to disciplinary
12 action.
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 a
3 practicing public accountant of this or any other state or in
4 a responsible audit position including work of a type
5 normally directed toward the expression of an independent
6 opinion on financial statements in a governmental agency
7 either: (1) in auditing the books and accounts or financial
8 activities of partnerships, corporations or other persons
9 engaged in 3 or more distinct lines of commercial or
10 industrial business in accordance with generally accepted
11 auditing standards; or (2) in auditing the books and accounts
12 or financial activities of 3 or more distinct governmental
13 agencies or independent organizational units, not an employer
14 of the applicant, in accordance with generally accepted
15 auditing standards, and in which the results of such auditing
16 are reported to a third party; or (3) in reviewing financial
17 statements and supporting material covering the financial
18 condition and operations of entities engaged in 3 or more
19 distinct lines of commercial or industrial business to
20 determine the reliability and fairness of the financial
21 reporting and compliance with generally accepted accounting
22 principles and applicable laws and governmental regulations;
23 or who provide satisfactory evidence to the Committee,
24 established herein, of such other experience or employment as
25 the 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 a
6 limited liability company, or shareholder in a
7 corporation must be licensed as a public accountant by
8 the Department under the provisions of this Act and must
9 be a holder of an effective unrevoked registration card;
10 and each partner, member of a limited liability company,
11 or shareholder of a corporation personally engaged in
12 this State in the practice of public accounting and each
13 person in charge of an office of the firm in this State
14 must 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 liability
24 company, or shareholder of a corporation not personally
25 engaged in this State in the practice of public
26 accounting must be a certified public accountant or be
27 otherwise authorized to practice accounting in some State
28 or Territory of the United States, in the District of
29 Columbia or in a foreign country or a political
30 subdivision 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
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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.
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