CPA Certificate vs License: What’s The Difference?

cpa certificate vs license

My readers are often confused about CPA certificate vs license. I am going to highlight the difference below, but bear in mind that CPA certificates are becoming less relevant because most state boards stopped issuing them.

CPA Certificate vs License: An Overview

Each state has its own laws and rules governing the CPA profession, and each has its own Board of Accountancy that monitors the CPAs that it licenses.

For most states, the term “CPA certificate” and “CPA license” is inter-changeable. However, for “two-tier states” there is a distinction between the two:

CPA Certificate

  • Work experience is often not required.
  • No CPA CPE (continuous professional education) hours required.
  • Scope of work is limited as certificate holder cannot own a CPA firm (either as sole owner or partner) or sign an audit report.
  • Cannot normally hold yourself out as a CPA within the jurisdiction, i.e. cannot call yourself a CPA in the state where you get the CPA certificate.

CPA License

  • Typically require 1-2 years of working experience, supervised and/or verified by a CPA licensee.
  • CPE hours required every reporting years (typically 120 hours every 3 years).
  • Can use CPA title in business cards and own CPA firm/sign audit report.

Implications to International Candidates

Because certificate is easier to get, one can consider certificate as the “first level”. The license, or permit to practice, is the “second level”. In fact, many international students aim for certificates only because the CPA qualification is used mainly for the enhancement of their credentials.

Please note that due to confusion and some abuses in the system, most states have switched from two-tier to one-tier. The only state that is applicable to international candidates, in my opinion, is Montana, but even then they have restrictions on how you can use the CPA title.

I strongly recommend that candidates regardless of origin to go for the full license. If you have difficulties fulfilling the educational or experience requirements, they are ways to resolve this. Please check out these pages for possible solutions:

For Your Further Reading

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You can also sign up to my free e-course to learn about the CPA exam application process, and tips on how to get qualified and pass the exam:

Comments

  1. Sami says

    Dear Stephanie,
    Thank you for all your hard work on the website, it is really amazing to say the least. I am an international student studying for my Bachelors degree in Accounting in the US. I plan on obtaining the CPA certificate and not the license. What are the states that still allow obtaining the CPA certificate without any work experience required?
    Thanks,
    Sami

    • Stephanie says

      Hello Sami, thanks for your kind note. I have added more information to the above on the two-tier states.

      Basically, there are 5 states that still have the two-tier system: Alabama, Florida, Illinois, Montana and Nebraska. I know Illinois is going to take this away very soon in July 1, 2010 so consider it no longer applicable in your case. Alabama is only for US citizens…
      I am in the process of double-checking the rest to make sure they are still valid options for you.
      Cheers, Stephanie

  2. Irfan says

    Hi Stephanie,

    Thanks for all the infomation you have posted online. It’s very helpful for newcomers. You mentioned above that only 5 states have two tier system. What about Delaware?

    Thanks

    irfan

  3. Irfan says

    Stephanie,

    Please disrgard my last email. I need your help!
    I have a B.Com (foreign) & Associate (US) plus 10 years experience as a Controller. I need a CPA certificate just for my resume. Please advise.

    Thanks

    irfan

  4. stephanie says

    Hi Irfan,

    Delaware is no longer a two-tier state since 2006… to the disappointment of many international candidates I have to say.

    If you foreign B.com a 3-year or 4-year degree? If 3-year, it’s likely to be deemed as an associate degree, in which case Delaware will be your only choice.

    If yours is a 3-year degree, check out the foreign credential evaluation page to say if there is any chance your B.com is considered a 4-year equivalent. If your degree is 4-year anyway, then no problem you have more choices.

    Is your 10 years of experience supervised by an active CPA licensee? If 4 or more of those years are, then you are good for Delaware.

    Just let me know if you have further questions!
    Stephanie

  5. Irfan says

    Hey Stephanie,

    Thanks for your prompt reply. It’s a 3 year degree but I’ll still try. Unfortunately, my work experience is not under active CPA licensee. That means I have no other option?

    The only other option is I’m few credit short of my Bachelor (US). I will finish that first. I have lots of credits on papers but not a four year degree.

    Thanks again!

    irfan

  6. Stephanie says

    Hi Irfan,
    You are most welcome!
    If you are just a few minutes short of the 4-year Bachelor degree in the US, then you should definitely go for it because it is increasingly difficult to go through Delaware (which I assume is your only choice given your current situation).

    Some states allow you to apply for the CPA exam before completion of the bachelor degree (i.e. a few credits short will do) so you can probably start applying now. I forgot which states but you can start with the ones listed here first:
    http://ipassthecpaexam.com/cpa-international-students/

    Cheers, Stephanie

  7. Irfan says

    Hey Stephanie,

    Is online degree acceptable for the CPA exam? I can finish my remaining courses online.

    irfan

    • Stephanie says

      Hi Irfan,
      If it is for fulfilling the bachelor/master degree requirement, no I don’t think so; but if it is just for the extra credits to get to 120/150 credit hours, then yes it is ok as long as your school is an accredited educational institution.

      Stephanie

  8. Irfan says

    Hey Stephnie,

    It looks like I have a little hope in Delaware. I worked 5 years for a non-public CPA that I recalled last night. I hope that works out. Is there any other work experience condition that I need to worry about?

    Thanks

    irfan

  9. Stephanie says

    Hi Irfan,
    Yes, just have to check that your supervisor at that time is an active CPA licensee (i.e. not just a certificate holder) during the time when you worked under him/her. And has to be CPA in US for Delaware.

    I really hope things will work out for you!
    Stephanie

  10. Babin says

    Stephanie,
    I have a few questions about the work experience requirement that hopefully you can help me with. I have met the education requirement and hopefully finish my exams by next testing window.
    I dont have any public accounting experience. I have worked as an internal auditor(in US) for the past 4 years but unfortunately my direct supervisors are not CPAs. Nevertheless, i am confident that i can find a CPA in my company (in accounting/finance department) who can verify my experience.

    My question is which states (if any) accepts work experice verified by a CPA as opposed to the experience strictly supervised by a CPA ? Also, do you have any insight on the extent of the verification necessory (i.e is the verifying CPA acknowledging that he knows for a fact that I have worked as an Internal Auditor for 4yrs, enough?).
    It will be greatly appreciated if you can point me to states that allows experience verified by CPA and accepts internal audit experience. I am so glad that i found your website!!

  11. Babin says

    Upon further reading your posts, It seems Colorodo’s “education in lieu of experience” provision would be a good option for me since i have close to 150 credits… But is this provision still allowed? I found this emergency rule adopted by Colorodo board in July 2010 (see below link). It makes no mention of the education in liue of.. provision:( http://www.dora.state.co.us/accountants/AdoptedChapter4.pdf

  12. Babin says

    Nevermind my previous comment. It looks like education in liue of experience is independent of chapter 4 and therefore still valid.. But, i am 17 credits short of the required 45 accounting credits to qualify for this provision.. i only have 28 pure accounting credits…

    i would be the happiest person in the world if somehow they accept becker review course as ACCT credit (which btw is not in my transcript) and 4 MIS courses i took (which do not have the ACCT program code)… .. but i think it is a long shot.. any guidance??
    in case anyone wants to see acceptable colorodo courseworks for this provision see page 7 of 32 of http://www.dora.state.co.us/accountants/Rules.pdf

    • Stephanie says

      Hello Babin,
      Thanks for your kind note on my site! For verification-only states, I know Indiana is one on top of my head. I’ll have to do some digging on further possibilities but will let you know if I find the others.

      If you have identified states other than Indiana I’d appreciate if you let me know because it should be useful info for other aspiring CPAs.

      Indiana requires 24 hours of accounting cerdits and 24 hours of business. Looks like there is a good chance that you can make it if you take some courses to make it up to 150 hours.

      On Becker… well I think they only accept credits if they are offered by an accredited college or educational institution. If your Becker course is offered via a college (i.e. the course should be stated in a college transcript), then yeah it should work; otherwise, don’t count on it…

      On Colorado, yes the education in lieu of experiene should be good until sometime around 2015 when CO plans to completely swtich to be a substantially equivalent state.

      Stephanie

  13. Babin says

    Stephanie, thank you very much for this tip. Indiana looks like the best option for me. I am just 3 credits short of the 150 requirement. I dont mind at all taking an online course for satisfying this requirement.
    I have another question now.. I am now a NY exam candidate. Once i passed all 4 exams, i can transfer CPA exam credits (with a nominal fee) to Indiana to meet Indiana’s initial licensing requirements right? I don’t think i can qualify for NY initial license…
    Thanks again for your guidance

    • Stephanie says

      Hi Babin,
      Excellent! I looked through some of the states, but most of the others have additional restrictions e.g. must be local resident of the state to get qualified. Anyway, yes you should be able to transfer the credits after passing the CPA exam, but please double check with the Indiana state board (on the credit transfer policy) for the details.
      Good luck on your exam! Stephanie

  14. Irfan says

    Hey Stephnie,

    Regarding Delaware work experience requirements. See below, another jurisdiction means another state? My work experience with CPA was in NY and I’m eligible for all other Delaware requirements.

    Please advise,

    irfan

    5.1.2 Qualifying experience shall be verified by a certified public accountant who holds a valid permit to practice or comparable license from another jurisdiction. The verification shall be notarized.

    • Stephanie says

      Hi Irfan,
      Nice to see you here again. Yes, another jurisdiction means the other states in the US, or US territories such as Guam, Virgin Islands, Washington DC which techically are not a “state”.

      So looks like things will work out for you? That’s great! Stephanie

  15. Mia says

    Hi Stephanie,

    I stumbled across your website and like what I see, well done! My situation is kind of unusual, so if you have any advice, thank you so much in advance.

    I am American, and 1 year away from finishing my Bachelor’s in Accounting at a college in Georgia. One thing I am considering is heading to Ireland or the UK to do my Master’s degree. When I have spoken to a few people over there who work in accountancy, they recommended waiting until I have passed my CPAs here in the US, as it’s something that will give me a competitive advantage over there with jobs (particularly if I decide to stay after grad school), and the accountancy board in Ireland also has a mutual recognition agreement with the AICPA which means that in order to become a Chartered Accountant in Ireland I only have to take an exam on local laws and taxation and then fulfill their work experience requirement. No such agreement as of yet with the UK, but still a US CPA license would give me a competitive advantage.

    My plan as of right now definitely involves at least passing all 4 parts of the CPA exam and obtaining the certificate before going to grad school abroad. In the event that I do return to the States at a later time, I would rather not have to start from scratch in order to obtain a CPA license. As for everything else, here are my questions:

    1. Once I have passed all 4 parts of the CPA exam, is there a maximum time limit allowed in order for me to obtain my license?
    2. Are there any states left in which there is no work experience requirement in order to obtain the license? If not, which states have more lenient work experience requirements? I ask this because I have been looking at New York as a place to move between the completion of my Bachelor’s the the commencement of my Master’s, but I recently noticed that they require at least half of the year to be in auditing, which is something I’m unsure about being able to obtain as a new entrant into the accounting profession.
    3. If not New York, are there any other states which you recommend I move to for the interim period between undergrad and grad school in order to obtain my license?

    Thanks for your help,
    Mia

    • Stephanie says

      Hello Mia,
      Thanks for your note! Yes there are still states that gives out CPA certificate/license without experience, but all of them require 150 credit hours. I assume that your bachelor degree is a 4-year (and not the accelerated 4 year/5 year one). If this is the case, you might need to take extra courses first in order to get qualified.

      As to whether there is a time limit between passing of CPa exam and getting the license, it depends on the state but generally they give you 5-10 years. Some states have no limits.

      I would think that you can still stick with your plan to pursue the master’s degree in Ireland or UK, because the master’s degree should be recognized — you just need to have the transcripts evaluated by the foreign credential evaluation agencies.

      but if you would like to work first… with 120 credit hours your choice is somewhat limited, but you can go to this page for more information (I list out the states that allow 120 hours to sit for the exam, as well as the limitations for each).

      Just drop me a note again if you have further questions! Stephanie

  16. Irfan says

    Thanks Stephnie! I’m so excited. It looks unreal and I never thought about it before. It’s all because of you & your website.

    Anyway, I will start the process for Delaware. The only fear I have is if I can’t proof my work experience for whatever reason then what. Can I transfer my CPA grades to different state and fulfil their requirement for work experiences. I just want all my bases covered before I go ahead with this.

    I owe you at least a lunch if you ever come to Manhattan!

    irfan

  17. Don says

    Hello Stephanie,

    I just found you site and I want to thank you for devoting your time to helping out so many people. I have a unique situation I worked for a single CPA for 2 years and he passed away 4 years ago. I recently passed my CPA exam and don’t have any way to get another CPA to sign off on my paperwork.

