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Public Act 098-0730 Public Act 0730 98TH GENERAL ASSEMBLY |
Public Act 098-0730 | HB4707 Enrolled | LRB098 17321 ZMM 52417 b |
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| AN ACT concerning regulation.
| 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by | changing Sections 8.05, 14.2, 14.4, 16, and 17.1 as follows: | (225 ILCS 450/8.05) | (Section scheduled to be repealed on January 1, 2024) | Sec. 8.05. Accountancy activities. | (a) Accountancy activities are services performed by a CPA, | including: | (1) signing, affixing, or associating the names used by | a person or CPA firm to any report expressing an assurance | on a financial statement or disclaiming an opinion on a | financial statement based on an audit or examination of | that statement or to express assurance on a financial | statement; | (2) other attestation engagements not otherwise | defined in paragraph (1); or | (3) offering to perform or performing one or more types | of the following services involving the use of professional | skills or competencies: accounting, management, financial | or consulting services, compilations, internal audit, | preparation of tax returns, furnishing advice on tax |
| matters, bookkeeping, or representations of taxpayers; | this includes the teaching of any of these areas at the | college or university level. | (b) If offering or performing accountancy activities using | the CPA title set forth in paragraphs (1), (2), and (3) of | subsection (a) of this Section, then: | (1) the activities identified in paragraph (1) of | subsection (a) may only be performed by licensed CPAs; | (2) the activities identified in paragraph (2) of | subsection (a) may only be performed by licensed or | registered CPAs; and | (3) the activities identified in paragraph (3) of | subsection (a) are not restricted to licensed or registered | CPAs, subject to the provisions of Section 9 9.02 of this | Act.
| (Source: P.A. 98-254, eff. 8-9-13.)
| (225 ILCS 450/14.2)
| (Section scheduled to be repealed on January 1, 2024)
| Sec. 14.2. Licensure by endorsement.
| (a) The Department shall issue a
license as a licensed CPA | to any applicant
who holds a current, valid, and unrevoked | license as a certified public accountant issued from another | state with equivalent educational requirements and examination | standards, applies to the Department on forms supplied by the | Department, and pays the required fee,
provided:
|
| (1) the individual applicant is determined by the | Department
to possess
qualifications substantially | equivalent to this State's current
licensing requirements;
| (2) at the time the applicant received his or her | license, 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 to practice was based, not | less than 4 years of
experience as outlined in Section 14 | of this Act 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.
| (c) Applicants have 3 years from the date of application to | complete the application process. If the process has not been | completed in 3 years, the application shall be denied, the fee | shall be forfeited, and the applicant must reapply and meet the | requirements in effect at the time of reapplication.
| (d) Any individual who is the holder of a current, valid, | and not previously disciplined license as a certified public | accountant of any state and has applied in writing to the |
| Department in form and substance satisfactory to the Department | for a license as a licensed CPA may perform accountancy | activities as set forth in Section 8.05 until the earlier of | the following dates: | (1) the expiration of 6 months after filing the written | application; or | (2) the denial of the application by the Department. | Any individual performing accountancy activities under | this subsection (d) shall be subject to discipline in the same | manner as an individual licensed under this Act. | (Source: P.A. 98-254, eff. 8-9-13.)
| (225 ILCS 450/14.4) | (Section scheduled to be repealed on January 1, 2024) | Sec. 14.4. Qualifications for licensure as a CPA firm. The | Department may license as licensed CPA firms individuals or | entities meeting the following requirements: | (1) A majority of the ownership of the firm, in terms | of financial interests and voting rights of all partners, | officers, shareholders, or members, or belongs to persons | licensed or registered in some state. All partners, | officers, shareholders, or members, whose principal place | of business is in this State and who have overall | responsibility for accountancy activities in this State, | as defined in paragraph (1) of subsection (a) of Section | 8.05 of this Act, must hold a valid license as a licensed |
| CPA issued by this State. An individual exercising the | practice privilege afforded under Section 5.2 who performs | services for which a firm license is required under | subsection (d) of Section 5.2 shall not be required to | obtain an individual license under this Act. | (2) All owners of the CPA firm, whether licensed as a | licensed CPA or not, shall be active participants in the | CPA firm or its affiliated entities and shall comply with | the rules adopted under this Act. | (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 | licensed CPAs. | (4) An individual who supervises services for which a | license is required under paragraph (1) of subsection (a) | of Section 8.05 of this Act, who signs or authorizes | another to sign any report for which a license is required | under paragraph (1) of subsection (a) of Section 8.05 of | this Act, or who supervises services for which a CPA firm | license is required under subsection (d) of Section 5.2 of | this Act shall hold a valid, active licensed CPA license | from this State or another state considered to be | substantially equivalent under paragraph (1) of subsection |
| (a) of Section 5.2. | (5) The CPA firm shall designate to the Department in | writing an individual licensed as a licensed CPA under this | Act or, in the case of a firm that must have a CPA firm | license pursuant to subsection (b) of Section 13 of this | Act, a licensee of another state who meets the requirements | set out in paragraph (1) or (2) of subsection (a) of | Section 5.2 of this Act, who shall be responsible for the | proper licensure of the CPA firm.
