Introduction
Certified Public Accountants (CPA) are individuals that engage in the field of public accounting and work with the CPA firms. The CPA’s are mostly found working as a senior accountant in the departments of manufacturing, financial services, government agencies, healthcare, and education. The CPA firms provide consulting, auditing and tax services to individuals, corporations, partnerships, and non-profit organizations. The CPA firms are also engaged in preparing auditing reports for the companies. It is the responsibility of CPA firms to ensure that the financial statements of the companies are accurate. In addition, the CPA firm assists the companies in suggesting ways that are helpful to improve the operations of the company. The paper discusses the procedure that is required to open a CPA firm in the State of Texas.
Essentials for a CPA firm
The objective of the certified public accounting firms is to offer financial, accounting, auditing, and consulting services to the public businesses, government agencies, and private firms. It is mandatory for each firm to have at least one state licensed certified public accountant of that particular state where the company is running its operations. In addition, the CPA firm is required to have at least one CPA as a partner or executive of the company. The working force of the CPA firm may include personnel such as tax accountants, auditors, receivable or payable technician, professionals of information technology. In addition to it, projects accountants, cost accountants, senior, junior and staff accountants, and other accountants that are the expert based on the list of the firm’s client are also a part of the working force of CPA firm (Crawford and Loyd).
The Texas State Board of Public Accountancy
It is analyzed that many states do not allow the use of title “Certified Public Accountant” by an individual who is not certified by that state. Therefore, many of the out-state CPA's are not allowed to function until they are given the license or certificate of working as a CPA in that particular state. Same is the case with the State of Texas, as it does not allow the title of accountant or auditor to be used by those individuals who do not possess the certificate of Texas CPA. However, the title can be used if the individual is CPA from any other state or he meets the essential requirements to practice in the State of Texas. The law of the State of Texas explains that any firm that runs its operations of public accountancy as a sole proprietorship is obliged to register itself with the Texas state Board of Public Accountancy. The law also gives detail that the registration to the board is essential if the firm is out-of-state and also fulfills the necessary requirements that are mentioned in the section 901.461 of the Public Accountancy Act (Accountancy). Following are the steps that are required by the firm that intends to operate in the State of Texas.
In the first step, the firm is required to get a Sole Proprietorship Registration Form. Additionally, the operation of the firm in the State of Texas needs to be performed by such individual who complies with the requirements of the section 901.462 of the Public Accountancy Act or by the person who already obtains the license of Texas.
The registration process will continue by filling the required registration forms along with the necessary documentation that are mentioned in the Sole Proprietorship Registration form. There are possibilities that the board may contact the firm to complete any necessary information or documentation. The firms that deal with the auditing and accounting will be required to register with the sponsor in the Peer Review Program.
When the board approves the initial registration, the second step will be to submit the set of forms and worksheets that will be sent by the board. When the firm completes and submits the second set of forms, the board will ask them to pay the Office License Fee for all the offices. Also, the firm will be required to pay Firm Organization Fee that will be concerned with the number of CPA employees in the Texas, the number of non-CPA owners that are working in Texas and the number of CPA’s of Texas. The fee for those firms that are out-of-state will be related to the number of CPA employees, the number of non-CPA employees, and the number of CPA owners that are inhabited in the state of the out-of-state firm.
It is essential for the firm to pay the annual advance fee for all of its offices that are operated in the State of Texas. However, the condition for the out-of-state firm will be slightly different as it will only pay for the registration of its primary office location. As soon as the firm has completed the initial processes and paid its primary registration fee, it will be allowed to pay for the future license renewal.
The third step is the final step in which the board provides the license to the firm after receiving the required fees and documents. The firm obtains its license to practice public accountancy when the board finally approves all the documentations and registration package of the firm (Texas State Board of Public Accountancy).
Works Cited
Accountancy, Texas State Board of Public. The Public Accountancy Act. Austin: Texas State Board of Public Accountancy, 2015. Print.
Crawford, Michael A and D. Scot Loyd. CPA's Multistate Guide to Ethics and Professional Conduct (2008). Riverwoods, Illinois: CCH, 2008. Print.
Texas State Board of Public Accountancy. TSBPA-Registration of A Firm Practicing Public Accountancy As A Sole Proprietorship. 2016. Web. 9 February 2016 <https://www.tsbpa.state.tx.us/forms/registration-firm-practicing-sole.html>.
