Download This Bill in Microsoft Word format
A34, R52, S176
STATUS INFORMATION
General Bill
Sponsors: Senator Climer
Document Path: SR-0184KM25.docx
Introduced in the Senate on January 14, 2025
Introduced in the House on March 20, 2025
Last Amended on May 1, 2025
Currently residing in the Senate
Governor's Action: May 12, 2025, Signed
Summary: Certified Public Accountants
HISTORY OF LEGISLATIVE ACTIONS
| Date | Body | Action Description with journal page number |
|---|---|---|
| 1/14/2025 | Senate | Introduced and read first time (Senate Journal-page 107) |
| 1/14/2025 | Senate | Referred to Committee on Labor, Commerce and Industry (Senate Journal-page 107) |
| 2/26/2025 | Senate | Committee report: Favorable with amendment Labor, Commerce and Industry (Senate Journal-page 12) |
| 3/5/2025 | Scrivener's error corrected | |
| 3/11/2025 | Senate | Committee Amendment Adopted (Senate Journal-page 18) |
| 3/11/2025 | Senate | Amended (Senate Journal-page 18) |
| 3/11/2025 | Senate | Roll call Ayes-41 Nays-0 (Senate Journal-page 18) |
| 3/12/2025 | Scrivener's error corrected | |
| 3/12/2025 | Senate | Read third time and sent to House (Senate Journal-page 10) |
| 3/20/2025 | House | Introduced and read first time (House Journal-page 20) |
| 3/20/2025 | House | Referred to Committee on Labor, Commerce and Industry (House Journal-page 20) |
| 4/1/2025 | Scrivener's error corrected | |
| 4/9/2025 | Scrivener's error corrected | |
| 4/30/2025 | House | Committee report: Favorable with amendment Labor, Commerce and Industry (House Journal-page 11) |
| 5/1/2025 | House | Amended (House Journal-page 106) |
| 5/1/2025 | House | Read second time (House Journal-page 106) |
| 5/1/2025 | House | Roll call Yeas-111 Nays-0 (House Journal-page 109) |
| 5/1/2025 | House | Unanimous consent for third reading on next legislative day (House Journal-page 110) |
| 5/5/2025 | Scrivener's error corrected | |
| 5/2/2025 | House | Read third time and returned to Senate with amendments |
| 5/6/2025 | Senate | Concurred in House amendment and enrolled (Senate Journal-page 102) |
| 5/8/2025 | Ratified R 52 | |
| 5/12/2025 | Signed By Governor | |
| 5/19/2025 | Effective date 06/30/25 | |
| 5/19/2025 | Act No. 34 |
View the latest legislative information at the website
VERSIONS OF THIS BILL
01/14/2025
02/26/2025
02/26/2025-A
03/05/2025
03/11/2025
03/12/2025
03/12/2025-A
04/01/2025
04/09/2025
04/30/2025
05/01/2025
05/05/2025
NOTE: THIS IS A TEMPORARY VERSION. THIS DOCUMENT WILL REMAIN IN THIS VERSION UNTIL FINAL APPROVAL BY THE LEGISLATIVE COUNCIL.
(A34, R52, S176)
AN ACT TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING SECTION 40-2-30, RELATING TO REQUIREMENTS FOR USE OF PROFESSIONAL DESIGNATIONS FOR CERTIFIED PUBLIC ACCOUNTANTS AND PUBLIC ACCOUNTS, SO AS TO APPLY THESE REQUIREMENTS TO USAGES IN ELECTRONIC FILES AND METADATA; BY AMENDING SECTION 40-2-35, RELATING TO REQUIREMENTS FOR LICENSURE BY THE BOARD OF ACCOUNTANCY, SO AS TO REVISE THE EDUCATIONAL AND EXPERIENCE REQUIREMENTS, TO REVISE REQUIREMENTS CONCERNING THE UNIFORM CERTIFIED PUBLIC ACCOUNTANT EXAM REQUIREMENTS; BY AMENDING SECTION 40-2-40, RELATING TO ENTITIES REQUIRED TO REGISTER WITH THE BOARD TO PRACTICE AS CERTIFIED PUBLIC ACCOUNTING FIRMS, SO AS TO REQUIRE SUCH REGISTRATION OF FIRMS THAT PERFORM COMPILATION SERVICES, AND TO PROVIDE OWNERSHIP OF SUCH FIRMS MAY BE HELD THROUGH A REVOCABLE GRANTOR TRUST; BY AMENDING SECTION 40-2-70, RELATING TO POWERS AND DUTIES OF THE BOARD, SO AS TO ADD REVIEW AND PROVIDE INPUT ON PROPOSED LEGISLATIVE CHANGES RELATED TO THE PRACTICE OF ACCOUNTING AS A POWER OF THE BOARD; BY AMENDING SECTION 40-2-80, RELATING TO INVESTIGATIONS OF COMPLAINTS OR OTHER INFORMATION SUGGESTING VIOLATIONS, SO AS TO PROVIDE INSPECTOR-INVESTIGATORS MUST HAVE BEEN LICENSED AS CERTIFIED PUBLIC ACCOUNTANTS FOR AT LEAST THE PREVIOUS FIVE YEARS; BY AMENDING SECTION 40-2-240, RELATING TO