CPA Portability: Important Changes to California's Licensing Requirements

January 2011



On January 1, 2011, the exception to state licensing requirements for "temporary and incidental" accounting practice within the Golden State was eliminated. Practice Privilege Notifications, with the attendant fees, must now be filed with the California Board of Accountancy (CBA) for services within California that are "temporary and incidental" to serving an out-of-state client.


Additionally, the "safe harbor" provision of the CBA's regulations lapsed, thereby abolishing a five-day grace period in which to file a Practice Privilege Notification with the CBA after beginning public accounting services within the state.




Multistate practice has been the subject of much discussion within the accounting community and its regulators. While state borders have become increasingly transparent to many businesses, and mobile technology has made "presence" within a state more a matter of opinion than of fact, accounting and other professionals still face regulations that make interstate practice more difficult and costly, particularly as to licensing and educational requirements.


The Uniform Accountancy Act (UAA) was amended in 2007 to allow accountants who are licensed in any state that has substantially equivalent standards to the UAA, and accountants in other states who individually meet those standards, to practice in other UAA states, subject to a few major caveats. Foremost, the accountant licensed in State A and performing services in State B may not have an office in State B. Those services may not include conducting an audit, examining prospective financial information, or submitting an audit to the Public Company Accounting Oversight Board (PCAOB) on behalf of a business headquartered in State B. Known informally as the "no notice, no fee, no escape" rule, the 2007 UAA amendments, in those states that have adopted them, require no formal notice to State B's regulatory authority, no fee to be paid by the State A accountant, and "no escape" in the sense that the accountant must fully comply with State A's laws and regulations. As of April 2010, 46 states (with the notable exception of California) had passed the UAA.


Wilson Elser has experience assisting CPAs with licensing requirements across the nation.


For more information regarding our capabilities, please contact:



Peter J. Larkin


White Plains


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