Illinois has just passed sweeping changes to its CPA licensure requirements. These updates, finalized this week, join the momentum of over a dozen other states that have already taken steps toward modernizing licensure to better align with today’s workforce realities. The changes are also consistent with the AICPA and NASBA’s proposed updates to the CPA model, aimed at broadening access and reducing barriers to entry.
For small to mid-size accounting firms focused on growth and talent acquisition, this legislative shift presents a powerful opportunity. From attracting a more diverse candidate pool to expanding operational flexibility, licensure reform of this kind sets the stage for a more dynamic and competitive future.
The traditional CPA licensure model—requiring 150 college credit hours, passing the CPA exam, and completing one year of supervised experience—has been a cornerstone of the profession for decades. However, this model has increasingly been viewed as outdated and exclusionary. Many aspiring accountants face financial and logistical challenges in meeting the 150-hour requirement, leading to a drop in CPA candidates nationwide. This decline exacerbates an already acute talent shortage, especially for small to mid-size firms that struggle to compete with larger firms’ recruitment resources.
House Bill 2459, set to take effect January 1, 2027, amends the Illinois Public Accounting Act by introducing two new CPA licensure pathways:
These alternatives provide flexible, experience-focused routes to licensure while maintaining the profession's rigorous standards. Numerous states have adopted similar requirements, with the exception of Florida, which is pushing for three pathways and a tuition-free path to a Master's in Accounting.
Another key provision across states is expanded practice mobility. CPAs licensed in states with equivalent requirements can now practice in Illinois and other states without obtaining a separate state license. If a state’s requirements are not deemed equivalent, the CPA must petition the state's licensure committee for consideration.
This mobility enhancement aligns with broader national trends, streamlining interstate practice and allowing firms to operate more seamlessly across state lines. It also boosts those states' attractiveness as a hub for accounting services, enabling greater flexibility for firms and professionals alike.
The revised licensure structure broadens the talent pool. Firms can now consider candidates with alternative educational and experiential backgrounds, opening doors to career-changers, diverse professionals, and those previously deterred by the 150-hour hurdle.
Flexible pathways allow firms to craft customized development programs. By supporting staff through new licensure options, firms can improve engagement and reduce turnover, demonstrating a genuine investment in employee growth.
Human resources practices, job descriptions, and mentorship models will need to evolve. Firms that modernize internal systems to reflect new standards can position themselves as progressive and employee-friendly.
With enhanced mobility provisions, firms outside state lines can now serve clients within the state without obtaining additional licensure. This reduces operational friction and opens the door for:
Conversely, in-state firms can access a wider talent pool and explore remote collaborations. The result is a more competitive, interconnected marketplace ripe with growth potential.
To capitalize on these changes, firms should:
Expand Recruiting: For firms in markets where competition is hot, now is the time to consider out-of-state schools and job boards.
Several states are exploring or enacting similar changes:
These movements signal a broader shift in the profession. While national standardization through NASBA and AICPA remains a goal, state-level innovation is accelerating. Firms operating in multiple states must stay agile and informed to ensure compliance and capitalize on emerging opportunities.
Despite the promise, firms must navigate:
Change also invites resistance. Traditionalists may question the impact on professional rigor. Firms must be prepared to advocate for the value of diverse licensure paths and uphold high standards internally.
Licensure reform is a forward-looking response to a critical industry challenge. For small to mid-size accounting firms, it’s a chance to rethink how they attract talent, structure development, and grow their presence. Those that adapt early will gain a decisive advantage in an evolving professional landscape.
Ready to embrace this new era of opportunity? Hollinden works with firms just like yours to leverage market opportunities and grow. Let’s discuss your next step forward.