CSSB 305(L&C): "An Act relating to the regulation of accountants; and amending the effective date for sec. 6, ch. 62, SLA 1991."
00CS FOR SENATE BILL NO. 305(L&C) 01 "An Act relating to the regulation of accountants; and amending the effective 02 date for sec. 6, ch. 62, SLA 1991." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 08.04 is amended by adding a new section to read: 05 Sec. 08.04.195. RECIPROCITY WITH OTHER JURISDICTIONS. (a) 06 Notwithstanding AS 08.04.100 - 08.04.130, the board may issue a certificate to an 07 applicant who holds a certificate, or its equivalent, issued by another jurisdiction if 08 the applicant 09 (1) passed the uniform certified public accountant examination given 10 by the other jurisdiction in order to receive the applicant's initial certificate from the 11 jurisdiction; 12 (2) has five years of experience outside the state in the practice of 13 public accounting or meets equivalent requirements established by the board by 14 regulation; the five years must occur after the applicant passes the examination
01 required in (1) of this subsection and within the 10 years immediately preceding the 02 applicant's application under this chapter; 03 (3) is not the subject of review procedures, disciplinary proceedings, 04 or unresolved complaints related to the applicant's certificate from another jurisdiction; 05 and 06 (4) is of good moral character. 07 (b) An applicant for the initial issuance of a certificate under this section shall 08 list in the application all states where the applicant has applied for or holds a 09 certificate, or its equivalent, and shall notify the board in writing within 30 days after 10 a denial, revocation, or suspension of a certificate, or its equivalent, by another 11 jurisdiction. 12 (c) The board may by regulation establish the education and continuing 13 education requirements for the issuance of a certificate under this section. 14 * Sec. 2. AS 08.04.240(c) is amended to read: 15 (c) Application for registration shall be made upon the affidavit of a general 16 partner, member, or shareholder who is a certified public accountant of this state in 17 good standing. The board shall in each case determine whether the applicant is 18 eligible for registration. A partnership, limited liability company, or corporation that 19 is so registered and that holds a permit issued under AS 08.04.400 may use the words 20 "certified public accountants" or the abbreviation "CPAs" in connection with its 21 partnership, limited liability company, or corporate name. Notification shall be given 22 the board within one month after the admission or withdrawal of a partner, member, 23 or shareholder from a partnership, limited liability company, or corporation registered 24 under this section. 25 * Sec. 3. AS 08.04.240 is amended by adding a new subsection to read: 26 (d) A limited liability company engaged in this state in the practice of public 27 accounting may register with the board as a limited liability company of certified 28 public accountants if 29 (1) the sole purpose and the sole business of the company are to furnish 30 to the public services that are consistent with this chapter or the regulations adopted 31 under this chapter, except that the company may invest its money in a manner that is
01 compatible with the practice of public accounting; 02 (2) at least one member is a certified public accountant of this state in 03 good standing; 04 (3) each member of the company is a certified public accountant in 05 good standing of this or another state of the United States; and 06 (4) except as otherwise provided in this chapter, each resident manager 07 in charge of an office of the company in this state and each member personally 08 engaged in this state in the practice of public accounting are certified public 09 accountants of this state in good standing. 10 * Sec. 4. AS 08.04.360 is amended to read: 11 Sec. 08.04.360. SUPERVISION REQUIRED. Each office established or 12 maintained in this state for the practice of public accounting shall be under the direct 13 supervision of a person in residence who holds a permit under AS 08.04.390 - 14 08.04.440. The supervisor may be either a sole proprietor, partner, principal, member, 15 or staff employee. A supervisor may serve in this capacity at one office only. 16 * Sec. 5. AS 08.04.380 is amended to read: 17 Sec. 08.04.380. WAIVER OF REQUIREMENTS. The board may waive the 18 requirements of AS 08.04.240(a)(3), [AND] (b)(4), and (d)(4), and 08.04.360 and 19 08.04.370 if 20 (1) the community has a population of 2,000 or less; and 21 (2) the firm opening or maintaining the office maintains another office 22 in the state that meets the requirements outlined in AS 08.04.360 and 08.04.370. 23 * Sec. 6. AS 08.04.400 is amended to read: 24 Sec. 08.04.400. PERMIT FOR PARTNERSHIP, LIMITED LIABILITY 25 COMPANY, OR CORPORATE PRACTICE AS A PUBLIC ACCOUNTANT. The 26 board shall issue a permit to engage in the practice of public accounting as a 27 partnership, limited liability company, or [AS A] corporation to a partnership, limited 28 liability company, or corporation registered under AS 08.04.240. The permit is valid 29 for two years. A permit is valid only for practice under the registered name of the 30 partnership, limited liability company, or corporation. A partnership registered under 31 former AS 08.04.330 - 08.04.340 on June 29, 1980, qualifies for a permit under this