| (Source: P.A. 98-254, eff. 8-9-13.)
| (225 ILCS 450/16) (from Ch. 111, par. 5517)
| (Section scheduled to be repealed on January 1, 2024)
| Sec. 16. Expiration and renewal of licenses; renewal of | registration;
continuing education ; peer review . | (a) The expiration date and renewal period for each license | or registration
issued under this Act shall be set by rule.
| (b) Every holder of a license or registration under this | Act may renew such license or registration before the | expiration date upon payment of the required renewal fee as set | by rule.
| (c) Every application for renewal of a license by a | licensed CPA who has been licensed under this Act for 3 years | or more shall be accompanied or supported by any evidence the | Department shall prescribe, in satisfaction of completing, | each 3 years, not less than 120 hours of continuing |
| professional education as prescribed by Department rules. Of | the 120 hours, not less than 4 hours shall be courses covering | the subject of professional ethics. All continuing education | sponsors applying to the Department for registration shall be | required to submit an initial nonrefundable application fee set | by Department rule. Each registered continuing education | sponsor shall be required to pay an annual renewal fee set by | Department rule. Publicly supported colleges, universities, | and governmental agencies located in Illinois are exempt from | payment of any fees required for continuing education sponsor | registration. Failure by a continuing education sponsor to be | licensed or pay the fees prescribed in this Act, or to comply | with the rules and regulations established by the Department | under this Section regarding requirements for continuing | education courses or sponsors, shall constitute grounds for | revocation or denial of renewal of the sponsor's registration. | (d) Licensed CPAs are exempt from the continuing | professional education requirement for the first renewal | period following the original issuance of the license. | Failure by an applicant for renewal of a license as a | licensed CPA to furnish the evidence shall constitute grounds | for disciplinary action, unless the Department in its | discretion shall determine the failure to have been due to | reasonable cause. The Department, in its discretion, may renew | a license despite failure to furnish evidence of satisfaction | of requirements of continuing education upon condition that the |
| applicant follow a particular program or schedule of continuing | education. In issuing rules and individual orders in respect of | requirements of continuing education, the Department in its | discretion may, among other things, use and rely upon | guidelines and pronouncements of recognized educational and | professional associations; may prescribe rules for the | content, duration, and organization of courses; shall take into | account the accessibility to applicants of such continuing | education as it may require, and any impediments to interstate | practice of public accounting that may result from differences | in requirements in other states; and may provide for relaxation | or suspension of requirements in regard to applicants who | certify that they do not intend to engage in the performance of | accountancy activities, and for instances of individual | hardship. | The Department shall establish by rule a means for the | verification of completion of the continuing education | required by this Section. This verification may be accomplished | through audits of records maintained by licensees; by requiring | the filing of continuing education certificates with the | Department; or by other means established by the Department. | The Department may establish, by rule, guidelines for | acceptance of continuing education on behalf of licensed CPAs | taking continuing education courses in other jurisdictions.
| (e) For renewals on and after July 1, 2012, as a condition | for granting a renewal license to CPA firms and sole |
| practitioners who perform accountancy activities outlined in | paragraph (1) of subsection (a) of Section 8.05 under this Act, | the Department shall require that the CPA firm or sole | practitioner satisfactorily complete a peer review during the | immediately preceding 3-year period, accepted by a Peer Review | Administrator in accordance with established standards for | performing and reporting on peer reviews, unless the CPA firm | or sole practitioner is exempted under the provisions of | subsection (i) of this Section. A CPA firm or sole practitioner | shall, at the request of the Department, submit to the | Department a letter from the Peer Review Administrator stating | the date on which the peer review was satisfactorily completed. | A new CPA firm or sole practitioner shall not be required | to comply with the peer review requirements for the first | license renewal. A CPA firm or sole practitioner shall undergo | its first peer review during the first full renewal cycle after | it is granted its initial license.
