You’ve worked a long time as a CPA and are now contemplating retirement. This article provides responses to some Frequently Asked Questions (FAQs).
I’ve just retired from my job. Do I need to continue paying membership dues?
Retiring from the workforce does not automatically mean that a member would stop paying membership dues. To qualify for a dues reduction, you must meet the criteria for a “Long-Term member” or “Retired member.”
A Long-Term member is one who has 40 years of membership and/or who is at least 70 years old as ofApril 1, the first day of the membership year. There’s no income threshold for this category of dues waiver—annual provincial and national dues are both waived.
A Retired member is one who is at least 55 years old on April 1, the first day of the membership year and who has an active income less than the indexed threshold as noted on the CPABC websiteand all subsequent years. The income threshold is adjusted annually and is based on individual income, not family/household income. For members who qualify for this waiver, member dues are waived and no national dues are charged. Note that you must declare your eligibility for the Retired Member dues reduction annually through the member portal by the member dues payment deadline date of April 1.
Active income includes accounting and non-accounting income from employment, director’s fees, and net income from self-employment. Active income does not include employment insurance, pension income, investment income, support payments, or disability income; however, all other sources of income are considered “active.” CPABC reserves the right to verify your eligibility for the Retired Member dues reduction.
If I qualify for a reduction in my membership dues, do I automatically qualify for an exemption from CPD?
The criteria for a dues waiver and a CPD exemption are not the same; therefore, qualifying for one does not mean you automatically qualify for the other. You have to declare each separately.
I’ll be retiring from my current job soon, and a CPA firm in my community has asked if I’d consider working for them part-time. Would I still qualify for a dues waiver and a CPD exemption if I work part-time?
Working part-time does not automatically pre-empt you from qualifying for a dues waiver or a CPD exemption. You might qualify for dues waiver but not CPD exemption, for example.
If you’ve qualified for a Long-Term Member dues waiver (see #1), there’s no income threshold. If you’ve declared that you are eligible for a Retired Member dues waiver, you would still qualify for this waiver even if you take on part-time work, as long as your active income is less than the indexed threshold in the year of retirement and in all subsequent years after meeting the age criteria.
With regard to the CPD exemption, if you work part-time for a CPA firm, you’ll be engaging in “public practice” as defined in the CPABC bylaws, and, therefore, would not qualify for CPD exemption, regardless of the income earned. However, if you work anywhere but a public accounting firm, you might qualify for a CPD exemption, assuming you meet all the other criteria (see #5).
I’ve been retired for a year. Do I still have to do CPD?
If you’re a member in retirement who meets all of the following criteria, you will be exempt from the minimum CPD requirement:
You are at least 55 years of age as of December 31;
You do not engage in “public practice” as defined in the CPABC bylaws;
You do not serve on the board or governing body of a public company or reporting issuer as defined in CPABC’s Code of Professional Conduct; and
Your “gross active income” during your first full calendar year of retirement and all subsequent years does not exceed an indexed threshold.
Note that “gross active income” for CPD purposes differs from “active income” for membership dues purposes. Gross active income for CPD purposes is active income including any gross revenues related to professional activities from self-employment sources, regardless of business structure used (sole-proprietorship, corporation, etc.).
What are my professional obligations if I’m exempt from minimum CPD requirements?
Under Rule 203 of the Code of Professional Conduct, you must sustain professional competence by staying informed of, and complying with, developments in professional standards in all functions in which you provide professional services or are relied upon because of your calling. This rule applies to all members, even those with an exemption from CPD reporting requirements.
Does CPABC have any resources for members who are contemplating retirement?
CPABC’s Professional Development team offers a number of courses to help members plan for retirement, in terms of both financial and psychological/emotional readiness. Visit the PD website for details.
In addition, CPABC welcomes retired members to share their expertise in the profession through volunteer service as committee members, CPA mentors, chapter board members, and more. Information about the different opportunities available is provided on our website.
I’ve retired from full-time employment and have been asked to serve on several boards. One directorship is pro bono and the others are paid. Are there any risks or additional requirements I should be aware of?
When volunteering on boards, members must still adhere to Rule 206.2 of the Code of Professional Conduct, which states:
A registrant who, as a member of an entity’s audit committee or board of directors, is required to participate in the review or approval, by such committee or board, of the entity’s financial statements prepared in accordance with an appropriate financial reporting framework, shall carry out that responsibility with the care and diligence of a competent Chartered Professional Accountant, enhanced by the skills and knowledge derived from the registrant’s own career.
In addition, retired members who serve on the board or governing body of a public company or reporting issuer—as described by the Code of Professional Conduct—are not eligible for a CPD exemption.