What Members Need to Know
about Public Practice Registration
and Licensing
From the Regulatory Affairs Team
Why "licensing" and "registration"?
In the legacy worlds, either individual practitioners were registered or firms were licensed. In the CPABC world, however, public practitioners must be regulated at both the individual and firm levels (additionally, a separate permit is
needed if a professional accounting corporation is used). In short, under CPABC, individual practitioners are licensed, and firms are registered.
You might be wondering why we need both. Wouldn’t it be more efficient to regulate one or the other?
By licensing individuals, CPABC, as a regulator, can confirm that every individual in public practice who signs off
on an engagement has the appropriate education and experience to undertake this work. But the firm is the publicfacing aspect of a practice, responsible for professional liability insurance and for the quality of work performed by
every person on staff—not just those who are licensed. By regulating firms as well as individuals, CPABC is able to
oversee quality-control processes and ensure that all services offered to the public meet professional standards.
Licence categories for individual practitioners
As defined in the CPABC bylaws and summarized below, “public practice” consists of two components:
1. “Public accounting,” which means providing or offering to provide audit, review, or compilation services; and
2. “Other regulated services,” which capture services such as tax advice, tax or statutory filings, forensic accounting,
and financial investigation.
These definitions lead into the various categories of individual licensing:
• Audit,
• Review,
• Compilation,
• Other regulated services – Reviewable (T1 and T2 services), and
• Other regulated services – Non-reviewable.
A member with a licence to practice public accounting (whether audit, review, or compilation) is able to deliver any of
the services that provide less assurance. For example, a practitioner with an audit licence can also provide review and compilation services. Moreover, under current regulations, audit, review, and compilation licences also allow the practitioner
to undertake tax and other regulated work—the caveat, of course, being that a member can only undertake services for
which they have the appropriate level of professional competence.
Note that firms do not have a category. A firm can offer any services that align with the categories of the individuals licensed to sign off on the relevant engagements.
Forensic accounting now requires licensing
Any member who conducts a forensic accounting practice must now be licensed, as forensic accounting falls under
the category of “other regulated services – non-reviewable.” Members who are not already licensed need to contact
CPABC by email at [email protected]. Once professional liability insurance is in place, the licence will be
confirmed.
If any readers know of members practising in this area who may not be aware of the requirement to become
licensed, please do relay this information to them, as licensing must be in place by September 1, 2016.