Can an out-of-state accounting firm that is owned by an Employee Stock Ownership Plan (ESOP) be allowed to do business in Oklahoma and to hold an Oklahoma public accounting permit, given Oklahoma's restrictions on who can own a professional accounting firm?

Plain-English summary

The Oklahoma Accountancy Board's executive director asked the Attorney General about an unusual ownership structure: an out-of-state accounting firm that converted from a limited liability partnership to a professional corporation, with 42% of the new entity's shares now held by an Employee Stock Ownership Plan (ESOP). The firm wanted to renew its Oklahoma permit to provide accounting services. The question: did the ESOP ownership structure disqualify it under either the Oklahoma Professional Entity Act (PEA) or the Oklahoma Accountancy Act (OAA)?

The OAA requires majority ownership by licensed accountants. The PEA adds a rule for professional corporations: "[n]o person shall be a shareholder . . . who is not duly licensed or otherwise permitted to render the same professional services" (18 O.S. § 809).

The AG's answer: the firm qualifies if the ESOP's trustees are licensed CPAs.

The reasoning: under standard trust law, when company stock is contributed to an ESOP, legal title vests in the ESOP trustees. The participating employees hold only an equitable beneficial interest. The ESOP at issue had five trustees, each of whom was a licensed CPA. Because the trustees (the legal owners) are licensed, the firm satisfies the PEA's "shareholder must be licensed" requirement. The same analysis applies under the OAA's majority-ownership requirement.

The AG canvassed AG opinions from other states. Two states (Arkansas and Georgia) had reached the opposite conclusion, focusing on the trustees' fiduciary duty to non-licensed employee beneficiaries as a potential conflict of interest. Two other states (Iowa and Ohio) reached the same conclusion as Oklahoma, finding that the trustee's legal title satisfies licensing requirements. The AG found the Iowa and Ohio reasoning more persuasive: the ESOP beneficiaries' "equitable interests remain subject to the limitation that [the] trustee may not be required to act in a manner that conflicts with public policy or exceeds the authority permitted under applicable laws."

The opinion also notes a 2024 PEA amendment that expressly allows foreign professional entities to qualify in Oklahoma. For a qualified foreign entity that is not a professional corporation, an unlicensed person may own an interest if that person does not provide professional services in Oklahoma. The separate rule for professional corporations still requires every shareholder to be licensed or otherwise permitted to render the relevant professional service.

What this means for you

If your accounting firm has ESOP-held shares

Identify the trustees who hold legal title to those shares and confirm their accounting licenses. The opinion addresses an out-of-state professional corporation with 42% of its shares in an ESOP overseen by five CPA trustees. It concludes that the described firm is eligible to qualify under the Professional Entity Act and to register and receive a public-accounting permit under the Oklahoma Accountancy Act, so long as the ESOP trustees are licensed accountants. Other statutory qualification and permit requirements still apply; the opinion does not provide a complete application checklist.

The employee beneficiaries' equitable interests do not make them shareholders for the ownership rules discussed here. Footnote 6 says that, because the owners of the ESOP-held shares in this scenario are licensed CPAs, the Board's rules for non-CPA owners do not apply to those shares.

If you review permit applications for the Accountancy Board

For ESOP-held shares in a professional corporation, the opinion treats the trustees who hold legal title as the shareholders. Check the trustees' licenses and the firm's other ownership interests under the applicable statutes. The opinion assumes that the non-ESOP shares in the described firm are held by licensed employees; it says this makes the firm wholly owned by licensed professionals for the ownership analysis.

The opinion expressly leaves the many other registration and permit requirements to the Board's ordinary review. Footnote 5 says those requirements vary with a firm's services and Oklahoma presence.

If you advise another professional entity

The opinion explains three ownership rules in 18 O.S. § 809: one for domestic professional entities, another for qualified foreign professional entities, and a separate rule for professional corporations regardless of origin. Its ultimate answer concerns an accounting professional corporation and the Accountancy Act. Examine the statute governing the profession and the entity's form before applying the reasoning elsewhere.

