There are 340,000 fewer accountants than just five years ago. At the same time, the need for accountants is greater than ever. According to a recent survey by Intuit QuickBooks, 68% of accountants have reported a growing demand for their services.

Accounting firms are struggling to meet this demand, and they’re turning away work. As a result, many small businesses can’t afford a CPA, which harms our economy. Without access to financial advice, small businesses suffer and many fail.

Our job as CPAs is to protect the public — it’s in the name “Certified Public Accountant.” But we can’t protect the public if there aren’t enough qualified accountants to do the job. 

The talent shortage is a problem that’s catching up with us, and we can’t ignore it anymore.

So, what’s causing the shortage? There are many factors, but one of the most obvious and well-studied is the 150-hour rule. Since its introduction in the late ’80s, the 150-hour rule requirement has been adopted by all 50 states and U.S. territories, with the U.S. Virgin Islands being the last to implement it in 2015. 

In effect, the 150-hour rule is a required fifth year of college, often in the form of a master’s degree, and it’s proven to be a significant barrier to attracting new talent into the profession.

The rulemakers intended to raise standards and ensure CPAs acquired the right skills and knowledge to meet client needs. It was also implemented during a time of surplus talent — we had plenty of CPAs. 

Forty years later, the situation has changed. The rule is discouraging many students from pursuing an accounting career. We’re seeing the lowest number of CPA exam candidates since 2006.

Limited access for underrepresented groups

Accounting has historically been one of the most reliable pathways into the upper-middle class. But that path is becoming less clear. That’s because we’ve tied success in our profession to an increasingly expensive system of traditional higher education.

The 150-hour education requirement is the equivalent of a five-year degree. While it’s “only” one additional year of schooling, it puts a significant financial strain on students and their families. It also delays entry into the workforce and the ability to start earning a salary, adding considerable opportunity cost to becoming a CPA.

For many aspiring CPAs, the additional education may not make economic sense compared to a four-year degree in a different business major.

The 150-hour requirement’s rigid structure also offers little flexibility. It’s not ideal for neurodiverse students who struggle in traditional learning environments. Many of these students benefit more from hands-on experience with the space to learn at their own pace than a lecture-based classroom model used in most traditional accounting education programs.

The 150-hour rule also limits our profession’s diversity. A recent study published in the Journal of Accounting Research found that the 150-hour requirement led to a 26% decline in the entry of minority CPAs, compared to a 14% decline for non-minority CPAs. These individuals are no less capable of becoming skilled and respected accountants, yet the current requirements often hold many back due to cost.

What’s the alternative?

We must consider alternatives to the 150-hour rule to improve the accountant talent pipeline. A pathway to a bachelor’s degree paired with two years of practical experience appeals to a more diverse range of candidates while lowering the financial barriers that hold them back from entering the field. In our profession, practical experience often proves to be more valuable than time in a classroom.

To maintain high standards, we should focus on making the CPA exam more rigorous rather than relying on an extra year of schooling to measure competency.

We’re already seeing some states take action. Ohio made the first move in 2025 to abolish the 150-hour rule and offer alternative pathways to CPA licensure, which will take effect in 2026. Virginia also just passed similar legislation.

Minnesota is also considering a bill amendment to create an alternative path to CPA licensure. The amendment would allow students to complete 120 semester credit hours from an accredited school to be eligible for CPA certification, with two years of professional experience and passing the CPA exam. South Carolina is implementing similar changes. 

These efforts reflect the growing recognition that the accounting profession must adapt to meet the needs of a modern, more diverse workforce. 

If you’re a part of the accounting community or are considering becoming a CPA, now is the time to stay informed of upcoming changes in your state and help push the profession into the future. Engage with your local state representatives to discuss alternatives to the 150-hour education requirement and push for much-needed change. 

Together, we can create and support a diverse and inclusive pool of highly skilled and knowledgeable professionals ready to lead a new era of accounting. 

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Management experts have long advised firm leaders to praise their people publicly and reprimand them privately. However, Nvidia CEO Jensen Huang, like Bridgewater founder Ray Dalio, advocates criticism in public.

As Huang describes in his new book The Nvidia Way, engaging in public criticism of your people fairly and constructively is a good way to normalize feedback. When public criticism becomes part of the company’s standard operating procedure, people no longer worry about humiliation and shame. As Huang explains, criticism is not the same as insulting. When done constructively, Huang argues that criticism is designed to help individuals and teams get better. 