REQUIREMENTS FOR PERSONS LICENSED IN OTHER JURISDICTIONS TO OBTAIN LICENSURE BY THE BOARD, SO AS TO PROVIDE RECIPROCITY LICENSURE REQUIREMENTS; AND BY AMENDING SECTION 40-2-245, RELATING TO REQUIREMENTS FOR PERSONS LICENSED IN OTHER JURISDICTIONS TO PRACTICE IN THIS STATE WITHOUT LICENSURE BY THE BOARD, SO AS TO REVISE THE REQUIREMENTS; AND BY REPEALING SECTION 40-2-20(18) RELATING TO DEFINITIONS CONCERNING THE BOARD OF ACCOUNTANCY, SECTION 40-2-35(H) RELATING TO REQUIREMENTS FOR LICENSURE BY THE BOARD OF ACCOUNTANCY, AND SECTION 40-2-35(I) RELATING TO RELATING TO REQUIREMENTS FOR LICENSURE BY THE BOARD OF ACCOUNTANCY.
Be it enacted by the General Assembly of the State of South Carolina:
Definition, erroneous cross-reference corrected
SECTION 1. Section 40-2-20(2) of the S.C. Code is amended to read:
(2)(a) "Attest" means providing the following services:
(i) any audit or other engagement to be performed in accordance with the Statements on Auditing Standards (SAS);
(ii) any review of a financial statement to be performed in accordance with the Statements on Standards for Accounting and Review Services (SSARS);
(iii) any examination of prospective financial information to be performed in accordance with the Statements on Standards for Attestation Engagements (SSAE);
(iv) any engagement to be performed in accordance with Public Company Accounting Oversight Board (PCAOB) Auditing Standards; or
(v) any examination, review, or agreed upon procedure to be performed in accordance with the SSAE, other than an examination described in subsubitem (iii).
(b) Any standards specified in this definition shall be adopted by reference by the board pursuant to rulemaking and shall be those developed for general application by national accountancy organizations, such as the AICPA or the PCAOB.
Definition revised
SECTION 2. Section 40-2-20(23) of the S.C. Code is amended to read:
(23) "Practice of accounting" means:
(a) issuing a report on financial statements of a person, firm, organization, or governmental unit or offering to render or rendering any attest or compilation service. This restriction does not prohibit any act of a public official or public employee in the performance of that person's duties or prohibit the performance by a nonlicensee of other services involving the use of accounting skills, including the preparation of tax returns, management advisory services, and the preparation of financial statements without the issuance of reports; or
(b) using or assuming the title "Certified Public Accountant" or the abbreviation "CPA" or any other title, designation, words, letters, abbreviation, sign, card, electronic file, metadata tag, or any other device tending to indicate that the person is a certified public accountant.
Definition deleted, reserved
SECTION 3. Section 40-2-20(33) of the S.C. Code is amended to read:
(33) Reserved.
Professional designation usage requirements
SECTION 4. Section 40-2-30(E) of the S.C. Code is amended to read:
(E) A firm may not provide attest services or assume or use the title "Certified Public Accountants," "Public Accountants," or the abbreviations "CPAs" and "PAs," or any other title, designation, words, letters, abbreviation, sign, card, electronic file, metadata tag, or any other device indicating the firm is a CPA firm unless:
(1) the firm holds a valid registration issued under this chapter or is exempt from the registration requirement by operation of subsection (I);
(2) ownership of the firm is in accordance with Section 40-2-40(C) and implementing regulations promulgated by the board, unless the firm is exempt from the registration requirement by operation of subsection (I); and
(3) owners who are not certified public accountants must be permitted to use the titles "principal," "partner," "owner," "officer," "member," or "shareholder" but must not hold themselves out to be certified public accountants.
