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Professional Corporations - FAQs

Find answers to common questions about professional corporations

Below is a list of questions that are asked frequently as members decide whether to form a professional corporation. The information provided is general in nature. You are encouraged to obtain independent legal advice or other specialists' opinions.

  • What are the requirements related to the use of the initials CPA or designation Chartered Professional Accountant in the name?

    Professional corporations registered with CPA Ontario may, but are not required to, following and as part of the registered name, use “Chartered Professional Accountant(s)” and the initials “CPA” or “C.P.A.” The use of CPA or Chartered Professional Accountant is limited to situations where the member’s name and designations issued by CPA Ontario form part of the professional corporation name as registered with the Ontario Ministry of Government Services(“the ministry”).

    A professional corporation must be registered with the Ministry. All professional corporations must also be registered with CPA Ontario once the professional corporation has been registered and approved with the Ministry. To ensure your professional corporation meets CPA Ontario’s requirements, we recommend you follow the general specifications of the sample articles of incorporation posted on our website.

    As of January 1, 2018, Firms registered with CPA Ontario that currently have the designation as part of their registered name shall only use, following and as part of the registered name, “Chartered Professional Accountant(s)” or the initials “CPA” or “C.P.A.”

    Please refer to Regulation 4-6 – Practice Structure and Regulation 4-7 Issuance and Use of Designation for further clarification.

  • What is a “descriptive style”?

    Designations are not required to be used as part of a firm name. However, if a firm that is engaged in the practice of public accounting or providing accounting services to the public does not have “Chartered Professional Accountant” or “CPA” (or “public accountant(s)”) as part of the firm name, then a descriptive style is required to be used. (See CPA Code of Professional Conduct Rule 402 - descriptive styles).

    Rule 402 allows the use of either “Chartered Professional Accountant” or “public accountant” as a descriptive style to denote that the entity is providing services to the public that require them to be registered as a firm. Note that a descriptive style is not the same as prescribed disclosure requirements, which are required to be used by licensed public accountants when signing assurance and compilation engagement reports, as required by the Public Accounting Act, 2004. Care should be taken by firms that do not have a licensed public accountant in choosing their descriptive style. “Chartered Professional Accountant” is the preferred term for these firms, as it would be difficult to use “public accountant” as a descriptive term in a manner which would not be misleading to the public. 

  • Does the descriptive style need to be used on all communications?

    Some firms also use descriptive styles on their letterhead and business cards as part of their marketing strategy, and they are welcome to incorporate the “CPA” designation into these concepts; for instance, “Chartered Professional Accountants and business advisors”.

    Firms that prefer to market a broader range of professional services are not precluded from advertising professional services without reference to “Chartered Professional Accountant(s)”.   However, any materials that refer to any services being provided by the firm which are captured by the definition of the practice of public accounting or providing accounting services to the public, including printed promotional material and website content, must include a descriptive style (if this is not otherwise evident from the firm’s name). This includes any assurance or compilation engagement reports, and other materials and correspondence, such as engagement letters, invoices, management letters and responses to requests for proposals.

  • What else must I take into consideration when establishing the name of my professional corporation?

    The name of the professional corporation must include the words ‘Professional Corporation’ or ‘Societe professionnelle’, in accordance with provision 3.2(2)3 of the Ontario Business Corporations Act. Naming a professional corporation must also comply with the requirements of the Bylaws, Regulations, and CPA Code of Professional Conduct, which provide more detail.

    Please note that the term ‘Professional Corporation’ may not be abbreviated. Furthermore, when a professional corporation is a partner of a Firm, wherever Partners of the Firm are listed, the professional corporation name of the Partner needs to be provided in full.

  • Can I have the name of my professional corporation approved by CPA Ontario prior to submitting my application to the government?

    Yes, it is recommended that you have your professional corporation name approved by CPA Ontario prior to submitting your documents to the Ontario Ministry of Government Services to avoid delays and added expense. A request must be submitted in writing to the attention of the CPA Ontario Registrar: The request must include all relevant facts such as:

    • the nature of the request
    • the nature of the services being provided (public accounting, accounting services, consulting)
    • the corporate structure (sole proprietor, partnership, professional corporation);
    • the number of members, students, professional colleagues, non-members involved with the practice
    • the names of the members involved in the practice

    Once a request has been received in the Registrar’s mailbox, it will be forwarded to the Registrar or his designate for a response. Responses will be provided in writing – responses will advise as to whether the proposed name is appropriate or, if not appropriate, will advise of the deficiency (with appropriate reference to the Regulations, Bylaws and CPA Code of Professional Conduct) and will provide recommendations for correction.

  • How long will it take to have my professional corporation registered?

    Completed professional corporation registration applications are usually processed by CPA Ontario within 4 - 6 weeks of the date of receipt of the completed application. Completed professional corporation applications for certificates of authorization generally take 3 - 5 weeks from the date of receipt of the completed application.

    Please note you will need to speak directly with the Ontario Ministry of Government Services (“the ministry”) to request an estimate as to how long it will take for your application for incorporation to be processed by the ministry.

  • Can I use a holding company or other company to hold the shares of my professional corporation?

    No. Under Section 3.2(2)1 of the Ontario Business Corporations Act (OBCA), all shares must be legally and beneficially held by one or more members of the same profession. In addition, OBCA Section 3.2(2)2 states that all officers and directors of the corporation shall be shareholders of the professional corporation. Furthermore, the OBCA does not distinguish between temporary ownership and long-term ownership. Consequently, it is not permissible to have a holding company temporarily hold the shares, even for a short period of time.

  • Can a professional corporation be a partner in a firm?

    Yes. A professional corporation may be a partner in a general partnership firm or in a limited liability partnership (LLP) firm. However, there are a number of taxation, liability and other issues associated with partnerships that have one or more professional corporations as partners. Members and firms are urged to consult with their legal counsel and other professional advisors in regard to such matters.

  • If only one or more partner(s) in the firm want to form a professional corporation, do all other partners need to do so as well?

    Members can form a professional corporation together, or some individuals can form a professional corporation which then forms a partnership. A partnership can have both Members and professional corporations in its structure. If some partners of the firm form a professional corporation, all of the other partners of the firm are not required to also form a professional corporation.

  • If a professional corporation is a partner of the firm, does it require a certificate of authorization?

    The professional corporation would not be required to have a certificate of authorization to practice public accounting if all of the engagement reports are issued and signed by the firm and the firm has a lead engagement partner who is licensed.

  • If a professional corporation is a partner of the Firm, are it's shareholders required to hold a public accounting licence?

    The current partners of the Firm who would be the shareholders of the professional corporation would not be required to maintain public accounting licences in their capacity as shareholders. However, if the professional corporation is responsible for an assurance engagement and the engagement opinion, statement or report is signed by the professional corporation, then the professional corporation has taken the role of the lead engagement person. In that case, a shareholder of the professional corporation would need to individually hold a public accounting license. In addition, the professional corporation would be required to hold a certificate of authorization.

  • If a professional corporation is a partner in the Firm, how does this impact the disclosure requirements of licensure status?

    If all assurance and compilation engagement reports are issued and signed in the name of the Firm, there would be no change required to the disclosure.

  • Must I change the sign outside my building, letterhead and business cards to include professional corporation?

    In every instance where you present the name of your professional corporation, the words “professional corporation” must appear. Please see above for additional information on firm names.