What Is A Certificate Of Compliance? - Definition | Meaning | Example

Skip to content Menu

• Topics
  • Financial Accounting Basics
  • Accounting Principles
  • Accounting Cycle
  • Financial Statements
  • Financial Ratio Analysis
  • Assets
• Resources
  • All Resources
  • Examples
  • Quizzes
    • Crossword Puzzles
    • Multiple-Choice Questions
    • Fill-in-the-Blank Questions
    • Matching Questions
    • Word Scrambles
• Dictionary
• Careers
  • CPA Exam
    • CPA Review Courses
    • CPA Requirements
    • CPA Exam Sections
    • Score Release Dates
    • Accounting Certifications
• Pro Course

What is a Certificate of Compliance?

Home › Business Management›What is a Certificate of Compliance?

Definition: A certificate of compliance is a written document that states the fulfillment of a given requirement. It is a formal certification that declares that an individual or company met a set of conditions.

What Does Certificate of Compliance Mean?

Contents

• What Does Certificate of Compliance Mean?
• Example

Certificates of compliance are issued for many purposes and they are normally drafted and signed by official institutions depending on the subject being covered. The main reason for these certificates to be solicited is to comply with a legal requirement to obtain permission to carry an activity or to close a business transaction. They are very common in the real estate business and in public utility services.

When a realtor is leading a client to close the sale of a property the federal or state government might demand several certificates of compliance to guarantee the fitness and safety of the property. Also, they might be issued as a credibility instrument. For example, a student pursuing a college application approval might include a certificate of this kind from courses he has done in the past to make its proposal more appealing to the judges.

Example

Mr. Scholes wants to build a second floor for his home. He drew a sketch of what he wanted and contacted a friend of him who’s an architect to help him with this project. His friend drafted a professional blueprint that would be filed with the municipal real estate authority in order to get the required permission to build the additional floor.

After the Property Department reviewed his application they replied that he needed to get a Certificate of Compliance issued by the Safety Department. This department is in charge of inspecting the structural conditions of real estate and properties to guarantee they are safe enough to sustain any modifications being proposed. After the department reviewed the structure they concluded that the house met the conditions for a second floor to be built.

They granted Mr. Scholes with the Certificate of Compliance and he was able to start the project.

Shaun Conrad, CPA

Accounting & CPA Exam Expert

Shaun Conrad is a Certified Public Accountant and CPA exam expert with a passion for teaching. After almost a decade of experience in public accounting, he created MyAccountingCourse.com to help people learn accounting & finance, pass the CPA exam, and start their career.

Search 2,000+ accounting terms and topics.

Search for:

• Basic Accounting Course
• Financial Accounting Basics
• Accounting Principles
• Accounting Cycle
• Financial Statements
• Financial Ratio

My Accounting Course  is a world-class educational resource developed by experts to simplify accounting, finance, & investment analysis topics, so students and professionals can learn and propel their careers.

Company

• About
• Contact
• Scholarships

Resources

• Dictionary
• Resources
• Careers
• CPA Careers
• Quizzes

Courses

• My Accounting Course Pro
• Basic Accounting
• Accounting
• Finance
• Economics

error: Content is protected !! Search for: