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Public Act 91-0508
HB2194 Enrolled LRB9104858ACtm
AN ACT to amend the Public Accounting Act.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Public Accounting Act is amended
by changing Sections 5, 9.1, and 14 and by adding Sections
14.2 and 14.3 as follows:
(225 ILCS 450/5) (from Ch. 111, par. 5506)
Sec. 5. Certification of out-of-State accountants.
(a) The Board may issue a certificate as a certified
public accountant, without examination, to any applicant who
holds a valid unrevoked certificate as a certified public
accountant issued under the laws of any other state or
territory of the United States or the District of Columbia,
provided:
(1) that the state that issued the certificate has
certification requirements that have been determined by
the Board to be substantially equivalent to the
certification requirements of Illinois and grants similar
rights to those that Illinois grants to certificate
holders;
(2) that the state that issued the certificate has
certification requirements that the Department has
determined not to be substantially equivalent to the
certification requirements of Illinois or does not grant
similar rights to Illinois certificate holders, but the
Board determines that the individual applicant possesses
personal qualifications substantially equivalent to
Illinois' certification requirements; or
(3) that the applicant does not qualify under
subsections (1) or (2) above, but the following
conditions are met:
(A) (a) the certificate was granted to the
applicant on the basis of the Uniform Certified
Public Accountant examination; and
(B) (b) the educational qualifications of the
applicant for a certificate, at the time of the
written examination, were equivalent to the
educational qualifications then required of
applicants for admission to the Illinois examination
for certified public accountant or, the applicant
has, after passing the examination upon which his or
her certificate was based, not less than 5 years of
experience in the practice of public accounting
within the 10 years immediately preceding this
application, otherwise reasonably considered
acceptable by the Board.
(b) In determining the substantial equivalency of the
requirements for certification or the rights granted to
certificate holders pursuant to this Section, the Board may
rely on the determinations of the National Qualification
Appraisal Service of the National Association of State Boards
of Accountancy or any other qualification appraisal service,
as it deems appropriate.
(Source: P.A. 88-36.)
(225 ILCS 450/9.1) (from Ch. 111, par. 5510.1)
Sec. 9.1. Temporary practice.
(a) An individual who has passed the Uniform CPA
Examination and who holds a valid, unrevoked license or
permit to practice as a public accountant from a state or
United States territory in which he or she resides or has his
or her principal place of business, and who does not reside
or have his or her principal place of business in this State,
may practice public accounting within this State without the
need to obtain a license under this Act. Such practice shall
be conducted in accordance with the relevant provisions of
this Act and rules and regulations adopted hereunder.
Licensed certified public accountants of other States and
Territories of the United States or the District of Columbia
who do not reside or have an office in this State may
temporarily practice public accounting in this State on
professional business incident to their regular practice
without licensure pursuant to this Act. Such temporary
practice must be conducted in accordance with the relevant
provisions of this Act and rules and regulations adopted
hereunder, including provisions relating to disciplinary
action.
(b) A foreign accountant who holds a license,
certificate, or degree in a foreign country constituting a
recognized qualification for the practice of public
accounting and who does not reside or have an office in this
State may temporarily practice public accounting in this
State or professional business incident to his or her regular
practice without licensure under this Act provided the
standards, including examination, governing issuance of the
foreign license, certificate, or degree are substantially
equivalent to those in Illinois, and the foreign jurisdiction
in question grants equal recognition to Illinois accountants.
(Source: P.A. 88-36.)
(225 ILCS 450/14) (from Ch. 111, par. 5515)
Sec. 14. Qualifications. The Department shall license as
public accountants the following:
(a) All persons who have received or who hereafter
receive certificates as certified public accountants from the
Board, who have had at least one year of full-time
experience, or its equivalent, providing any type of service
or advice involving the use of accounting, attest, management
advisory, financial advisory, tax, or consulting skills,
which may be gained through employment in government,
industry, academia, or public practice. either on the
professional staff of a practicing public accountant of this
or any other state or in a responsible audit position
including work of a type normally directed toward the
expression of an independent opinion on financial statements
in a governmental agency either: (1) in auditing the books
and accounts or financial activities of partnerships,
corporations or other persons engaged in 3 or more distinct
lines of commercial or industrial business in accordance with
generally accepted auditing standards; or (2) in auditing the
books and accounts or financial activities of 3 or more
distinct governmental agencies or independent organizational
units, not an employer of the applicant, in accordance with
generally accepted auditing standards, and in which the
results of such auditing are reported to a third party; or
(3) in reviewing financial statements and supporting material
covering the financial condition and operations of entities
engaged in 3 or more distinct lines of commercial or
industrial business to determine the reliability and fairness
of the financial reporting and compliance with generally
accepted accounting principles and applicable laws and
governmental regulations; or who provide satisfactory
evidence to the Committee, established herein, of such other
experience or employment as the Committee may consider
substantially equivalent thereto.
