in-20250416-IR-872240481FRA: DIGEST LICENSURE AND PERMIT REQUIREMENTS

Final Rule LSA Document #24-481 DIGEST Sec. 1. The following definitions apply throughout this title: Sec. 6.1. (a) As part of the one hundred fifty (150) total semester hours required under IC 25-2.1-3-2(b) for first time CPA candidates, a candidate must have earned a baccalaureate or graduate degree from a college or university that is accredited by an accrediting organization as included in section 6.3 of this rule and completed: (b) College courses with substantial duplication of content may be counted only one (1) time toward the requirements in IC 25-2.1-3-2 and this section. This subsection shall does not apply to internships. Sec. 6.3. (a) A college or university is recognized by the board if it is accredited by one (1) of the following Council for Higher Education Accreditation regional accrediting associations: (b) The colleges and universities recognized by the board under subsection (a), which do not include candidates for accreditation, are listed in the following documents, which are incorporated by reference as if fully set out in this rule: (c) Degrees from foreign universities, if they substantially comply with the requirements of section 6.1 of this rule and IC 25-2.1-3-2, will be deemed to meet the requirements established by IC 25-2.1-3-2. (d) The applicant's claim to college or university credits must be confirmed by an official transcript of credit issued by the institution. The transcript must show that the degree has been conferred and must bear the official seal of the college or university, as well as the official signature of the registrar. (e) The applicant is responsible for all such the material being in possession of the board or the board's designee by the deadline for filing applications. Incomplete or late applications will be disapproved by the board. Sec. 6.4. A graduate of a four (4) year degree granting college or university not accredited at the time the candidate's degree was received, or at the time the application was filed, will be deemed to be a graduate of an accredited educational institution if: Sec. 8. (a) This section and sections 8.2 through 8.5 of this rule implement the requirements in IC 25-2.1-3-10. The experience requirements are twenty-four (24) twelve (12) months of full-time employment in the following positions: (b) Clerical functions shall may not count be counted under this section toward meeting the experience requirements. Clerical functions are positions that do not have accounting significance, including doing merely mathematical calculations, account analysis (i.e., looking into accounting books for specific information already recorded), and merely recording information in the general ledger, as opposed to compiling the information. Positions that partly qualify under this section and partly do not qualify shall be under this section are treated under the method provided for in section 8.2 of this rule, with the part of the position that does not qualify under this section being treated as if it were part-time employment. (c) Experience in fractions of months will be counted. (d) An applicant may combine the types of experience described in subsection (a). To do so, the applicant must obtain a total of twenty-four (24) twelve (12) months of experience. Sec. 9.6. (a) CPA examination candidates may not take the CPA examination prior to before meeting the education requirements found in under IC 25-2.1-3-2. for first time CPA examination candidates, which may be met by obtaining at least one hundred twenty (120) semester hours of college education that includes accounting and business administration credits or the equivalent, as determined by the board to be appropriate. (b) The board may cancel any examination scores received by a candidate who fails to meet the requirements in this section. (c) If an examination score is canceled, the candidate is not entitled to any credit for any section of the examination passed. Sec. 10. (a) The following is a schedule of fees adopted by the board: (b) A fee for an individual initially registered in the: (c) Failure of an applicant to pay the initial registration fee will cause the application to be terminated one (1) year after the board's action granting registration. (d) Should If an applicant pay pays the initial registration fee after the first renewal deadline for all licensees, following and after the applicant's approval for licensure, the applicant must pay the renewal fee in addition to the initial registration fee in order to become licensed. Sec. 10.5. (a) To provide funds for administering and enforcing the provisions of IC 25-2.1, including investigating and taking action against persons who violate IC 25-2.1, in addition to the fees required under section 10 of this rule, the board shall charge and collect the following fees: (b) Fees collected under this section shall be deposited in the accountant investigative fund established under IC 25-2.1-8-4. Sec. 19.1. (a) A CPA candidate must shall attain the uniform passing grade established by the administrator of the Uniform CPA Examination, or its successor. (b) A candidate may take the required examination sections individually, in any order, and in the form and manner as prescribed by the administrator of the Uniform CPA Examination, or its successor. A candidate may not retake a failed examination section until the candidate has been notified of the score for the most recent attempt