An unlicensed buyer cannot hold a single share in the professional corporation an Ontario accountant practises through — Business Corporations Act section 3.2(2) requires all of them to be owned by members of the same profession. But the Public Accounting Act, 2004 reserves far less work than the word “accounting” suggests, and most of a small firm’s output sits outside it.
Key takeaways
SECTION 01 OF 10
Two services, and only when performed independently. Section 2(1) reads: “the practice of public accounting means providing, on a basis that is independent of the person for whom the services are being provided, either of the following services”. Independence is part of the definition.
Paragraph 1 is “Assurance engagements, including an audit or a review engagement”; paragraph 2 is “compilation services”. Both turn on one condition: “if it can reasonably be expected that the services will be relied upon or used by a third party”. Nothing else in the Act is reserved.
SECTION 02 OF 10
Under the marginal note Other practices not precluded, section 3(3) needs no licence for services as “a bookkeeper or for engaging in bookkeeping, in cost accounting or in the installation of bookkeeping or business systems, solely by virtue of engaging in those activities”.
Nor is tax reserved. The same subsection exempts “a person preparing or offering to prepare financial statements solely as part of tax returns” where the preparer offers “no opinion independent of the taxpayer”. Treadstone Law’s guide to buying a bookkeeping practice treats that market as one with no licensing body between the parties.
SECTION 03 OF 10
One sentence decides whether a compilation is licensed work. Section 2(3) provides that where the materials “contain a notice in the prescribed form that provides that any assurance given by the person is limited to the accuracy of the computations required in order to complete the compilation, the provision of the compilation services does not constitute public accounting for the purposes of this Act”. The notice on the file, not the fee line, decides it.
Section 2 of the Chartered Professional Accountants of Ontario Act, 2017 is equally blunt: “This Act does not affect or interfere with the right of any individual who is not a member of CPA Ontario to practise as an accountant.” That Act’s own central phrase, to “practise as a Chartered Professional Accountant”, appears eleven times and is defined nowhere, so its edge is set by by-laws, not statute.
SECTION 04 OF 10
A licence attaches to a person, and only to a person the regulator already admits. Section 4(1): “To be eligible to be licensed under this Act, a person must be a member of CPA Ontario.” Subsection (2) closes the loop — “A person’s licence under this Act is revoked on the day the person ceases to be a member of CPA Ontario.” No transfer, no assignment, no change-of-control approval.
Sequencing is the only lever left, which is how Treadstone Law frames whether the buyer needs its own licence before closing: a condition precedent, or a post-closing arrangement. Who holds one is public — section 21 requires CPA Ontario to publish “The Roll of Public Accountants in Ontario”.
SECTION 05 OF 10
Individuals are licensed; corporations are authorised. Section 3(1) requires a person practising public accounting to be licensed if an individual and, “in the case of a professional corporation, hold a certificate of authorization in accordance with this Act”. Section 11(1) limits who may create one to persons “licensed under this Act to practise public accounting”.
Incorporating changes nothing about who answers for the work: section 12 applies the Act to a licensed individual “even if the individual practises as a public accountant through a professional corporation”. Treadstone Law on the certificate of authorization adds that a corporation can exist and still not be authorised to provide the service.
SECTION 06 OF 10
This provision decides whether an unlicensed buyer is in the deal at all. Business Corporations Act section 3.2(2), paragraph 1: “All of the issued and outstanding shares of the corporation shall be legally and beneficially owned, directly or indirectly, by one or more members of the same profession.” Paragraph 2: “All officers and directors of the corporation shall be shareholders of the corporation.” A member is “a member of a profession governed by an Act that permits the profession to be practised through a professional corporation”, and section 3.1(2) names the CPA Ontario Act as one.
The control documents a financial buyer reaches for are void here, not merely unenforceable: an agreement or proxy vesting the right to vote “in a person other than a shareholder of a professional corporation” is void, and “a unanimous shareholder agreement in respect of a professional corporation is void unless each shareholder of the corporation is a member of the professional corporation”. Treadstone Law on who can own shares and non-professional shareholders describes the same pattern; see also professional-practice share restrictions.
