Bill Text: AZ HB2260 | 2013 | Fifty-first Legislature 1st Regular | Chaptered
Bill Title: Certified public accountants
Spectrum: Moderate Partisan Bill (Republican 10-3)
Status: (Passed) 2013-04-29 - Governor Signed [HB2260 Detail]
Download: Arizona-2013-HB2260-Chaptered.html
|
Senate Engrossed House Bill |
|
State of Arizona House of Representatives Fifty-first Legislature First Regular Session 2013
|
|
CHAPTER 136
|
|
HOUSE BILL 2260 |
|
|
AN ACT
amending sections 32-701, 32-703, 32-721 and 32-723, Arizona Revised Statutes; repealing section 32-724, Arizona Revised Statutes; amending section 32-725, Arizona Revised Statutes; repealing section 32-726, Arizona Revised Statutes; amending sections 32-729 and 32-730, Arizona Revised Statutes; amending title 32, chapter 6, article 2, Arizona Revised Statutes, by adding sections 32‑730.01, 32-730.02, 32-730.03 and 32-730.04; amending sections 32-731, 32-732 and 32-741, Arizona Revised Statutes; renumbering section 32-741.01, Arizona Revised Statutes, as section 32-741.04; amending title 32, chapter 6, article 3, Arizona Revised Statutes, by adding a new section 32-741.01 and sections 32-741.02 and 32-741.03; amending section 32‑741.04, Arizona Revised Statutes, as renumbered by this act; amending sections 32-742, 32-747 and 32-747.01, Arizona Revised Statutes; repealing section 32-748, Arizona Revised Statutes; relating to certified public accountants.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 32-701, Arizona Revised Statutes, is amended to read:
32-701. Definitions
In this chapter, unless the context otherwise requires:
1. "Accounting services" means services that are commonly and historically performed by accountants, including recording or summarizing financial transactions, bookkeeping, analyzing or verifying financial information, auditing, reviewing or compiling financial statements, reporting financial results, financial planning and providing attestation, tax or consulting services.
1. 2. "Accredited institution" means any public or private regionally or nationally accredited college or university that is accredited by an organization recognized by the council for higher education accreditation or its successor agency.
3. "Attest services" means the following services that are rendered by the holder of a certificate issued by the board:
(a) Audits or other engagements performed in accordance with the statements on auditing standards adopted by the American institute of certified public accountants.
(b) Reviews of financial statements performed in accordance with the statements on standards for accounting and review services adopted by the American institute of certified public accountants.
(c) Any examination of prospective financial information to be performed in accordance with the statements on standards for attestation engagements adopted by the American institute of certified public accountants.
(d) Any engagement to be performed in accordance with the standards of the public company accounting oversight board or its successor.
2. 4. "Attestation" or "attest function" means the issuance by a registrant of a written communication that expresses a conclusion about the reliability of a written assertion that is the responsibility of another party.
3. 5. "Board" means the Arizona state board of accountancy established by section 32‑702.
4. 6. "Certified public accountant" means an individual who has been issued a certificate of authority by the board to practice as a certified public accountant, including an individual on inactive status or who meets the limited reciprocity privilege requirements pursuant to section 32-725.
7. "Client" means a person or entity, other than one's employer, for whom accounting services are provided.
8. "Consulting services" includes management advisory services, litigation support services, valuation services and other services that require the use of technical skills, education, observation, experience and knowledge to develop an analytical approach to process and to present findings, conclusions or recommendations.
5. 9. "Conviction" means a judgment of conviction by any state or federal court of competent jurisdiction in a criminal cause, regardless of whether an appeal is pending or could be taken, and includes any judgment or order based on a plea of no contest.
6. 10. "Disciplinary action" means any other regulatory sanctions imposed by the board in combination with, or as an alternative to, revocation or suspension of a certificate or registration, including the imposition of:
(a) An administrative penalty in an amount not to exceed two thousand dollars for each violation of this chapter or rules adopted pursuant to this chapter.
(b) Restrictions on the scope of registrants' the registrant's accounting practice, including, without limitation, restriction of audit or attest function practice, restriction of tax practice or restriction of management advisory practice consulting services.
(c) Peer Pre-issuance and post-issuance peer review and.
(d) Professional education requirements.
(d) (e) A decree of censure.
(e) (f) Probation requirements best adapted to protect the public welfare that may include a requirement for restitution payments to accounting services clients or to other persons suffering economic loss resulting from violations of this chapter or rules adopted pursuant to this chapter.
(f) (g) Reimbursement of the board's costs of investigations and proceedings initiated under this chapter.
(h) A requirement for restitution payments to accounting services clients or to other persons suffering economic loss resulting from violations of this chapter or rules adopted pursuant to this chapter.
11. "Employer" means a person or entity that hires an individual to perform a service and that directs and controls the manner in which the service is performed.
7. 12. "Federal securities laws" means the securities act of 1933, the securities exchange act of 1934, the public utility holding company act of 1935 and the investment company act of 1940, as amended.
13. "Financial statements":
(a) Means statements and footnotes related to statements that purport to show a financial position or changes in a financial position in conformity with generally accepted accounting principals or other comprehensive basis of accounting.
(b) Includes balance sheets, statements of income, statements of retained earnings, statements of cash flows, statements of changes in an owner's equity and other commonly used or recognized summaries of financial information.
(c) Does not include tax returns or information contained in tax returns.
8. 14. "Firm" means a business organization that is engaged in the practice of public accounting and that is established under the laws of any state or foreign country, including a sole practitioner, partnership, professional corporation, professional limited liability company, limited liability company, limited liability partnership or any other entity recognized by the board that has met the applicable requirements contained in sections 32‑731 and 32‑732.
15. "Good cause" means factors that temporarily prevent a registrant from satisfying a particular requirement in a specific instance as determined by the board and may include:
(a) A disability.
(b) An illness.
(c) A physical or mental condition.
(d) Military service.
(e) Financial hardship.
(f) A natural disaster.
(g) Any condition or circumstance that the board deems relevant.
9. 16. "Letter of concern" means an advisory letter to notify a registrant that, while the evidence does not warrant disciplinary action, the board believes that the registrant should modify or eliminate certain practices and that continuation of the activities that led to the evidence being submitted to the board may result in board action against the registrant. A letter of concern is not a disciplinary action.
10. 17. "Limited reciprocity privilege" means the permission to practice as a certified public accountant in this state pursuant to section 32‑725 for an individual whose principal place of business is outside of this state.
18. "Management advisory services" means advisory services consisting of the development of findings, conclusions or recommendations for the recipient's consideration and decision making.
11. 19. "Practice of accounting" means providing any accounting services, including recording and summarizing financial transactions, analyzing and verifying financial information, examining, reviewing and reporting on financial statements, reporting financial results to an employer, clients or other parties and rendering attestation, tax and management advisory services to an employer, clients or other parties for a client or an employer.
