Background:

The Public Accountancy Act (Act) governs the practice of accounting in Washington. Under the Act, both accountants and accounting firms must be licensed to hold themselves out as "certified public accountants" (CPAs). The Board of Accountancy (Board) issues licenses, adopts rules, conducts investigations, administers an examination, and otherwise implements the Act.

Certified Public Accountants and CPA firms perform various services that, depending on the service, must meet certain professional standards. The Board conducts a quality assurance review (QAR) program to review the work of licensees and out-of-state CPAs with practice privileges in Washington. Generally, out-of-state CPAs and CPA firms licensed in their home state may perform attest and compilation services for people and businesses in Washington, subject to certain requirements, such as consenting to jurisdiction in Washington.

The word "state" is defined to include the states of the United States, the District of Columbia, Puerto Rico, Guam, the United States Virgin Islands, and the Commonwealth of the Northern Mariana Islands, if the Board determines that the Commonwealth of the Northern Mariana Islands is issuing licenses under substantially equivalent standards as Washington.

The Board must grant a license as a CPA to a holder of a permit, license, or certificate issued by a foreign country's board, agency, or institute, provided the following conditions are met:

The foreign country is a party to an agreement on trade with the United States that encourages the mutual recognition of licensing and certification requirements for the provision of covered services by the parties under the trade agreement.
The foreign country's board, agency, or institute makes similar provision to allow a person who holds a Washington license to obtain the foreign country's comparable permit, license, or certificate.
The foreign permit, license, or certificate: (1) was issued by the foreign country's board, agency, or institute that regulates the practice of public accountancy; (2) is in good standing at the time of the application; and (3) was issued upon the basis of educational, examination, experience, and ethical requirements substantially equivalent currently or at the time of issuance to those in Washington.
Within the previous 36 months the applicant completed an accumulation of 120 hours of continuing professional education (although the Board may vary this requirement by rule).
The applicant's foreign permit, license, or certificate was the type of permit, license, or certificate requiring the most stringent qualifications if, in the foreign country, more than one type of permit, license, or certificate is issued.
The applicant has passed a written examination or its equivalent, approved by the Board, that tests knowledge in the areas of United States accounting principles, auditing standards, commercial law, income tax law, and Washington rules of professional ethics.
The applicant has within the eight years prior to applying for a license, demonstrated, in accordance with the rules issued by the Board, one year of public accounting experience, within the foreign country where the foreign permit, license, or certificate was issued, equivalent to the experience required in Washington or such other experience or employment the Board regards as substantially equivalent.

Attest services are the following financial statement services:

any audit or other engagement to be performed in accordance with the Statements on Auditing Standards;
any review of a financial statement to be provided in accordance with the Statements on Standards for Accounting and Review Services;
any examination of prospective financial information to be performed in accordance with the Statements on Standards for Attestation Engagements; and
any engagement to be performed in accordance with the Public Company Accounting Oversight Board Auditing Standards.

Compilation services are services to be performed in accordance with Statements on Standards for Accounting and Review Services that is present, in the form of financial statements, information that is the representation of management (owners) without undertaking to express any assurance on the statements.

Summary:

It is specified that nothing in the Public Accountancy Act prohibits a firm holding a license or registration as a chartered professional accounting firm in British Columbia from performing any of the following services without being licensed by the Board:

an attest or compilation engagement of a business entity operating in Washington that is the consolidated, subsidiary, or component entity of another entity that is operating in Canada that acts as the issuer of the report; or
a standalone attest or compilation engagement of a wholly or majority-owned subsidiary and or component of an entity that is operating in Canada.

Similarly, a chartered professional accountant licensed in British Columbia who is an employee or owner of a chartered professional accounting firm also registered in British Columbia is not required to obtain a license as a Certified Public Accountant in Washington to perform attest or compilation engagements to such subsidiaries or component entities of Canadian companies.

However, all of the above changes to law expire on June 30, 2023.

House	94	0
Senate	49	0