From where I sit, public criticism can be constructive if the goal is to create a better firm and better client experience. Again, to make public criticism work for you, the first thing to do is normalize the feedback. Let’s face it: at most firms, people are not comfortable receiving constructive criticism about themselves or their colleagues — and that’s a problem. Because if you can get to the point that public criticism can be normalized at your firm, then your team can learn from each other’s mistakes. But if you keep all criticism private, no one can learn from it except the person being criticized — and many others will likely make the same mistake.

Instead, if you say: “Hey, we are going to have public criticism going forward. Not of the person, but potentially of the behavior or action.” That may make your people uncomfortable at first, but in the long run, public criticism will significantly accelerate learning at the firm level when you have shared mistakes.

Culture of accountability

In addition to normalizing feedback and accelerating learning through shared mistakes, public criticism is an excellent way to build a culture of accountability. An accountability culture is one in which everyone takes ownership of the things they do and say. Again, as a leader you must reinforce that the team is not going to be insulting each other. Instead, you’re going to be speaking openly and removing ambiguity by making expectations incredibly clear. And if there’s a problem, or if people are falling short, reaffirm that it’s OK to have these conversations in public. Because if you relegate all of your firm’s criticism to a private office, you’re impeding your team’s ability to learn and get better. And you’re making people fearful of open, unvarnished feedback.

As Nelson Mandela said, “I never lose. I either win or learn.”

As I’ve found throughout my business (and parenting) career, growth only happens when you are willing to change and do something different than before. And the only way you will do that is if people are pointing out the things that need to be done differently. Winning is nice, but learning is more valuable.

The right way to criticize

I know some of you reading this article are ready to fire off comments about how public criticism creates a toxic culture. Again, being critical of something is different than insulting someone. By criticizing the right way, you won’t be damaging morale or creating a toxic culture. You need to be clear about what you’re criticizing, which is typically a specific point, with clear feedback about how to improve it. 

Again, the purpose of criticizing publicly is to make your firm better. You’re focusing on specific issues that must be fixed; you’re not denigrating someone’s character or threatening their compensation or job security. You’re not doing character assassinations or gaslighting them. Public criticism is not punishment. When engaging in public criticism, make it clear to everyone within earshot: “This is an opportunity for growth that we want you to have, but we don’t want to remove that opportunity for the rest of the firm.”

As I wrote in my article Autopsies without blame, you want to focus on the issue — not the person — to improve the performance of the firm. 

Real-world example

My team and I were recently in a group meeting with a client. The client said to one of the team members: “Hey, it’s great chatting with you; you’re always great about responding.” And then the client said somewhat jokingly to one of our seniors, “However, I do have a real problem getting hold of you,” while pointing directly at him. The client’s point was that our senior team needed to make themselves more available to clients. That was clearly a public criticism of our seniors and that as a client, she expected a higher degree of communication from senior people on the team. That dialogue was constructive for everyone involved. And we were able to go back and say: “OK, what do we need to adjust here to ensure that our most senior people are available to our best clients?”

Key takeaways

1. Make public criticism a regular part of your company’s culture and operations. Make it normal for people to communicate about things that have gone wrong. It’s not a one-time outburst or public humiliation exercise.

2. Celebrate accelerated learning through shared mistakes. 

3. Lean into the culture of accountability. 

Public criticism is an opportunity for growth, not a punishment. Once you frame it that way, it completely changes the way people communicate at your firm. Public criticism isn’t about protecting people’s feelings, it’s about delivering better experiences for clients and preventing multiple people from making the same mistakes. Tell anyone receiving public criticism: “We’re not talking about you as a person. We’re talking about an issue at hand. Let’s fix it together.”  By the way, this approach works just as well with remote teams and employees as it does in person.

It’s all about “wins and learns” in your regular team meetings. The lesson could be: Here was a mistake that occurred. This was negative feedback we got from a client. This was a mistake we made on a tax return. Here’s how it happened; here’s how we fixed it.” The win was that the client was very appreciative that we acknowledged the mistake and fixed it so quickly. You should feel comfortable discussing these things in public and encouraging your team to do the same.