of that failed exam section. Credit for any examination section passed shall be is valid for a period of eighteen (18) thirty-six (36) months, which shall be is calculated from the actual date the candidate took the examination section National Association of State Boards of Accountancy (NASBA) releases the candidate's passing score to the candidate or the board without having to attain a minimum score on any failed examination section, and without regard to whether the candidate has taken other examination sections, provided the following: (c) A candidate shall retain credit for any and all sections of the examination passed as a candidate of another state if such that credit would have been given under then applicable requirements in Indiana. (d) A candidate shall be is considered to have passed the examination once the candidate simultaneously holds valid credit for passing each section of the examination. (e) Notwithstanding subsection (d), the board may, on a case-by-case basis, extend the term of credit validity upon on a showing by a candidate that credit was lost by reason of circumstances beyond the candidate's control. (f) The administrator of the Uniform CPA Examination, or the administrator of its successor, shall notify eligible candidates of the time, place, and procedures for the examination, or a candidate shall independently contact the administrator of the Uniform CPA Examination, the administrator of its successor, or a test center operator to schedule the time, place, and procedures for the examination at an approved test site. Sec. 2.1. A licensee shall furnish to his their client or former client, upon on a request made within a reasonable time: Sec. 14.5. (a) A licensee who: (b) The An application shall must be accompanied by evidence of completion of the CPE hours required in subsection (c). (c) In order To activate the certificate, a licensee shall complete one hundred twenty (120) CPE hours prior to before filing the application. (d) The CPE hours required under subsection (c) must: (e) CPE hours obtained by a licensee to reactivate an inactive or retired license cannot be double counted by also using them for credit in the reporting period in progress for renewal of the license at the end of the reporting period. The CPE requirements for the reporting period in progress at the time of reactivation are stated in section 16 of this rule. Sec. 14.6. (a) Nothing in this section precludes a retired or an inactive status CPA from: (b) A licensee may only convert to inactive or retired status at renewal and must hold a license in good standing. (c) An inactive or a retired licensee cannot offer or render professional services that require their signature and use of the CPA title, either with or without inactive or retired attached, and shall affirm their understanding of the limitations placed on them by being given an exemption from CPE. (d) Licensees have the responsibility to maintain professional competence relative to the services they provide even when exempted from the specific CPE licensure requirements. (e) Licensees may not be compensated for service other than through reimbursement of actual expenses or a limited per diem allowance for expenses. Sec. 14.7. (a) A nonresident licensee seeking renewal of a certificate in this state shall be determined to have met the CPE requirement of this rule by meeting the CPE requirements of renewal of a certificate in the state where the licensee's principal place of business is located. (b) Nonresident applicants for renewal shall demonstrate compliance by signing a statement that they are compliant with the CPE requirements for the licensee's principal place of business. (c) If a nonresident licensee's principal place of business state has no CPE requirements for renewal, the nonresident licensee must comply with the CPE requirements for renewal in this state. (d) An individual using practice privileges in this state, who complies with the CPE requirements applicable in the state where their principal place of business is located, is considered to have complied with the CPE requirements of this state. Sec. 16. The following table establishes the number of CPE hours that a licensee must obtain for the three (3) year reporting period in progress at the time of the issuance or reactivation of a certificate under section 8, 14, or 14.5 of this rule, and it also establishes the minimum hours required in the calendar year of the issuance or reactivation. Self-study is limited to fifty percent (50%) of the required minimum CPE for the three (3) year period: Sec. 1. (a) This section establishes the requirements for nonlicensee owners of CPA or PA firms under IC 25-2.1-5-4. This section does not apply to firms of accounting practitioners under IC 25-2.1-6-6. (b) An active individual participant under IC 25-2.1-5-4(c)(2) is an individual who is actively engaged in the firm or affiliated entities in providing services to the firm's clients as his or her principal their occupation. (c) The firm's owners must shall comply with the AICPA Code of Professional Conduct, applicable which applies to CPA firms only, or the NSA Rules of Professional Conduct, applicable which applies to PA firms only, as adopted by the board in 872 IAC 1-2-1. Sec. 1.5. "Administering entity" means an entity approved by a board approved sponsoring organization to administer the approved peer review program. Sec. 2. "Approved peer review program" means a peer review program: the sponsoring organization's entire peer review process, including the standards for administering, performing, and reporting on peer reviews, oversight procedures, training, and related guidance materials. Sec. 4.5. "Enrollment in a peer review program" means a firm is required to: Sec. 6.3. "Peer review oversight committee" or "PROC" means a board approved committee for monitoring the approved peer review program, including sponsoring organizations' administering entities, to provide reasonable assurance the administering entities and respective peer review committee, and report acceptance bodies, are functioning in a way that effectively enforces the performance and reporting of peer reviews under the peer review standards. Sec. 6.4. "Peer review standards" means the board approved professional standards and guidance for administering, performing, and reporting on peer reviews. Sec. 6.5. "Peer reviewer/reviewing firm" means a CPA or an accounting firm, or both, responsible for conducting the peer review, holding a valid and active license to practice public accounting in good standing issued by this state or some other state, and meeting the peer reviewer qualifications to perform peer reviews established in the board approved peer review standards. Sec. 6.6. "Preparation of financial statements" means providing a service of any preparation of financial statements engagement to be performed in accordance with the Statement on Standards for Accounting and Review Services. Sec. 6.7. "Sponsoring organization" means a board approved professional association, a society, or other organization responsible for facilitating and administering peer reviews directly or through its administering entities, and for the oversight of the administering entities under the sponsoring organization's peer review standards. Sec. 7. (a) The board shall appoint a peer review oversight committee. A PROC shall be appointed or adopted by the board to monitor the board approved peer review program, including sponsoring organizations' administering entities. The PROC, or the board's designee, shall report to the board, at least annually, on the conclusions and recommendations reached as a result of the PROC's activities. (b) The oversight committee shall: (c) An appointment under this section is for a term of three (3) years, except for but an appointment to fill a vacancy shall be is for the remainder of the unexpired term. A committee member may continue to serve until the member's successor is appointed and qualified. An oversight committee member may be reappointed at the end of each term. Sec. 8.5. (a) The board shall approve peer review sponsoring organizations, programs, and standards. (b) The board recognizes the AICPA as an approved sponsoring organization, along with its peer review program and standards. This approval applies to the peer review alliance or its successor and other peer review programs administered by entities involved in administering the AICPA peer review program and other peer review programs administered by the administering entities. These organizations are not required to submit an application for approval to the board. As a condition of this approval, a sponsoring organization is required to: (c) The board may terminate its approval of a sponsoring organization for cause after receiving notice and the opportunity for a hearing. For purposes of this subsection, "cause" includes a substantive change in the peer review program that adversely affects licensees or the public firms, or impairs the board's ability to protect the public in this state, or failing to maintain an ongoing compliance with the requirements of this rule. (d) The board may approve other peer review sponsoring organizations and programs. For an organization not specifically identified in this rule as board approved, to receive board approval for its peer review program and standards, the organization shall submit evidence to the satisfaction of the board. The evidence must include the standards, procedures, guidelines, oversight process, training materials, and related documents used to administer, perform, and accept peer reviews. The board has the authority to request any other documents or information, or both, from an organization about its peer review program in determining whether to grant approval. Sec. 9. (a) This section applies to renewal of firm permits that expire on or after June 30, 2006. June 29, 2006. (b) During the three (3) year period preceding a firm's application for renewal of a permit under IC 25-2.1-5, a firm shall complete a peer review in compliance with this rule, unless the firm is not required to have a peer review under subsection (d)(2) or (d)(3). Failure of a firm to complete a peer review may result in the denial of the renewal of the firm's permit under IC 25-2.1-5. (c) Each firm where attest or compilation services are performed shall be covered by a peer review. A single peer review report covering all locations may be submitted for firms with multiple firm locations. (b) Enrollment in an approved peer review program is a condition for renewal of a permit for firms that issue attest and compilation reports. The board requires licensees that issue attest or compilation reports to be enrolled in an approved peer review program. (c) A firm is not required to enroll in an approved peer review program if its only level of service is performing preparation of financial statements, with or without disclaimer reports, under