01 section as long as each partner personally engaged in the practice of public accounting 02 in this state holds a license or permit under AS 08.04.661. 03 * Sec. 7. AS 08.04.420 is amended to read: 04 Sec. 08.04.420. PERMIT FOR GENERAL PRACTICE AS A CERTIFIED 05 PUBLIC ACCOUNTANT. A certified public accountant, or a partnership, limited 06 liability company, or corporation of certified public accountants in good standing in 07 a state, not holding a permit under AS 08.04.390 or 08.04.400 or [NOR] maintaining 08 an office in this state but engaging in the practice of public accounting in this state, 09 shall apply to the board for a permit to practice. The board shall determine whether 10 the applicant is eligible for the permit. 11 * Sec. 8. AS 08.04.440 is amended to read: 12 Sec. 08.04.440. EFFECT OF FAILURE TO OBTAIN PERMIT. Failure of an 13 individual [A PERSON], partnership, limited liability company, or corporation to 14 apply for the annual permit to practice or to pay the annual fee within (1) three years 15 from the expiration date of the permit to practice or annual registration last obtained 16 or renewed, or (2) three years from the date upon which the certificate holder or 17 licensee was granted a certificate as a certified public accountant or license as a public 18 accountant valid under AS 08.04.661 deprives the individual [PERSON], partnership, 19 limited liability company, or corporation of the right to a permit or annual registration 20 or renewal of a permit, unless the board determines that the failure is excusable. In 21 case of excusable failure, the fee may not exceed three times the annual fee. 22 * Sec. 9. AS 08.04.470 is amended to read: 23 Sec. 08.04.470. REVOCATION OR SUSPENSION OF PARTNERSHIP, 24 LIMITED LIABILITY COMPANY, OR CORPORATE REGISTRATION OR 25 PERMIT. The board shall revoke the registration and permit to practice of a 26 partnership, limited liability company, or corporation if at any time it does not meet 27 the qualifications prescribed by the sections of this chapter under which it qualified for 28 registration. 29 * Sec. 10. AS 08.04.480 is amended to read: 30 Sec. 08.04.480. GROUNDS FOR REVOCATION OR SUSPENSION OF 31 PARTNERSHIP, LIMITED LIABILITY COMPANY, OR CORPORATE PERMIT.
01 The board may revoke or suspend the registration and permit to practice of a 02 partnership, limited liability company, or corporation, may revoke, suspend, or refuse 03 to renew its permit to practice or may censure the partnership, limited liability 04 company, or corporation for any of the causes enumerated in AS 08.04.450 and 05 08.04.460, or for any of the following additional causes: 06 (1) the revocation or suspension of the certificate, license, or 07 registration of any partner, member, or shareholder; 08 (2) the revocation, suspension, or refusal to renew the permit to practice 09 of any partner, member, or shareholder; 10 (3) the cancellation, revocation, suspension, or refusal to renew the 11 authority of the partnership or any partner, the limited liability company or a 12 member, or the corporation or a shareholder to practice public accounting in any other 13 state for any cause other than failure to pay an annual registration fee in that state. 14 * Sec. 11. AS 08.04.505 is amended to read: 15 Sec. 08.04.505. ISSUANCE OF REPORTS. Only a person or firm that holds 16 a valid permit issued under this chapter may issue a report on financial statements of 17 another person, firm, organization, or governmental unit. This restriction does not 18 apply to 19 (1) an officer, partner, member, or employee of a firm or organization 20 affixing that person's signature to a statement or report in reference to the financial 21 affairs of the firm or organization with wording designating the position, title, or office 22 that the person holds in the firm or organization; 23 (2) an act of a public official or employee in the performance of 24 official duties; 25 (3) the performance by persons of other services involving the use of 26 accounting skills, including the preparation of tax returns, management advisory 27 services, and the preparation of financial statements without the issuance of reports on 28 them. 29 * Sec. 12. AS 08.04.510 is amended to read: 30 Sec. 08.04.510. PARTNERSHIP, LIMITED LIABILITY COMPANY, OR 31 CORPORATION POSING AS A CERTIFIED PUBLIC ACCOUNTANT. (a) A
01 partnership, limited liability company, or corporation may not assume or use the title 02 or designation "certified public accountant" or the abbreviation "CPA" or any other 03 title, designation, word, letter, abbreviation, sign, card, or device tending to indicate 04 that it is composed of certified public accountants, unless the partnership, limited 05 liability company, or corporation is registered and holds a live permit, is practicing 06 under its registered name, and its offices in this state for the practice of public 07 accounting are maintained as required by AS 08.04.360 - 08.04.380. 08 (b) A partnership, limited liability company, or corporation of certified public 09 accountants in good standing in any state, not registered as a partnership, limited 10 liability company, or corporation of certified public accountants under AS 08.04.240 11 but holding a permit under AS 08.04.420, may use the title or designation "certified 12 public accountants." 13 * Sec. 13. AS 08.04.530 is amended to read: 14 Sec. 08.04.530. PARTNERSHIP, LIMITED LIABILITY COMPANY, OR 15 CORPORATION POSING AS PUBLIC ACCOUNTANT. A partnership, limited 16 liability company, or corporation may not assume or use the designation "public 17 accountant" or the abbreviation "PA" or any other title, designation, word, letter, 18 abbreviation, sign, card, or device tending to indicate that the partnership, limited 19 liability company, or corporation is composed of public accountants, unless the 20 partnership, limited liability company, or corporation holds a live permit, is practicing 21 under its registered name, and its office in this state for the practice of public 22 accounting is maintained as required by AS 08.04.360 - 08.04.380. 23 * Sec. 14. AS 08.04.540 is amended to read: 24 Sec. 08.04.540. USE OF DECEPTIVE TITLE OR ABBREVIATION. An 25 individual [A PERSON], partnership, limited liability company, or corporation may 26 not assume or use the title or designation "certified accountant", "chartered 27 accountant", "enrolled accountant", "licensed accountant", "registered accountant", or 28 any other title or designation likely to be confused with "certified public accountant" 29 or "public accountant", or any of the abbreviations "CA", "EA", "LA", "RA", or 30 similar abbreviations likely to be confused with "CPA" or "PA"; however, an 31 individual [A PERSON], partnership, limited liability company, or corporation
01 holding a live permit and whose offices in this state for the practice of public 02 accounting are maintained as required by AS 08.04.360 - 08.04.380 may hold out to 03 the public as an accountant or auditor. 04 * Sec. 15. AS 08.04.570 is amended to read: 05 Sec. 08.04.570. ACTS NOT PROHIBITED. AS 08.04.560 does not prohibit 06 (1) an officer, employee, partner, member, or principal of any 07 organization from affixing that person's signature to any statement or report in 08 reference to the financial affairs of the organization together with any wording 09 designating the position, title, or office which that person holds; 10 (2) an act of a public official or public employee in the performance 11 of that person's duties; 12 (3) a person maintaining a bookkeeping or tax service from affixing 13 that person's signature to any record, statement, or report maintained or prepared by 14 the person. 15 * Sec. 16. AS 08.04 is amended by adding a new section to read: 16 Sec. 08.04.595. USE OF TITLE WITH LIMITED LIABILITY COMPANY 17 NAME. A person may not sign or affix a limited liability company name to an 18 accounting or financial statement, or opinion or report on an accounting or financial 19 statement, with wording indicating that the person is a limited liability company 20 composed of certified public accountants or public accountants or with wording 21 indicating that the company has expert knowledge in accounting or auditing unless the 22 company holds a live permit, is practicing under its registered name, and its offices in 23 this state for the practice of public accounting are maintained as required by 24 AS 08.04.360 - 08.04.380. 25 * Sec. 17. AS 08.04.600 is amended to read: 26 Sec. 08.04.600. DISCLOSURE OF LACK OF PERMIT. An individual [A 27 PERSON], partnership, limited liability company, or corporation that does not hold 28 a live permit may not hold out to the public as a certified public accountant or public 29 accountant by use of such words or abbreviations on any sign, card, letterhead, or in 30 any advertisement or directory, without indicating that the individual [PERSON], 31 partnership, limited liability company, or corporation does not hold a permit. This
