Regulation of Accountants – Illinois

225 ILCS 450/3 provides that to be admitted to take the examination after the year 2000, for the purpose of determining the qualifications of applicants for certificates as certified public accountants under the Public Accountancy Act, the applicants shall be required to present proof of the successful completion of 150 college or university semester hours of study or their quarter-hour or other academic credit unit equivalent, to include a baccalaureate or higher degree conferred by a college or university acceptable to the Board, the total educational program to include an accounting concentration or equivalent as determined by Board rule. In adopting those rules, the Board shall consider, among other things, any impediments to the interstate practice of public accounting that may result from differences in the requirements in other states.

225 ILCS 450/7 provides that a holder of a certificate or registration as a certified public accountant issued by the State Accountancy Board or Department shall not be entitled to practice public accounting, as defined in Section 8 [225 ILCS 450/8], in this State until the person has been licensed as a licensed certified public accountant by the Department.  The Department may refuse to issue or may suspend the license of any person who fails to file a return, or to pay the tax, penalty or interest shown in a filed return, or to pay any final assessment of tax, penalty or interest, as required by any tax Act administered by the Illinois Department of Revenue, until such time as the requirements of any such tax Act are satisfied.

Pursuant to 225 ILCS 450/8, persons, either individually, as members of a partnership or limited liability company, or as officers of a corporation, who sign, affix or associate their names or any trade or assumed names used by them in a profession or business to any report expressing or disclaiming an opinion on a financial statement based on an audit or examination of that statement, or expressing assurance on a financial statement, shall be deemed to be in practice as licensed public accountants or licensed certified public accountants within the meaning and intent of this Act.

225 ILCS 450/16 provides that the expiration date and renewal period for each license issued under this Act shall be set by rule.  Every holder of a license or registration under this Act may renew such license or registration before the expiration date upon payment of the required renewal fee as set by rule.  Every application for renewal of a license by a licensed certified public accountant who has been licensed under this Act for 3 years or more shall be accompanied or supported by any evidence the Department shall prescribe, in satisfaction of completing, each 3 years, not less than 120 hours of continuing professional education programs in subjects given by continuing education sponsors registered by the Department upon recommendation of the Committee.  Of the 120 hours, not less than 4 hours shall be courses covering the subject of professional ethics.  All continuing education sponsors applying to the Department for registration shall be required to submit an initial nonrefundable application fee set by Department rule.  Each registered continuing education sponsor shall be required to pay an annual renewal fee set by Department rule.  Publicly supported colleges, universities, and governmental agencies located in Illinois are exempt from payment of any fees required for continuing education sponsor registration.  Failure by a continuing education sponsor to be licensed or pay the fees prescribed in this Act, or to comply with the rules and regulations established by the Department under this Section regarding requirements for continuing education courses or sponsors, shall constitute grounds for revocation or denial of renewal of the sponsor’s registration.

Licensed Certified Public Accountants are exempt from the continuing professional education requirement for the first renewal period following the original issuance of the license.  Notwithstanding the provisions of subsection (c), the Department may accept courses and sponsors approved by other states, by the American Institute of Certified Public Accountants, by other state CPA societies, or by national accrediting organizations such as the National Association of State Boards of Accountancy.  Failure by an applicant for renewal of a license as a licensed certified public accountant to furnish the evidence shall constitute grounds for disciplinary action, unless the Department in its discretion shall determine the failure to have been due to reasonable cause.  The Department, in its discretion, may renew a license despite failure to furnish evidence of satisfaction of requirements of continuing education upon condition that the applicant follow a particular program or schedule of continuing education.  In issuing rules and individual orders in respect of requirements of continuing education, the Department in its discretion may, among other things, use and rely upon guidelines and pronouncements of recognized educational and professional associations; may prescribe rules for the content, duration, and organization of courses; shall take into account the accessibility to applicants of such continuing education as it may require, and any impediments to interstate practice of public accounting that may result from differences in requirements in other states; and may provide for relaxation or suspension of requirements in regard to applicants who certify that they do not intend to engage in the practice of public accounting, and for instances of individual hardship.

