California Board of Accountancy

Accountancy Partnerships

An accountancy partnership is required to be approved for licensure by the Board before practicing or holding out to the public as an accountancy partnership.

An accountancy partnership must have at least two partners, with at least one of the partners licensed to practice accountancy in the State of California. An accountancy partnership with a nonlicensee owner must have at least one partner with an active California CPA license.

It is suggested that you print out the Check Sheet, included in the application packet, to assist you in completing the application process. All forms related to the application process are available from our Forms Page.


Appropriate Use of Partnership Name

Change of Address, Partners, and/or Firm Name

Change to a Limited Liability Partnership

Dissolution of an Accountancy Partnership

Federal Employer ID Number

Fees for Licensure

Nonlicensee Partners

Out-of-State Partners

Partners of the Firm

Partnership Renewal Cycle

Resident Manager(s)

 

Please carefully review the laws and regulations governing the Board's accountancy firms as noted above. If you have any questions after reviewing the information provided here, you may contact the Board's staff by email at firminfo@cba.ca.gov, by fax at (916) 263-3676, or by calling (916) 561-1701.



Appropriate Use of Partnership Name

The name of the firm must meet the requirements set forth in Sections 5060 and 5073 of the Business and Professions Code (BPC) and Section 75.5 of Title 16 of the California Code of Regulations (Title 16). Board staff is unable to provide guidance regarding firm structure and whether a particular firm name will be considered false and misleading by your clients, therefore, licensees are encouraged to contact their legal counsel for guidance.



Change of Address, Partners, and/or Firm Name

Each time your partnership has a change in partners, address, or telephone number you must notify the Board within 30 days of the change. The notification must be provided in writing and signed.

Each time your partnership has a name change, you must submit a General Partnership/Limited Liability Partnership with Name Change . Prior approval by the Board is required before you can hold out or practice under an amended name style. The name change application fee is $150. Check, money order, or cashier's check must accompany the application and be made payable to the California Board of Accountancy. All forms related to the name change process, are available here from our Forms Page.



Change to a Limited Liability Partnership

General partnerships wanting to change to a limited liability partnership may contact the California Secretary of State at their website.



Dissolution of an Accountancy Partnership

To dissolve a general partnership, submit a letter to the Board stating that the firm has been dissolved, and provide the effective date. Upon receipt of the letter, the firm's license will be cancelled.

To dissolve a limited liability partnership, you must contact the Secretary of State and file a Notice of Change of Status. The firm must receive a Tax Clearance Certificate from the Franchise Tax Board before the Notice of Change of Status can be filed. Information on dissolving a limited liability partnership is available on the California Secretary of State's website.

Upon completion of the above, submit a letter to the Board stating the firm has been dissolved, and provide the effective date. Upon receipt of the letter, the firm's license will be cancelled.



Federal Employer ID Number

Disclosure of the firm's federal employer identification number (FEIN) is mandatory. Section 30 of the BPC and Public Law 94-455 (42 USCA 405 (c)(2)(C)) authorizes collection of your FEIN. The FEIN will be used exclusively for tax enforcement purposes, for purposes of compliance with any judgment or order for family support in accordance with Section 17520 of the Family Code, or for verification of licensure by a licensing entity which utilizes a national examination and where licensure is reciprocal with the requesting state.

In addition, Section 30 of the California BPC prohibits the renewal of a license by a licensing board if the firm fails to disclose or provide their FEIN. California law does not provide any exception, nor does it permit the Board to make any exceptions.



Fees for Licensure

The application and initial license fees are $270. Check, money order, or cashier's check must accompany your application and be made payable to the California Board of Accountancy.



Nonlicensee Partners

Section 5079 of the BPC permits minority ownership of a public accounting firm by individuals who are not licensed CPAs or PAs. The number of licensed partners as owners must be greater than the number of unlicensed persons. The only exception is that a firm with two owners may have one owner who is a nonlicensee.

At initial licensure, as well as at renewal, Section 51 of Title 16 requires firms with nonlicensee owners to certify that his or her principal place of business in California has been informed of the rules of professional conduct applicable to accountancy firms. The declaration must be signed by a licensed partner of the firm.



Out-of-State Partners

An out-of-state CPA or PA wanting to practice in California must file an application for licensure and meet the requirements set forth in Sections 5087 and 5088 of the BPC and Section 21 of Title 16.

Section 5072(b)(2) of the BPC requires each partner personally engaged in the practice of public accountancy as defined by Section 5051 to hold a valid permit to practice in California or have applied for a certificate as a CPA in good standing of some state, except as permitted by Section 5079.

The Board must be notified within 30 days after the admission to, or withdrawal of, a partner from any partnership registered with the Board. Section 5073(e) provides that a registration granted in reliance upon Section 5087 and 5088 may be terminated based upon related changes.



Partners of the Firm

Section 5072 (b)(1) of the BPC requires at least one general partner to hold a valid license to practice as a CPA, PA, or accountancy corporation, or be an applicant for a certificate as a CPA under Sections 5087 and 5088.

Section 5072(b)(3) requires each partner not personally engaged in the practice of public accountancy within California to be a CPA in good standing of some state, except as permitted by Section 5079.



Partnership Renewal Cycle

A partnership license must be renewed every two years to remain in good standing. The expiration date is based on the month and year the Board originally approved the application. If approved in an even-numbered year, the license will expire each even-numbered year on the last day of the month in which it was originally approved. If approved in an odd-numbered year, the license will expire each odd-numbered year on the last day of the month in which it was originally approved.

The Board mails renewal forms with instructions approximately two months before the firm's license expiration date. If your renewal form is not completed, mailed, and postmarked by the license expiration date, your firm's practice rights cease until all deficiencies are corrected and the license is renewed.

Failure to renew within five years of expiration will result in cancellation of a partnership's license. A cancelled license cannot be renewed, reinstated, or restored.

If a partnership license has been cancelled, the partners must reapply and be approved for licensure before practicing or holding out to the public as an accountancy partnership.



Resident Manager(s)

Section 5072(b)(4) of the BPC requires each resident manager in charge of an office of the firm in California to be a licensee in good standing in California, or to have applied for a certificate as a CPA under Sections 5087 and 5088.

Section 5078 of the BPC requires in each office of a CPA/PA in California, which is not under the personal management of that accountant, that the work be supervised by a CPA or PA.