New Jersey Becomes the 25th State in the U.S. to Implement CPA Licensure Reform
New Jersey Governor Murphy signed legislation on Monday allowing CPA candidates to obtain licensure through an alternative path of "bachelor's degree plus two years of work experience plus passing the exam," replacing the previous single requirement of 150 credit hours or a master's degree. This move makes the state the 25th in the nation to adopt the reform, which has progressed significantly faster than the promotion of the 150-credit-hour requirement in the 1980s.
Key Takeaways
- New Jersey Governor Phil Murphy signed legislation on Monday aimed at lowering the barriers to becoming a Certified Public Accountant (CPA), which critics had called "costly." According to the New Jersey Society of CPAs (NJCPA), the new law provides an alternative licensure pathway: candidates can obtain a license by completing a bachelor's degree, accumulating two years of work experience, and passing the CPA exam.
- Previously, CPA candidates in New Jersey and many other states had only one certification path: completing at least 150 college credit hours (typically 30 more than a bachelor's degree) or obtaining a master's degree, completing one year of work experience, and passing the exam.
- Murphy's signing marks a milestone in CPA licensure reform widely supported by the accounting industry. The reform aims to address the accounting talent shortage and attract more, and more diverse, young professionals to the field. Including New Jersey, half of the states nationwide have now completed this reform. "We are the 25th state," said Kathleen Hoffelder, senior content editor at NJCPA, in an email on Tuesday.
Deep Dive
The pace of this licensure reform is currently noticeably faster than in the 1980s, when a reverse push led by Florida to raise educational requirements to 150 credits took over a decade to gain widespread support.
"Looking at how many states have passed this reform in a year, I still think it's quite a milestone in terms of licensure consistency," said Mark Koziel, CEO of the American Institute of CPAs (AICPA) and the Association of International Certified Professional Accountants, in an interview on Tuesday.
While some states are eliminating or phasing out the existing 150-credit pathway, New Jersey has chosen to retain it. According to the press release, the new law takes effect on February 11. The new rules will also allow CPAs licensed in other states to practice in New Jersey, provided they hold a bachelor's degree or higher, have passed the CPA exam, and have at least one year of experience as a practicing CPA.
"We are incredibly pleased that Governor Murphy has signed the additional CPA pathway bill into law," said Aiysha (AJ) Johnson, CEO and Executive Director of NJCPA, in a statement in the press release shared with CFO Dive. "We thank the Governor for his support, and we thank Assemblyman Sterley Stanley, Senator Anthony Bucco, and the entire New Jersey Legislature for their significant support, as well as our knowledgeable members and the business community, who understand the challenges we would face without a future talent pipeline."
To date, 25 states have signed laws or completed CPA rule changes, a total confirmed by Robert Pawlewicz, assistant professor of accounting at the Robins School of Business at the University of Richmond, and Corey Butler, spokesperson for the Minnesota Society of CPAs. Both are closely tracking this reform.
For ongoing updates on CPA licensure changes, visit CFO Dive'srelated tracker page。