01 section does not prohibit 02 (1) an officer, employee, partner, member, or principal of an 03 organization from self-description through the position, title, or office that the person 04 holds in the organization; [,] 05 (2) an act of a public official or public employee in the performance 06 of that individual's [PERSON'S] duties; [,] or 07 (3) a person from maintaining a bookkeeping or tax service. 08 * Sec. 18. AS 08.04.610 is amended to read: 09 Sec. 08.04.610. DECEPTIVE USE OF PARTNERSHIP, LIMITED 10 LIABILITY COMPANY, OR CORPORATION TITLE. A person may not assume 11 or use the title or designation "certified public accountant" or "public accountant" or 12 an abbreviation of them, in conjunction with a name indicating or implying that there 13 is a partnership, limited liability company, or corporation, or in conjunction with the 14 designation "and Company," [OR] "and Co.," "L.L.C.," "LLC," "Ltd.," or any 15 similar designation unless there is a bona fide partnership, limited liability company, 16 or corporation registered under that name. However, a sole proprietor or partnership 17 lawfully using the title or designation "certified public accountant" or "public 18 accountant" or an abbreviation of them in conjunction with such names or designation 19 on April 26, 1960, may continue to do so if the person or partnership otherwise 20 complies with this chapter. 21 * Sec. 19. AS 08.04.620 is amended to read: 22 Sec. 08.04.620. EXCEPTIONS. This chapter does not prohibit 23 (1) a person not a certified public accountant or public accountant from 24 serving as an employee of or as an assistant to an individual [A PERSON], 25 partnership, limited liability company, or corporation holding a live permit so long 26 as the employee or assistant does not use the employee's or the assistant's name in 27 connection with an accounting or financial statement; 28 (2) a certified public accountant or public accountant from indicating 29 that the certified public accountant or public accountant holds a certificate or license 30 entitling the certified public accountant or public accountant to that designation if the 31 certified public accountant or public accountant holds a valid certificate or license in
01 any state, but the person may not indicate that services are available to the public 02 unless the certified public accountant or public accountant holds a live permit issued 03 under this chapter; 04 (3) a holder of a certificate, license, or degree from a foreign country 05 which constitutes a recognized qualification for the practice of public accounting in 06 that country from indicating that the person holds the certificate, license, or degree, but 07 the person may not indicate that the person's services are available to the public unless 08 the person holds a live permit issued under this chapter. 09 * Sec. 20. AS 08.04.662(a) is amended to read: 10 (a) A licensee, or a partner, officer, shareholder, member, or employee of a 11 licensee, may not reveal information communicated to the licensee by a client about 12 a matter concerning which the client has employed the licensee in a professional 13 capacity. This section does not apply to 14 (1) information required to be disclosed by the standards of the public 15 accountancy profession in reporting on the examination of financial statements; 16 (2) the release of information the client has authorized the licensee to 17 reveal; 18 (3) information revealed as part of the discovery of evidence related to 19 a court or administrative proceeding or introduced in evidence in a court or 20 administrative proceeding; 21 (4) information revealed in ethical investigations conducted by private 22 professional organizations; or 23 (5) information revealed in the course of a quality review under 24 AS 08.04.426. 25 * Sec. 21. AS 08.04.680 is amended by adding new paragraphs to read: 26 (7) "limited liability company" means an organization organized under 27 AS 10.50 or a foreign limited liability company; in this paragraph, "foreign limited 28 liability company" has the meaning given in AS 10.50.990; 29 (8) "member" means a person who has been admitted to membership 30 in a limited liability company. 31 * Sec. 22. Section 6, ch. 62, SLA 1991, is repealed and reenacted to read:
01 Sec. 6. AS 08.04.120 is repealed and reenacted to read: 02 Sec. 08.04.120. EDUCATIONAL AND EXPERIENCE REQUIREMENTS. 03 (a) The education and experience requirements for an applicant are as follows: 04 (1) a baccalaureate degree or its equivalent conferred by a college or 05 university acceptable to the board and additional semester hours or post-baccalaureate 06 study so that the total educational program includes at least 150 hours, with an 07 accounting concentration or equivalent as determined by the board by regulation to be 08 appropriate, and two years of accounting experience satisfactory to the board; or 09 (2) a baccalaureate degree or its equivalent conferred by a college or 10 university acceptable to the board and additional semester hours or post-baccalaureate 11 study so that the total educational program includes at least 150 hours, and three years 12 of accounting experience satisfactory to the board. 13 (b) Notwithstanding (a) of this section, the board may grant a certificate to an 14 applicant who has not completed the 150-hour educational program required by (a) of 15 this section if the applicant has received a baccalaureate degree, or its equivalent, 16 before January 1, 2001, from a college or university acceptable to the board, and if the 17 applicant satisfies the other criteria established by the board by regulation for receiving 18 the certificate. 19 * Sec. 23. Section, 21, ch. 62, SLA 1991, is amended to read: 20 Sec. 21. Section 6 of this Act takes effect January 1, 2001 [SEPTEMBER 1, 21 1997].