After passing the toughest exam in the finance and accounting field and earning the prestigious three letters after your name (CPA), what’s next? Is the hard work over? Far from it. You still have to earn a specific number of continuing professional education credits (CPE) to keep your CPA license active. For this post, we’ll cover what CPE credit is and the various ways you can earn CPE credit.
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What is CPE?
CPE stands for Continuing Professional Education and primarily boils down to continuing professional development. It’s how licensed CPAs maintain the skill sets required in their working lives.
CPE is not exclusive to CPAs only, other professionals like pilots, lawyers, engineers, and teachers have continuing professional education requirements to stay licensed.
CPE is one of the best ways for CPAs to remain on the cutting edge. To add value to their firm or company, it’s essential to stay updated with the latest accounting industry rules, policies, and trends, as well as acquire key skills for future professional development. It also imparts accountants the necessary knowledge to effectively complete their jobs.
The American Institute of Certified Public Accountants (AICPA) and the National Association of State Boards of Accountancy (NASBA) both publish requirements of CPE for CPAs. Accounting professionals earn a certain number of CPE credits for courses, webcasts, or certificate training that they attend.
The number of credits per year that must be accrued is determined by the state boards of accountancy. These vary by state. Be sure to check the requirements stipulated by the state board where you are working.
All these aspects will be studied in detail in this post.
What Are CPE Credits
Let us start with what is CPE credit. CPE credit is what is received for completing Continuing Professional Education (CPE).
As a CPA, you’re required to earn a minimum amount of CPE credits. This will enable you to maintain an active license as well as develop a good standing with the board of accountancy of your state.
How many credits do you need to get CPA certification?
The AICPA regulations stipulate that CPAs are required to complete 120 hours every three years to maintain their license. However, individual boards in states set their own CPE credit needs.
For example, some states require 80 hours of CPE credits every 2 years, with a minimum of 20 credits per year. Check the National Registry of NASBA of CPE sponsors to find the requirements of your state.
Here are some quick facts about CPE credits.
- 50 minutes of approved learning make for 1 CPE credit
- 40 hours of CPE must be completed by CPAs every year.
- It’s the discretion of the respective State Board of Accountancy to set additional stipulations or requirements for CPE credits.
- The responsibility for maintaining evidence of completion of CPE credits lies with the CPAs for at least 5 years.
CPE is critical for CPAs as it helps them to stay abreast of the happenings in the accounting industry and use that expertise to better serve their clients.
Apart from using CPE to perform at the highest level and use it to grow as a Certified Public Accountant, the stipulated credits are also needed to maintain the license and designation.
Best Ways to Earn CPE Credits
The next important question is how to get CPE credits. You must earn CPE credits from a qualifying program. Here are some of the options.
- CPE Courses: Before taking up a course, research its content before putting your money into it. Your objective is to enhance your skill sets and the selected course should help you in this direction. Select a program from a CPE course provider who has the experience and is reputed in this niche.
For practicing CPAs, an online course is the best option. These are so designed that you can take a deep dive into the latest topics, updates for audit and accounting, state and federal tax, entity issues, and in-depth reviews of the newest GASB and PCAOB standards.
Included in the courses are webcasts with a live instructor and these make for CPE credits too. Choose a course that has a large library of webcasts with a broadcast schedule that suits you.
Specific CPE certifications also help CPAs to garner credits. Topics can range from tax policy to ethics.
- Learning mediums: There are several teaching mediums that you can select in tune with your preferred learning style. These include webinars, self-paced online courses, and classroom-based teaching at select centers in the USA.
- Conferences and events: Conferences and events are a great way to sharpen your skill sets and network with other professionals. These events require a larger time commitment, but they typically offer enough credits to cover your annual CPE requirement. Be at these conferences and experience exclusive content from experts and great speakers in the accounting field.
- Webcasts: The AICPA offers a wide range of webcasts. You’ll have the flexibility to choose the preferred dates, topics, format and required credits for future webcasts. You can also purchase their annual webcast pass to access a bundle of interactive webcasts. The annual pass covers a range of topics such as auditing, tax, and management accounting to fraud and practice management.