Common questions

Q: Who owns a share held in an ESOP trust for these licensing rules? A: The opinion applies trust-law principles: the trustee holds legal title to the share, while employees participating in the ESOP have equitable interests. It treats the licensed trustees as shareholders for the PEA and OAA ownership tests in the described case.

Q: Do employee beneficiaries have to be CPAs?
A: The opinion says the described firm's ESOP may include unlicensed employee beneficiaries. Their equitable interests do not displace the licensed trustees' legal title to the ESOP shares.

Q: What happens if a trustee is unlicensed?
A: The opinion's favorable conclusion expressly depends on the trustees being licensed accountants. It does not decide the firm's eligibility under a changed trustee arrangement.

Q: Is a foreign professional corporation exempt from the shareholder licensing rule? A: No. The opinion reads the 2024 amendment as permitting some unlicensed owners of qualified foreign professional entities, but says the separate professional-corporation clause still requires every shareholder, foreign or domestic, to be licensed or otherwise permitted to provide the relevant services.

Q: Does the opinion settle every permit requirement?
A: No. It answers the ownership question. Footnote 5 says registration and permit requirements vary by firm, services, and in-state footprint, and the opinion assumes compliance with other applicable statutory requirements.

Q: Why did the Attorney General choose the Iowa and Ohio analysis over Arkansas and Georgia? A: The opinion finds the Iowa and Ohio focus on the trustee's legal title persuasive. It acknowledges the potential conflict between trustee duties to beneficiaries and professional obligations, but says that hypothetical concern does not overcome the trust-law analysis because the accounting firm must be managed under professional obligations and ethical standards.

Background and statutory framework

The Professional Entity Act (PEA), originally enacted in 1961 as the Professional Corporation Act, lets licensed professionals practice through limited-liability business entities. Before the PEA, professionals were generally limited to sole proprietorships or partnerships under the historical view that "human personal qualifications for such professions cannot be possessed by a corporation."

The PEA imposes additional requirements beyond standard corporate formation: managers must be licensed in the relevant profession; services may be rendered only through licensed practitioners; the entity's stated purpose must be limited to one type of professional service or related service. Title 18, section 809 imposes ownership restrictions, with three rules after the 2024 amendment:

1. Domestic professional entities: only licensed individuals may hold an ownership interest.
2. Qualified foreign professional entities: unlicensed individuals may hold ownership interests if they are not rendering professional services in Oklahoma.
3. Any professional corporation, foreign or domestic: only licensed individuals may hold ownership interests.

The Oklahoma Accountancy Act (OAA) regulates accountants and accounting firms. Firms must register with the Oklahoma Accountancy Board and hold a Board-issued permit unless exempt. Section 15.15A(F) and (G) require, with limited exceptions, that "a simple majority of the ownership of the firm, in terms of financial interests and voting rights, belongs to partners or shareholders" engaged in accounting and licensed in one or more jurisdictions.

ESOPs are employee benefit plans designed to give employees an ownership stake. The mechanics: a company forms a trust; the trust holds company stock either contributed by the company or purchased with company-contributed funds; stock value is apportioned among employee accounts based on pay and longevity; on departure, the company repurchases the stock and pays out cash. Trust law principles govern: the trustee holds legal title; the participating employees hold equitable interests; the trustee has fiduciary duties to the beneficiaries.

The opinion's central move is to apply trust law directly to the PEA's "shareholder" concept. A "shareholder" is the legal owner of the share. For shares held in trust, that is the trustee. U.S. Dept. of Labor v. Koresko (3d Cir. 2016) applied this exact framework: "trustees have legal title and a non-beneficial interest in trust assets, [while] beneficiaries have an equitable or beneficial interest."

