Note: The views and opinions expressed in this article are solely those of the author and do not necessarily reflect the official policy or position of the MACPA or the Maryland Board of Public Accountancy. This article is shared to foster discussion and does not imply endorsement or opposition.

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By Joseph P. Petito, Esq.

The CPA Competency-Based Experience Pathway, issued Sept. 12 by the AICPA and the National Association of State Boards of Accountancy, provides a path for an individual with a baccalaureate degree and the required accounting and business courses (typically a concentration) to become a CPA without having to take an additional 30 hours of education by substituting a year of "competency-based" work experience. The total program would include two years of work experience — the first year "competency-based" and the second year general experience as currently required by most states. 

The AICPA-NASBA proposal is intended to encourage students to enter the CPA profession by making it less costly to become a CPA while maintaining the profession’s 150-hour education requirement, as the "competency-based" experience would be deemed to be equivalent to the additional 30 hours of general education. The other two "tracks" for becoming a CPA remain:

1. a master's degree with an accounting concentration and one year of general experience, and
   
   
2. a baccalaureate degree with an accounting concentration plus 30 additional hours of general study, plus one year of general experience. In every case, the individual must pass the Uniform CPA Examination. 

I have made the point in previous articles that work experience, if constructed appropriately, can provide a substantially similar education as in-classroom or online learning. To a large part, the proposed Experience Pathway reflects this. Most of the work experience that would be required under the proposal would be geared to obtaining general professional skills — ethical behavior, critical thinking, communication, collaboration, business acumen and technology. Since the content of the additional 30 hours of education required under the 150-hour requirement is not specified, it is fair to presume that most students who don’t pursue a master's degree in accounting will take general education courses. An anomaly exists then, since the proposed Experience Pathway requires that individuals must also obtain work experience in a specific technical skill — either audit, tax or business and financial reporting.

There is no requirement that such skills be learned as part of the additional 30 semester hours beyond an accounting concentration. The Experience Pathway would impose an increased requirement beyond what students would have needed if they took 30 semester hours of education. For the nearly half of students who do not intend to practice in public accounting, this additional accounting skill requirement may be a deterrent to becoming a CPA. As a result, the technical skills requirement should be dropped.

This is not to say a technical skills-based experience requirement like that in the Experience Pathway could not be useful, only that it could be useful in a different manner. 

To a large degree, the Experience Pathway is how the AICPA and NASBA hope to catch up with the states already moving forward to allow one year of general experience to substitute for a year of education. These states include Minnesota, North Carolina, Ohio and California, among others. Rather than play catchup, the AICPA and NASBA have the opportunity to lead by enabling non-traditional students to become CPAs, using experience to substitute for what they lack in their accounting education. These include students who graduated as business majors or who decided later in college to become a CPA but were unable to fully complete their accounting course requirements. Such students could benefit from an Experience Pathway that allows work experience to make up for their lack of an accounting and / or business courses. 

Here's one way to accomplish this: Rather than complete one of the three technical experience competencies contained in the Experience Pathway, a student without the requisite accounting or business courses could be required to satisfy all three — audit and assurance, tax, and business and financial reporting. Their second year of experience would consist of learning the general professional competencies. They would also need to pass the Uniform CPA Exam.  

The following two new options could be added to the Experience Pathway proposal:

• Baccalaureate with business major: One year of technical skills "competency-based" experience (including audit, tax, and business financial reporting experience) and one year of professional experience.
  
  
• Baccalaureate with some (to be determined) amount of accounting education: One year of modified accounting skills "competency-based" technical experience (including audit, tax, and business financial reporting experience) and one year of general professional experience.

This approach would open the profession to business majors and others who have already taken introductory accounting and enable them to enter the profession without having to return to college to obtain additional accounting education. Many students do not decide to become CPAs before entering college. Students who decide after the first or second year in college to pursue their CPA can make up their lost courses through substantive work experience.  

With the proposed Experience Pathway, the AICPA and NASBA have formerly acknowledged that specific, competency-based experience is an equivalent and cost-effective means to obtain knowledge that otherwise would have been obtained through classroom or online learning. The profession should take the opportunity, now that it is focused on this issue, to expand that concept to include students who, but for a few accounting courses, could become CPAs.