Are Annual CPE Subscriptions a Good Idea?
The benefits of an annual pass include:
- Low cost ($675 to $818),
- Unlimited access to CPE for a year,
- Flexible sessions of 1-8 hours,
- Immediate certification with no assessment, and
- 1 year unlimited access to archived webcasts. Hence, you can go through the webcasts available with the subscription and choose the ones that will enhance your career prospects.
- Publications: AICPA offers CPE credits through several published materials ranging from Comprehensive References to Authoritative guides. CPAs can subscribe to them either singly or in a group. Typically, the topics of these publications are in the following domains: Accounting & Reporting, Audit & Assurance, Ethics, Firm Practice Management, Forensic Services, Government, Management Accounting, Personal Financial Planning, Tax, Technology, Valuation Services, and more.
- Bundles: Don’t have the time or the inclination to hunt and find the right CPA programs year after year? A CPE bundle is your best bet to keep things simple. The AICPA provides this feature for every topic mentioned above and hence, you can select one that matches your area of interest. For example, you can choose the management accounting topic and go through CPE-published materials, certificates, webcasts, or exams only on that topic.
- Certification exam: You can also evaluate your depth of knowledge and capability by challenging yourself to pass the AICPA certification exams to earn CPE credits. This exam is held on a variety of topics such as auditing, forensic services, taxation, and personal financial planning.
- College Courses: This is one of the simplest methods of how to get a CPA continuing professional education credits. Enroll in an accredited college or university for a relevant course. For 1 college credit in the quarter system, you get 10 CPE credits, and for 1 college credit in the semester system, you get 15 CPE credits.
However, before trying different channels for CPE credits, ensure that they follow the requirements of the AICPA and your specific State Board of Accountancy. The credits will only count if the CPE courses you take are from an authorized CPE provider and the conferences you attend are likewise planned by recognized organizations. Do not take a provider’s word for it but check with the board that the program you are taking up or the conference you are attending will lead to credits for you.
While earning a CPA credential may just be the gateway to a lucrative career, earning CPE credits and sustaining your license to keep it going well is no less important. Hence, choose any of the above CPE-earning methods and keep yourself updated in your professional niche.
How To Report CPE Hours
It’s no longer enough to merely complete some CPE courses. You’ll also need to document evidence of completion of CPE credits, a responsibility of which lies squarely on CPAs themselves.
As per the recommendation of NASBA, a CPA is required to keep a record of this documentation for a minimum of 5 years.
NASBA also lists the acceptable documentation and evidence of having completed the CPE credits. They are as follows:
- A certificate or other verification supplied by the CPE program sponsor for independent or group study programs.
- A certificate of completion supplied by the CPE program sponsor of self-study courses after satisfactory completion of an examination.
- A record or transcript of the grade the participant received for a university or college course that is completed for credit.
- A certificate of attendance issued by a representative of the university or college for university or college non-credit courses.
- CPAs who have published articles, books, or CPE programs have to follow these three ways to claim credit.
- Have a copy of the publication or in the case of a CPE program, the course development documentation, that has the name of the writer as a contributor or author.
- A statement from the writer that corroborates the number of CPE hours claimed, and
- The name and contact information of the publisher or independent reviewer(s).
CPAs must accurately document and report their Continuing Professional Education credits.
This means not only claiming credits for the portion of a course that has been completed but also making sure that the learning activities enhance professional competence and skill sets.
Also, ensure that the learning activity gone through is as per the recommendations of the CPE program sponsors and matches the regulations of the state board.
Summing up
Your learning shouldn’t stop with the CPA exam. To excel in your profession, it’s critical to stay on the cutting edge. CPE is your best way to get latest information about audit and accounting, tax, management accounting, or whatever field you’re interested in. There are several ways that you can do so, as given in this post.
However, to ensure that you do not miss out on this issue, AICPA has strict guidelines in this regard. After passing the uniform CPA exam, you must earn at least 40 hours of Continuing Professional Education (CPE) credits to keep your CPA license active. Find a CPE program that aligns with your goals and take your career to the next level.
