PwC’s US Audit Leader Advocates CPA Licensing Reforms Amid Talent Shortages
NEW YORK, November 28, 2024 – Deanna Byrne, head of PwC’s U.S. audit, expressed strong support for the review of CPA licensing requirements to address a talent group in the accounting profession. In a recent interview with Bloomberg Tax, Byrne stressed the importance of balancing education and experience to attract new talent while maintaining the discipline and mobility of the profession. He stressed the need for reform as part of a broader strategy to improve the quality of audits and strengthen the company ‘ s capacity to report on the sustainability and governance of artificial intelligence.
The current CPA accreditation model requires candidates to complete 150 hours of credit, equivalent to an additional year of schooling beyond a standard four-year degree. Critics argue that this “150 hour rule” creates a significant barrier to entry, contributing to a decrease in the number of accounting graduates. Byrne has supported alternative paths that combine a standard title (120 hours credit) with two years of relevant professional experience. “We believe that we can continue to do high-quality work with candidates who would have 120, in addition to the experience being promoted,” Mr. Byrne said.
PwC not only supports this change. KPMG’s CEO also advocated reducing the need for credit hours, reflecting a broader industry effort to address talent shortages. Although the four large companies, including PwC, have largely managed to mitigate the effects of cross-talent, small businesses and businesses have been more affected. State regulators are considering proposals to harmonize licensing requirements with these new alternatives, which could lay the foundation for change across the industry.
Byrne, who assumed PwC’s role as U.S. Chief of Security in July, brings 36 years of experience to the position, including senior audit management for major companies such as Under Armour Inc. and Campbell Soup Co. His long career at PwC has enabled him to meet the challenges of the audit profession, from traditional financial reporting to new areas such as the environment and AI governance. Byrne stressed the company’s willingness to meet the growing demand for non-financial security services, especially as regulatory requirements evolve in Europe and beyond.
Improved audit quality remains a cornerstone of Byrne’s leadership program. PwC has introduced reforms that link the remuneration of key partners to the quality of audit work, a measure to strengthen investor accountability and confidence. Eight PwC partners, including Byrne and Paul Griggs, signed compensation agreements linking their payment to the conduct of the company audit. This initiative follows a three-year reform plan presented by Tim Ryan, Senior Retired Partner, to strengthen the reputation and operational integrity of the company.
In addition, PwC is piloting programs to improve fraud detection and risk assessments that could threaten the viability of a business. These efforts are consistent with the prior updates of the U.S. audit standards on fraud and associated risks, which may influence how the signature approaches its audit methodology in the future. “We focus on demand satisfaction and ensure that, as this market evolves, we are ready to deliver to our customers,” Byrne said, reflecting PwC’s commitment to innovation and adaptability.
As the accounting profession faces increasing pressures from talent shortages, regulatory changes and growing market demand, PwC’s proactive actions under Byrne’s leadership are a concerted effort to address these challenges. By advocating licensing reform and prioritizing audit quality, the company is positioning itself to maintain its leadership in an increasingly complex and competitive environment.
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