A bill that would create a second pathway to gaining a CPA — one allowing candidates to do a second year of on-the-job mentorship rather than a fifth year of schooling — passed the Assembly Regulated Professions Committee Thursday.
The bill, introduced by Assemblyman Sterley Stanley (D-East Brunswick) is heavily supported by the New Jersey Society of Certified Public Accountants, which recognizes the need to increase access to passed posed an additional pathway to obtain CPA licensure in the state.
According to the bill, candidates for a CPA still would be required to pass the CPA exam (considered by many to be the most rigorous of professional licensure tests) but allowing candidates to essentially do a second (paid) year of one-the-job training as opposed the 30 more hours of paid coursework.
The goal of the bill is more than just the financial benefit to the candidates. A.J. Johnson, the CEO of the N.J. CPAs, said providing an alternate pathway should help encourage more students to not only go for a CPA but to stay in the profession — a vital need in an industry that annually is losing more professionals than it is adding.
A similar bill already has passed in 11 states with 15 states joining New Jersey and the District of Columbia with the intent of adding the pathway by the end of the year.
Johnson is hopeful N.J. will make the change — saying its benefits go beyond the profession and into the greater business and government communities.
“If we have a shortage of accountants that impacts all businesses — from small businesses to major companies to multinational corporations,” she told BINJE.com. “Everyone would be impacted — from the most local levels of government to major companies and firms.”
Johnson said creating the alternate path also would boost the number of CPAs among first-generation students, who often — but not always —come from underrepresented groups in the profession.
Some question whether putting students into the workforce would dull their desire to go for a CPA. Johnson thinks the opposite will happen.
“We’d like to see more people major in accounting,” she said. “We would hope that, with the proper messaging and showing them the opportunities in accounting, that they would pursue the CPA as the as the gold standard.”
Numerous firms and schools already have partnered to make the fifth year of schooling, including PWC-Saint Peter’s, Withum-Seton Hall and, more recently, WilkinGuttenplan-Rowan.
Johnson said these companies are taking advantage of the additional year of mentorship to sell students on the profession — and the firm. This will continue with greater emphasis if the bill passes.
“I think it’s going to be critically important for government entities, companies and firms to think about the pathway through the experience as a way to attract people to their firms,” she said. “They not only want to give them a solid experience, but give them a sense of the culture, so that the new talent that’s there doesn’t feel like they’re just part of the system.
“I know lots of firms already are providing incentives and time, resources, materials to support their talent in taking and passing the CPA exam successfully.”
Johnson said she is hopeful the bill can be passed and signed by the end of the year. She said she doesn’t see any big hurdles ahead.
“We currently don’t have opposition to the bill,” she said. “I think the legislators understand that without the appropriate number of accountants, not just in our state, but across the country, we won’t be able to get the work done.
“We also haven’t heard much opposition from the educators. Institutions want to make sure that the education they provide is relevant and that the candidates come out as prepared as possible.”
The need for the alternate path clearly is there, Johnson said.
She said the American Institute of ICPAs reports that approximately 75% of today’s public accounting CPAs are expected to retire in the next 15 years — and that the profession is losing more members than it is gaining.
“I don’t claim that the additional pathway is going to be the only solution, but I do think it’s part of a multi-pronged approach to ensuring that we can fill the pipeline,” she said. “I think everybody in the accounting profession understands this. That’s why you see not just New Jersey, but other states moving forward with this additional pathway.”