The Department shall establish by rule a means for the verification of completion of the continuing education required by this Section.  This verification may be accomplished through audits of records maintained by licensees; by requiring the filing of continuing education certificates with the Department; or by other means established by the Department.  The Department may establish, by rule, guidelines for acceptance of continuing education on behalf of licensed certified public accountants taking continuing education courses in other jurisdictions.  For renewals on and after July 1, 2012, as a condition for granting a renewal license to firms and sole practitioners who provide services requiring a license under this Act, the Department shall require that the firm or sole practitioner satisfactorily complete a peer review during the immediately preceding 3-year period, accepted by a Peer Review Administrator in accordance with established standards for performing and reporting on peer reviews, unless the firm or sole practitioner is exempted under the provisions of subsection (i) of this Section.  A firm or sole practitioner shall, at the request of the Department, submit to the Department a letter from the Peer Review Administrator stating the date on which the peer review was satisfactorily completed.  A new firm or sole practitioner not subject to subsection (l) of this Section shall undergo its first peer review during the first full renewal cycle after it is granted its initial license.

The requirements of this subsection shall not apply to any person providing services requiring a license under this Act to the extent that such services are provided in the capacity of an employee of the Office of the Auditor General or to a nonprofit cooperative association engaged in the rendering of licensed service to its members only under paragraph (3) of subsection (b) of Section 14 of this Act [225 ILCS 450/14] or any of its employees to the extent that such services are provided in the capacity of an employee of the association.  The Department shall approve only Peer Review Administrators that the Department finds comply with established standards for performing and reporting on peer reviews.  The Department may adopt rules establishing guidelines for peer reviews, which shall do all of the following:

  • Require that a peer review be conducted by a reviewer that is independent of the firm reviewed and approved by the Peer Review Administrator under established standards.
  • Other than in the peer review process, prohibit the use or public disclosure of information obtained by the reviewer, the Peer Review Administrator, or the Department during or in connection with the peer review process.  The requirement that information not be publicly disclosed shall not apply to a hearing before the Department that the firm or sole practitioner requests be public or to the information described in paragraph (3) of subsection (i) of this Section.

If a firm or sole practitioner fails to satisfactorily complete a peer review as required by subsection (e) of this Section or does not comply with any remedial actions determined necessary by the Peer Review Administrator, the Peer Review Administrator shall notify the Department of the failure and shall submit a record with specific references to the rule, statutory provision, professional standards, or other applicable authority upon which the Peer Review Administrator made its determination and the specific actions taken or failed to be taken by the licensee that in the opinion of the Peer Review Administrator constitutes a failure to comply.  The Department may at its discretion or shall upon submission of a written application by the firm or sole practitioner hold a hearing under Section 20.1 of this Act [225 ILCS 450/20.1] to determine whether the firm or sole practitioner has complied with subsection (e) of this Section.  The hearing shall be confidential and shall not be open to the public unless requested by the firm or sole practitioner.

The firm or sole practitioner reviewed shall pay for any peer review performed.  The Peer Review Administrator may charge a fee to each firm and sole practitioner sufficient to cover costs of administering the peer review program.  A firm or sole practitioner shall be exempt from the requirement to undergo a peer review if within 3 years before the date of application for renewal licensure, the sole practitioner or firm has undergone a peer review conducted in another state or foreign jurisdiction that meets the requirements of paragraphs (1) and (2) of subsection (f) of this Section.  The sole practitioner or firm shall submit to the Department a letter from the organization administering the most recent peer review stating the date on which the peer review was completed; or the sole practitioner or firm satisfies all of the following conditions:

  • during the preceding 2 years, the firm or sole practitioner has not accepted or performed any services requiring a license under this Act;
  • the firm or sole practitioner agrees to notify the Department within 30 days of accepting an engagement for services requiring a license under this Act and to undergo a peer review within 18 months after the end of the period covered by the engagement; or
  • for reasons of personal health, military service, or other good cause, the Department determines that the sole practitioner or firm is entitled to an exemption, which may be granted for a period of time not to exceed 12 months.