20. "Practice of public accounting" means providing accounting services for a client but does not include providing accounting services, other than attest services or compilation services, for a nonprofit entity or a family member without an expectation of and without receiving compensation.
12. 21. "Principal place of business" means the office designated by the individual or firm as the principal location for the practice of accounting.
13. 22. "Public accountant" means an individual who has been issued a certificate of authority by the board to practice as a public accountant, including an individual on inactive status.
14. "Reciprocity" means the issuance of a certificate by the board to an individual to practice as a certified public accountant in this state as provided by section 32-724.
23. "Registrant" means any certified public accountant, public accountant or firm that is registered with the board.
15. 24. "Related courses" means:
(a) Business administration.
(b) Statistics.
(c) Computer science, information systems or data processing.
(d) Economics.
(e) Finance.
(f) Management.
(g) Business law.
(h) College algebra or more advanced mathematics.
(i) Advanced written communication.
(j) Advanced oral communication.
(k) Ethics.
(l) Marketing.
(l) (m) Other courses closely related to the subject of accounting and satisfactory to the board.
16. "Restricted financial services" means the following services rendered by the holder of a certificate issued by the board:
(a) Audits or other engagements performed in accordance with the statements on auditing standards adopted by the American institute of certified public accountants.
(b) Reviews of financial statements performed in accordance with the statements on standards for accounting and review services adopted by the American institute of certified public accountants.
(c) Attestation engagements performed in accordance with the statements on standards for attestation engagements adopted by the American institute of certified public accountants.
(d) The preparation and issuance of audit reports as required by the Sarbanes-Oxley act of 2002 (P.L. 107-204; 116 Stat. 745) or the rules of the securities and exchange commission.
Sec. 2. Section 32-703, Arizona Revised Statutes, is amended to read:
32-703. Powers and duties; rules; executive director; advisory committees and individuals
A. The primary duty of the board is to protect the public from unlawful, incompetent, unqualified or unprofessional certified public accountants or public accountants through certification, regulation and rehabilitation.
B. The board may:
1. Investigate complaints filed with the board or on its own motion to determine whether a certified public accountant or public accountant has engaged in conduct in violation of this chapter or rules adopted pursuant to this chapter.
2. Establish and maintain high standards of competence, independence and integrity in the practice of accounting by a certified public accountant or by a public accountant as required by generally accepted auditing standards and generally accepted accounting principles and, in the case of publicly held corporations or enterprises offering securities for sale, in accordance with state or federal securities agency accounting requirements.
3. Establish reporting requirements that require registrants to report:
(a) The imposition of any discipline on the right to practice before the federal securities and exchange commission, the internal revenue service, any state board of accountancy, other government agencies or the public company accounting oversight board.
(b) Any criminal conviction, any civil judgment involving negligence in the practice of accounting by a certified public accountant or by a public accountant and any judgment or order as described in section 32‑741, subsection A, paragraphs 7 and 8.
4. Establish basic requirements for continuing professional education of certified public accountants and public accountants, except that the requirements shall not exceed eighty classroom hours in any registration renewal period.
5. Adopt procedures concerning disciplinary actions, administrative hearings and consent decisions.
6. Issue to qualified applicants certificates executed for and on behalf of the board by the signatures of the president and secretary of the board.
7. Adopt procedures and rules concerning examination and grading the examinations of individuals applying for a certificate as required by to administer this chapter.
8. Require peer review pursuant to rules adopted by the board on a general and random basis of the professional work of a registrant engaged in the practice of accounting.
9. Subject to title 41, chapter 4, article 4, employ an executive director and other personnel that it considers necessary to administer and enforce this chapter.
10. Appoint accounting and auditing, tax, peer review, law, certification, continuing professional education or other committees or individuals as it considers necessary to advise or assist the board in administering and enforcing this chapter. These committees and individuals serve at the pleasure of the board.
11. Take all action that is necessary and proper to effectuate the purposes of this chapter.
12. Sue and be sued in its official name as an agency of this state.
13. Adopt and amend rules concerning the definition of terms, the orderly conduct of the board's affairs and the effective administration of this chapter.
C. The board or an authorized agent of the board may:
1. Issue subpoenas to compel the attendance of witnesses or the production of documents. If a subpoena is disobeyed, the board may invoke the aid of any court in requiring the attendance and testimony of witnesses and the production of documents.
2. Administer oaths and take testimony.
3. Cooperate with the appropriate authorities in other jurisdictions in investigation and enforcement concerning violations of this chapter and comparable statutes of other jurisdictions.
4. Receive evidence concerning all matters within the scope of this chapter.
Sec. 3. Section 32-721, Arizona Revised Statutes, is amended to read:
32-721. Certified public accountants; qualifications
A. The board shall issue a certificate of certified public accountant to any individual who complies with all of the following:
1. Meets the requirement to take the examination pursuant to section 32‑723.
2. Within a period of time prescribed by the rules of the board, has obtained a passing grade in each subject of the examination for certified public accountant in this state, or in any other state, territory or possession of the United States that uses the questions and grading facilities of the American institute of certified public accountants or any other institution approved by the board.
3. Meets the following character and fitness requirements:
(a) Is at least eighteen years of age.
(b) Is of good moral character.
(c) Has not engaged in any conduct that would constitute grounds for revocation or suspension of a certificate or other disciplinary action pursuant to section 32‑741.
4. Meets the additional experience and educational requirements prescribed by subsection B of this section.
B. In addition to the requirements prescribed by subsection A of this section, the applicant must meet both of the following requirements:
1. Meets the requirements of sections 1-501 and 41-1080.
2. Is at least eighteen years of age.
3. Is of good moral character.
4. Has not engaged in any conduct that would constitute grounds for revocation or suspension of a certificate or other disciplinary action pursuant to section 32-741.
5. Meets the requirements of subsection B, C or D of this section.
B. If the applicant passes the uniform certified public accountant examination and has never been certified, registered or licensed as a certified public accountant in this state or another jurisdiction, the applicant must comply with both of the following:
1. Have been employed full time had at least two thousand hours of paid or unpaid experience, either before or after passing each section all sections of the examination for certified public accountant, for at least one year in the office of a certified public accountant or public accountant, in private industry or with a government agency that has exposed the applicant to and provided the applicant with experience in the practice of accounting. The board may accept part‑time employment as a substitute for the requirement of one year of full‑time employment if the part‑time employment provides the applicant with equivalent experience in the practice of accounting. The applicant's experience must be sufficient to demonstrate the applicant's ability for critical inquiry and analysis of financial accounting information, including balance sheets, income statements, cash flow statements and tax returns and the applicant's ability to communicate, either orally or in writing, on the results of an inquiry or analysis of that information to an employer, client or third party.
2. Present satisfactory evidence that the person has successfully obtained a baccalaureate degree or higher degree from an accredited institution or a college or university maintaining that maintains standards comparable to those of an accredited institution that the applicant has completed at least one hundred fifty semester hours of education of which:
(a) At least thirty‑six semester hours are nonduplicative accounting courses of which at least thirty semester hours are upper level division courses.
(b) At least thirty semester hours are related courses.
C. If the applicant passes the uniform certified public accountant examination and has a certificate, registration or license to practice as a certified public accountant in another jurisdiction, at least one of the following shall apply:
1. The certificate, registration or license is issued by a jurisdiction whose requirements are determined by the board to be substantially equivalent to the requirements prescribed in subsection B of this section.
2. The applicant has a baccalaureate degree or its equivalent or a higher degree from an accredited institution or a college or university that maintains standards comparable to those of an accredited institution and either of the following applies:
(a) The applicant has Been employed as a certified public accountant in the practice of accounting for at least three years and has completed at least one hundred fifty semester hours of education that includes both of the following:
(i) At least twenty-four semester hours of nonduplicative accounting courses, of which twelve semester hours are upper division courses.
(ii) At least eighteen semester hours in related courses.
(b) The applicant has Been employed as a certified public accountant in the practice of accounting for at least five of the ten preceding years and has completed both of the following:
(i) At least twenty-four semester hours of nonduplicative accounting courses, of which twelve semester hours are upper division courses.
(ii) At least eighteen semester hours in related courses.
3. The applicant has been employed as a certified public accountant in the practice of accounting for at least ten of the fifteen preceding years.
D. If an applicant passes the international uniform certified public accountant qualification examination of the american institute of certified public accountants, all of the following apply:
1. The applicant's country has a mutual recognition agreement with the national association of state boards of accountancy that has been adopted by the board.
2. The board recognizes that the applicant's qualifications are substantially equivalent to the qualifications of certified public accountants in the United states in the areas of education, examination and experience.
Sec. 4. Section 32-723, Arizona Revised Statutes, is amended to read:
32-723. Uniform certified public accountant examination; qualifications
A. Examination of persons applying for certificates under this chapter shall be held within the state, as the board decides, at least once each year.
B. A. A person shall not be permitted to take the uniform certified public accountant examination unless the person presents satisfactory evidence that the person has successfully obtained a baccalaureate degree or a higher degree from an accredited institution or a college or university maintaining that maintains standards comparable to those of an accredited institution. The evidence must show both of the following:
1. At least twenty‑four semester hours in of nonduplicative accounting courses of which twelve semester hours are upper division courses. must be in intermediate accounting theory, advanced accounting, cost accounting, auditing theory and practice or income taxes, or any combination thereof, or advanced accounting courses equivalent thereof, and shall include an additional
2. At least eighteen semester hours in related courses. Any transcripts submitted as evidence must be from an accredited institution or a college or university maintaining standards comparable to those of an accredited institution.
C. The board shall determine the required subjects in which applicants may be examined.
D. All examinations provided for in this section shall be conducted in a manner prescribed by the board. The board may make use of all or any part of a certified public accountants' examination and advisory grading service, or both, as it deems appropriate to assist it in performing its duties.
B. The board may contract with a public or private entity for the administration of the examination. The examination may be conducted under a uniform examination system.
E. C. All examinations shall be graded under the auspices of the board. Each subject shall be graded separately. Within a reasonable time after the examination the board or its contracted agent shall notify each candidate of the candidate's grade. Any candidate may request a grade review or an appeal by submitting a written request to the board or its designated uniform certified public accountant examination score review or appeal form to the board's contracted agent.
F. A candidate who successfully passes sections of an examination shall be deemed to have received a condition as provided by rules of the board and shall have the right to be reexamined in the remaining sections at subsequent examinations held by the board. If the candidate passes the remaining sections within a period of time specified in the rules of the board, the candidate shall be considered to have passed the examination in its entirety.
G. A candidate who has received a condition in an examination in any state whose examination is satisfactory to the board and in which the requirements to take the examination are as high as those required in this state may be deemed to have received a condition and may be given credit in the candidate's Arizona examination for those sections passed. The out‑of‑state condition must be in effect as determined by the rules of the board. The candidate may be reexamined only in the remaining sections at subsequent examinations held by the board. If the candidate passes the remaining sections within a period of time specified in the rules of the board the candidate shall be considered to have passed the examination in its entirety.
H. The board may permit an Arizona applicant for the Arizona examination to take the examination for certified public accountant outside of this state under the auspices and control of any other state board of accountancy.
I. The board may adopt rules regarding the scope of the examinations and the method and time of filing applications and may adopt all other rules necessary to implement this section.
Sec. 5. Repeal
Section 32-724, Arizona Revised Statutes, is repealed.
Sec. 6. Section 32-725, Arizona Revised Statutes, is amended to read:
32-725. Limited reciprocity privilege; qualifications
A. The limited reciprocity privilege may be exercised by an individual who is not a resident of this state and who meets the requirements of this section.
B. To qualify to exercise the limited reciprocity privilege, an individual must:
1. Have a principal place of business that is not in this state.
2. Not be the subject of suspension or revocation of a certificate as provided by section 32‑741 or relinquishment of a certificate as provided by section 32‑741.01 32-741.04.
3. Hold a valid registration, certificate or license as a certified public accountant issued by another state and either of the following must apply:
(a) The other state requires as a condition of licensure on or before December 31, 2011 that an individual has all of the following:
(i) At least one hundred fifty semester hours of college education, including a baccalaureate degree or a higher degree that is conferred by an accredited institution or a college or university that maintains standards that are comparable to those of an accredited institution.
(ii) A passing grade on the uniform certified public accountant examination.
(iii) At least one year of experience in the practice of accounting that has been verified.
(b) The individual meets the qualifications prescribed in section 32‑726 32-721, subsection C.
C. An individual qualifying for limited reciprocity privilege under this section is considered to have qualifications that are substantially equivalent to the requirements prescribed pursuant to this chapter, as provided by section 32‑726, and has all of the privileges of registrants, certificate holders or licensees in this state without obtaining a registration, certificate or license under this chapter.
D. An individual qualifying for limited reciprocity privilege under this section may use the title "CPA" or "certified public accountant" and may offer or practice accounting in person or by mail, telephone or electronic means. No notice, fee or other submission is required. The individual is subject to the requirements prescribed in subsection E of this section.
E. Each individual who holds a registration, certificate or license issued by another state and who exercises the limited reciprocity privilege and each partnership, corporation or other entity engaging in the practice of accounting as provided by this section, as a condition of exercising the privilege provided by this section:
1. Shall:
(a) Comply with article 3 of this chapter and rules adopted pursuant to article 3 of this chapter. In any investigation or other proceedings conducted pursuant to article 3 of this chapter, an individual claiming permission to practice as a certified public accountant in this state under the limited reciprocity privilege has the burden of demonstrating that the applicable requirements of subsection B of this section have been satisfied.
(b) Cease the offering or practicing of accounting in person or by mail, telephone or electronic means in this state if the individual no longer satisfies the requirements of subsection B of this section or the partnership, corporation or other entity no longer satisfies the requirements of subsection G of this section.
2. Is subject to:
(a) The personal and subject matter jurisdiction of the board and the power of the board to investigate complaints and take disciplinary action.
(b) Service by either of the following:
(i) The appointment of the state board that issued the registration, certificate or license to the individual as agent, on whom process may be served in any action or proceeding against the person by the board.
(ii) Directly on the person.
F. Any individual who holds a valid registration, certificate or license as a certified public accountant issued by another state or a foreign country, whose principal place of business is not in this state and who does not otherwise qualify under this section for limited reciprocity privilege may enter this state and provide services if the services are limited to the following:
1. Expert witness services.
2. Teaching or lecturing.
3. Other services as determined by the board.
G. A partnership, corporation or other entity formed under the laws of another state or United States territory relating to the practice of accounting in that state or United States territory may use the title "certified public accountant" or "CPA" in this state and may engage in the practice of accounting in this state, including the provision of restricted financial attest services, without having to register as a firm if all of the following apply:
1. The partnership, corporation or other entity is owned by or employs an individual who is a limited reciprocity privilege holder pursuant to this section.
2. The partnership, corporation or other entity is in good standing in its principal place of business under the laws of that jurisdiction relating to the practice of accounting.
3. The principal place of business of the limited reciprocity privilege holder is a recognized place of business for the practice of accounting by the partnership, corporation or other entity.
4. The partnership, corporation or other entity does not have an office in this state and does not represent that it has an office in this state.
5. The partnership, corporation or other entity holds an active permit or registration as a certified public accountant firm in another state or United States territory.
6. The practice of accounting is performed by or under the direct supervision of an individual who is qualified for the limited reciprocity privilege under this section.
Sec. 7. Repeal
Section 32-726, Arizona Revised Statutes, is repealed.
Sec. 8. Section 32-729, Arizona Revised Statutes, is amended to read:
32-729. Fees
A. The board shall establish and collect:
1. A uniform fee from each an applicant for each examination held initial examination and reexamination application pursuant to section 32‑723 to cover reasonable costs of the examination. No additional fee shall be required from an applicant entitled to a certificate after having successfully passed the examination except as provided in subsection B of this section. If the board refuses to allow an applicant to take the examination, the board shall return to the applicant one‑half of the examination fee. reviewing the applicant's ELIGIBILITY to take the examination and facilitating the applicant to take the examination until the applicant passes all sections.
B. 2. The board shall establish and collect A uniform fee from each applicant for a certificate to be issued pursuant to section 32‑721 or 32‑724.
3. A uniform registration fee of at least one hundred and not more than three hundred dollars from each applicant for registration as a certified public accountant or public accountant pursuant to section 32-730. The registration fee is due during the month of the anniversary of the registrant's birth. Registrants for less than two years shall be charged on a pro rata basis for the remainder of the registration period. The board shall establish and collect a late fee, if applicable, of not more than one hundred dollars.
4. A uniform registration fee of at least one hundred dollars and not more than three hundred dollars from each applicant for registration as a firm pursuant to section 32-730. The registration fee is due during the month of the anniversary of the effective date of the firm's formation. The board shall establish and collect a late fee, if applicable, of not more than one hundred dollars. The board shall not charge a fee for the registration of additional offices of the same firm or for the registration of a sole practitioner.
5. A uniform application fee in an amount to be determined by the board to reinstate a license pursuant to this chapter.
6. A uniform registration fee of fifty dollars for retired status registration as described in section 32-730.04.
Sec. 9. Section 32-730, Arizona Revised Statutes, is amended to read:
32-730. Biennial registration; continuing professional education
A. Except as provided in subsection C of this section and in section 32-4301, the board shall biennially require every certified public accountant, public accountant and firm to register once every two years with the board and pay a registration fee pursuant to section 32‑729. of not less than one hundred nor more than three hundred dollars during the month of the anniversary of the registrant's birth in the case of an individual or, in the case of a registered firm, during the month of the anniversary of the effective date of the firm's formation. In the administration of this section, registrants for less than two years shall be charged on a pro rata basis for the remainder of the registration period.
B. A certified public accountant or public accountant who is not actively engaged in the practice of accounting may request that the individual's certificate be placed on inactive status by meeting the requirements for inactive status and completing the forms prescribed by the board. A certified public accountant or public accountant whose certificate has been suspended by the board or against whom disciplinary proceedings have been initiated may not place or maintain his certificate on inactive status. A certified public accountant or public accountant who elects to place a certificate on inactive status:
1. Shall continue to biennially register with the board and pay the required fees.
2. Shall not engage in the practice of accounting for a fee or other compensation while the individual remains on inactive status.
3. Shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA" while the person remains on inactive status.
C. B. The registration fee for certified public accountants and public accountants may be reduced or waived by the board for registrants who are at least sixty‑five years of age or who have become disabled to a degree precluding the continuance of their practice for six months or more prior to the due date of any renewal fee.
D. C. At the time of registration, every certified public accountant and public accountant, shall as a prerequisite to biennial registration, shall submit to the board satisfactory proof, in a manner prescribed by the board, that the registrant has completed the continuing professional education requirements established by the board. The board may grant an a full or partial exemption from continuing professional education requirements or an extension of time to complete the continuing professional education requirements for registrants on a demonstration of good cause as determined by the board.
E. Except as otherwise provided in this chapter, a certified public accountant or public accountant who elects to place a certificate on inactive status may reactivate the certificate if the certificate has been inactive for six years or less by doing all of the following:
1. Filing an application for renewal on the form prescribed by the board and paying the applicable fees.
2. Submitting proof that the certified public accountant or public accountant has satisfied continuing education requirements prescribed by the board in its rules.
3. Affirming that the certified public accountant or public accountant has not engaged in any conduct that would constitute grounds for revocation or suspension of a certificate pursuant to section 32‑741.
F. A registrant may reactivate an inactive certificate pursuant to subsection E of this section only one time. Reactivation of an inactive certificate pursuant to subsection E of this section is effective on the date that the application for reactivation is approved by the board. A certificate that is reactivated pursuant to subsection E of this section continues in effect through the date prescribed in subsection A of this section.
G. A certificate that has been inactive for more than six years expires.
H. A certified public accountant or public accountant whose certificate has expired or been canceled and who does not meet the good cause requirements of section 32‑741 may apply for and reactivate or reinstate the certificate if the certified public accountant or public accountant meets all of the following requirements:
1. Has not engaged in any conduct that would constitute grounds for revocation or suspension of a certificate pursuant to section 32‑741.
2. Pays all fees required of applicants for initial certification.
3. Takes and passes the examination required of applicants for initial certification.
I. A certified public accountant or public accountant who is not actively engaged in the practice of accounting or who qualifies for limited reciprocity privilege pursuant to section 32‑725 and who does not want to renew or place the certificate on inactive status may request that the certificate be canceled by submitting a written request on a form approved by the board. This subsection does not apply if a complaint has been filed with the board or disciplinary proceedings are pending against the certified public accountant or public accountant.
J. Each firm established or maintained in this state for the purpose of a certified public accountant or a public accountant to practice accounting in this state shall register biennially under this chapter with the board. The board shall not charge a fee for registration of additional offices of the same firm or sole practitioner. The board shall prescribe by rule the required registration procedures for this subsection.
K. A firm that is established or maintained in this state for the purpose of a certified public accountant or a public accountant practicing accounting in this state and that does not want to renew its registration may cancel its registration by submitting a written request on a form approved by the board. This subsection does not apply if a complaint has been filed with the board or disciplinary proceedings are pending against the firm. END_STATUTE
Sec. 10. Title 32, chapter 6, article 2, Arizona Revised Statutes, is amended by adding sections 32-730.01, 32-730.02, 32-730.03 and 32-730.04, to read:
32-730.01. Inactive status; reactivation; exception
A. A registrant who is not actively engaged in the practice of accounting in this state for a fee or other compensation may request that the registrant's certificate be placed on inactive status by meeting the requirements for inactive status and completing the forms prescribed by the board. A registrant whose certificate is under a disciplinary order by the board or against whom disciplinary proceedings have been initiated may not place or maintain a certificate on inactive status.
B. A registrant whose certificate is on inactive status:
1. Shall continue to register once every two years with the board and pay fifty per cent of the registration fee and one hundred per cent of any applicable late fee pursuant to section 32‑729.
2. Shall not engage in the practice of accounting in this state for a fee or other compensation while the registrant's certificate remains on inactive status.
3. In this state shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA" while the registrant's certificate remains on inactive status unless accompanied by the word "inactive".
C. Except as otherwise provided in this chapter, a registrant who elects to place a certificate on inactive status may reactivate the certificate if the certificate has been inactive for six years or less by doing all of the following:
1. Filing an application for renewal on the form prescribed by the board and paying the registration fee pursuant to section 32-729.
2. Submitting proof that the registrant has satisfied continuing professional education requirements as prescribed by the board.
3. Affirming that the registrant has not engaged in any conduct that would constitute grounds for revocation or suspension of a certificate pursuant to section 32-741.
D. A registrant may reactivate an inactive certificate pursuant to subsection c of this section only once.
E. A certificate expires if it has been inactive for more than six years.
F. Subsections D and E of this section do not apply if inactive status is approved by the board for good cause based on a registrant's disability.
32-730.02. Canceled status; reinstatement
A. A registrant may cancel a certificate or registration by submitting a written request on a form prescribed by the board. A registrant whose certificate or registration is under a disciplinary order by the board or against whom disciplinary proceedings have been initiated may not cancel the certificate or registration.
B. An individual whose certificate has been canceled shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA" while the certificate remains on canceled status unless the individual qualifies for limited reciprocity privilege pursuant to section 32-725.
C. An individual whose certificate has been canceled may apply for reinstatement and the board may reinstate the certificate if the individual meets all of the following requirements:
1. Has not engaged in any conduct that would constitute grounds for revocation or suspension of a certificate pursuant to section 32-741.
2. Files an application for reinstatement on the form prescribed by the board and pays the reinstatement application fee pursuant to section 32‑729.
3. Submits proof that the individual has satisfied continuing professional education requirements as prescribed by the board.
4. On board approval of reinstatement, pays the registration and reinstatement fees pursuant to section 32-729.
32-730.03. Expired status; reinstatement
A. A registrant's certificate is expired if the registrant fails to reinstate the certificate within twelve months after it has been suspended pursuant to section 32-741.01 or 32-741.02 or fails to reinstate a certificate that has been on inactive status pursuant to section 32-730.01 for more than six years.
B. An individual whose certificate has expired shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA" while the certificate remains on expired status unless the individual qualifies for limited reciprocity privilege pursuant to section 32-725.
C. An individual whose certificate has expired may apply for reinstatement and the board may reinstate the certificate if the individual meets all of the following requirements:
1. Files an application for reinstatement on a form prescribed by the board and pays the reinstatement application fee pursuant to section 32-729.
2. Has not engaged in any conduct that would constitute grounds for revocation or suspension of a certificate pursuant to section 32-741.
3. Submits proof that the individual has satisfied continuing professional education requirements as prescribed by the board.
4. On board approval of reinstatement, pays the registration fee pursuant to section 32-729.
32-730.04. Retired status; reinstatement
A. A registrant who is at least fifty-five years of age, who has been a certified public accountant or public accountant in any jurisdiction for at least twenty years and who is not actively engaged in the practice of accounting for a fee or other compensation may request that the registrant's certificate be placed on retired status by submitting a request on a form approved by the board. A registrant whose certificate is under a disciplinary order by the board or against whom disciplinary proceedings have been initiated may not place or maintain a certificate on retired status.
B. A registrant whose certificate is on retired status:
1. Shall continue to register once every two years with the board and pay a registration fee as prescribed by section 32-729.
2. Shall not engage in the practice of accounting for a fee or other compensation while the registrant's certificate remains on retired status.
3. Shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA" unless accompanied by the word "retired" or the abbreviation "RET" while the registrant's certificate remains on retired status.
4. May apply for reinstatement and the board may reinstate the certificate if the registrant meets all of the following requirements:
(a) Submits proof that the registrant has satisfied continuing professional education requirements as prescribed by the board.
(b) Pays the registration fee pursuant to section 32-729.
Sec. 11. Section 32-731, Arizona Revised Statutes, is amended to read:
32-731. Certified public accountant partnership; qualifications
A. Except as provided in section 32-725, subsection G, a partnership engaged in this state in the practice of accounting by certified public accountants shall register biennially once every two years with the board as a partnership of certified public accountants and shall meet the following requirements:
1. At least one partner shall be a resident and a full‑time practicing certified public accountant in good standing in this state.
2. At least fifty‑one per cent of the ownership of the partnership, in terms of direct and indirect financial interests and voting rights, must belong to holders in good standing of certificates or licenses to practice accounting as certified public accountants in any state or foreign country. Only certified public accountants whose qualifications are considered to be substantially equivalent, as provided by section 32‑726 32-721, subsections C and D, may be considered as meeting the requirement prescribed by this paragraph.
B. A partnership registered with the board pursuant to this section may include owners who are not certified pursuant to this chapter if all of the following apply:
1. The partnership designates an individual who is certified pursuant to this chapter and who is responsible for the proper registration of the firm.
2. All noncertified partners actively participate in the management of the partnership or a directly affiliated entity that has been approved by the board. For the purposes of this paragraph:
(a) A partner actively participates if all of the following occur:
(i) The partner performs at least five hundred hours of professional services for the public accounting partnership during the calendar year.
(ii) The professional services performed constitute the partner's principal occupation.
(iii) The partner's interest in the public accounting partnership reverts to the partnership if the partner stops performing services for the partnership.
(b) "Directly affiliated entity" means a firm in which each owner of an equity interest in the entity actively participates in the business of providing services to the firm's clients.
3. Any partner who is ultimately responsible for supervising attest services in this state or the partner who signs any reports related to restricted financial attest services on behalf of the partnership in this state shall be certified pursuant to this chapter and shall meet the experience requirements for carrying out these functions adopted by the board in its rules.
4. The partnership complies with other requirements imposed by the board in its rules.
C. Application for registration pursuant to this section shall be made on affidavit of a partner of the partnership who is a certified public accountant in good standing in this state. The board shall in each case shall determine whether the applicant is eligible for registration. A partnership that is registered pursuant to this section may use the words "certified public accountants" or the abbreviation "C.P.A.'s" or "CPA's" in connection with its partnership name as provided for by the board in its rules. Partnerships registered pursuant to this chapter may provide restricted financial attest services. Notification shall be given to the board within one month of the termination of any partnership, or of the admission to or withdrawal of an Arizona partner from any partnership registered pursuant to this section.
D. A partnership that applies for an initial registration or a renewal pursuant to this section shall list in its application all states in which the partnership has applied for or holds a registration, license or permit as a certified public accountant partnership and shall list any past denials, revocations or suspensions of registrations, licenses or permits by any other state.
E. An applicant for registration or a partnership registered pursuant to this section shall notify the board in writing within one month of any change of partners whose principal place of business is in this state, any change in the number or location of offices of the partnership in this state, any change in the identity of the individuals in charge of the partnership's offices in this state and any issuance, denial, revocation or suspension of a registration, license or permit by any other state.
F. A partnership that desires to practice under this chapter must register with the board for a two year period in the month of the effective date of the formation of the firm and every two years thereafter and pay a registration fee of at least one hundred dollars but not more than three hundred dollars for the privilege of practicing in this state. A partnership registering for less than two years must pay a pro rata portion of the fee.
G. F. A partnership that fails to comply with this section due to changes in the ownership of the firm or personnel after receiving or renewing the registration must take corrective action to comply with this section as quickly as possible. The board may grant a reasonable period of time for the firm to take these corrective actions. A failure to comply with these requirements is grounds for suspension or revocation of the partnership registration.
Sec. 12. Section 32-732, Arizona Revised Statutes, is amended to read:
32-732. Public accountant partnership; requirements
A. A partnership engaged in this state in the practice of public accounting as public accountants shall register biennially with the board as a partnership of public accountants and shall meet the following requirements:
1. All public accountant members of the partnership shall be residents in good standing in this state.
2. At least fifty‑one per cent of the ownership of the partnership, in terms of direct and indirect financial interests and voting rights, must belong to holders in good standing of certificates or licenses to practice accounting as public accountants in any state or foreign country.
B. A partnership registered with the board pursuant to this section may include owners who are not public accountants if all of the following apply:
1. The partnership designates a person who is a public accountant and who is responsible for the proper registration of the firm.
2. All partners who are not public accountants actively participate in the management of the partnership or a directly affiliated entity that has been approved by the board. For the purposes of this paragraph:
(a) A partner actively participates if all of the following occur:
(i) The partner performs at least five hundred hours of professional services for the public accounting partnership during the calendar year.
(ii) The professional services performed constitute the partner's principal occupation.
(iii) The partner's interest in the public accounting partnership reverts to the partnership if the partner stops performing services for the partnership.
(b) "Directly affiliated entity" means a firm where each owner of an equity interest in the entity actively participates in the business of providing services to the firm's clients.
3. Any person who is responsible for supervising attest services or for signing reports on financial statements on behalf of the partnership shall be certified pursuant to this chapter and shall meet the experience requirements for carrying out these functions adopted by the board in its rules.
4. The partnership complies with other requirements imposed by the board in its rules.
C. Application for registration pursuant to this section shall be made upon affidavit of a partner of the partnership who is a certified public accountant or public accountant in good standing in this state. The board shall in each case shall determine whether the applicant is eligible for registration. A partnership which that is registered pursuant to this section and which that holds a certificate issued pursuant to this chapter may use the words "public accountants" or the abbreviation "P.A.'s" or "PA's" in connection with its partnership name as provided for by the board in its rules. Each partnership registered pursuant to this chapter may provide restricted financial attest services. Notification shall be given to the board within one month of the termination of any partnership, or of the admission to or withdrawal of an Arizona partner from any partnership registered pursuant to this section.
D. A partnership that applies for an initial registration or a renewal pursuant to this section shall list in its application all states in which the partnership has applied for or holds a registration, license or permit as a public accountant partnership and shall list any past denials, revocations or suspensions of registrations, licenses or permits by any other state.
E. An applicant for registration or a partnership registered pursuant to this section shall notify the board in writing within one month of any change of partners whose principal place of business is in this state, any change in the number or location of offices of the partnership in this state, any change in the identity of the persons in charge of the partnership's offices in this state and any issuance, denial, revocation or suspension of a registration, license or permit by any other state.
F. A partnership that desires to practice under this chapter must register with the board for a two-year period in the month of the effective date of the formation of the firm and every two years thereafter and pay a registration fee of at least one hundred dollars but not more than three hundred dollars for the privilege of practicing in this state. A partnership registering for less than two years must pay a pro rata portion of the fee.
G. A partnership that fails to comply with this section due to changes in the ownership of the firm or personnel after receiving or renewing the registration must take corrective action to comply with this section as quickly as possible. The board may grant a reasonable period of time for the firm to take these corrective actions. A failure to comply with these requirements is grounds for suspension or revocation of the partnership registration.
Sec. 13. Section 32-741, Arizona Revised Statutes, is amended to read:
32-741. Revocation or suspension of certificate; disciplinary action; letter of concern
A. After notice and an opportunity for a hearing, the board may revoke or suspend any certificate granted under this chapter and may take disciplinary action concerning the holder of any certificate for any of the following causes:
1. Conviction of a felony under the laws of any state or of the United States if civil rights have not been restored pursuant to title 13, chapter 9 or other applicable recognized judicial or gubernatorial order.
2. Conviction of any crime that has a reasonable relationship to the practice of accounting by a certified public accountant or by a public accountant, including crimes involving accounting or tax violations, dishonesty, fraud, misrepresentation, embezzlement, theft, forgery, perjury or breach of fiduciary duty, regardless of whether civil rights have been restored.
3. Fraud or deceit in obtaining a certificate as a certified public accountant or in obtaining a certificate as a public accountant under this chapter.
4. Dishonesty, fraud or gross or continuing negligence in the practice of accounting.
5. Cancellation, revocation or suspension of Discipline to the holder of any certificate or other authority to practice or refusal to renew the certificate or other authority to practice as a certified public accountant by any other state or foreign country for any cause other than failure to pay license or registration fees.
6. Violation of any of the provisions of this chapter, of title 44, chapter 12, article 13 or of any fraud provisions of the federal securities laws.
7. Final judgment in a civil action if the court makes findings of accounting violations, dishonesty, fraud, misrepresentation or breach of fiduciary duty.
8. Final judgment or order in a civil action or administrative proceeding if the court or agency makes findings of violations of any fraud provisions of the laws of this state or federal securities laws.
9. Knowing Violation of any decision, order or rule issued or adopted by the board.
10. Suspension or revocation for cause of the right to practice before the federal securities exchange commission or any other governmental body or agency or the public company accounting oversight board or its successor.
11. Offering or accepting commissions or contingency fees for services rendered for clients for whom the attest function services are is also offered or rendered in the performance of the practice of accounting unless:
(a) The fee is fixed by a court or another public authority.
(b) In a tax matter, the fee is determined based on the results of a judicial proceeding or the finding of a governmental agency.
12. Failing to disclose to a client that the registrant has received or expects to receive a commission from a third party for any engagement, services or product sales involving services other than the attest function.
13. Knowingly Making any false or misleading statement or verification in support of an application for a certificate, registration or permit filed by another person.
14. Knowingly Making a false or misleading statement:
(a) To the board or its designated agent.
(b) On a form required by the board.
(c) In written correspondence to the board.
15. Failing to respond in writing or furnish information in a timely manner to the board or its designated agent, if the information is legally requested by the board and is in the registrant's possession or control.
B. Pursuant to title 41, chapter 6, article 10, the board may summarily suspend the certificate of any certified public accountant or public accountant pending proceedings for revocation or other disciplinary action on the receipt of either of the following:
1. A notice of conviction of any crime that has a reasonable relationship to the practice of accounting, including crimes involving accounting or tax violations, dishonesty, fraud, misrepresentation, embezzlement, theft, forgery, perjury or breach of fiduciary duty or of any felony.
2. A final judgment or order in a civil action or administrative proceeding in which the court or agency made findings of violations of any fraud provisions of the laws of this state or federal securities laws.
C. The certificate of any certified public accountant or public accountant who fails to timely register and pay the biennial registration fee as required by section 32‑730, subsection A shall be automatically suspended without prior notice or a hearing. Terms of a suspension issued under this subsection shall include a provision that the suspension shall be automatically vacated when the registrant has paid all past due fees. The board may waive the collection of any fee after suspension under conditions which the board deems justifiable. If the certified public accountant or public accountant fails to reinstate the certificate within twelve months of the date of suspension, the certificate expires. The board shall not reinstate a certificate of a certified public accountant or public accountant whose certificate has expired pursuant to this subsection unless the certified public accountant or public accountant complies with section 32‑730, subsection H or section 32‑748.
D. The board shall, after notice and a hearing, suspend the certificate of any certified public accountant or public accountant who fails to show proof, in accordance with section 32‑730, subsection D, of compliance with the continuing professional education requirements established by the board. If the board determines that the failure was for reasonable cause or excusable neglect, the board may require compliance as expeditiously as possible. If the certified public accountant or public accountant fails to reinstate the certificate within twelve months after the date of suspension, the certificate expires. The board shall not reinstate a certificate that has expired pursuant to this subsection unless the certified public accountant or public accountant complies with section 32‑748 and all other requirements for reinstatement.
E. C. The board may take disciplinary action against a holder of a certificate issued pursuant to this chapter who is practicing accounting even if the person is not representing to the public that the person is a certified public accountant or a public accountant and even if the person is practicing accounting in a firm that is not registered by the board.
F. D. The board may issue a letter of concern if, in the opinion of the board, there is insufficient evidence to support disciplinary action against the registrant, but the board believes, as a result of information ascertained during an investigation, that continuation of the activities that led to the investigation may result in future board action against the registrant. A registrant may file a response with the board within thirty days after receipt of a letter of concern. Letters of concern issued by the board and records kept by the board in connection with investigations leading to letters of concern are confidential and are not public records.
Sec. 14. Renumber
Section 32-741.01, Arizona Revised Statutes, is renumbered as section 32-741.04.
Sec. 15. Title 32, chapter 6, article 3, Arizona Revised Statutes, is amended by adding a new section 32-741.01 and sections 32-741.02 and 32‑741.03, to read:
32-741.01. Suspension for nonregistration; expiration of certificate
A. The certificate of any registrant who fails to timely register and pay the biennial registration fee as required by section 32-729 is automatically suspended without prior notice or a hearing.
B. A registrant whose certificate is suspended shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA" while the REGISTRANT'S certificate remains on suspended status.
C. A suspension under this section is vacated when the board has determined that the registrant has paid all past due fees and has satisfied all other requirements for renewal.
D. If the registrant fails to renew the registrant's registration within twelve months after the date of suspension, the certificate expires.
32-741.02. Suspension for noncompliance with continuing education requirements; expiration of certificate
A. After notice and an opportunity for a hearing, The board shall suspend the certificate of any registrant who fails to show proof of compliance with the continuing professional education requirements established by the board pursuant to section 32-730.
B. A registrant whose certificate is suspended shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA" while the REGISTRANT'S CERTIFICATE remains on suspended status.
C. A suspension issued under this section is vacated when the board has determined that the registrant has complied with the continuing professional Education requirements and has satisfied all other requirements for renewal.
D. If the registrant fails to meet the requirements of subsection C of this section within twelve months after the date of suspension, the certificate expires.
32-741.03. Revoked certificate; qualifications for new certificate
A. If the board revokes the certificate of an individual registrant, the individual shall return the certificate to the board. If the individual is unable to return the certificate, the individual must sign and submit to the board an affidavit on a form prescribed by the board stating that the individual is unable to return the certificate to the board.
B. An individual whose certificate has been revoked shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA".
C. Except as otherwise provided in this subsection, the board shall not issue a certificate to an individual whose certificate has been revoked until five years after the effective date of revocation. If the revocation is based only on section 32-741, subsection a, paragraph 1 or 2 and the criminal conviction is ultimately reversed on appeal, the board shall enter an order vacating the revocation.
D. An individual whose certificate has been revoked may apply for and the board may issue a new certificate if the individual does all of the following:
1. Files an application for reinstatement on a form prescribed by the board and pays the reinstatement application fee pursuant to section 32-729.
2. Demonstrates through substantial evidence presented to the board that the individual is completely rehabilitated with respect to the conduct that was the basis of the revocation of the certificate. Demonstration of rehabilitation shall include evidence of the following:
(a) The individual has not engaged in any conduct during the revocation period that, if the individual had been registered during the period, would have constituted a basis for revocation or suspension pursuant to section 32-741.