the Statements on Standards for Accounting and Review Services. However, if the firm elects to enroll in an approved peer review program, it is required to have a peer review that includes preparation of financial statements within the scope of the review. (d) A firm enrolled in an approved peer review program shall schedule, undergo, and complete its initial peer review in compliance with the sponsoring organization's peer review standards and related guidance. A firm's initial peer review is due eighteen (18) months after the date it enrolled, or should have enrolled, in an approved peer review program. The due date is a date by which a review has taken place and all materials have been submitted to the administering entity. (e) A firm enrolled in an approved peer review program shall schedule, undergo, and complete its subsequent peer reviews in compliance with the sponsoring organization's peer review standards and related guidance. Unless an extension has been granted as provided in this rule, subsequent peer reviews are due within three (3) years and six (6) months after the peer review year end of the previous peer review. (f) For good cause shown, the board may grant or renew permits for a reasonable period pending completion of the firm's peer review. (g) For firms required to be registered with and subject to inspection by the Public Company Accounting Oversight Board (PCAOB), the board recognizes the PCAOB's inspection process for reviewing practices subject to its authority, which are not included in the scope of peer review programs. Firms subject to inspection by the PCAOB are also required to meet the peer review requirements under an approved peer review program that covers the portion of the firm's practice not subject to the PCAOB's permanent inspection. (h) If a firm is sold, dissolved, or merged with another firm, determining successor or predecessor firms, the peer review year end or ends, and the peer review due date or dates will be made under the sponsoring organization's guidance. (i) Failure of a firm to complete a peer review may result in the denial of renewing the firm's permit under IC 25-2.1-5. (d) Each (j) An application for renewal of a permit under IC 25-2.1-5 shall must certify: (e) Before commencement of an attest or compilation engagement, a firm that was not required to obtain a peer review under subsection (d)(2) shall: (f) (k) A firm that was not required to obtain a peer review under subsection (d)(3) (c) shall: (g) In order (l) To renew an expired firm permit, a firm shall complete undergo a peer review in compliance with this rule. An exemption under subsection (d)(2) or (d)(3) (b) shall be calculated as if the firm permit had been renewed before its expiration. (h) (m) Each firm is responsible for the cost of the peer reviews under this rule. Sec. 9.5. (a) The objective of this reporting rule is to reinforce the board's efforts to ensure that only appropriately qualified CPA firms are engaged in offering and rendering services based on peer review. Based on its review of the documents submitted under this rule, the board may consider, by hearing or consent, additional corrective actions, such as probation, practice limits, additional continuing education, preissuance reviews, more frequent peer reviews, and other measures, including, in severe cases, discipline against the reviewed firm and any individual licensees employed or contracted by the reviewed firm, other than peer reviewers or their staffs. (b) For peer reviews scheduled on or after April 30, 2025, the firm is required to submit a copy of the results of its most recently accepted peer review to the board, which includes the following documents: (c) The firm shall submit the peer review documents in subsection (b)(1) through (b)(3) to the board within thirty (30) days after the administering entity's acceptance. The firm shall submit the document in subsection (b)(4) to the board within thirty (30) days after the date the letter is signed by the firm, or with submission of the firm's renewal application, whichever occurs first. The firm shall submit the document in subsection (b)(5) to the board within thirty (30) days of the date of the letter, or with submission of the firm's renewal application, whichever occurs first. (d) For peer reviews scheduled after April 30, 2025, the firm is required to provide the following additional documents and objective information: (e) The firm shall allow the administering entity to give the board access to the documents and objective information specified in this section through a secure website process, such as the AICPA's Facilitated State Board Access. Sec. 10. (a) An approved peer review program administering entity shall determine and report the following to the oversight committee with respect to each firm that is reviewed: (b) A firm that is the subject of a peer review may submit to the administering entity a response to the determinations and recommendations contained in the peer review report. (c) Peer review reports and related comments shall be retained by the administering entity: (d) All (a) The proceedings, records, and work papers related to a peer review performed under this rule are: (e) (b) Subject to IC 25-2.1-5-9, a member of the oversight committee, the administering entity, or an individual who was involved with or who performed a peer review may not testify in a civil action, an arbitration, an administrative proceeding, or a board proceeding to matters: