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Public Accounting in Ontario
Bill 94, The Public Accounting Act, 2004 came into force as of November 1, 2005. A that time, a new 17-person Public Accountants Council (PAC), consisting of nine public representatives (including the Chair), four CAs, two CMAs and two CGAs, was constituted to develop new high standards required by the Act, as well as to assume an oversight role of all accounting bodies authorized to license their members.
The new Act enables the PAC to oversee a public accounting standard for Ontario benchmarked against the high, internationally recognized public accounting standard that Chartered Accountants have been required to meet. In the future, that standard can only be increased.
The PAC has developed stringent criteria and processes for comprehensively reviewing and assessing the qualification and regulatory standards of the accounting bodies designated in the Act (the Institute, CGA Ontario and CMA Ontario). The PAC's granting of authorization requires that a designated body demonstrate that it meets the Standards that the PAC has adopted. The Institute has been granted authorization by the PAC to licence and govern members in the practice of public accounting effective on November 1, 2006.
The PAC's Standards, which took effect as of June 20, 2006, meet the requirement of s. 19(4) of the Public Accounting Act, 2004 that the standards for public accounting licensing "shall be no less rigorous than the internationally recognized standards under the (former) Public Accountancy Act as they existed on June 9, 2004" (the date on which the new Act was adopted by the Legislature). The internationally recognized standards that existed under the former legislation were the standards of qualification and regulation that CAs are required to meet.
The new Standards that are now in effect include:
- rigorous education, examination and practical experience requirements that are substantially equivalent to the requirements that the Institute has established;
- the enforcement of exacting rules of professional conduct related to the practice of public accounting;
- mandatory, cyclical practice inspection of licensees;
- professional liability insurance programs for public accounting work;
- continuing professional development requirements; and
- comprehensive discipline mechanisms.
Under the new Act , Certified Management Accountants (CMAs) and Certified General Accountants (CGAs) can only become eligible for licensure if their respective bodies demonstrate to the new PAC that their qualifying and regulatory programs meet the standards that have been adopted by the PAC.