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NASBA regional briefing: private equity task force, licensure pathways and shifting CPA exam pass rates
Summary
Board member and NASBA treasurer Andy Bonner summarized NASBA regional meeting takeaways: a NASBA task force is drafting guidance on private‑equity and alternative practice structures; exam pass rates vary widely by section with FAR low and ISC high; NASBA and AICPA are advancing licensure‑pathway mapping and ALD technology updates.
Board member and NASBA treasurer Andy Bonner gave a summary of topics covered at the NASBA regional meeting, highlighting private equity concerns, CPA exam pass‑rate disparities and licensure‑pathway developments.
Bonner said NASBA formed a task force to evaluate private‑equity ownership and alternative practice structures, including questions state boards should ask to understand firm ownership, participation and independence risks. NASBA plans to issue a white paper and a list of template questions for state boards; the white paper and related materials were expected to be presented at NASBA’s annual meeting in October.
Bonner and other board members discussed CPA Exam pass rates presented at NASBA. He reported recent quarter‑over‑quarter increases in certain sections, notably Information Systems & Controls (ISC) and Tax Compliance & Planning (TCP). NASBA data cited in discussion included: ISC pass rates around 72% (TSCPA cited an 81% pass rate for its candidates), BAR (business analysis and reporting) pass rates in recent quarters reported near 47% and 38% in a prior quarter, and FAR (financial accounting and reporting) pass rates of about 42% in Q1 and 44% in Q2 of the year. Board members expressed concern that roughly 60% of candidates who fail FAR do not return to retake it.
NASBA work on licensing mobility and new pathways was also discussed: a map of U.S. states showing where new licensure pathways had been enacted is available on NASBA’s site, and the Uniform Accountancy Act (UAA) updates and mobility model are in progress. Bonner also noted NASBA’s ALD technology rewrite and other IT projects, including pilot testing of internal chat/automation tools and a candidate mobile app, as well as the transition of some exam operations in Guam.
Why it matters: NASBA guidance and national trends shape state boards’ regulatory response to private equity in accounting firms, CPA exam design and candidate preparation, and the implementation of mobility and pathway provisions that affect who may obtain CPA licensure.
Clarifying details: Bonner reported NASBA will publish a white paper on private equity ownership and that NASBA’s task force is also working with AICPA and state boards on peer review and independence implications for alternative practice structures.