Pursuant to 225 ILCS 450/17.1, any registered certified public accountant who has permitted his/her registration to expire or who has had his/her registration on inactive status may have his or her registration restored by making application to the Department and filing proof acceptable to the Department as defined by rule of his or her fitness to have his or her registration restored, which may include sworn evidence certifying to active practice in another jurisdiction satisfactory to the Department and by paying the required restoration fee.

Any licensed certified public accountant who has permitted his/her license to expire or who has had his/her license on inactive status may have his/her license restored by making application to the Department and filing proof acceptable to the Department as defined by rule of his or her fitness to have his or her license restored, including sworn evidence certifying to active practice in another jurisdiction satisfactory to the Department and by paying the required restoration fee and by submitting proof of the required continuing education.  If the licensed certified public accountant or registered certified public accountant has not maintained an active practice in another jurisdiction satisfactory to the Department, the Department shall determine, by an evaluation program established by rule, fitness to resume active status and may require the applicant to complete a period of supervised experience.

However, any licensed certified public accountant or registered certified public accountant whose license or registration expired while s/he was (1) in Federal Service on active duty with the Armed Forces of the United States, or the State Militia called into service or training, or (2) in training or education under the supervision of the United States preliminary to induction into the military service, may have his license or registration renewed reinstated or restored without paying any lapsed renewal and restoration fees if within 2 years after honorable termination of such service, training or education except under conditions other than honorable, he furnished the Department with satisfactory evidence to the effect that s/he has been so engaged and that his/her service, training or education has been so terminated.

225 ILCS 450/20.01 provides that Sec. 20.01. (a), the Department may refuse to issue or renew, or may revoke, suspend, or reprimand any registration or registrant, any license or licensee, place a licensee or registrant on probation for a period of time subject to any conditions the Department may specify including requiring the licensee or registrant to attend continuing education courses or to work under the supervision of another licensee or registrant, impose a fine not to exceed $ 5,000 for each violation, restrict the authorized scope of practice, or require a licensee or registrant to undergo a peer review program, for any one or more of the following:

  • Attempting to procure a license or registration to practice under this Act by bribery or fraudulent misrepresentations.
  • Having a license to practice public accounting or registration revoked, suspended, or otherwise acted against, including the denial of licensure or registration, by the licensing or registering authority of another state, territory, or country, including but not limited to the District of Columbia, or any United States territory.  No disciplinary action shall be taken in Illinois if the action taken in another jurisdiction was based upon failure to meet the continuing professional education requirements of that jurisdiction and the applicable Illinois continuing professional education requirements are met.
  • Being convicted or found guilty, regardless of adjudication, of a crime in any jurisdiction which directly relates to the practice of public accounting or the ability to practice public accounting or as a Registered Certified Public Accountant.
  • Making or filing a report or record which the registrant or licensee knows to be false, willfully failing to file a report or record required by state or federal law, willfully impeding or obstructing the filing, or inducing another person to impede or obstruct the filing.  The reports or records shall include only those that are signed in the capacity of a licensed certified public accountant or a registered certified public accountant.
  • Conviction in this or another State or the District of Columbia, or any United States Territory, of any crime that is punishable by one year or more in prison or conviction of a crime in a federal court that is punishable by one year or more in prison.
  • Proof that the licensee or registrant is guilty of fraud or deceit, or of gross negligence, incompetency, or misconduct, in the practice of public accounting.
  • Practicing on a revoked, suspended, or inactive license or registration.
  • Suspension or revocation of the right to practice before any state or federal agency.
  • Conviction of any crime under the laws of the United States or any state or territory of the United States that is a felony or misdemeanor and has dishonesty as an essential element, or of any crime that is directly related to the practice of the profession.
  • Making any misrepresentation for the purpose of obtaining a license, or registration or material misstatement in furnishing information to the Department.
  • Aiding or assisting another person in violating any provision of this Act or rules promulgated hereunder.
  • Engaging in dishonorable, unethical, or unprofessional conduct of a character likely to deceive, defraud, or harm the public.
  • Habitual or excessive use or addiction to alcohol, narcotics, stimulants, or any other chemical agent or drug that results in the inability to practice with reasonable skill, judgment, or safety.
  • Directly or indirectly giving to or receiving from any person, firm, corporation, partnership, or association any fee, commission, rebate, or other form of compensation for any professional service not actually rendered.
  • Physical or mental disability, including deterioration through the aging process or loss of abilities and skills that results in the inability to practice the profession with reasonable judgment, skill or safety.
  • Solicitation of professional services by using false or misleading advertising.
  • Failure to file a return, or pay the tax, penalty or interest shown in a filed return, or to pay any final assessment of tax, penalty or interest, as required by any tax Act administered by the Illinois Department of Revenue or any successor agency or the Internal Revenue Service or any successor agency.
  • Practicing or attempting to practice under a name other than the full name as shown on the license or registration or any other legally authorized name.
  • A finding by the Department that a licensee or registrant has not complied with a provision of any lawful order issued by the Department.
  • Making a false statement to the Department regarding compliance with continuing professional education or peer review requirements.
  • Failing to make a substantive response to a request for information by the Department within 30 days of the request.

