In September, the Michigan legislature introduced a bill establishing an additional pathway to CPA licensure. This new route would allow candidates to meet the education requirements for licensure with 120 credit hours, instead of the current 150-hour standard. If enacted, Michigan would join more than 20 other states in adopting this alternative education pathway.

While expanded routes to licensure are welcome news for aspiring CPAs, the change raises new questions about CPA mobility. Many states currently grant practice privileges to out-of-state CPAs based on the assumption that licensure requirements are substantially equivalent across U.S. jurisdictions. As those requirements evolve, several states, including Michigan, are transitioning to a new mobility framework that focuses on the individual CPA’s qualifications (individual practice privilege) rather than their home state’s rules. Often referred to as automatic mobility, this model will require CPAs and their firms to have a deeper understanding of mobility requirements in other states, as well as the specific qualifications each CPA held at the time of initial licensure. These changes will impact how all CPAs can practice across state lines, not just newly licensed CPAs.

CPA firms already face complex compliance challenges related to firm-level licensure and mobility. For example, a Michigan-based firm serving clients in multiple states must understand the licensure and registration requirements in each state where it operates, including which services trigger mandatory registration with state boards of accountancy. A Michigan firm performing a compilation for a Minnesota client, for instance, does not need to register with the Minnesota Board—but it must still comply with Minnesota’s firm ownership and peer review standards. However, if that same client required an audit, the firm would need to obtain a Minnesota firm permit. Michigan firm permits renew biennially, while Minnesota permits renew annually, adding yet another compliance layer for firms to manage.

Minnesota has also adopted an automatic mobility system for individual CPAs. Under this system, a CPA in good standing from another state may practice in Minnesota if they have passed the Uniform CPA Exam and hold a bachelor’s degree or higher with an accounting concentration. As this system becomes more common, firms will need to verify not only whether their staff hold active licenses, but also how those licenses were obtained before assigning engagements. Because states are implementing automatic mobility with differing criteria and safeguards around education and experience, firms must compare each state’s rules against each staff member’s qualifications—while also maintaining firm-level compliance with varying permit requirements across jurisdictions.

As new pathways and mobility systems emerge, CPA firms may find their current system of controls inadequate. Many firms rely on spreadsheets and calendar reminders to ensure compliance with varying state licensing requirements, a system that quickly breaks down when states update regulations or staff turnover occurs. Missteps can result in disciplinary action, fines, or even the invalidation of audit reports if a firm inadvertently practices without proper registration. Even firms with dedicated compliance personnel find it increasingly difficult to maintain accurate records of which staff hold active licenses, when those licenses expire, and whether those individuals qualify for mobility in a client's state.

To simplify these growing compliance demands and address the associated risks, contact CPA QualityPro. Developed with input from regulators, state CPA societies, and experts in CPA licensing laws, CPA QualityPro tracks firm licenses, renewal deadlines, and mobility eligibility in one streamlined dashboard. With CPA QualityPro, firms can easily determine practice privileges based on current licenses, client locations, and service-specific requirements in each state.

CPA QualityPro is a proud MICPA Advantage Resource Member.