Educational and experience requirements for licensure
SECTION 5. Section 40-2-35(C) of the S.C. Code is amended to read:
(C) To meet the educational requirement for licensure, the applicant must:
(1) have a baccalaureate degree or higher from an accredited institution;
(2) in addition to, or concurrently with, the degree in item (1), complete at least twenty-four semester credit hours, or the equivalent, of accounting courses at the junior level or above, that cover some or all of the following subject matter content:
(a) financial accounting for business organizations;
(b) financial statement and auditing and attestation services;
(c) taxation;
(d) accounting information systems;
(e) managerial or cost accounting;
(f) mergers and acquisitions;
(g) data analytics;
(h) information systems or technology;
(i) accounting ethics; and
(j) other courses the board approves through a regulation; and
(3) in addition to, or concurrently with, the degree in item (1), complete at least twenty-four semester credit hours, or the equivalent, of business-related courses, other than accounting, that cover some or all of the following subject matter content:
(a) business law;
(b) economics;
(c) management;
(d) marketing;
(e) finance;
(f) business communications;
(g) data analytics;
(h) information systems or technology;
(i) business ethics; and
(j) other subject matter content the board approves through a regulation; and
(4) in addition to meeting the combined requirements of items (1), (2), and (3), the experience requirements in Section 40-2-35(G) must be satisfied based on the applicant's highest level of education attained:
(a) Applicants who have completed a baccalaureate degree, the applicant must also satisfy the experience requirements in Section 40-2-35(G)(1)(a), which requires two years of relevant professional experience.
(b) Applicants who have completed a post-baccalaureate degree, or a baccalaureate degree with at least one hundred fifty total semester credit hours, must also satisfy the experience requirements in Section 40-2-35(G)(1)(b), which requires one year of relevant experience.
Educational and experience requirements for licensure
SECTION 6. Section 40-2-35(E)(3) of the S.C. Code is amended to read:
(3) in addition to the requirements of subsections (C)(2) and (C)(3), the applicant must have on record with the board official transcripts demonstrating successful completion of either:
(a) at least one hundred twenty semester hours of credit; or
(b) a conferred baccalaureate degree.
Uniform Certified Public Accounting Examination
SECTION 7. Section 40-2-35(F) of the S.C. Code is amended to read:
(F) To meet the exam requirement, a candidate must pass all sections of the Uniform CPA Examination.
(1) A candidate may take the required test sections individually and in any order. Credit for each test section passed is valid for thirty-six months from the date the passing score is released to the candidate or the board by the National Association of State Boards of Accountancy (NASBA). The validity of credit for a section that is passed is not contingent upon the candidate achieving a minimum score on any failed section, nor is it dependent on the order in which other sections are taken.
(a) A candidate must successfully pass all sections of the Uniform CPA Examination within a rolling thirty-six-month period, which begins on the date that the NASBA releases the first passing score to the candidate or the board, as applicable. The thirty-six-month period concludes on the date the candidate sits for the final section required for licensure, regardless of when the NASBA releases the score.
(b) The board may grant an extension of time to a candidate if the extension is justified by extenuating circumstances or hardship.
(c) The board shall accommodate any hardship that results from the conditions of administration of the exam.
(2) A candidate may transfer credits for passed sections of the Uniform CPA Examination from another state or territory of the United States transferred to this State. Credits transferred for less than all sections of the examination are subject to the same conditional credit rules as if the examination had been taken in South Carolina.
Educational and experience requirements for licensure
SECTION 8. Section 40-2-35(G) of the S.C. Code is amended to read:
(G)(1) In addition to meeting the requirements of Section 40-2-35 (C)(1), (2), and (3), an applicant shall attain the following experience:
(a) applicants who have completed a baccalaureate degree must complete two years of relevant professional experience;
(b) applicants who have completed a post-baccalaureate degree, or a baccalaureate degree with at least one hundred fifty total semester credit hours, must complete one year of relevant experience;
(c) applicants must present evidence of meeting the accounting experience requirement in a manner prescribed by the board; and
(d) applicants who present evidence of experience obtained seven or more years before the date of application must obtain and document an additional six months of experience within the prior two years of the date of application.
(2) The board may promulgate regulations to require that the accounting experience required pursuant to item (1) must be completed according to a competency framework developed by a recognized national accounting organization. The framework must be administered in accordance with rules established by the board.
(3) The experience required pursuant to item (1) should primarily involve providing a service or advice in one or more of the following areas:
(a) accounting;
(b) attestation;
(c) compilation;
(d) management advisory;
(e) financial advisory;
(f) tax;
(g) consulting skills; or
(h) other qualifying experiences outlined in items (4) and (7).
(4)(a) The accounting experience required pursuant to this subsection may also be satisfied by:
(i) teaching experience taught at the intermediate accounting level or above that includes at least twenty-four semester hours of teaching courses that apply to a baccalaureate, masters, or postgraduate degree and which may cover subject matters including, but not limited to, financial accounting, taxation, auditing, technology, and other areas that fall within the scope of the Uniform CPA Examination; or
(ii) any combination of experience that the board determines to be equivalent to the types of experience provided for in items (3) and (4)(a)(i) of this subsection.
(b) The teaching experience may not accrue more rapidly than elapsed time. An applicant who intends to use teaching experience to meet his accounting experience requirement must not be given credit for teaching more than twenty-four semester hours in less than one academic year and credit for semester hours taught must not be given for teaching subjects outside the scope of the Uniform CPA Examination.
(5) The accounting experience required pursuant to this subsection may be supervised by a non-licensee but must be verified by a CPA who is licensed in any state or territory of the United States or the District of Columbia who has direct knowledge of the experience attained.
(6) The accounting experience required pursuant to this subsection may be attained in either full-time or part-time employment, but not more rapidly than forty hours per week. Two thousand hours of part-time accounting experience is equivalent to one year.
(7) The board may accept experience other than accounting experience to satisfy the accounting experience required pursuant to this section but only to the extent that the board determines that the non-accounting experience contributes to competence in public accounting. The board may require information related to the non-accounting experience to determine how it contributes to competence in public accounting.
(8) The accounting experience required by this subsection may begin upon successful completion of subsections (C)(2) and (C)(3), and:
(a) at least one hundred twenty semester hours of credit; or
(b) a conferred baccalaureate degree.
CPA firms, registration required for compilation services
SECTION 9. Section 40-2-40(B) of the S.C. Code is amended to read:
(B) The following must hold a registration issued pursuant to this section:
(1) a firm with an office in this State performing attest services as defined in Section 40-2-20(2) or engaging in the practice of accounting;
(2) a firm with an office in this State that uses the title "CPA" or "CPA firm"; or
(3) a firm that does not have an office in this State but performs attest services described in Section 40-2-20(2), or performs compilation services as defined in Section 40-2-20(6), for a client in this State, unless it is exempt from registration pursuant to Section 40-2-30(I).
CPA firms, ownership by revocable trusts
SECTION 10. Section 40-2-40(C) of the S.C. Code is amended to read:
(C) Qualifications for registration as a certified public accountant firm are as follows:
(1) A simple majority of the firm ownership in terms of financial interests and voting rights of all partners, officers, shareholders, members, or managers must belong to certified public accountants currently licensed in some state. Although firm ownership may include non-CPA owners, the firm and its owners must comply with regulations promulgated by the board. All non-CPA owners must be active individual participants in the firm or affiliated entities.
(2) Partners, officers, shareholders, members, or managers whose principal place of business is in this State, and who also perform professional services in this State, must hold a valid license issued pursuant to this section. An individual who has practice privileges under Section 40-2-245 must not be required to obtain a license from this State pursuant to Section 40-2-35.
(3) For firms registering under subsection (B), there must be a designated resident manager in charge of each office in this State who must be a certified public accountant licensed in this State.
(4) Non-CPA owners must not assume ultimate responsibility for any financial statement, attest, or compilation engagement.
(5) Non-CPA owners shall abide by the code of professional ethics adopted pursuant to this chapter.
(6) Owners shall at all times maintain ownership equity in their own right and must be the beneficial owners of the equity capital ascribed to them. Ownership may also be held through a revocable, not irrevocable, grantor trust, provided that the trust is established for the sole benefit of the owner, and provided that the owner retains full control and the ability to revoke the trust. Provision must be made for the ownership to be transferred to the firm or to other qualified owners if the noncertified public accountant or the beneficial owner of the revocable grantor trust ceases to be an active individual participant in the firm.
(7)(a) This section applies only to non-CPA owners who are residents of this State.
(b) Non-CPA owners must complete the same number of hours of continuing professional education as licensed certified public accountants in this State, including the annual ethics requirement pursuant to Section 40-2-250(C)(6).
(c) Non-CPA owners who are licensed professionals subject to continuing education requirements applicable to that profession may complete the required number of continuing professional education hours in courses offered or accepted by organizations or regulatory bodies governing that profession, and also must complete the same number of hours of continuing professional education as licensed certified public accountants in this State.
(8) A certified public accounting firm and its designated resident manager under item (3) are responsible for the following in regard to a noncertified public accountant owner:
(a) a non-CPA owner shall comply with all applicable accountancy statutes and regulations; and
(b) a non-CPA owner shall be of good moral character and shall not engage in any conduct that, if committed by a licensee, would constitute a violation of the regulations promulgated by the board.