If the applicant's certificate was issued more than 4
years prior to the application for an internal license under
this Section, the applicant shall submit any evidence the
Department may require showing the applicant has completed
not less than 90 hours of continuing professional education
acceptable to the Department within the 3 years immediately
preceding the date of application.
The Committee shall be the sole and final judge of the
qualification of experience under this section.
(b) All partnerships, limited liability companies, or
corporations, or other entities engaged in the practice of
public accounting in this State and meeting the following
requirements:
(1) (Blank) At least one partner, member of a
limited liability company, or shareholder in a
corporation must be licensed as a public accountant by
the Department under the provisions of this Act and must
be a holder of an effective unrevoked registration card;
and each partner, member of a limited liability company,
or shareholder of a corporation personally engaged in
this State in the practice of public accounting and each
person in charge of an office of the firm in this State
must be so licensed and must be a holder of such a card.
(2) A majority of the ownership of the firm, in
terms of financial interests and voting rights of all
partners, officers, shareholders, members, or managers,
belongs to persons licensed in some state, and the
partners, officers, shareholders, members, or managers
whose principal place of business is in this State and
who practice public accounting in this State, as defined
in Section 8 of this Act, hold a valid license issued by
this State. Each partner, member of a limited liability
company, or shareholder of a corporation not personally
engaged in this State in the practice of public
accounting must be a certified public accountant or be
otherwise authorized to practice accounting in some State
or Territory of the United States, in the District of
Columbia or in a foreign country or a political
subdivision thereof.
(3) It shall be lawful for a nonprofit cooperative
association engaged in rendering an auditing and
accounting service to its members only, to continue to
render that service provided that the rendering of
auditing and accounting service by the cooperative
association shall at all times be under the control and
supervision of public accountants.
(4) The Department may adopt rules and regulations
as necessary to provide for the practice of public
accounting by business entities that may be otherwise
authorized by law to conduct business in Illinois.
The Director shall appoint a Public Accountant
Registration Committee as follows: 7 persons who shall be
appointed by and shall serve in an advisory capacity to the
Director. Six members must be licensed public accountants,
in good standing, and must be actively engaged in the
practice of public accounting in this State, and one member
of the public, who is not licensed under this Act, or a
similar Act of another jurisdiction, and, who has no
connection with the accounting or public accounting
profession. Members shall serve 4 year terms and until their
successors are appointed and qualified. No member shall be
reappointed to the Committee for more than 2 terms.
Appointments to fill vacancies shall be made in the same
manner as original appointments, for the unexpired portion of
the vacated term. The membership of the Committee should
reasonably reflect representation from the geographic areas
in this State.
The members of the Committee appointed by the Director
shall receive reasonable compensation, to be determined by
the Department, for the necessary, legitimate, and
authorized expenses approved by the Department. All expenses
shall be paid from the Registered Certified Public
Accountants' Administration and Disciplinary Fund.
The Director may terminate the appointment of any member
for cause.
The Committee shall present an annual report to the
Department the content of which shall be specified by rule.
The Director shall consider the advice and
recommendations of the Committee on questions involving
standards of professional conduct, discipline and
qualifications of candidates and licensees under this Act.
(Source: P.A. 88-36.)
(225 ILCS 450/14.2 new)
Sec. 14.2. Licensure by endorsement. (a) The Department
shall issue a license as a public accountant to any applicant
who holds a valid unrevoked license or permit to practice as
a public accountant issued under the laws of any other state
or territory of the United States or the District of
Columbia, provided:
(1) the individual applicant is determined by the
Department to possess personal qualifications
substantially equivalent to this State's current
licensing requirements;
(2) at the time the applicant received his or her
current valid and unrevoked license or permit, the
applicant possessed qualifications substantially
equivalent to the qualifications for licensure then in
effect in this State; or
(3) the applicant has, after passing the
examination upon which his or her license or other permit
to practice was based, not less than 4 years of
experience in the practice of public accounting within
the 10 years immediately before the application.
(b) In determining the substantial equivalency of any
state's requirements to Illinois' requirements, the
Department may rely on the determinations of the National
Qualification Appraisal Service of the National Association
of State Boards of Accountancy or such other qualification
appraisal service as it deems appropriate.
(225 ILCS 450/14.3 new)
Sec. 14.3. Additional requirements for firms. In
addition to the ownership requirements set forth in
subsection (b) of Section 14, all firms licensed under this
Act shall meet the following requirements:
(a) All owners of the firm who are not licensed shall be
active participants in the firm or its affiliated entities.
(b) An individual who supervises services for which a
license is required under Section 8 of this Act or who signs
or authorizes another to sign any report for which a license
is required under Section 8 of this Act shall hold a valid,
unrevoked license from this State or another state and shall
comply with such additional experience requirements as may be
required by rule of the Department.
(c) The firm shall require that all owners of the firm,
whether or not certified or licensed under this Act, comply
with rules promulgated under this Act.
(d) The firm shall designate to the Department in
writing an individual licensed under this Act who shall be
responsible for the proper registration of the firm.
Section 99. Effective date. This Act takes effect upon
becoming law.
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