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Texas Lowered Its Educational Requirements for CPA Licensing

The growing population and number of businesses moving to Texas increase the state’s need for certified public accountants (CPAs). As a result, on September 1, 2023, Texas amended the Public Accountancy Act to let CPA candidates and students begin taking the CPA Exam after completing 120 credit hours, including 21 hours of upper-level accounting, rather than 150 credit hours.

Benefits of Lower CPA Licensing Education Requirements

Texas lowered its educational requirements for CPA licensing to encourage more students to enter the accounting education path and get more accountants licensed as CPAs. Having more candidates and students enter the testing and licensure path encourages them to become CPAs and provides more value for Texas-based organizations.

The original requirement of 150 credit hours before testing was a barrier to entry into the CPA profession:

  • Many students are ready to start the CPA Exam before they complete the education requirement.
  • Students might need to start working before completing 150 credit hours due to increasing financial burdens such as student debt and starting families.
  • The ability to begin testing at 120 hours provides additional flexibility as students earn 150 hours for certification.

Employer Advantages of Lower CPA Licensing Education Requirements

Companies that hire accounting graduates with 120 credit hours can encourage them to earn the additional 30 credits and take the CPA exam during their employment. This objective provides accounting graduates and employers with multiple advantages:

  • The ability to work while preparing for the CPA Exam helps reduce the financial barrier to earning the additional 30 credits.
  • Companies can consider offering loans to cover the remaining 30 credits that would be forgiven if the accounting graduate remains with the company for a set time.
  • Employers can influence the accounting areas covered within the additional 30 credits to fill client needs better.
  • Recent accounting graduates could be required to become CPAs before being promoted.
  • Employers would have adequate time to encourage recent accounting graduates to remain long-term as they build their careers.

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