Citations and references

Statutes:

• 18 O.S. §§ 801 to 819 (Professional Entity Act)
• 18 O.S. § 809 (Ownership restrictions)
• 59 O.S. §§ 15.1 to 15.38 (Oklahoma Accountancy Act)
• 59 O.S. § 15.15A (Firm permits and ownership)

Regulations:

• Okla. Admin. Code § 10:15-23-2.1

Cases:

• Petersen v. Comm’r of Internal Revenue, 924 F.3d 1111 (10th Cir. 2019) (ESOP trust law)
• U.S. Dept. of Labor v. Koresko, 646 Fed. Appx. 230 (3d Cir. 2016) (trustee/beneficiary distinction)
• Sanders v. Turn Key Health Clinics, 2025 OK 19, 566 P.3d 591

Other state AG opinions cited:

• Ark. A.G. Opinion No. 2000-275 (2000)
• 1995 Ga. Op. Atty. Gen. 138
• 1989 Iowa Op. Atty. Gen. 42
• 1985 Ohio Op. Atty. Gen. 2-241

Source

• Landing page: https://oklahoma.gov/oag/opinions/ag-opinions/2025/16.html
• Original PDF: https://oklahoma.gov/content/dam/ok/en/oag/opinions/ag-opinions/2025/AG%20Opinion%202025-16.pdf

Original opinion text

GENTNER DRUMMOND
ATTORNEY GENERAL
ATTORNEY GENERAL OPINION
2025-16

Ashley Plyushko, Executive Director
December 4, 2025
Oklahoma Accountancy Board
201 NW 63rd St. Ste. 210
Oklahoma City, OK 73116
[email protected]

Dear Executive Director Plyushko:

This office has received your request for an Attorney General Opinion in which you ask, in effect, the following question:

Is an out-of-state accounting firm formed as a professional corporation that is owned by an Employee Stock Ownership Plan eligible to:
(1) qualify to do business in Oklahoma pursuant to the Oklahoma Professional Entity Act, 18 O.S.2021 & Supp.2024, §§ 801 – 819, and (2) register and receive a permit to practice public accounting from the Oklahoma Accountancy Board pursuant to the Oklahoma Accountancy Act, 59 O.S.2021 & Supp.2024, §§ 15.1 – 15.38?

I.
SUMMARY

Generally speaking, the Professional Entity Act requires that all shareholders of a professional corporation doing business in Oklahoma be licensed in the profession for which the corporation was formed. 18 O.S.Supp.2024, § 809. Similarly, the Oklahoma Accountancy Act requires that accounting firms seeking a permit to do business in Oklahoma be majority-owned by licensed accountants. 59 O.S.Supp.2023, § 15.15A(F), (G). Because an Employee Stock Ownership Plan (“ESOP”) is a trust, principles of trust law dictate that an ownership interest held by an ESOP is legally owned by the ESOP’s trustees, as opposed to the ESOP beneficiaries. Accordingly, if the ESOP trustees are licensed accountants, then the accounting firm described in your question is eligible to qualify to do business in Oklahoma pursuant to the Professional Entity Act, and register and receive a permit to practice public accounting pursuant to the Oklahoma Accountancy Act.

313 N.E. 21ST STREET • OKLAHOMA CITY, OK 73105 • (405) 521-3921 • FAX: (405) 521-6246

Ashley Plyushko, Executive Director
A.G. Opinion
Oklahoma Accountancy Board
Page 2

II.
BACKGROUND

Your request involves the following scenario: an out-of-state accounting firm that holds a permit to provide services in Oklahoma issued by the Oklahoma Accountancy Board (“Board”) converted from a limited liability partnership to a professional corporation organized under the laws of its home state. Forty-two percent (42%) of the shares in the new entity are held by its ESOP.

An ESOP is an employee benefit plan that gives employees an ownership stake in their employer. The mechanics of forming an ESOP can be complex, but at its most basic, a company forms an ESOP through the creation of a trust, which holds company stock that is either contributed directly by the company or purchased with funds contributed by the company. The value of stock is apportioned among dedicated employee accounts, typically in proportion to an employee’s pay and longevity at the company. When the employee leaves the company, the company stock that corresponds to that employee’s account is re-purchased by the company and the employee receives the equivalent cash payout. See generally ELIZABETH A. MYERS & JOHN J. TOPOLESKI, CONG. RSCH. SERV., IF13104, EMPLOYEE STOCK OWNERSHIP PLANS (ESOPS): AN OVERVIEW (2025). As with any other trust, an ESOP trust is overseen by trustees—the legal owners of the trust assets— who have a fiduciary duty to manage its assets in the best interest of the participating employees. See, e.g., Brundle v. Wilmington Tr., N.A., 241 F.Supp.3d 610, 614 (E.D. Va. 2017) (describing creation of a sample ESOP); see also Petersen v. Comm’r of Internal Revenue, 148 T.C. 463, 473- 75 (U.S. Tax Ct. 2017), aff’d, 924 F.3d 1111 (10th Cir. 2019) (describing the formation and characteristics of an ESOP trust).

You have advised that the ESOP relevant to your question is overseen by five trustees, each of whom is a certified public accountant (“CPA”). The firm now seeks to renew its permit to provide professional accounting services in Oklahoma. You have asked whether the firm’s change of entity type and new ownership structure affect the firm’s eligibility to (1) do business in Oklahoma under the Oklahoma Professional Entity Act, 18 O.S.2021 & Supp.2024, §§ 801 – 819, and (2) register and receive a renewal permit to provide accounting services in Oklahoma under the Oklahoma Accountancy Act, 59 O.S.2021 & Supp.2024, §§ 15.1 – 15.38.

III.
DISCUSSION

This Opinion proceeds in two parts. First, it concludes that an out-of-state professional corporation structured as described above may qualify to do business in Oklahoma under the Professional Entity Act, assuming it complies with the statutory requirements. Next, the Opinion concludes that this duly-qualified professional corporation, operating as an accounting firm, may also register and receive a permit to practice accounting services in Oklahoma, again assuming it satisfies the statutory requirements.

A. The Professional Entity Act.

Enacted in 1961 as the Professional Corporation Act, the Professional Entity Act (“PEA”) enables licensed professionals—for example, physicians, attorneys, or accountants—to engage in their

Ashley Plyushko, Executive Director
A.G. Opinion
Oklahoma Accountancy Board
Page 3

practice through a limited liability business entity. See 18 O.S.2021, § 802. Before the PEA, these professions were generally limited to practicing as sole proprietorships or partnerships. See Sanders v. Turn Key Health Clinics, 2025 OK 19, ¶ 46, 566 P.3d 591, 607. This historical limitation was rooted in the view that “human personal qualifications for such professions cannot be possessed by a corporation.” 1A William M. Fletcher, FLETCHER CYCLOPEDIA OF THE LAW OF CORPORATIONS, § 97 (Sept. 2024 Update). Over time, however, states including Oklahoma began to adopt professional entity statutes to allow practitioners to take advantage of the benefits of the corporate form, while maintaining guardrails to safeguard the personal—and often confidential— relationship between professional and client. 1 See 19 C.J.S. Corporations § 653 (Dec. 2024 update); see also Christian v. Shideler, 1963 OK 129, ¶¶ 12-14, 382 P.2d 129, 132-33 (describing the nationwide trend of states adopting legislation similar to the PEA).

The process of forming an Oklahoma professional entity, or qualifying an out-of-state professional entity, 2 under the PEA largely resembles the process for any other business entity in Oklahoma, but with additional requirements to “preserv[e] the established professional aspects of the personal relationship between the professional person and those he serves.” 18 O.S.2021, § 802. Thus, a professional corporation would begin by filing with the Secretary of State “the appropriate instrument required by the [Oklahoma General Corporation Act.]” 18 O.S.Supp.2024, § 804; see also Sanders, 2025 OK 19, ¶ 46, 566 P.3d at 607 (noting the PEA gives licensed professionals “freedom of contract to organize the business aspects of their professional practices and services based upon Oklahoma corporation, partnership, and limited liability company statutes”). In addition, those forming or qualifying a professional corporation to do business in Oklahoma must be managers 3 who are licensed or otherwise permitted to practice in Oklahoma, see 18 O.S.Supp.2024, § 804; the corporation may provide services in Oklahoma only through licensed practitioners, id. § 811; and the corporation’s stated business purpose must be limited to providing one type of professional service or related service, id. §§ 804, 806.

Finally, the PEA, like equivalent statutes in other states, places limitations on who may hold ownership interests in a professional entity. See Model Bus. Corp. Act, Prof. Corp. Supp. § 22, Official Comment (1984). These ownership restrictions are set forth in title 18, section 809, another provision that was amended in 2024. See supra footnote 2. Before the 2024 amendment,

1
For instance, the PEA explicitly “[d]oes not alter any law applicable to the relationship between a person rendering professional services and a person receiving such services, including liability arising out of such professional services.” 18 O.S.2021, § 812.
2
In your request, you seek clarification as to the PEA’s application to out-of-state (or “foreign”) professional entities. Before 2024, the PEA was silent as to these entities, although in 1976 this office offered the narrow opinion that a foreign professional corporation could lawfully do business in Oklahoma where the sole stockholder was licensed to practice in Oklahoma and the entity satisfied the domestication requirements of the Oklahoma General Corporation Act. 1976 OK AG 184. In 2024, however, the PEA was amended to specifically allow foreign professional entities to qualify to provide services in Oklahoma, much like any other business entity would. See Senate Bill 620, 2024 Okla. Sess. Laws ch. 120. The steps for a foreign professional corporation to qualify to do business in Oklahoma are now set forth in title 18, sections 804 (requirements under the PEA) and 1130 (requirements under the Oklahoma General Corporation Act applicable to all corporations).

3
A “manager” of a professional corporation is defined to mean the entity’s directors and officers. 18 O.S.Supp.2024, § 803(A)(4).

Ashley Plyushko, Executive Director
A.G. Opinion
Oklahoma Accountancy Board
Page 4

the PEA prohibited unlicensed individuals from holding any ownership interest in a professional entity. 18 O.S.2021, § 809. After the amendment, this prohibition remains in place for domestic professional entities, but not for foreign professional entities: “An owner of a qualified foreign professional entity need not be duly licensed if he or she is not rendering professional services in this state.” 18 O.S.Supp.2024, § 809. (emphasis added). 4 The 2024 amendment also added a separate clause specific to professional corporations, without differentiating between foreign or domestic: “No person shall be a shareholder of a professional corporation who is not duly licensed or otherwise permitted to render the same professional services or related professional services as the services for which the corporation is organized.” Id.

Distilled to its simplest terms, this leaves us with three separate rules for ownership of professional entities in Oklahoma:

(1) For domestic professional entities, only individuals who are licensed or otherwise permitted to practice the relevant profession in Oklahoma may hold an ownership interest;

(2) For qualified foreign professional entities, unlicensed individuals may hold ownership interests only if such persons are not rendering professional services in Oklahoma; and

(3) For any professional corporation—domestic or qualified foreign—only individuals who are licensed or otherwise permitted to practice the relevant profession may hold an ownership interest.

Candidly, it is unclear why the PEA should impose different ownership requirements for professional corporations than for any other professional entity. Nevertheless, the language of section 809 is clear and, as such, it must be interpreted according to its plain meaning. See, e.g., Rickard v. Coulimore, 2022 OK 9, ¶ 9, 505 P.3d 920, 924 (“We presume the Legislature expressed its intent and intended what it expressed—and nothing more.”).

With these provisions in mind, the question is whether the PEA permits shares in a professional corporation to be held by an ESOP, and specifically an ESOP that is managed by licensed professionals as trustees. As described above, when company stock is contributed to an ESOP, it is held in trust with legal title vested in the ESOP trustee and participating employees retaining an equitable interest. See, e.g., Petersen v. Comm’r of Internal Revenue, 924 F.3d 1111, 1116 (10th Cir. 2019) (quoting RESTATEMENT (THIRD) OF TRUSTS § 2 (2003)). In this case, you have advised that the ESOP is overseen by five trustees, each of whom is a CPA. Assuming at least some of the firm’s ESOP participants are non-licensed employees, it raises the question of whether this splitting of ownership interests brings the firm out of compliance with PEA’s ownership requirement for professional corporations.

4
This differential treatment of foreign and domestic entities is mirrored in title 18, section 804. That provision requires a domestic professional entity to include in its formation documents a certification that all managers and owners of the entity are licensed or otherwise permitted to practice in Oklahoma. By contrast, a foreign professional entity must provide such certification as to its managers, but not its owners. 18 O.S.Supp.2024, § 804.

Ashley Plyushko, Executive Director
A.G. Opinion
Oklahoma Accountancy Board
Page 5

While this question has not been addressed by this office or answered by courts in Oklahoma, it is not novel. Since at least the 1980s, Attorneys General in other states have been asked whether comparable ownership restrictions prohibit stock ownership by ESOPs (or similar employee benefit plans) for the benefit of non-licensed employees. Unfortunately, their answers have not been uniform, and the following are illustrative of the arguments on each side.

Two Attorneys General concluded that shares in a professional corporation cannot be held by an ESOP whose participants include non-licensed employees, even if the ESOP trustee is a licensed professional. See Ark. A.G. Opinion No. 2000-275, 2000 WL 1848553, at 3-4 (Nov. 6, 2000) (“Ark. Op.”), 1995 Ga. Op. Atty. Gen. 138, 1995 WL 124584 (Feb. 10, 1995). In reaching this conclusion, the opinions focused on the trustee’s potential conflict of interest. Specifically, the opinions pointed to the policies underlying ownership restrictions in professional entity statutes: “protecting the ethical standards of the profession, and avoiding interference in management decisions by nonprofessionals interested in maximizing the return on their investments.” Ga. Op., at 1; see also Ark. Op., at *2. If the trustee were to act in accordance with the ethical standards of the profession, but in a manner that failed to maximize the value of ownership interests, such actions could violate the trustee’s duty of undivided loyalty to the trust beneficiaries: the ESOP participants. This potential for a trustee being caught between the ethical standards of the profession and the fiduciary duty to the ESOP participants was enough for the Attorneys General to conclude that the ownership restrictions in their states’ professional entity statutes prohibited ESOPs—even those managed by a licensed trustee—from holding stock in the entity for the benefit of non-licensed employees.

On the other hand, Attorneys General in Iowa and Ohio reached the opposite conclusion. See 1989 Iowa Op. Atty. Gen. 42, 1989 WL 408428 (Sept. 1, 1989) (“Iowa Op.”); 1985 Ohio Op. Atty. Gen. 2-241, 1985 WL 204528 (Oct. 29, 1985) (“Ohio Op.”). They reasoned that a statutory requirement that ownership interests be held only by licensed professionals is satisfied if the trustee holding legal title to the stock is a licensed professional, even if beneficiaries holding an equitable interest in the stock were non-licensed employees. As the Ohio Attorney General remarked, “regardless of the precise nature of the interest of a trust beneficiary, that interest is not sufficient to negate the conclusion that the holder of the legal title to shares of stock in a professional association is the shareholder for the purposes of [Ohio’s professional entity law].” Ohio Op., at 2; see also Iowa Op., at 2. The Attorneys General dismissed concerns of a fiduciary tug-of-war between the profit- maximizing interest of non-licensed employees and the professional obligations of a licensed trustee. By the very nature of the entity they invest in, unlicensed employees’ equitable interests “remain subject to the limitation that [the] trustee may not be required to act in a manner that conflicts with public policy or exceeds the authority permitted under applicable laws.” Iowa Op., at 3; Ohio Op., at 4. Accord 1997 OK AG 82, ¶ 7.

Turning back to your question, the reasoning in these latter two opinions is persuasive. The PEA prohibits individuals from owning stock in a professional corporation if they are not licensed or otherwise permitted to render the professional services for which the corporation is organized. 18 O.S.Supp.2024, § 809. In the scenario you describe, the persons having legal title to the accounting firm’s stock held by the ESOP are the ESOP’s trustees, each of whom is a licensed CPA. Accordingly, the firm complies with the PEA’s stock ownership restriction. See, e.g., U.S. Dept. of Labor v. Koresko, 646 Fed. Appx. 230, 237 (3rd Cir. 2016) (finding that “ordinary notions of

Ashley Plyushko, Executive Director
A.G. Opinion
Oklahoma Accountancy Board
Page 6

property and trust law” applied to an ERISA employee benefit plan, such that “trustees have legal title and a non-beneficial interest in trust assets, [while] beneficiaries…have an equitable or beneficial interest”). While unlicensed employees will benefit from the accrued value of the stock held by the ESOP, they own no more than an equitable interest. And while ESOP trustees have a fiduciary duty to those employees, that duty is limited by the fact that the ESOP owns stock in an accounting firm that, by law, must be managed according to the professional obligations and ethical standards inherent in that occupation. Concerns about a hypothetical conflict of interest on the part of the ESOP trustees is not enough to overcome this reality. Accordingly, the accounting firm described in your question may qualify to do business in Oklahoma as a professional corporation.

B. The Oklahoma Accountancy Act.

The next question is whether the foreign professional corporation described in your request, having qualified to do business under the PEA, is eligible to register and obtain a permit to provide accounting services in Oklahoma. The Oklahoma Accountancy Act (“OAA”) governs the regulation of accountants and accounting firms that provide services in Oklahoma. The OAA defines an accounting “firm” to include, among others, a “professional corporation, or any other professional form of organization organized under the laws of this state or the laws of another jurisdiction,” that is “engaged in accountancy[.]” 59 O.S.Supp.2024, § 15.1A(20). To provide accounting services in Oklahoma, firms must register with the Board and hold a Board-issued permit, unless exempt by the OAA. Id. 5

As with the PEA, the OAA also includes restrictions on who may hold ownership interests in an accounting firm. Specifically, a firm applying for a permit to practice in Oklahoma must document, subject to exceptions not relevant here, that “a simple majority of the ownership of the firm, in terms of financial interests and voting rights, belongs to partners or shareholders” engaged in accounting work and certified or licensed in one or more jurisdictions. 59 O.S.Supp.2023, § 15.15A(F), (G). For firms that are not 100-percent owned by licensed or certified accountants, all non-licensed owners must be “active individual participants” in the firm and “the firm and its ownership must comply with rules promulgated by the board.” Id.

For the same reasons set forth in section III.A supra, the firm described in your request satisfies this requirement. The shares of the firm held by the ESOP are legally owned by the ESOP trustees, each of whom is a licensed CPA. Thus, the ownership interest held by the ESOP “belongs to…shareholders engaged in” the practice of accounting, as does the non-ESOP ownership interest

5
The registration and permitting requirements for an accounting firm to offer its services in Oklahoma are varied and complicated. Which requirements a firm must meet largely depends on the nature of the firm, the services it provides, and its footprint in the state. See, e.g., 59 O.S.Supp.2023, §§ 15.12A, 15.15, 15.15A, 15.15C. A detailed review of these provisions is unnecessary to answer your question, which presumes that the out-of-state firm in question seeks to renew its registration and permit to provide services in Oklahoma.

Ashley Plyushko, Executive Director
A.G. Opinion
Oklahoma Accountancy Board
Page 7

held by the firm’s licensed employees. 6 This results in a firm that is wholly owned by licensed professionals, satisfying the OAA’s majority ownership requirement in title 59, section 15.15A.

It is, therefore, the official Opinion of the Attorney General that:

An out-of-state accounting firm formed as a professional corporation that is owned by an Employee Stock Ownership Plan (“ESOP”) is eligible to (1) qualify to do business in Oklahoma pursuant to the Oklahoma Professional Entity Act, 18 O.S.2021 & Supp.2024, §§ 801 - 819, and (2) register and receive a permit to practice public accounting from the Oklahoma Accountancy Board pursuant to the Oklahoma Accountancy Act, 59 O.S.2021 & Supp.2024, §§ 15.1 – 15.38, so long as the ESOP’s trustees are licensed accountants.

GENTNER DRUMMOND
ATTORNEY GENERAL OF OKLAHOMA

ETHAN SHANER
DEPUTY GENERAL COUNSEL

6
Separately, the Board promulgated rules setting forth requirements for non-CPA owners of an accounting firm. Okla. Admin. Code 10:15-23-2.1 Because the “owners” of the shares held in the ESOP are licensed CPAs, there are no non-CPA owners of the firm and these requirements are therefore inapplicable.