July 2013: Acceptance of the Word Count Formula Alternative

July 2013

In January 2012, NASBA and the AICPA revised the Statement on Standards for Continuing Professional Education (CPE) Programs (Standards). A significant revision to the Standards was the addition of an alternative to pilot testing for determining the recommended CPE credit for a self study program.

The revised Standards became effective July 1, 2012.  Subsequent to July 1, 2012, Registry sponsors have been permitted to use the word count formula for courses in development and release for consumption on or after July 1, 2012.  However, CPE sponsors have been hesitant to adopt the word count formula since some boards of accountancy have not updated regulations to specifically include the option of determining CPE credits by using the word count formula.

Based on our review of accountancy boards’ rules and regulations and consideration of the acceptability of Registry CPE sponsors by boards of accountancy, we have summarized the current accountancy board regulations regarding the acceptability of the word count formula as an alternative to pilot testing.  Please refer to the following table to view each category by jurisdiction.

No Requirement for CPE
There are currently three jurisdictions that do not state requirements regarding continuing professional education.  Therefore, the word count formula is not an issue for these jurisdictions.

Requires QAS Approval for Self Study
There are currently six jurisdictions that require self study credits be earned from approved QAS providers.  The word count formula is an acceptable methodology for QAS providers.

Accepts CPE from Registry Sponsors by Rule or Policy
There are many jurisdictions that accept CPE credits issued from National Registry of CPE Sponsors by stating such in their rules and regulations or confirmed by policy.  For these jurisdictions, the acceptance of CPE credits is based on the provider being approved on the Registry.  As National Registry approval is granted based on compliance with the Standards and the word count formula is a part of the Standards, the word count formula  would be an acceptable methodology for these jurisdictions.

Rules and Regulations do not Define or Describe Self Study Programs
There are also jurisdictions whose rules and regulations are silent in regards to describing or defining self study programs.  As such, we believe that the use of the word count formula would be acceptable in those jurisdictions as no specific guidance or requirements are given as to methodology.

Jurisdiction/State

No Requirement for CPE

Requires QAS Approval for Self Study

Accepts CPE from Registry Sponsors by Rule or Policy

Rules and Regulations do not Define or Describe Self Study Programs

1

CNMI

X

 

 

 

2

Virgin Islands

X

 

 

 

3

Wisconsin

X

 

 

 

4

Florida

 

X

 

 

5

Minnesota

 

X

 

 

6

Mississippi

 

X

 

 

7

Oregon

 

X

 

 

8

South Carolina

 

X

 

 

9

Tennessee

 

X

 

 

10

Alabama

 

 

X

 

11

Alaska

 

 

X

 

12

Arkansas

 

 

X

 

13

District of Columbia

 

 

X

 

14

Hawaii

 

 

X

 

15

Illinois

 

 

X

 

16

Iowa

 

 

X

 

17

Kansas

 

 

X

 

18

Maine

 

 

X

 

19

Massachusetts

 

 

X

 

20

Missouri

 

 

X

 

21

Montana

 

 

X

 

22

Nevada

 

 

X

 

23

New Mexico

 

 

X

 

24

North Dakota

 

 

X

 

25

Ohio

 

 

X

 

26

Oklahoma

 

 

X

 

27

Pennsylvania

 

 

X

 

28

Texas

 

 

X

 

29

Vermont

 

 

X

 

30

Virginia

 

 

X

 

31

West Virginia

 

 

X

 

32

Arizona

 

 

 

X

33

Colorado

 

 

 

X

34

Delaware

 

 

 

X

35

Guam

 

 

 

X

36

Idaho

 

 

 

X

37

Kentucky

 

 

 

X

38

Maryland

 

 

 

X

39

Michigan

 

 

 

X

40

Nebraska

 

 

 

X

41

New Hampshire

 

 

 

X

42

New Jersey

 

 

 

X

43

Puerto Rico

 

 

 

X

44

Rhode Island

 

 

 

X

45

Wyoming

 

 

 

X

 

State Board Action Required
Based on our research of the rules and regulations and conversations with boards of accountancy, there are jurisdictions that describe or define self study programs using the basis of pilot tests, field tests, or average completion times.  We have communicated with each jurisdiction’s Executive Director and/or attorney to determine the acceptability of the word count formula.  In addition, certain boards are in the process of adopting regulations regarding the acceptance of the word count formula. Until those rules are effective, the word count formula method will not be accepted.

Jurisdiction/State

Results

1

California

Currently, the Board has changes to regulations pending that include incorporation of the word count formula.

2

Connecticut

Response Pending

3

Georgia

Response Pending

4

Indiana

Response Pending

5

Louisiana

Response Pending

6

New York *

The Board is reviewing the acceptance of the word count formula at upcoming meeting.

7

North Carolina

New Rules Pending

8

South Dakota

The Board is considering potential rule changes.

9

Utah

Response Pending

10

Washington

The Board recently approved the word count formula and the Board policy is being finalized.

* New York accepts CPE credits from providers on the Registry that are taken outside of NY; however, self study sponsors must register with the New York Board of Accountancy.  Per the application for Continuing Education Sponsor Agreement with New York, self study programs are described in terms of using pilot testing – pre-tests of the targeted participation sample.

In summary, there remain 10 jurisdictions (identified in the chart above) for which we believe action must be taken to amend rules and regulations to allow for the acceptability of the word count formula.  We continue to diligently work with these jurisdictions and will continue to report progress to you.

Questions may be addressed to Jessica Luttrull, Manager-National Registry, at jluttrull@nasba.org or 615-880-4245.

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