Board of Accountancy powers and duties
SECTION 11. Section 40-2-70(A) of the S.C. Code is amended by adding:
(15) review and provide input on proposed legislative changes related to the practice of accounting.
Inspector-investigator qualifications
SECTION 12. Section 40-2-80(B) of the S.C. Code is amended to read:
(B)(1) An investigation of a licensee pursuant to this chapter must be performed by an inspector-investigator who has been licensed as a certified public accountant for at least the previous five years. The inspector-investigator must report the results of his investigation to the board no later than one-hundred-fifty days after the date upon which he initiated his investigation. If the inspector-investigator has not completed his investigation by that date, then the board may extend the investigation for a period defined by the board. The board may grant subsequent extensions to complete the investigation as needed. The inspector-investigator may designate additional persons of appropriate competency to assist in an investigation.
(2) The department shall annually post a report related to the number of complaints received, the number of investigations initiated, the average length of investigations, and the number of investigations that exceeded one-hundred-fifty days.
Licensure for persons licensed in other jurisdictions
SECTION 13. Section 40-2-240 of the S.C. Code is amended to read:
Section 40-2-240. (A) A CPA licensed in another jurisdiction who moves his principal place of business to this State may obtain a license through reciprocity. The board shall issue a license pursuant to this section to an applicant who:
(1) has successfully passed the Uniform CPA Examination;
(2) holds an active certificate, license, or permit issued pursuant to the laws of any state or territory of the United States, the District of Columbia, or any foreign licensing authority that is recognized by the International Qualifications Appraisal Board and subject to Mutual Recognition Agreements;
(3) is legally authorized to practice in the jurisdiction where his existing certificate, license, or permit is held; and
(4) certifies that he is in compliance with the continuing professional education requirements in the jurisdiction where his existing certificate, license, or permit is held.
(B) To apply for a license pursuant to this section an applicant must:
(1) identify all jurisdictions, foreign and domestic, in which the applicant has applied for or holds a designation to practice public accountancy or in which any applications have been denied; and
(2) file an application with the board together with the application fee prescribed by the board.
(C) Each person issued a license pursuant to this section shall notify the board in writing within thirty days after any issuance, denial, revocation, or suspension of a designation or commencement of a disciplinary or enforcement action against the licensee by any jurisdiction.
Authorization to practice of persons licensed in other jurisdictions
SECTION 14. Section 40-2-245 of the S.C. Code is amended to read:
Section 40-2-245. (A) An individual whose principal place of business is outside this State is presumed to have qualifications equivalent to this state's requirements if the individual:
(1) has successfully passed the Uniform CPA Examination;
(2) holds an active certificate, license, or permit issued pursuant to the laws of any state, territory of the United States, the District of Columbia, or any foreign authority recognized by the International Qualifications Appraisal Board under a Mutual Recognition Agreement; and
(3) is legally authorized to practice in the jurisdiction where the existing certificate, license, or permit is held.
(B) Such individual may exercise all privileges of a licensee in this State without obtaining a license pursuant to Section 40-2-35 if the individual meets the requirements contained in subsection (A).
(C) Notwithstanding any other provision of law, an individual offering or rendering professional services in this State, whether in person, by mail, telephone, or electronic means, shall be granted practice privileges in this State subject to the conditions contained in subsection (A). No notice, fee, or other submission is required for the individual to practice pursuant to these privileges.
(D) By exercising practice privileges pursuant to this section, an individual licensee or holder of a permit or certificate to practice from another jurisdiction, along with the firm employing that licensee or permit or certificate holder:
(1) consents to the personal and subject matter jurisdiction of the board and its disciplinary authority;
(2) agrees to comply with the regulations and provisions of this section;
(3) agrees to cease offering or rendering professional services in this State, individually or on behalf of a firm, if their license, permit, or certificate from his principal jurisdiction is no longer valid;
(4) consents to service of an administrative notice of hearing at the board in the individual's principal jurisdiction should any action or proceeding be initiated by that board against the licensee.
(E) A licensee of this State who offers or renders services or uses the CPA title in another state shall be subject to disciplinary action in this State for any act committed in the other state that would subject the licensee to discipline if committed in this State. The board shall investigate any complaint made by the Board of Accountancy, or equivalent regulatory agency, in another state.
Repealed subsections and items
SECTION 15. Section 40-2-20(18), Section 40-2-35(H), and Section 40-2-35(I) of the S.C. Code are repealed.
Severability
SECTION 16. If any section, subsection, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.
Time effective
SECTION 17. This act takes effect on June 30, 2025.
Ratified the 8th day of May, 2025.
Approved the 12th day of May, 2025.
This web page was last updated on May 19, 2025 at 1:07 PM