NYS CPA Ethics Requirements: Exam, CPE, and Conduct Rules

New York State CPA ethics requirements come in three layers: a one-time ethics exam before you get your license, four hours of New York-specific ethics continuing education every three years after that, and a set of conduct rules in state regulation that govern independence, commissions, client records, and peer review. The New York State Education Department (NYSED) enforces all of it through the State Board for Public Accountancy, and the penalties for falling short reach as far as license revocation.

The Ethics Exam Before Licensure

Before NYSED will issue a CPA license, you have to pass the AICPA’s “Professional Ethics: The American Institute of Certified Public Accountants’ Comprehensive Course.” It’s a self-study course built around the AICPA Code of Professional Conduct, covering independence, conflicts of interest, and the conceptual framework that applies whether you go into public practice or industry. Passing requires at least 90 percent on the final exam.¹

The score doesn’t expire, so there’s no ticking clock once you clear it. Hold onto the completion certificate. NYSED wants it with your license application, and the department may ask for it again during a later records audit.

Four Hours of Ethics CPE Every Three Years

Once you’re licensed, you must complete at least four contact hours of professional ethics during each three-calendar-year period preceding your registration expiration date. Those four hours count toward your regular annual CPE obligation rather than adding to it.²

Two details trip people up. First, the course sponsor must be registered with the department. Second, the curriculum needs to focus on New York-specific regulations. A generic national ethics course may not qualify. Qualifying content generally addresses Article 149 of the New York State Education Law, which governs public accountancy, and the Rules of the Board of Regents that define unprofessional conduct for CPAs.³ File the certificate of completion the sponsor gives you. You will need it if the Board pulls your name for a random audit.

Newly licensed CPAs get a short runway. If you received your license on or after January 1, 2020, the CPE requirement starts on the January 1st that falls within your initial registration period. A CPA licensed in June 2025, for example, first has to meet the requirement beginning January 1, 2026.⁴

The four ethics hours sit inside a larger annual requirement: 40 contact hours across recognized subject areas, or 24 hours concentrated in a single recognized area such as taxation, auditing, or accounting.²

Conduct Rules That Carry Discipline

The behavioral standards with real regulatory teeth are in 8 NYCRR Section 29.10, the regulation that defines unprofessional conduct for public accountancy. It builds on the general professional-conduct rules in Section 29.1 and adds requirements specific to accountants, including independence, commission restrictions, and competency benchmarks for attest engagements.⁵

Independence on Attest Work

If you perform audits, reviews, or other attest services, you must remain independent from the client. No direct or indirect financial interest during the engagement period or the period covered by the financial statements. When evaluating whether you met generally accepted auditing standards, the State Board may reference standards set by the AICPA, the PCAOB, and the SEC.⁵ An independence violation can cost you your license.

Section 29.10 also treats it as unprofessional conduct to supervise attest or compilation services without meeting competency thresholds. A supervisor on attest work needs at least 1,000 hours of experience preparing or reviewing financial statements in the prior five years, or a satisfactory peer review. A supervisor on compilations needs at least 40 hours of CPE in accounting, auditing, or attest during the preceding three years.

Commissions and Referral Fees

You cannot accept a commission for recommending a product or service to a client for whom you also perform attest services. That covers audits, reviews, compilations where a third party may rely on the financials, and examinations of prospective financial information.⁶

For non-attest clients, commissions are allowed but only with full written disclosure. The disclosure has to identify the product or service, the third party providing it, the business relationship between you and that third party, and a description of the commission itself. It must be in writing, in at least 12-point type, and delivered before or at the time of the recommendation.⁶

Client Records During Fee Disputes

A fee dispute doesn’t give you the right to hold client records. New York’s tax preparer regulations say so directly: an outstanding fee dispute does not relieve you of the obligation to return records the client needs for tax compliance.⁷ Work papers you created remain your property, but they must be retained for the period required by applicable professional standards. Retention periods vary by engagement type and governing standards, so confirm the specifics with counsel.

