Key Takeaways

  • The Iowa Senate passed new legislation on Tuesday that would allow future CPA candidates to qualify for licensure with an undergraduate degree that includes accounting coursework, two years of accounting experience, and passing the CPA exam, according to a press release from the Iowa Society of Certified Public Accountants (ISCPA).
  • The bill now moves through an enrollment process before heading to Iowa Governor Kim Reynolds' desk for her signature, according to the ISCPA, which supported the legislation. The new law preserves the state's two existing CPA licensure pathways: earning an undergraduate degree, a master's degree, one year of experience, and passing the CPA exam; or earning an undergraduate degree, an additional 30 credit hours, one year of experience, and passing the CPA exam.
  • "The added pathway helps remove barriers to entering the profession, such as the time and cost of the additional 30 college credits, while ensuring the 'four Es'—education, exam, experience, and ethics—remain integral to the CPA designation," the press release stated.

Deeper Dive

Iowa joins a growing number of states that have passed new CPA licensure laws to ease the accounting talent shortage, with most substituting more work experience for the usual 150-credit-hour requirement, which typically represents a fifth year of college.

The Minnesota Society of CPAs is closely monitoring related legislation, according to spokesperson Corey Butler, as the Hawkeye State follows Indiana, Georgia, Ohio, Virginia, New Mexico, Utah, and Hawaii in passing new CPA pathway laws.

Some accounting experts predict that the shortage of qualified accountants—and the potential risk of reporting errors that may result—will persist this year despite industry efforts to broaden the talent pipeline.