Pursuant to 225 ILCS 450/28, each of the following acts perpetrated in the State of Illinois is a Class B misdemeanor.

  • The practice of public accounting insofar as it consists in rendering service as described in Section 8 [225 ILCS 450/8], without licensure, in violation of the provisions of this Act;
  • The obtaining or attempting to obtain licensure as a licensed certified public accountant or registration as a registered certified public accountant by fraud;
  • The use of the title “Certified Public Accountant” or the abbreviation “C.P.A.” or use of any similar words or letters indicating the user is a certified public accountant, the title “Registered Certified Public Accountant”, the abbreviation “R.C.P.A.”, any similar words or letters indicating the user is a certified public accountant or a registered certified public accountant by any person in contravention of this Act;
  • The use of the title “Certified Public Accountant” or “Licensed Certified Public Accountant” or the abbreviation “C.P.A.” or “L.C.P.A.” or any similar words or letters indicating the user is a certified public accountant by any person in contravention with this Act;
  • The use of the title “Certified Public Accountant” or the abbreviation “C.P.A.” or any similar words or letters indicating that the members are certified public accountants, by any partnership, limited liability company, corporation, or other entity unless all members thereof personally engaged in the practice of public accounting in this State are licensed as licensed certified public accountants by the Department, and are holders of an effective unrevoked license, and the partnership, limited liability company, corporation, or other entity is licensed as licensed certified public accountants by the Board with an effective unrevoked license;
  • The use of the title “Licensed Certified Public Accountant”, or the abbreviation “L.C.P.A.” or any similar words or letters indicating such person is a licensed certified public accountant, by any person not licensed as a licensed certified public accountant by the Department, and holding an effective unrevoked license; provided nothing in this Act shall prohibit the use of the title “Accountant” or “Bookkeeper” by any person;
  • The use of the title “Licensed Certified Public Accountants”, “Public Accountants” or the abbreviation “P.A.’s” or any similar words or letters indicating that the members are public accountants by any partnership, limited liability company, corporation, or other entity unless all members thereof personally engaged in the practice of public accounting in this State are licensed as licensed certified public accountants by the Department and are holders of effective unrevoked licenses, and the partnership is licensed as a public accounting firm by the Department with an effective unrevoked license;
  • Making false statements to the Department regarding compliance with continuing professional education requirements;
  • The use of the title “Certified Public Accountant” or the abbreviation “C.P.A.” or any similar words or letters indicating that the members are certified public accountants, by any partnership unless all members thereof personally engaged in the practice of public accounting in this State have received certificates as certified public accountants from the Board, are licensed as public accountants by the Department, and are holders of an effective unrevoked license, and the partnership is licensed as public accountants by the Department with an effective unrevoked license.

Inside Regulation of Accountants – Illinois