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Dear AICPA and State CPA Board Members,
I write to you today as a dedicated CPA and founder of Netgain Solutions, a company focused on advancing accounting technology. We are at a pivotal moment in our profession, facing a critical shortage of talent. While the CPA designation remains a hallmark of excellence, it is imperative that we address one of the significant barriers to entry: the 150-hour educational requirement.
Netgain’s mission is centered around leveraging technology to enhance the profession, but technology alone will not solve the CPA shortage. Our profession is on the cusp of transformational improvements as the industry begins to embrace groundbreaking technologies like open banking, AI, and blockchain. However, technological advancements alone will not be enough to solve these talent shortages.
Strong, skilled professionals are the foundation of our work. Unfortunately, the 150-hour requirement has become a substantial obstacle for many potential CPAs, particularly those from lower-income and minority backgrounds. As a result, we risk excluding talented individuals who could have greatly contributed to the future of accounting.
The history of accounting is deeply connected to the growth of modern capitalism. From double-entry bookkeeping during the Renaissance to the role accounting played in the Industrial Revolution, our profession has been instrumental in shaping the financial systems that drive global economies. As CPAs, we have a duty to ensure that this legacy continues by maintaining the integrity and transparency of financial markets and ensuring responsible business management. However, the current educational requirement may be undermining this by unnecessarily narrowing the pipeline of future CPAs.
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Current challenges
The CPA shortage is a pressing issue that threatens the profession’s future. The 150-credit hour requirement, while introduced with good intentions, imposes financial and practical burdens, particularly on those from less privileged backgrounds — deterring students from pursuing the profession.
The decline in candidates taking the CPA exam is telling: In just the past five years, the profession has seen a 33 percent decline in first-time candidates who have taken the CPA exam. We must ask ourselves whether this additional education requirement truly enhances CPA readiness. Conversely, has it inadvertently become a barrier to entry, especially for underrepresented communities, excluding diverse talent from our ranks?
International comparisons
The U.S. is an outlier with its 150-hour rule. Many countries, such as Japan, Canada, the UK, and Germany, maintain high professional standards through a combination of rigorous exams and practical experience, without the need for such extensive academic requirements. Their systems demonstrate that it is possible to prepare highly competent accountants without placing undue burdens on aspiring professionals.
The case for change
Reducing the educational requirement to 120 hours, paired with a strong focus on mentorship and relevant work experience, would broaden access to the profession while maintaining high standards.
Practical experience is often a more effective teacher than additional classroom time, and it can deepen an accountant’s understanding of the profession’s complexities, especially in their given fields and industries of practice. By making the path to licensure more accessible, we would attract candidates from a broader range of backgrounds, strengthening the CPA profession.
Addressing concerns
I understand there may be concerns that lowering the educational threshold could weaken the CPA designation. However, other countries have shown that focusing on hands-on experience and mentorship can produce professionals of the same caliber. In fact, prior to the adoption of the relatively new 150-hour requirement, high caliber CPAs consistently entered the field. With appropriate safeguards in place, such as structured mentorship programs, we can ensure that the CPA designation retains its rigor and global competitiveness.
The importance of the CPA certification
The CPA certification is more than a credential; it is a mark of trust, professionalism, and expertise. It assures businesses, investors, and regulators that those who hold it are equipped to handle complex financial matters with integrity. While technology is transforming the accounting profession, the CPA designation remains a cornerstone of the profession, ensuring that those who hold it can navigate the challenges of an increasingly complex financial landscape.
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Looking forward: The future of accounting
As we embrace automation, artificial intelligence, and data-driven solutions, it is critical that we continue to attract talented individuals to the profession. Technology will undoubtedly shape the future of accounting, but we will always need highly educated, skilled CPAs to guide these advancements. By removing unnecessary barriers such as the 150-hour rule, we can secure a steady pipeline of future-ready professionals who are prepared to lead the profession into the next era.
Call to action
I urge the AICPA and state boards to reconsider the 150-hour requirement and explore alternative pathways to CPA licensure through mentorship and apprentice programs.
The profession made the change to 150 hours when there were far more students entering accounting. Today, faced with a dwindling pipeline of future CPAs, it’s time to reassess this rule based on today’s realities. We must adapt to ensure the pathway to licensure remains accessible to the next generation of accounting professionals.
Now is the time to modernize CPA licensure and create a more inclusive, accessible, and innovative future for accounting.
Sincerely,
Adam Riches, CPA
Founder & CEO, Netgain Solutions, Inc.