Put mistakes on the open agenda and review them constructively rather than critically. That will go a long way to making continuous improvement part of your firm’s culture. The Japanese call that “kaizen” — getting 1% better every day.

Political and regulatory changes heavily influence the accounting industry. Shifting tax policies, new compliance laws, and cybersecurity regulations create an unpredictable landscape. CPA firms must stay ahead of these changes to avoid penalties and operational disruptions.

Navigating Political and Regulatory Shifts in Accounting IT

With increasing government scrutiny on data security, firms must comply with laws such as the Sarbanes-Oxley Act (SOX), the Gramm-Leach-Bliley Act (GLBA), and IRS Publication 4557. Additionally, political debates around data privacy, like state-level consumer data protection acts, can introduce new compliance burdens.

A scalable, cloud-based IT infrastructure enables accounting firms to adapt to evolving regulations without massive overhauls. IT providers with a compliance-first approach ensure CPA firms remain secure and audit-ready in any political climate.

The Need for Agile, Scalable IT in CPA Firms

The accounting world isn’t static. Tax laws, client expectations, and technology change rapidly. Firms that rely on outdated IT systems struggle to keep up, leading to security risks, inefficiencies, and compliance issues.

A scalable and secure IT environment allows firms to:

• Adjust to seasonal demands (such as tax season surges)
• Seamlessly integrate new accounting software
• Expand operations without IT bottlenecks
• Stay compliant with evolving regulations

Cloud Hosting Tailored to Accounting Software

Not all cloud solutions are equal. Accounting firms rely on specialized software like CCH, QuickBooks, Thomson Reuters, and Lacerte. Generic cloud providers often fail to optimize these applications, leading to latency issues, software incompatibility, and security gaps.

Look for an IT provider who delivers a customized hosting environment tailored for CPAs. This includes:

• Optimized performance for accounting applications
• Automatic updates to meet compliance requirements
• Secure access from anywhere, on any device
• Built-in disaster recovery and data redundancy

By leveraging accounting-focused MSPs, firms gain a competitive edge with seamless software integration and enhanced security measures.

Security and Compliance: Non-Negotiables for CPA Firms

Accounting Firms handle sensitive financial data, making them prime targets for cyber threats. A single data breach can result in legal consequences and loss of client trust. Regulatory compliance isn’t optional—it’s essential.

Consider IT solutions that align with industry regulations, such as:

• SOC 2 Type II Compliance for Strict Security Protocols
• Multi-factor authentication to prevent unauthorized access
• End-to-end encryption to secure client data
• Continuous system monitoring to detect threats in real-time

By choosing a fully managed cloud solution, firms offload the burden of IT security to dedicated experts, ensuring 24/7 protection.

Future-Proofing your Firm with Adaptive IT Solutions

The accounting industry is constantly evolving, and so is IT. Unlike traditional IT setups that require costly, time-consuming upgrades, cloud-based solutions adapt seamlessly to industry advancements. This ensures that accounting firms remain competitive and compliant without the burden of managing complex IT updates.

With automatic software updates and security patches, firms no longer need to worry about system vulnerabilities or outdated applications. AI-driven cybersecurity defenses proactively detect and neutralize threats before they become critical issues. This preemptive approach to IT security minimizes downtime and protects sensitive financial data.

Another key advantage is scalability. Whether your firm is expanding, adding new employees, or adopting new accounting software, your IT infrastructure grows with you. Unlike on-premises solutions requiring expensive hardware upgrades, cloud-based IT services allow instant resource scaling, ensuring optimal performance during tax season and peak workloads.

Dedicated accounting IT experts also understand accounting firms’ unique challenges. Their expertise ensures a smooth, hassle-free transition to a modern, future-ready IT environment, from software integrations to data migration and compliance audits.

Instead of reacting to changes, firms stay ahead with proactive IT management, ensuring continuous innovation, enhanced security, and long-term operational success.

Ready to Future-Proof Your Firm?

Don’t wait until IT issues slow your business down. Transitioning to a scalable, secure, and compliant IT environment may seem overwhelming, but some providers can ensure a seamless process. CPA-focused cloud solutions are designed to remove IT complexities, allowing your firm to focus on what truly matters—serving your clients and growing your business.

Take the first step toward a more secure, compliant, and scalable IT future.