| The requirements of this subsection (e) shall not apply to | any person providing services requiring a license under this | Act to the extent that such services are provided in the | capacity of an employee of the Office of the Auditor General or | to a nonprofit cooperative association engaged in the rendering | of licensed service to its members only under paragraph (3) of | Section 14.4 of this Act or any of its employees to the extent | that such services are provided in the capacity of an employee | of the association. |
| (f) The Department shall approve only Peer Review | Administrators that the Department finds comply with | established standards for performing and reporting on peer | reviews. The Department may adopt rules establishing | guidelines for peer reviews, which shall do all of the | following:
| (1) Require that a peer review be conducted by a | reviewer that is independent of the CPA firm reviewed and | approved by the Peer Review Administrator under | established standards. | (2) Other than in the peer review process, prohibit the | use or public disclosure of information obtained by the | reviewer, the Peer Review Administrator, or the Department | during or in connection with the peer review process. The | requirement that information not be publicly disclosed | shall not apply to a hearing before the Department that the | CPA firm or sole practitioner requests be public or to the | information described in paragraph (3) of subsection (i) of | this Section. | (g) If a CPA firm or sole practitioner fails to | satisfactorily complete a peer review as required by subsection | (e) of this Section or does not comply with any remedial | actions determined necessary by the Peer Review Administrator, | the Peer Review Administrator shall notify the Department of | the failure and shall submit a record with specific references | to the rule, statutory provision, professional standards, or |
| other applicable authority upon which the Peer Review | Administrator made its determination and the specific actions | taken or failed to be taken by the licensee that in the opinion | of the Peer Review Administrator constitutes a failure to | comply. The Department may at its discretion or shall upon | submission of a written application by the CPA firm or sole | practitioner hold a hearing under Section 20.1 of this Act to | determine whether the CPA firm or sole practitioner has | complied with subsection (e) of this Section. The hearing shall | be confidential and shall not be open to the public unless | requested by the CPA firm or sole practitioner. | (h) The CPA firm or sole practitioner reviewed shall pay | for any peer review performed. The Peer Review Administrator | may charge a fee to each firm and sole practitioner sufficient | to cover costs of administering the peer review program. | (i) A CPA firm or sole practitioner shall not be required | to comply with the peer review requirements if: | (1) Within 3 years before the date of application for | renewal licensure, the sole practitioner or CPA firm has | undergone a peer review conducted in another state or | foreign jurisdiction that meets the requirements of | paragraphs (1) and (2) of subsection (f) of this Section. | The sole practitioner or CPA firm shall, at the request of | the Department, submit to the Department a letter from the | organization administering the most recent peer review | stating the date on which the peer review was completed; or |
| (2) Within 2 years before the date of application for | renewal licensure, the sole practitioner or CPA firm | satisfies all of the following conditions: | (A) has not accepted or performed any accountancy | activities outlined in paragraph (1) of subsection (a) | of Section 8.05 of this Act; and | (B) the firm or sole practitioner agrees to notify | the Peer Review Administrator within 30 days of | accepting an engagement for services requiring a | license under this Act and to undergo a peer review | within 18 months after the end of the period covered by | the engagement; or | (3) For reasons of personal health, military service, | or other good cause, the Department determines that the | sole practitioner or firm is entitled to an exemption, | which may be granted for a period of time not to exceed 12 | months. | (j) If a peer review report indicates that a CPA firm or | sole practitioner complies with the appropriate professional | standards and practices set forth in the rules of the | Department and no further remedial action is required, the Peer | Review Administrator shall, after issuance of the final letter | of acceptance, destroy all working papers and documents related | to the peer review, other than report-related documents and | documents evidencing completion of remedial actions, if any, in | accordance with rules established by the Department. |
| (k) (Blank). | (Source: P.A. 98-254, eff. 8-9-13.)
| (225 ILCS 450/17.1) (from Ch. 111, par. 5518.1)
| (Section scheduled to be repealed on January 1, 2024)
| Sec. 17.1. Restoration. | (a) Any registered CPA who has permitted his or her | registration to expire or who has had his or her registration | on inactive status may have his or her registration restored by | making application to the Department and filing proof | acceptable to the Department as defined by rule of his or her | fitness to have his or her registration restored, which may | include sworn evidence certifying to active practice in another | jurisdiction satisfactory to the Department and by paying the | required restoration fee.
| (b) Any licensed CPA who has permitted
his or her license | to expire
or who has had his or her license on inactive status | may have his or her license restored
by (1) making application | to the Department and filing proof
acceptable to the
Department | as defined by rule of his or her fitness to have his or her | license restored, including
sworn
evidence certifying to | active practice in another jurisdiction satisfactory
to the | Department , (2) and by paying the required restoration fee , (3)
| and by submitting proof of the
required continuing education | and (4) in the case of a sole practitioner, satisfactory | completion of peer review outlined in subsection (e) of Section |
| 16, unless exempt from peer review under subsection (i) of | Section 16 . | (c) Any firm that has permitted its license to expire may | have its license restored by (1) making application to the | Department and filing proof acceptable to the Department as | defined by rule of its fitness to have its license restored, | including sworn evidence certifying to active practice in | another jurisdiction satisfactory to the Department, (2) | paying the required restoration fee, and (3) satisfactory | completion of peer review outlined in subsection (e) of Section | 16, unless exempt from peer review under subsection (i) of | Section 16. | (d) If the licensed CPA or registered CPA has not | maintained an active
practice in another
jurisdiction | satisfactory to the Department, the Department shall | determine,
by an evaluation program established by rule, | fitness to resume active status
and may require the applicant | to complete a period of supervised
experience.
| Any licensed CPA or registered CPA whose license or | registration expired
while he or she was (1) in
Federal Service | on active duty with the Armed Forces of the United States,
or | the State Militia called into service or training, or (2) in | training
or education under the supervision of the United | States preliminary to
induction
into the military service, may | have his or her license or registration renewed reinstated or | restored
without
paying any lapsed renewal and restoration fees |
| if within 2 years after
honorable termination
of such service, | training or education except under conditions other than
| honorable, he or she furnished
the Department with satisfactory | evidence to the effect that he or she
has been
so engaged and | that his or her service, training, or education has been so | terminated.
| (Source: P.A. 98-254, eff. 8-9-13.)
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Effective Date: 1/1/2015
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