New Jersey Survey: 62% of CPAs See No Skills Difference Between Those With 120 Vs. 150 Credit Hours

The New Jersey Society of CPAs (NJCPA) recently surveyed 1,060 members on the controversial question of whether an extra year of college, or a total of 150 credit hours, is too many to earn a CPA license.

Here are three takeaways:

  • More than 40% of those surveyed said that new hires working in accounting-related roles who had not completed 150 credit hours “rarely” or “never” pursue CPA certification.
  • No skills difference was detected between those with 120 hours and those with 150, according to 62% of respondents.
  • An overwhelming majority, nearly 80%, believe it would be beneficial to the profession to provide alternative pathways to certification so 150 credit hours is not the only option.

The findings were discussed Feb. 13 by Aiysha Johnson, NJCPA CEO and executive director, and Jeff Kaszerman, NJCPA vice president of government relations, in the society’s weekly IssuesWatch podcast, which covers the latest business and economic issues impacting New Jersey CPAs and the business community.

The 150-hour question has heated up over the last few years, in part because too few students are completing an accounting degree and earning their CPA license. An unprecedented labor shortage has prompted lively debates over whether the 150-credit-hour requirement serves as a deterrent for a career in public accounting and CPA licensure.

In fact, new research by the Massachusetts Institute of Technology’s Sloan School of Management shows that the 150-hour rule causes a 26% drop in minority entrants. “Tuition in professional fields like accounting is expensive, and forgoing a year of income to complete a fifth year of college entails a sacrifice,” according to MIT Sloan associate professor of accounting Andrew Sutherland in a report on the study. “Naturally, the burden of such requirements tends to fall on those least able to afford the additional year.” Furthermore, the rule didn’t measurably improve CPA service quality, the study asserts.

The pipeline challenge, Johnson said, is not only driven by fewer accounting majors but also by demographic shifts – lower birth rates mean fewer college students overall. Colleges in fact are calling the dramatic drop in the college-age population beginning in 2025 the “enrollment cliff,” which is already being seen in New Jersey, where community colleges and four-year schools are seeing a 2% decline.

Kaszerman said the 150-hour rule has been in place in New Jersey for the last two decades. Florida started the trend in the early 1980s and other states started following suit in the mid- to late 1990s until it was adopted as a national standard.

One of the biggest obstacles with changing the 150-hour requirement is mobility, or the ability for CPAs to work across state lines, because of the similar educational, examination and experience requirements for licensure across states.

For example, if one state allows 120 credit hours it could mean a CPA licensed under those rules may not be able to practice in a state with the 150-hour requirement. “It’s much more complicated than it sounds. It’s not just a matter of switching it to 120,” said Kaszerman.

Despite the complications, some states are looking at alternatives. In New Jersey, Big 4 firm PwC has teamed up with St. Peter’s University on a pilot program that allows students to receive 30 credits for working as paid staff. Princeton, N.J.-based Withum and Seton Hall have followed suit with a similar program. Last year, the Minnesota Society of CPAs introduced legislation that would allow alternatives to the 150-hour rule. The issue is set to be debated in this legislative session.

“That started sort of a Civil War,” Kaszerman said. “NASBA and the AICPA, especially in the beginning, were adamantly opposed to any changes.” But with growing pressure, the AICPA created a “experience, learn and earn” program where students could work part time at a firm while earning the extra 30 credits from an inexpensive Tulane University online program.

A number of concepts are being discussed among state societies and an AICPA-convened National Pipeline Advisory Group, a multi-stakeholder panel charged with developing a national strategy to address the profession’s talent shortage. A draft report is due in May.

NJCPA Chief Marketing Officer Don Meyer concluded, “It seems like we’re transitioning to arguing about whether or not there should be change to arguing about what the change should be, which I think it’s progress.”


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