Corporate CPAs want the deets on active vs inactive
BOA Business
Anne Janotta Erickson, MNCPA membership marketing team leader | August/September 2023 Footnote
Editor's note: Updated August 1, 2023
Part of my role at the MNCPA is to help CPAs in corporate accounting connect the dots.
What does that mean exactly? Sometimes it’s as simple as pointing out an MNCPA resource that can help or introducing them to a fellow member who is worth knowing. And often, corporate CPAs ask about the rules that regulate their certificate.
Specifically, these members want the deets on active verses inactive status. Why? Because they get a choice on the type of certificate they maintain. On the flip side, CPAs in public accounting are required to keep it active.
What’s the difference?
There are two main differences between active and inactive status:
CPE requirement:
- Active CPAs must maintain 120 CPE credits per three-year reporting period.
- Inactive CPAs do not have an annual CPE credit requirement.
Usage:
- Active CPAs can use the credential any way they like.
- Example:
- Inactive CPAs are limited to using CPA with the inactive modifier.
- Example:
- Morgan Accountant, CPA (inactive)
What’s not different?
Renewing! Both active and inactive CPA certificate holders must renew annually through the Minnesota Board of Accountancy (BOA). Active CPAs also report their CPE; inactive CPAs don’t because there’s nothing for them to report, as long they are already inactive.
What’s right for you?
For some corporate CPAs, choosing to stay active is a no-brainer. They worked hard to earn the credential, and nothing is going to stand in the way of them using it anywhere and everywhere! In a turbulent business climate, using your CPA to set yourself apart professionally is a savvy move. But for others, the decision isn’t quite so clear cut. This might be because their company doesn’t reimburse them for the cost of maintaining an active CPA certificate. Or perhaps getting time off to take CPE is an issue.
Ready to make a change?
Here’s the quick scoop on switching your CPA certificate status:
Inactive to active
Switch to active status any time during the year, provided you’ve earned enough CPE (120 credits within three calendar years of the preceding application). Submit necessary paperwork and fees to the BOA.
- January-September: Submit the Status Change to Active form.
- October-December: During the BOA’s renewal period, submit the BOA’s paper renewal form and required paperwork. Refer to the form itself for paperwork specifics.
Active to inactive
A status change to inactive can only be made during the BOA’s renewal period (early October-Dec. 31) with an effective date of Jan. 1. Indicate the status change within the BOA’s renewal form.
Note: Switching to inactive status as a solution for fixing a CPE shortage won’t fly with the BOA. You’re going to need to be in CPE compliance (120 CPE credits for the three-year reporting period ending June 30 preceding the Jan. 1. effective date) to make the switch.
Example: To change to an inactive status for 2024, you will need enough CPE for the reporting years ended June 30: 2021, 2022 and 2023.
What’s my recommendation?
Corporate CPAs need to do what’s right for them. If that means going inactive, I get it. The good news is that you can always make the switch back to active. With that said, I have yet to talk with a member who regrets keeping their CPA active. Maintaining an active CPA makes you a more marketable professional. That’s good for you and the company that’s lucky enough to hire you.
Have questions?
We have answers! Contact the MNCPA at 952-831-2707 or
customerservice@mncpa.org. Or visit
www.mncpa.org/active to read up on your CPA certificate status options.
The Minnesota BOA regulates the CPA profession. They can be reached at 651-296-7938 or
www.boa.state.mn.us.
