
Why The Accounting Profession Is Better Off Without A 150-Hour Rule
Some people still believe that the 150-hour rule has elevated the accounting profession. I'm not one of them, and frankly, I'm thrilled that the rule may soon become a thing of the past.
For those not intimately familiar with the ins and outs of accounting, this rule forces aspiring CPAs to complete what amounts to a fifth year of schooling—30 extra credit hours of college credit beyond a bachelor's degree—before they can even sit for the CPA exam.
In theory, adding 30 extra hours of schooling seems like a sound idea. After all, more education should lead to better-trained and better-skilled accountants.
Well, based on my experience in the profession and personal opinion, an extra year of schooling doesn't benefit anyone. It just leads to higher tuition payments without offering much real, practical value.
If you ask me, the rule has only served to make the talent crisis in our industry worse. Accounting firms can't fill positions fast enough, experienced CPAs are retiring in droves, and fewer students are choosing accounting as a career path. Meanwhile, the 150-hour rule simply places unnecessary financial and time burdens on aspiring accountants.
The numbers don't lie. The accounting profession has a serious people problem. U.S. accountants and auditors are leaving their jobs in high numbers. Even worse, about 75% of today's CPAs are set to retire over the next 15 years.
Sure, the 150-hour rule isn't the only reason why our industry is in crisis. But it certainly isn't helping. For many promising students, the prospect of taking on an extra year of tuition—often accumulating more student debt—simply doesn't make financial sense, especially when other high-paying careers in tech, finance or consulting don't impose similar hurdles.
Nothing beats experience.
Proponents of the 150-hour rule argue that additional education leads to better-prepared professionals. But ask any seasoned accountant, and they'll tell you: The most valuable learning happens on the job.
Auditing, for example, is as much an art as it is a science. Textbooks can only take you so far. And they certainly can't fully prepare someone for the judgment calls, client interactions and real-world problem-solving that define the profession. CPAs truly learn their craft through hands-on experience, not through extra semesters of coursework that often have little relevance to their day-to-day responsibilities.
This is why I'm so gratified to see the recent shift in state-level licensing rules. Fourteen states have passed legislation allowing alternative pathways to CPA licensure, typically by substituting the extra 30 credit hours with an additional year of work experience.
And now, after years of defending and promoting the 150-hour rule, the American Institute of CPAs (AICPA) and the National Association of State Boards of Accountancy (NASBA) are finally changing their tune. Most notably, they've agreed to amend the Uniform Accountancy Act (UAA) to allow for alternative pathways to licensure, specifically, permitting candidates to qualify with a bachelor's degree along with two years of experience, rather than the traditional 150-hour requirement.
This is a significant step forward, but it's also an admission that the 150-hour rule has failed in its original purpose. If the AICPA and NASBA—once the rule's strongest advocates—are now willing to reconsider it, that should signal to the rest of the profession that change is not just necessary, but long overdue.
Let's rethink the entire model.
Reducing the 150-hour rule to 120 hours is definitely a step in the right direction. But why stop there? We should be asking an even bigger question: Why are we fixated on credit hours at all?
The truth is, the current system is built on an outdated assumption that more classroom time equals better-prepared professionals. But in a field like accounting—where technology, regulations and business practices evolve rapidly—rigid educational mandates can actually hinder adaptability.
What if, instead of requiring a fixed number of credit hours, we focused on competency-based assessments? What if we allowed apprenticeships, on-the-job training or specialized certifications to further supplement traditional education requirements? The future of the profession depends on attracting smart, capable professionals in a way that removes artificial barriers and recognizes diverse pathways to expertise.
AI will transform accounting.
This shift becomes even more urgent when we consider how technology is reshaping the skills accountants need.
There's no question that artificial intelligence (AI) will have a profound impact on the accounting profession. AI-powered tools, like those we develop at my company, are already helping to automate repetitive tasks, reduce errors and allow accountants to focus on higher-value work. According to Gartner, finance leaders are increasingly optimistic about AI's potential, with many planning to allocate more resources to AI deployment in the coming years.
But AI won't replace accountants—it will augment them. The profession will always need skilled professionals who can interpret data, exercise judgment and provide strategic insights. The question is: Will we have enough of them?
Here's the bottom line.
The accounting profession is clearly in crisis. Between the talent shortage, increasing regulatory complexity and the rapid pace of technological change, the status quo is no longer sustainable.
Eliminating the 150-hour rule won't solve every problem, but it's a critical first step. At the end of the day, the goal should be simple: Ensure that the profession attracts the best and brightest. Because if we don't act now, the talent crisis will only deepen—and the profession will suffer for it.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation.
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