Peer Review for Firms That Do Attest Work

Any New York CPA firm performing attest services must undergo peer review. Under Education Law Section 7410, the first review comes within 18 months of the firm’s initial attest engagement, and every three years after that.⁸ The old exemption for firms with two or fewer accounting professionals has been repealed, so size no longer gets a firm out of the requirement.

Peer review is an outside check on your firm’s quality-control system. An independent reviewer assesses whether attest work meets professional standards. A weak result doesn’t automatically end your license, but it flags problems the State Board can pursue, and it can prompt additional scrutiny at registration renewal.

Circular 230 for CPAs Practicing Before the IRS

If you represent clients before the IRS, Treasury Circular 230 layers a federal ethics regime on top of New York’s. Circular 230 governs attorneys, CPAs, and enrolled agents who practice before the IRS and sets standards of competency, diligence, and ethical conduct.⁹

The due-diligence standard in Section 10.22 is where practitioners most often run into trouble. You must take reasonable care in preparing returns, verifying representations made to the IRS, and evaluating the information a client gives you. Good-faith reliance on client-supplied information is generally acceptable, but ignoring red flags is not. If something looks wrong or inconsistent with other facts you have, you’re expected to ask before signing.

The IRS Office of Professional Responsibility enforces Circular 230 on its own timeline and its own authority. Sanctions include censure, suspension from IRS practice, permanent disbarment from IRS practice, and monetary penalties.⁹ You can keep a valid New York license and still lose the right to represent clients before the IRS.

What Non-Compliance Costs You

The State Board for Public Accountancy runs monthly random audits of CPE records. Failing to produce complete records on time is itself grounds for discipline, including suspension, revocation, and fines.⁴ Sometimes the underlying education was done; the violation is being unable to prove it.

Practicing without an active registration is separately classified as unprofessional conduct under Section 29.10. Letting your registration lapse while you continue to use the CPA title or perform accountancy work stacks violations. New York Education Law Section 6509 defines professional misconduct broadly enough to include practicing fraudulently, with gross incompetence, or with gross negligence, giving the Board wide latitude to act.¹⁰

A single lapse can also draw parallel AICPA action. The Joint Ethics Enforcement Program coordinates investigations between the AICPA and state CPA societies, so one incident can produce proceedings at both the state regulatory level and the professional-membership level.¹¹

Records and the Triennial Renewal

Keep your CPE certificates for at least five years and be ready to produce them for NYSED on request. Tracking is on you, not on the course providers. Organize certificates by registration period and keep both digital and physical copies.

You report completed credits through the NYSED online registration portal at your triennial renewal, certifying that you’ve met the ethics and CPE requirements. The system asks for course providers and completion dates, and false information on that certification is itself a conduct violation. The current registration total is $292, which is a $242 registration fee plus a $50 continuing education fee.¹²

1
AICPA & CIMA. Professional Ethics: The American Institute of Certified Public Accountants’ Comprehensive Course (For Licensure)
2
Legal Information Institute. New York Compilation of Codes, Rules and Regulations Title 8 70.9 – Continuing Education
3
New York State Senate. New York Education Law 7401-A – Definitions
4
New York State Education Department. Mandatory Continuing Education Questions and Answers for Public Accountancy
5
Legal Information Institute. New York Compilation of Codes, Rules and Regulations Title 8 29.10 – Special Provisions for the Profession of Public Accountancy
6
Office of the Professions. NYS Rules of the Board of Regents Part 29
7
New York Department of Taxation and Finance. Tax Preparer Regulations
8
New York State Education Department. NYS Public Accountancy – Mandatory Peer Review
9
Internal Revenue Service. Office of Professional Responsibility and Circular 230
10
Office of the Professions. New York Education Law 6509 – Definitions of Professional Misconduct
11
AICPA & CIMA. Ethics Enforcement
12
Office of the Professions. Fees