SECTION 07 OF 10
Not the corporation repurposed: paragraph 5 requires the articles to provide that “the corporation may not carry on a business other than the practice of the profession”. What remains is the unlicensed side of the same client base — the bookkeeping, systems and tax work carved out by section 3(3) — bought as an asset transaction with the client relationships, staff and software rather than a share purchase. See buying assets and leaving the corporation behind and pricing a share deal against an asset deal.
Neither Act addresses what buyers ask next: a management services agreement between an unlicensed company and a licensed practice. I found no provision permitting or prohibiting it; that belongs to the by-laws section 65(3) empowers CPA Ontario’s council to make.
SECTION 08 OF 10
Demand for reserved work is set by other statutes, and they let most private companies opt out. Business Corporations Act section 148 exempts a corporation “from the requirements of this Part regarding the appointment and duties of an auditor” where it is not an offering corporation and “all of the shareholders consent in writing to the exemption”. Federally, CBCA section 163(1): “The shareholders of a corporation that is not a distributing corporation may resolve not to appoint an auditor”.
So the licensed share of a practice turns on which clients cannot or will not waive — offering and distributing corporations, borrowers whose lenders demand assurance, and anyone whose shareholders will not all sign. I have no verified figure for the licensed share of Ontario practice revenue and will not supply one. Ask for engagements split by type, and the reserved fraction falls out.
SECTION 09 OF 10
A buyer with other holdings should read the disqualification rule before the price. Business Corporations Act section 152(1) disqualifies a person from being an auditor “if the person is not independent of the corporation, all of its affiliates, or of the directors or officers of the corporation and its affiliates”, and subsection (2) deems a person not independent where that person or their business partner holds a material interest in the client’s securities. One line widens the net: “a person’s business partner includes a shareholder of the person”.
Nor does incorporation move the professional liability. Section 3.4(3): “The liability of a member for a professional liability claim is not affected by the fact that the member is practising the profession through a professional corporation.” Subsection (4) makes a person “jointly and severally liable with a professional corporation” for errors and omissions occurring “while the person was a shareholder of the corporation”.
SECTION 10 OF 10
Contravening section 13 draws a fine of “not more than $25,000 for a first offence”, but the provision that reaches a purchase price is quieter. Section 37(1), marginal note No costs, etc., recoverable by unlicensed person: “No person is entitled to recover any costs incurred or charges made as a public accountant unless the person was licensed under this Act at the time when the costs were incurred or when the services were rendered in respect of which the charges were made.” Fees billed for reserved work by an unlicensed practice are not legally recoverable.
Four checks come from the regulator, not the seller: the individuals on the Roll and in the CPA Act register; the firm registered under section 23 with a current certificate if it does reserved work; no open inspection, since section 41 lets CPA Ontario “conduct inspections respecting the practices of its members and of firms”; and the section 28(3) shareholder-change notice built into the closing steps. Treadstone Law on practice files, consent, multi-discipline, professional corporations and practice sales all put regulator confirmation ahead of signing.
Two boundaries. This is Ontario law; accounting regulation elsewhere in Canada is provincial and not described here, and CPA Act section 29(6) draws the same line, preserving the right to call oneself an accountant “if the person does not reside, have an office or offer or provide accounting services in Ontario”. Two things I could not verify: CPA Ontario’s website returned HTTP 403 to every request shape tried on 1 September 2026, so no regulator wording is quoted here; and I could not locate on e-Laws a regulation prescribing the section 2(3) notice.
No. All issued and outstanding shares of the corporation must be legally and beneficially owned by members of the same profession, and any unanimous shareholder agreement is void unless every shareholder is a member — there is no route for a purely financial buyer to hold shares directly.
No. The Public Accounting Act reserves only assurance engagements and compilation services performed independently where a third party can be expected to rely on them; bookkeeping, cost accounting, and preparing financial statements solely as part of a tax return are explicitly outside the licence.
The unlicensed portion of the client base — bookkeeping, systems work, and tax preparation — bought as an asset transaction covering client relationships, staff, and software, rather than a share purchase of the licensed professional corporation itself.
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