NYSED Issues Survey Results on Accounting Practice

NEW YORK—The New York State Education Department (NYSED) this month released the results of a survey intended to help officials resolve accounting issues, including how to best broaden the definition of a practice operating under decades-old regulations.

The NYSED distributed the 12-question “Perspective on the Future of the Accounting Profession” survey to 34,739 CPAs and PAs licensed in the state as of the end of last May. More than one-third—12,351—responded, answering yes or no questions about the 150-hour rule, mandatory peer review, and non-CPA ownership of accounting firms, among other topics.

Officials initiated the survey after years of public hearings, round table discussions, and disagreement over competing proposals in Albany on how best to revamp state laws that have governed the profession. The New York State Society of CPAs criticized the questions, saying they were were posed in a way that could skew the results.

The NYSED, indeed, ultimately discarded its first question—“Should the scope of practice of CPAs…be amended to include all professional services they provide or just attest and compilation services, no matter where employed?”—because the question elicited seperate answers, but allowed only a single yes or no response.

“A response rate nearly 2 percent lower than any other survey question…indicates that some…respondents may have had difficulty in understanding…the question,” an analysis of the survey stated. The NYSED omitted the results from its analysis.

The survey also asked, “Due to the decrease in students graduating from registered accounting programs, should the rules of the Board of Regents be amended to require candidates for licensure to graduate from only a 120-hour education program, rather than a 150-hour education program?” The results were nearly split, with 49.2 percent answering yes, and 50.8 percent answering no.

On substantial equivalency, the survey asked, “Should New York embrace the concept of substantial equivalency to make it easier for out-of-state CPAs to practice in New York, even if this means lowering some of New York’s licensing standards?” A little less than one-quarter responded yes, while more than three-quarters said no.

Many were in favor of peer review—58.8 percent said there “should…be mandatory peer review for all firms registered to practice public accountancy in New York state.” Almost 73 percent of the respondents employed in industry agreed with this, while 54.3 percent of those in public accounting said yes.

A majority of respondents agreed that “sole-proprietorships, which are professional practice structures authorized by law in New York state, be required to register with the NYSED”—66 percent answered yes to this question.

A similar amount agreed that CPAs “be allowed to accept commissions and referral fees when the client is not associated with an attest or compilation engagement”—64 percent said yes.

Other Questions

Almost three-quarters of the respondents (72.3 percent) disagreed that CPAs “working in private industry be allowed to perform compilation services for the public on behalf of their corporate employers.”

A whopping 90.5 percent said New York should “continue to require all candidates for licensure to obtain audit and/or review engagement experience as a requirement for licensure.”

Most respondents (80.7 percent) said they would not want “New York’s Education Law (to) be amended to allow non-licensed individuals to become up to 49 percent owners of public accounting firms” and 76.7 percent said they wouldn’t want the law to be amended “to eliminate the 24-hour concentration option for continuing professional education.” About 66 percent answered no to the question, “should the exemption from mandatory continuing education for CPAs…working in private industry, government, or academia be removed from Education Law?”

Finally, 86 percent said they would not want “public accountants (to) be grandfathered into the certified public accountancy profession.”