3.1 State Board Licensing and Disciplinary Systems

The license is a state-board product

REG Area I, Group B has one representative task: understand and explain the role and authority of state boards of accountancy. That sentence is the whole skill. The Uniform CPA Examination is national. The license is not. Passing REG, FAR, AUD, and a Discipline section does not authorize you to sign an attest report, hold out as a CPA, or offer public accounting services. Only a state board of accountancy—or the board of another U.S. licensing jurisdiction (the District of Columbia and the territories)—can issue that license.

Assign three actors three different verbs and most of this topic becomes mechanical:

• State board of accountancy — licenses and disciplines. It decides who may sit for the Exam as a candidate of that jurisdiction, who is licensed, who must complete continuing professional education (CPE), who may hold out, and who loses the credential.
• NASBA — serves the boards. The National Association of State Boards of Accountancy is a central service organization: exam-candidate services, credential evaluation, mobility-research tools, and the Accountancy Licensee Database / CPAverify. It is not a fifty-sixth licensing board.
• AICPA — associates members and develops the Exam. The American Institute of Certified Public Accountants writes the Uniform CPA Examination through its Board of Examiners and jointly publishes the Uniform Accountancy Act with NASBA. AICPA membership is voluntary. It is a professional-association relationship, not a substitute for a license. Dropping AICPA membership does not cancel a state license; holding AICPA membership does not create one.

The IRS Office of Professional Responsibility (OPR) is a fourth actor you already met under Circular 230. OPR polices practice before the IRS. It does not issue CPA licenses. A board can revoke a license for tax-related dishonesty even if OPR never opens a file, and OPR can censure a practitioner even if the board does not. The two systems are parallel, not nested.

The Uniform Accountancy Act is a model, not a statute

The Uniform Accountancy Act (UAA) is jointly published by the AICPA and NASBA. It is a model act. A model act has no legal force until a legislature—or, for some provisions, a board using delegated rulemaking—enacts it, in whole or with local amendments. That is why REG will not ask you for a particular state's application fee, wall-certificate surcharge, or CPE-hour grid. It will ask whether you know that the board, applying that jurisdiction's statute, is the licensing authority.

Typical UAA-style elements, which almost every jurisdiction uses in some form:

1. Education. A baccalaureate accounting concentration, historically framed around 150 semester hours. The Ninth Edition of the UAA (2025) adds an additional optional model pathway—bachelor's degree with an accounting concentration, two years of experience, and the Exam—alongside the graduate-degree-plus-one-year and 150-hour-plus-one-year models. Those words become law only where a jurisdiction adopts them. Do not treat the model as self-executing.
2. Uniform CPA Examination. Necessary. Never sufficient.
3. Experience. Commonly one year of qualifying experience verified by a licensee under the traditional model; two years under the new model pathway. Boards define what counts as qualifying.
4. Ethics examination. Many jurisdictions require a professional ethics exam (often an AICPA professional-ethics course and exam, or a board-written ethics exam) before the license issues. "Many" is the accurate word; do not invent a particular state's vendor or passing score.

Because the UAA is only a model, two candidates with identical Exam scores can face different experience clocks and different ethics-exam rules. That variation is the legal design, not a REG trick.

Mobility without inventing a state's notice rule

Cross-border practice is a board-law problem, not a federal CPA license in disguise. Under the UAA's substantial equivalency and practice privilege framework, a CPA in good standing whose principal place of business is in one jurisdiction may practice in another without obtaining a second full license when education, Exam, and experience criteria are treated as substantially equivalent. NASBA's National Qualification Appraisal Service has historically verified jurisdiction-level substantial equivalency. The 2025 UAA revisions shift the model toward an individual-based practice privilege (the individual's own education, Exam, and experience) and add a safe harbor for CPAs licensed under earlier pathways as of December 31, 2024. Those revisions operate only when a jurisdiction enacts them.

What you must not do on REG: recite a host state's fee table, notice form, or effective date that you cannot verify. What you must do: know that mobility is a privilege granted or withheld under board law, that the visiting CPA remains subject to the host board's jurisdiction for work performed there, and that a mobility privilege is not a defense to unauthorized practice, CPE default, or exam cheating.

Discipline: the board can take the credential

Boards exist to protect the public. That mission appears as four clusters of power.

Grounds that overlap Circular 230 are fair game even though Circular 230 is an IRS regime: false or reckless tax work, dishonesty, exam cheating, failing CPE, practicing on a lapsed license, and unauthorized practice of public accountancy. Typical sanctions are censure, probation, extra CPE, civil penalties, suspension, and revocation.

Worked map. A senior associate is licensed by State A, drops AICPA membership to save dues, then is caught sharing live REG task-based simulations with a candidate who will sit in State B. AICPA membership is already gone, so membership ethics process is beside the point. NASBA can support candidate-database and board-to-board communication; it still cannot pull the license. State A's board can suspend or revoke. State B's board can restrict or deny practice privilege for work in B. OPR becomes relevant only if the conduct is practice before the IRS. Assigning each actor one verb is the REG skill.