What is the difference between an individual CPA license and a CPA firm permit?
I am studying for AUD and keep seeing references to firm licensure as separate from individual licensure. How are they different?
An individual CPA license authorizes a person, subject to state rules, to use the CPA designation and perform services allowed under that license. A CPA firm permit or firm license applies to the entity that holds itself out as a CPA firm or performs regulated public accounting services.
The distinction matters because a licensed employee does not automatically turn a non-CPA employer into a CPA firm. If an entity's marketing implies CPA firm services, the entity may need the proper firm licensure and must comply with applicable professional standards.
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