Corporate CPAs: Choose your certificate status adventure
September 2019 Footnote
Editor's note: Updated August 29, 2019
Remember the “Choose Your Own Adventure” children’s book series?
The premise is simple: Each reader starts with the same story, but page by page, you get to call the shots and determine where you want the story to go.
Believe it or not, this premise works for corporate CPAs, too. You see, corporate CPAs can steer their own certification status story. The choice that’s right for you — whether active or inactive — will likely be different than what’s right for your corporate CPA peers.
How will your CPA certification status story unfold?
Once upon a time …
Deciding to become a CPA is a story all your own, but the major milestones accomplished to earn the credential are the same for everyone.
- Pass the CPA exam.
- Meet the education requirements.
- Earn your experience.
- Receive your initial CPA certificate from the Minnesota Board of Accountancy.
This is where stories diverge.
You see, CPAs in public accounting have one path to follow: active certification. But corporate CPAs have a choice: remain on the active pathway or choose to go inactive.
Path No. 1: Active
Sure, earning your CPA was an adventure. But it was also a major professional accomplishment. For many CPAs, that’s reason enough to keep their credential active.
Only active CPAs enjoy the flexibility and freedom of using the designation without restriction. What does that mean?
For starters, you can conduct all professional services allowed under Minnesota Board of Accountancy (BOA) rules. This layer of flexibility allows you to easily transition between corporate and public accounting or operate your own tax practice on the side.
However, the bigger draw for most active corporate CPAs is the freedom to use the designation anywhere and everywhere. You name it — resumes, business cards, LinkedIn — and you can list your CPA credential on it if you’re active.
So, why wouldn’t a CPA remain active? Often it comes down to CPE. Active CPAs must maintain 120 CPE credits per rolling three-year reporting period, with a minimum of 20 credits taken annually. Credits are reported to the Minnesota BOA.
Path No. 2: Inactive
Shifting to inactive status can be a personal and/or professional decision. Common reasons for pursuing an inactive CPA certificate include:
- CPE: Inactive CPAs do not have an annual CPE requirement.
- Cost: Too many employers don’t provide financial support for maintaining an active CPA certificate, putting the cost burden on the individual.
- Time: Learning takes time and, again, too many employers don’t offer paid time away for CPE.
Sure, each of these reasons provides some day-to-day flexibility. But inactive CPAs are limited on how they can use their credential professionally. In fact, any reference to CPA must include the inactive modifier. Example: Cooper P. Allan, CPA (inactive).
Unfortunately, many inactive CPAs drop the credential entirely as it’s easier than explaining what inactive means. But this does little to benefit you, your company or the profession overall.
Remember, holding yourself out or practicing as an active CPA when you’re inactive violates BOA statute — a big professional no-no.
Ready for a new adventure?
Professional plot twists happen. The good news is that your certification status can adjust.
Inactive to active
Switch to active status any time once you’ve earned enough CPE (120 credits within three years of the preceding application). Submit necessary paperwork and fees to the BOA. For an effective date of Jan. 1, complete the BOA’s online renewal form. Otherwise, submit the Status Change to Active form.
Active to inactive
A status change to inactive can only be made during the BOA’s renewal period (mid-September–Dec. 31) with an effective date of Jan. 1. Indicate the status change within the BOA’s renewal form. Remember, your CPE must comply in order to make the change to inactive.
As of Aug. 1, 2019, Minnesota’s retiring CPAs can request retired status. Learn more at www.mncpa.org/retired
CPA certification is regulated through the Minnesota BOA. They can be reached for questions at 651-296-7938 or www.boa.state.mn.us.
The MNCPA is here to help. Visit www.mncpa.org/active
for the CPA certificate status scoop. Or contact us anytime at 952-831-2707 or email@example.com