    I have a MBA and I would like to just use the CPA designation on my resume and business card. I tried to beat the deadline for Ill. but I didn’t pass the exam in time. Please recommend a state that would allow me to get a license with my MBA credits or at the very least a CPA certificate.

    Thanks, Don

    • Stephanie says

      Hi Don,
      Your situation is pretty unique indeed.

      I think in your case you can write a letter to explain the situation (with proof that you did work for this CPA and if possible, if you know where this CPA was registered) and see if it works. Alternatively, can see if the society of CPAs from your state can help.

      For Illinois, not sure what do you mean by the “deadline”. If you are talking about how the removal of its 2-tier status, then good news is that they have extended the deadline to two years, i.e. people can still get CPA certificate without working experience until July 2012. Hope this is what you are looking for?
      Just drop me a note if I misunderstood your comment.

      Stephanie

  18. Jatin says

    Hi Stephanie,

    Will you please guide me about the liberal State boards from where I could appear for CPA given that I don’t have an accounting bachelors. I am an MBA (from Cranfield, UK with finance theme) and CAIIB (Certificated Associate of Indian Institute of Bankers) and also studying towards final level of CIMA (Chartered Institute of Management Accountants, UK).
    I have recently got done my credentials checked for Delaware and Montana from FACS. They accorded 135 hours to all my qualifications (CIMA credentials were not sent to them) and they ignored my accounting credits gained in CAIIB. They reported deficiency in accounting credits (attributed only 1.5 semester hours out of 24 required) while I was fulfilling business credits requirement. I am in a state of flux since then and searching all resources for answers. I would be highly grateful if you could help me out with-
    1. Shall I start studying for the deficient (accounting, taxation) courses and if so where from. Since I am an international student I can only enroll for online courses. I looked at foothill College California for joining online courses. The problem is which particular courses (can you provide me the course numbers). I can share my evaluation if you feel that will give you better idea about the deficient courses.
    2. Can I plead for including CAIIB course credits with an accountancy board even if FACS has not accepted it as equivalent to a USA degree.
    3. CIMA has also awarded “Advanced Diploma in Management Accounting” after I completed 3 levels for ACMA award. Will this be able to help bridge the deficient courses gap?
    4. Are there other liberal states which put less onus on accounting courses alone and with the given business credits will I be eligible atleast for “Certificate” requirement as I am not thinking about the licensure presently.

    Best regards

    Jatinder Pandhey
    http://uk.linkedin.com/in/jatinderpandhey

  19. Charan says

    Hi Stephanie,

    Do you know if there is any time requirement to get additional courses completed under Maine for license purposes? I have 150 credits but i do not have the 15 hours of accounting and audit. I would need to do two additional courses and just wondering how much time i have as well i need to get the 400 hours of audit- i don’t want to lose credit for passing my CPA exams! thank you!

  20. Valerie says

    Hi Stephanie,
    I’ve found your site very helpful in my decision to sit for the CPA.

    Is it still true that if I sat for the exam in past years and didn’t pass that I’m grandfathered in and I’m not required to have the 150 semester hours?
    Also please give me your recommendation for a good cpa review for an unemployed accountant who has limited finances, who has sat for the exam five years ago but desire to take the exam this year.

    thanks

  21. Angel says

    Hi Stephanie,

    I am an international student from Hong Kong in the process of obtaining a 4-year undergraduate degree in California. I do not have enough semester units to take the CPA exam yet, but do you know if I can take the exam first, then finish the required units, and then receive the CPA certificate? Also, for the 1 year experience requirement for the license, do you know if I can fulfill them at an accounting firm in Hong Kong? Last question…what are the differences between a US CPA and the HKICPA? Do I have to take extra tests if I wish to work in Hong Kong as a CPA in the long term? What is the upside of being a US CPA in Hong Kong? Or would you recommend me to take the HKICPA exam instead if I don’t plan in staying in the US in the future…I need your help!

  22. Prateek says

    Hi Stephanie !!
    Hope you are doing good !
    I need a bit of help regarding transferring the CPA credits from one state to another.

