CPA License

As is the case with many professions, accountants have different levels of certification and licensing.  Passing the uniform CPA exam gives you permission to use the title CPA in certain circumstances, such as on a business card.  But to use the title in such a way that someone might construe it to mean that you have the legal authority to sign an audit opinion, you have to serve an internship doing audit work that leads to financial statement opinion letters, and your work has to be supervised by someone who is already licensed.

The exact details of licensing are controlled by each state, and there is a lack of uniformity in their requirements.  The problem with this system, aside from its lack of uniformity, is that accountants do more than perform audits leading to an opinion about the fairness of financial statements.  Until 1992, the State of Washington's statutes governing the licensing of accountants made no distinctions in this space.  The licensing law had a sunset provision built into it, and when it came up for renewal, Booth Gardner, the governor at the time, actually read the legislation and started asking embarrassing questions.  So he refused to sign the renewal legislation until the legislature amended it to provide a meaningful path toward licensing accountants doing other work.

Governor Gardner's insistence on this change was controversial among accountants.  Some thought it would dilute the meaning of the title CPA.  Others thought it would strengthen it by licensing more accountants, and subjecting them to the continuing professional education (CPE) requirements to maintain their licenses.  The changes he required the legislature to make still required licensed accountants to not work outside of areas for which they were qualified.  And arguably, this was new in the way it was going to be looked upon, if not enforced.  There was still a huge dependence on personal ethics on the part of licensed accountants.  But, it had not exactly been unheard of for audit professionals who knew very little about other areas such as tax work or what accountants call management advisory services, to take engagements beyond their expertise.  With Gardner's change, it would at least be more explicitly stated that taking such engagements was a violation of the intent of that part of the statute.

 

While I had gotten my CPA certificate in 1980 well before joining Boeing, I had never done any supervised work that qualified as experience leading to licensing.  None of the controllers or audit supervisors for whom I had worked were licensed CPAs in the State of Washington, even though they probably had well over half a century of experience among them and one was actually licensed as a Chartered Accountant in the U.K.  

Boeing's H.R. department was tasked by Corporate Finance to find out if anyone on the Boeing payroll was impacted by the change in the CPA licensing statute.  There were three of us.

As is the case with many professions, accountants have different levels of certification and licensing.  Passing the uniform CPA exam gives you permission to use the title CPA in certain circumstances, such as on a business card.  But to use the title in such a way that someone might construe it to mean that you have the legal authority to sign an audit opinion, you have to serve an internship doing audit work that leads to financial statement opinion letters.  And your work has to be supervised by someone who is already licensed.

The three of us were invited to a meeting and offered an opportunity to participate in a supervised audit that would qualify us for licensing under the new state guidelines.  Joe Muldoon agreed to release me to do this work while covering the cost of my time on his budget.  One of the other guys was able to work a similar deal with his home organization, and so we became temporary internal auditors of The Boeing Company.  Our task: audit the Boeing Employees Good Neighbor Fund (BEGNF).  This was Boeing's internal version of the United Way, with less restrictive guidelines about what sort of organizations could apply for, and receive grants.  Almost all employees were members of BEGNF. 

 

It was an interesting several months, both getting to know more about Boeing Finance, and seeing how BEGNF worked.  We found very few discrepancies between BEGNF's reports and what they actually did.  We found a few minor issues with where the grant guidelines had been stretched a bit, but by and large, when someone asked me after that if I though BEGNF was well run and something the employees should trust, I could reply with a resounding "yes, " which is the limit on the comments that an auditor can make, unless they do find issues.  Then they can't even say that much.

Joe also paid form me to travel and take a weeklong course on Activity Based Cost Accounting, plus my continuing education classes that I took at the WSCPA offices in Bellevue also became something I could attend on-hours and charge to the company on my expense reports.  The result of all of this was, that for the duration of my time at Boeing I was able to legally use the title CPA in a slightly wider set of circumstances.  Also, I became a bit of a fixture in Jim Toole's computing related CPE classes at the WSCPA offices in Bellevue.