DAR File No. 39055

Commerce, Occupational and Professional Licensing

Section R156-26a-501

Unprofessional Conduct

Notice of Proposed Rule

(Amendment)

DAR File No.: 39055
Filed: 01/05/2015 02:43:14 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The Division and Utah Board of Accountancy are proposing an amendment to add a new subsection to the unprofessional conduct section of the Certified Public Accountant Licensing Act Rule.

Summary of the rule or change:

Subsection R156-26a-501(3) is being proposed as a new subsection to the unprofessional conduct rules affecting certified public accountants (CPAs) and CPA firms. The proposed subsection makes it unprofessional conduct to include the name of a person who is not licensed as a CPA as part of the CPA firm name. Use of a non-licensee in the CPA firm name improperly implies that the person is a licensed CPA. This problem has previously come to the Division's attention where non-CPAs have been included in the CPA firm name and have improperly represented themselves as CPAs. The Division has taken action against those persons for improperly holding themselves out as a CPA. Accordingly, this rule is to clarify what is already prohibited by other unlawful conduct provisions.

State statutory or constitutional authorization for this rule:

• Subsection 58-1-106(1)(a)
• Section 58-26a-101
• Subsection 58-1-202(1)(a)

Anticipated cost or savings to:

the state budget:

This proposed rule amendment will not affect the state budget other than the cost to the Division to republish and distribute the rule of approximately $75. Any costs incurred will be absorbed in the Division's current budget.

local governments:

The proposed amendments apply only to licensed CPAs and CPA firms. As a result, the proposed amendments do not apply to local governments.

small businesses:

The proposed amendment applies only to licensed CPAs and CPA firms, which may qualify as a small business. However, the Division does not anticipate any cost to CPA firms as a result of the proposed amendment as long as the CPA firm is in compliance with the requirement. Persons or companies applying for the CPA firm licensure will be required to choose a name that does not inappropriately imply non-licensed persons are CPAs at the firm. This proposed amendment should not result in additional costs to applicants becoming licensed.

persons other than small businesses, businesses, or local governmental entities:

The proposed amendment applies only to licensed CPAs and CPA firms. However, the Division does not anticipate any cost to CPAs or CPA firms as a result of the proposed amendment as long as the CPA firm is in compliance with the requirement. Persons or companies applying for the CPA firm licensure will be required to choose a name that does not inappropriately imply non-licensed persons are CPAs at the firm. This proposed amendment should not result in additional costs to applicants becoming licensed.

Compliance costs for affected persons:

The proposed amendment applies only to licensed CPAs and CPA firms. However, the Division does not anticipate any cost to CPAs or CPA firms as a result of the proposed amendment as long as the CPA firm is in compliance with the requirement. Persons or companies applying for the CPA firm licensure will be required to choose a name that does not inappropriately imply non-licensed persons are CPAs at the firm. This proposed amendment should not result in additional costs to applicants becoming licensed.

Comments by the department head on the fiscal impact the rule may have on businesses:

This filing clarifies that a CPA firm may not include in its company name the name of any individual who has not obtained a CPA license. To comply, a business must choose and file an appropriate company name; therefore, no fiscal impact to businesses is anticipated.

Francine A. Giani, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Commerce
Occupational and Professional Licensing
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY, UT 84111-2316

Direct questions regarding this rule to:

• Dan Jones at the above address, by phone at 801-530-6720, by FAX at 801-530-6511, or by Internet E-mail at [email protected]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

03/03/2015

Interested persons may attend a public hearing regarding this rule:

• 02/04/2015 01:30 PM, Heber Wells Bldg, 160 E 300 S, Conference Room 475 (fourth floor), Salt Lake City, UT

This rule may become effective on:

03/10/2015

Authorized by:

Mark Steinagel, Director

R156. Commerce, Occupational and Professional Licensing.

R156-26a. Certified Public Accountant Licensing Act Rule.

R156-26a-501. Unprofessional Conduct.

"Unprofessional conduct" includes:

(1) a licensee willfully failing to comply with continuing professional education or fraudulently reporting continuing professional education; or

(2) commission of an act or omission that fails to conform to the accepted and recognized standards and ethics of the profession including those stated in the "Code of Professional Conduct" of the American Institute of Certified Public Accountants (AICPA) as adopted June 1, 2008, which is hereby incorporated by reference; or

(3) a CPA firm using the name of a person who is not a licensed certified public accountant as part of the CPA firm name with the exception that a CPA firm may continue to use the name of a former owner who was a CPA but who has retired or is no longer active in the CPA firm.

 

KEY: accountants, licensing, peer review, continuing professional education

Date of Enactment or Last Substantive Amendment: [August 10, 2009]2015

Notice of Continuation: November 15, 2011

Authorizing, and Implemented or Interpreted Law: 58-26a-101; 58-1-106(1)(a); 58-1-202(1)(a)