I passed CPA Exams from state of Colorado, I work in the Private Company and I applied for the license based on Colorado CPA requirement 4.1C.

I applied for the license on July 2009 and in October 2009 my application was denied saying “that your application was denied because the experience you submitted lacked independence.” As per Colorado rule 4.1.C.1.b,which reads:

“The work must be of an independent aspect, in fact and appearance, comparable to that required in connection with commercial, financial audit relationships. Independent aspect, under this subsection, is defined by AICPA professional audit literature; and, specifically involves experience gained while working for an entity, in which there is no financial interest owned, or management control exercisable by the applicant’s employer”

Please could anyone help me to understand what the underlined sentence mean. How a person could hold position in the private entity where there is NO financial interest owned or there is NO management control. What are the Titles in that position in an entity?

I asked AICPA and they directed me to Colorado to contact them and I sent a emails to NASBA and The Colorado Board of Accountancy weeks ago they are not responding my email.

I feel Colorado State of Accountancy took unfair decision firstly holding my license for four months and then denial off my application seeking "independence" for an accountants working in Private Sector”

I meet conditions, working under CPA for 8000 hours who sign my application for licensing, my work is at Balance Sheet level specifically preparing financial statements and presenting for review, and I do have independence for performing my duties as an accountant of a private sector.

I request everyone who read my massage and appreciate if anyone could suggest or comment or provide me more information as what I should do next. Looking for someone who can help me.  I feel the State board of Colorado have been Unfair to me jeopardizing further higher education and career.

I can provide you with my job description at your request and please send me your judgment or what you think about it.

Thank you

What they mean is, it seems that you are reporting directly to your supervisor, who reports "up the chain" to the CEO/President of the company, who then reports to the Board of Directors.  In order to be independent [of management], you need to report "up the chain" to the Audit Committee of your company, or the BoD directly.

The CEO/President has a direct financial interest in how the company performs, since his job security and compensation are tied to reported company performance.  Therefore, since you report to him/her, you are not independent of someone who has a direct financial interest in the company.

The BoD, by its nature, is made up of people who have no direct financial interest in the company.  The Board's sole purpose is to direct the company in a fair and unbiased manner.  Further, the BoD has no control/management over your day-to-day job function.  Conversely, the CEO/President (all the way down to your direct supervisor) DOES have "management control" over you...so you're not independent.

Thank you for your respond.

But still as an Accountant for a private entity, you have financial Interest in the company you need your salary, whomever you report to you will still be controlled and managed by the entity.  I report to US government which is totally outside of management.

I even ask AICPA - “As this rule makes reference to AICPA professional audit literature, where in the literature this rule is defined; could you please provide me a link or you could send me an extract via email”

They asked to contact Colorado, Just I even asked Colorado to give me specific about this rule, they said there are some positions like that but they cannot say me what? Can you really believe this? If you are an accountant and professional will you take that? I lost my four months of time and then money.  Just unfair, don’t know how many other CA’s and ACCA’s gets trapped in this rule.