    I am a CPA from the Delaware Board and I want to transfer my credits from Delaware state to New Hampshire, as it is easier to meet the licensing requirements of New Hampshire for me. Could you please help by throwing some light on the consequences and possible flipsides of this action. Since I am in India, i have no clue about the formalities involved and I just want some practical insight on the decesion as I dont want any surprises in the end, worked really hard to clear the exam, just dont wanna mess up with the credits. Hope you understand !!

    Thanks a lot for all the help Stephanie..Keep up the good work !!

    Regards

  23. Tommy says

    Hi Stephanie,

    I have an active CPA license in the state of California. However, I live and work in the state of Nevada, and I work in private industry. I do not perform any type of attest/audit functions. I carry the title of Senior Accountant with the private company that I work for.

    Can I use “CPA” after my name on email signatures and business cards? Since Nevada adopted the Practice Privilege provision, I was under the impression that I could use the CPA designation even though my license is in California, but have received conflicting responses to this question.

    Can you confirm?

    Thanks

  24. Shrusti says

    Hey stephanie.
    Thank you so much. All your information and suggetions are really really helpful. I just have a question i am in new jersey right now, but just in case i start giving exams just give part of the exams and then have to move to chicago then will my part exams passed work over there or is it a good idea giving exams ova here or its better just to move over there n then give exams ova there.
    Will wait for your response and thank you so much for your help

  25. John says

    Stephanie,

    By far the best information source I’ve seen, and I’ve been searching a lot lately. Here is my situation:
    1. Have a Bachelor’s
    2. Started working as a Controller while attending college and raising a family.
    3. Have always worked direct for the owner who has never been a CPA @ 3 separate companies.
    4. Cannot afford the paycut to go work for a CPA firm to fulfillFlorida’s work experience requirement given current family situation.
    5. Even if I could afford the paycut most firms will not look at a 33 year old entry level (to the audit field) candidate.
    6. Am seeing several roadblocks without having the CPA desnigation to go further

    I was confused by one thing you said “Cannot hold yourself out as a CPA within the jurisdiction, i.e. cannot call yourself a CPA in the state where you get the CPA certificate.” Does this mean if I get a certificate in Florida I cannot call myself a CPA in Florida, but can in Georgia? Also, what might be the best path for me to take? I appreciate your guidance. Thanks

  26. Balaji Thiagarajan says

    Hi Stephanie,

    I have passed all the 4 papers of the CPA exam from MI State. I do not plan to work in Public accounting or set up my own practise.
    Therefore, I hope to get only a certificate (instead of license). However, since the state of MI does not have a disctinction between a certificate and a license. Therefore, I have to fulful the education & experience requirement which I do not seem to have. Can I tranfer my credits to a Two-Tier State, for ex. Illinois and get only a certificate so that I can call myself a CPA.

    Thanks,
    Balaji Thiagarajan

  27. Sanjay Gaur says

    Hi Stephanie

    Thanks for wonderful information provided by your website. I have an query. I am a Chartered Accountant from India with B.com degree. I evaluated my education and I got 125 credit hours. This, I did somewhere in 2002. Now, I am preparing for CPA exam and I applied from Michigan state since this state recognise Indian Chartered Accountant. I am working in Kuwait and I need CPA just to improve my CV (Biodata). After reading above emails, I came to know that I should get atleast certificate because otherwise, I have to have a training under licensed CPA. This is not possible in Kuwait and obvisiously, I am not US citizen so I will not come to US to have this training under CPA. Now, I want to know that if I clear my CPA examination, what proof will I have to show to interviewer that I have completed CPA as I will not have certificate. So, what to do as I can not transfer credits to Illinois because they require 150 hours should be completed before appearing in examination and I donot have those and I am appearing in August. Any suggestions will be highly appreciated.

  28. Stephanie says

    Dear all,
    Many thanks for taking the time to leave your comments here and I should have had answered the above questions in other pages.

    In order to streamline and improve the response time, I would like to redirect your questions to these pages:

    1. For state specific questions (including whether specific state’ licensing rules):
    Please go to CPA exam requirements by state, click on the state you are interested in, and add a comment there.

    2. For general questions from international candidates:
    Please check out this page written for you first, and click away / leave comments from there!

    Finally, if you have a questions specifically on understanding the meaning of “certificate” vs “license” for CPA, then please scroll back up and find the heading “Your comments are most welcome” and drop a note for me there. Thanks!

    Stephanie