Who can own an accounting practice in Saskatchewan

Buying an accounting practice in Saskatchewan means asking two separate questions: who may do the work, and who may own the entity that does it. CPA Saskatchewan answers both, and the answers may differ from what a buyer of an ordinary small business expects. A purchaser who is not a CPA cannot treat the practice as a passive investment, and a seller cannot assume that the shares are free to sell to anyone. This guide sets out what the regulator publishes on licensing, firm structures and association with non-members. It is a starting point for questions, since other provinces run their own regimes and CPA Saskatchewan decides what applies here.

The work itself is reserved

CPA Saskatchewan states that the practice of professional accounting is reserved to licensed CPAs under subsection 18(1) of The Accounting Profession Act, with limited exemptions in subsection 18(3). A member needs a licence from CPA Saskatchewan to execute audit, review, other assurance or compilation engagement reports. Not every member at a firm needs one. Only the member or members who have authority to release those reports, or financial reporting opinions, declarations or certifications, on the firm’s behalf must be licensed. For a buyer, that points to a first question: which person will hold the licence after closing?

How a firm is licensed

The regulator says a firm licence is issued when at least one member of the firm becomes licensed. Where more than one member is licensed, the firm’s licence is based on the member who holds the highest-level licence. A member must be employed at a registered firm, and must apply and be approved, before offering any professional accounting service to a client. The licensing status of members and firms is publicly available, so a buyer can check the seller’s status without asking permission. If the licensed member is the retiring owner, the firm’s own licensing position needs a plan before the sale closes. CPA Saskatchewan also says a member may apply for a licence for planning or staff transition purposes, provided the member has authority to act on behalf of the firm. It adds that a member who practises professional accounting without a licence is subject to a penalty for each report issued, up to a set maximum, so timing matters.

Firm structures and professional corporations

CPA Saskatchewan says firms may be sole proprietors, partnerships, another type of entity or professional corporations. A professional corporation is registered with CPA Saskatchewan, and the regulator describes an annual renewal that includes a declaration required by The Professional Corporations Act and the regulator’s bylaws. It also says that a professional corporation not renewed by the deadline is considered expired under its bylaws. The structure matters in a sale. Buying the shares of a professional corporation and buying the assets of a practice are different transactions, so ask the regulator which steps each one involves.

The rule on non-member owners

The central ownership rule is stated directly on CPA Saskatchewan’s page on association with non-members. A CPA cannot carry on the practice of professional accounting through an entity owned or co-owned by a non-member, and professional accounting or other regulated services can only be provided through a firm fully owned by CPAs that is licensed and registered with CPA Saskatchewan. The page notes that it is non-authoritative guidance only, which is one more reason to confirm a structure with the regulator. The same page says that a CPA’s direct responsibility for a non-member’s compliance with the CPA Code also applies when the non-member owns an interest in, or works for, a “related business or practice”. A passive investor, a family member who is not a CPA, or a lender who takes an ownership stake in the entity is therefore a question to put to the regulator before closing, not a detail to sort out later.

Working with non-members who are not owners

The regulator does not forbid every association with a non-member, and it lists considerations when a CPA works with one. The CPA is directly responsible for the non-member’s compliance, and the CPA Code is deemed to apply as if the non-member were a member. The considerations it lists include supervising, directing and evaluating the non-member’s work, considering who is ultimately responsible for the engagement, obtaining the client’s consent to access the information needed where the CPA is responsible for the engagement and the non-member engaged the client, and preparing an agreement with the non-member. A related business that a seller wants to keep outside the sale is worth testing against this guidance.

• Identify who will hold the licence that authorizes release of engagement reports after closing, and when that person applies.
• Ask CPA Saskatchewan whether the planned structure, whether a share purchase or an asset purchase, puts any non-member into an ownership position.
• List every related business or practice the seller owns, and ask whether any non-member owns an interest in it.
• Confirm the professional corporation’s registration and renewal status with the regulator, not only with the seller.
• Put any continuing arrangement with a non-member in a written agreement that reflects the supervision the regulator describes.

The professional-practice questions in can a non-professional own a practice apply across provinces, but Saskatchewan’s answer comes from CPA Saskatchewan’s own publications.