Mandatory CPE Rules

This summary is provided solely for the convenience of members of the Tennessee Society of CPAs and is not intended to replace the full text of the rules. To obtain the full text of the Tennessee State Board of Accountancy (TSBA) rules on continuing education, or if you have questions, contact the Tennessee State Board of Accountancy at 500 James Robertson Parkway, Second Floor, Nashville, TN 37243-1141, call 615/741-2550 or 888/453-6150 or send an e-mail to: tnsba@mail.state.tn.us, or review the board's Web site at www.state.tn.us/commerce/boards/tnsba/.

Who Must Comply
All persons who are issued an active certificate as a CPA or a PA must comply with the continuing education requirements.

Basic Requirements
During each two-year period, ending December 31, renewal licensees must complete 80 hours of acceptable continuing education credit.

CPE Exemptions are Allowed as Follows:

A. Retired and Inactive Certificate Holders
If inactive or retired, one must use that wording adjacent to the credential any time it is used.

To qualify for retired status, you must be over 55 years of age and not practicing public or private accounting.

B. Hardship Exception
The board has authority to make a written exception which must be reviewed and re-approved, if applicable, each year, for reasons of individual hardship, including health and military service.

Re-Entry
An individual, formerly the holder of an active certificate, who wishes to apply for reinstatement of the active certificate must first satisfy the two-year 80 hour CPE rule.

Programs Which Qualify
A specific program qualifies as acceptable continuing education if it is a formal program of learning which contributes directly to the professional competence of an individual certified public accountant or a licensed public accountant. Such a program must meet the minimum standards of quality of development and presentation and of measurement and reporting of credits set forth in the Statement on Standards for Formal Continuing Education Programs, published by the National Association of State Boards of Accountancy (NASBA). If the aforementioned guidelines are not met, the sponsor must be exempt by state board rule from registering as a sponsor. The TSBA anticipates that individuals will maintain the high standards of the profession in selecting quality programs.

Controls and Reporting
For auditing purposes, applicants for renewal of certificates must be able to provide a signed statement of the continuing education programs which they claim to be acceptable. The form must show: a) sponsoring organization; b) location of program; c) title of program; d) dates attended; e) hours claimed and f) professional development coding (technical and non-technical).

Acceptable Subject Matter
Acceptable general subject matters are: accounting and auditing, taxation and management or financial advisory.

The above general subject matters are acceptable as long as they contribute to the basic professional knowledge and competence of the individual and meet the minimum standards of quality of development and presentation and of measurement and reporting of credits set forth in the Statement on Standards for Formal Continuing Education Programs published by NASBA.

Areas other than those listed may be acceptable if the individual can demonstrate they contribute to his/her professional competence. The responsibility for substantiating that a particular program is acceptable and meets the requirements rests solely on the individual.

Exempt Sponsor Programs
The following groups of programs qualify for credit if they meet the standards specified under acceptable subject matter: a) professional education and development programs of national, state and local accounting organizations; b) technical sessions at meetings of national, state and local accounting organizations and its chapters; c) university or college courses ? both credit and non-credit courses; d) formal in-firm or in-house education programs sponsored by your employer and e) courses presented by governmental entities.

Credit Hours Granted - General
Continuing education credit will be given for whole hours only, with a minimum of 50 minutes constituting one hour. Only contact hours are allowed. For university or college courses, each semester unit of credit shall equal 15 hours toward the requirement. A quarter unit of credit shall equal 10 hours.

Credit for Formal Individual Study Programs
The amount of credit to be allowed for correspondence and formal individual study programs is to be recommended by the program sponsor. Individuals claiming credit for such correspondence or formal individual study courses are required to obtain evidence of satisfactory completion of the course from the exempt sponsors or approved under the quality assurance program of NASBA. Credit will be allowed in the period in which the course is completed.

Credit for Service as Lecturer, Discussion Leader or Speaker
Instructors, discussion leaders and speakers may claim continuing education credit for both preparation and presentation time. Credit may be claimed for actual preparation time up to three times the class contact hours for the first time the class is presented. Credit as an instructor, discussion leader or speaker may be claimed provided the session is one which would meet the continuing education requirements of those attending. The maximum credit for such preparation and teaching shall not exceed 50 percent of the renewal period requirement.

Credit for Published Articles, Books, etc.
Credit may be claimed for published articles and books. The amount of credit awarded will be determined by the TSBA, provided such articles and books contribute to the professional competence of the individual. Credit may be claimed on a self-declaration basis up to 50 percent of the renewal period requirement. In exceptional circumstances, an article(s) or book(s) may be provided to the TSBA with an explanation of the circumstances which would justify a greater credit.

Evidence of Completion - Retention
Primary responsibility for documenting the requirements rests with the individual and evidence to support fulfillment of those requirements should be retained for a period of five years after the completion of education courses. Satisfaction of the documentation requirements, including the retention of attendance records and written outlines, may be accomplished as follows:

a) The individual must retain a copy of the course outline prepared by the course sponsor along with the following information: 1) name of the sponsoring organization; 2) location of program; 3) title of program or description of content; 4) dates attended and 5) hours claimed.
b) For courses taken for scholastic credit in accredited universities and colleges, evidence of satisfactory completion of the course will be sufficient; for non-credit courses taken, a statement of the hours of attendance, signed by the instructor, must be obtained by the individual.
c) For formal individual study programs, written evidence of completion must be obtained by the individual from the approved sponsor.
d) A sponsors' certificate of completion/attendance is preferred evidence of completion of a course.

Reporting Requirements
On or before December 31, each two years, the two-tiered or inactive certificate, active permit or license holder shall give evidence to the TSBA that their continuing education requirements have been met for the reporting period ending December 31. Renewal and reporting requirements will be on an odd or even year cycle based on the last digit of your certificate or license number (i.e. even-numbered certificate holders renew by December 31, 2002 and odd-numbered certificate holders renew by December 31, 2003).

Keep all records for 5 years. These are subject to audit by the TSBA.