State of Illinois
91st General Assembly
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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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