AICPA News – August 2021

The past year has been a defining time for CPAs and management accountants in their roles as trusted advisors to businesses large and small, with the profession proving its ability to adapt and thrive amid disruption and adversity, senior leaders of the AICPA and CIMA said during a keynote presentation at the AICPA & CIMA ENGAGE conference.

That resiliency will be needed going forward, with more changes to come from technological disruption, expanded categories of non-financial reporting, and the rapid evolution of new service lines and business opportunities, Association CEO Barry Melancon, CPA, CGMA, said during the panel session at ENGAGE, one of the leading events dedicated to accounting and finance. Clients and employers are also facing increased complexity on several fronts, many heightened by the pandemic, and they’re looking for the profession to solve it for them.

“It’s hard to argue with the notion that we are in a world reimagined,” Melancon said, adding that the profession is nevertheless well positioned to capitalize on opportunities tied to change. Key topics discussed during the session included:

Digital Transformation. The shift to remote work due to the COVID-19 pandemic accelerated uptake rates for cloud solutions and related technology. Client advisory services (CAS) practices that embraced the cloud before the pandemic fared well during workplace shutdowns, and many firms showed great creativity in areas such as remote auditing that can have application in the post-pandemic world. The leap forward that many firms and employers had to take on technology upgrades due to the pandemic sets the profession up well for the next level of changes involving artificial intelligence, particularly machine learning, panelists said. This will be manifested in such initiatives as the Dynamic Audit Solution, an AICPA and CPA.com effort that is transforming the way audits are performed.

Business Model Evolution. One of the great successes of the profession over the past 18 months was its work in small business relief, and it can have an enduring impact for clients as firms deepen new relationships with lenders, particularly the fintech sector, said Erik Asgeirsson, president and CEO of CPA.com. The Association’s leaders also noted growth in CAS and other advisory services, as well as emerging areas of non-financial reporting bearing on sustainability, data integrity and supply chains, among others.

Focus on Talent. Ensuring a robust pipeline of new CPAs and Chartered Global Management Accountants (CGMAs) and promoting diversity and inclusion are critical, panelists said. To ensure newly licensed CPAs have the skills and competencies required today and into the future, the AICPA is collaborating with the National Association of State Boards of Accountancy to update the CPA licensure model. A new exam for the model, called CPA Evolution, is expected in early 2024

AICPA Awards $766K in Scholarships to Accounting Students

The American Institute of CPAs (AICPA) has granted $766,000 in academic scholarships to 150 students as part of the AICPA Legacy Scholars program.

“The AICPA is committed to fostering the next generation of CPAs. The Legacy Scholars program helps assure we’re attracting students from diverse backgrounds to meet the evolving needs of the accounting profession,” said Mike Decker, VP – CPA Examination & Pipeline at AICPA & CIMA. “The Legacy Scholars program identifies talented accounting students and provides them financial assistance, resources and guidance to help them begin their career. We look forward to welcoming this year’s Legacy Scholarship recipients into the profession in the coming years.”

The program helps students pay for college, easing their journey to becoming CPAs. Funded by the AICPA, the AICPA Foundation, and partners, the Legacy Scholars program consists of six distinct scholarships awarding between $3,000 and $10,000 per student. The scholarships provide support to a variety of students, ranging from those with liberal arts degrees pursuing graduate degrees in accounting, to minority and female scholars to those transferring from two-year to four-year institutions. View list of recipients at: https://cpapracticeadvisor.com/21232664

AICPA Announces 2021 ‘Standing Ovation’ Award Recipients

The AICPA has honored nine young CPAs for contributions to their specialty area with the sixth annual Standing Ovation award. The recipients, all talented CPAs age 40 and under, were acknowledged during AICPA & CIMA ENGAGE 2021.

The AICPA’s Standing Ovation program recognizes young CPAs who exhibit exemplary professional achievement in personal financial planning, business valuation and forensic accounting, and information technology. Beyond making a notable contribution to the profession, nomination requirements include maintaining an active CPA license, being an AICPA member in good standing and holding either the Personal Financial Specialist (PFS), Certified Information Technology Professional (CITP), Certified in Financial Forensics (CFF), or Accredited in Business Valuation (ABV) credential. Nominees must also be 40 years old or younger. View winners at: https://cpapracticeadvisor.com/21232436

CPA Exam Practice Analysis Solicits Feedback

The AICPA is soliciting feedback on the draft content proposed in the new Core and Disciplines CPA Examination structure. This request for input is the next step in the CPA Examination Practice Analysis, which is designed to determine the knowledge and skills that newly licensed CPAs need to protect the public interest under the CPA Evolution licensure model. Stakeholders are asked to provide feedback on preliminary content through September 7, 2021. This valuable input from the profession will help guide the development of new CPA Exam blueprints and Exam design, which will then be shared via an Exposure Draft, which is planned in July 2022.

Under the CPA Evolution licensure model, all candidates will be required to take three Core sections that will assess the knowledge and skills that all newly licensed CPAs need in their role to protect the public interest covering: Accounting, Auditing & Attestation, and Taxation. The three Disciplines are Business Analysis and Reporting, Information Systems and Control and Tax Compliance and Planning. Due to its central role in the profession, technology concepts will be incorporated into all Core and Disciplines sections.

More information on the current practice analysis to develop a CPA Evolution-aligned CPA Exam, include general information, timelines and FAQs is available online and will be updated regularly.

AICPA Proposes New Form AAR-EZ to Simplify and Improve the AAR Process

The AICPA recently submitted recommendations to the Internal Revenue Service (IRS) to simplify and improve the administrative adjustment request (AAR) process under the centralized partnership audit regime (CPAR). The recommendations provide a simplified framework that the AICPA is referring to as a Form AAR-EZ.

The AICPA recommends the following:

• Short-term simplification measures under the existing AAR process
• Instruction changes, clarifications and attachments
• Long-term AAR simplification
• Proposed Form AAR-EZ process
• Deemed automatic extension request(s) under the superseding return rules
• Limited amended partnership returns in the case of retroactive changes

Completing and filing AARs can be a time-consuming, administrative burden for partnerships and practitioners. Making minor adjustments to previously filed partnership returns, including those that are not relevant in determining the tax liability of any partners, is unreasonably difficult due to the complexity of the AAR process.