(b) With respect to any criminal conviction that constitutes any part of the basis for the previous revocation, civil rights have been fully restored pursuant to statute or an applicable recognized judicial or gubernatorial order.
(c) Restitution has been made as ordered by the board or by a court of competent jurisdiction as a result of the individual's violation of this chapter or rules adopted pursuant to this chapter.
(d) Other evidence of rehabilitation that the board deems appropriate.
3. Submits proof that the individual has satisfied continuing professional education requirements as prescribed by the board.
4. If not waived by the board, presents satisfactory evidence from an accredited institution or a college or university that maintains standards comparable to those of an accredited institution that the individual has completed at least one hundred fifty semester hours of education as follows:
(a) At least thirty-six semester hours are accounting courses of which at least thirty semester hours are upper level courses.
(b) At least thirty semester hours are related courses.
5. If prescribed by the board, presents evidence that the individual has retaken and passed the uniform certified public accountant examination.
6. On board approval of reinstatement, pays the registration fee pursuant to section 32-729.
Sec. 16. Section 32-741.04, Arizona Revised Statutes, as renumbered by this act, is amended to read:
32-741.04. Relinquishment of certificate with disciplinary proceedings pending; qualifications for new certificate
A. A certified public accountant or public accountant against whom disciplinary proceedings have been initiated may relinquish his the individual's certificate to the board during the course of the board's investigation pending or in lieu of an investigation or disciplinary proceedings or while under a disciplinary order. The board shall consider a relinquishment tendered by a certified public accountant or public accountant pursuant to this section and shall determine whether to accept the relinquishment. The board shall issue an order documenting its decision.
B. A certified public accountant or public accountant who relinquishes a certificate pursuant to this section loses the right to practice accounting as a certified public accountant or public accountant in this state.
B. An individual whose certificate has been relinquished shall not assume or use the title or designation of "certified public accountant" or "public accountant" or the abbreviation "C.P.A.", "CPA", "P.A." or "PA".
C. A person An individual who relinquishes a certificate pursuant to this section and who desires to may apply for reinstatement and the board may issue a new certificate shall meet if the individual does all of the requirements for applicants for initial certification pursuant to section 32‑721. following:
1. Files an application for reinstatement on the form prescribed by the board and pays the reinstatement application fee pursuant to section 32‑729.
2. Demonstrates through substantial evidence presented to the board that the individual is completely rehabilitated with respect to the conduct that was pending at the time of relinquishment. Demonstration of rehabilitation shall include evidence of the following:
(a) The individual has not engaged in any conduct during the relinquishment period that, if the individual had been registered during the period, would have constituted a basis for revocation or suspension pursuant to section 32-741.
(b) With respect to any criminal conviction that constitutes any part of the basis for the relinquishment, civil rights have been fully restored pursuant to statute or an applicable recognized judicial or gubernatorial order.
(c) The individual has addressed or redeemed any complaints, investigations or any board order requirements that are pending or outstanding at the time of relinquishment.
(d) Other evidence of rehabilitation that the board deems appropriate.
3. Submits proof that the individual has satisfied continuing education requirements as prescribed by the board.
4. If not waived by the board, presents satisfactory evidence from an accredited institution or a college or university that maintains standards comparable to those of an accredited institution that the individual has completed at least one hundred fifty semester hours of education as follows:
(a) At least thirty-six semester hours are accounting courses of which at least thirty semester hours are upper level courses.
(b) At least thirty semester hours are related courses.
5. If prescribed by the board, presents evidence that the individual has retaken and passed the uniform certified public accountant examination.
6. On board approval of reinstatement, pays the registration fee pursuant to section 32-729.
C. D. If the board accepts the relinquishment of a certificate of a certified public accountant or public accountant, the person shall return the certificate to the board and shall attach to the certificate a document that is signed and dated and that is in substantially the following form:
I, (insert name of registrant), acknowledge that disciplinary proceedings have been initiated against me pursuant to title 32, chapter 6, article 3, Arizona Revised Statutes, and I relinquish my right to practice accounting as a (insert either "certified public accountant" or "public accountant") in the state of Arizona. I understand that if I choose to apply for a new certificate, I must meet all requirements for initial certification pursuant to section 32‑721 32-741.04, Arizona Revised Statutes. I further understand that, in deciding whether to issue a new certificate to me, the board will consider all disciplinary actions currently pending against me and any other matters it determines to be appropriate.
Sec. 17. Section 32-742, Arizona Revised Statutes, is amended to read:
32-742. Revocation or suspension of firm's certificate; failure to reinstate
A. After notice and an opportunity for a hearing, the board shall revoke a firm's registration to practice public accounting if at any time it does not have all the qualifications prescribed by this chapter.
B. After notice and an opportunity for a hearing, the board may revoke or suspend a firm's registration to practice public accounting and may additionally take disciplinary action concerning the registrant for any of the causes enumerated in section 32‑741, subsection A or for any of the following additional causes:
1. The revocation or suspension of any certificate issued by the board of any partner, shareholder, member, manager, officer, director, agent or employee of the firm.
2. The cancellation, revocation, suspension or refusal to renew the authority of the firm or any Arizona partner, shareholder, member, manager, officer, director, agent or employee to practice public accounting in any other state for any cause other than failure to pay an annual registration fee in the other state.
C. The board shall suspend, without notice or hearing, the registration to practice public accounting of any firm that fails to register and pay the biennial registration fee as required by section 32‑730. Terms of a suspension issued under this subsection shall include a provision that the suspension shall be vacated when the registrant has paid all past due fees and penalties. The board may waive the collection of any fee or penalty after suspension under conditions the board deems justifiable. If the firm fails to reinstate its registration within twelve months after the date of suspension, the registration expires.
D. A firm whose registration has expired for failure to renew may apply for reinstatement. The board may reinstate the registration if the firm meets all of the following requirements:
1. Files an application on a form prescribed by the board.
2. Has not engaged in any conduct that would constitute grounds for revocation or suspension of a registration pursuant to section 32-741.
3. On board approval of reinstatement, pays the registration fee pursuant to section 32-729.
Sec. 18. Section 32-747, Arizona Revised Statutes, is amended to read:
32-747. Unlawful use of designation or abbreviation; classification
A. An individual who has received from the board a certificate to practice as a certified public accountant or as a public accountant issued under the laws of the state or who is a limited reciprocity privilege holder under section 32‑725 shall be known as a "certified public accountant" or "public accountant", in accordance with the certificate or the privilege and may also use the abbreviation "C.P.A.", "CPA", "P.A." or "PA", in accordance with the certificate or the privilege unless the status of the certificate is canceled, expired, suspended, relinquished or revoked. No other individual or firm shall assume or use any title, designation or abbreviation or any other title, designation, sign, card or device in this state tending to indicate that the individual or firm using it is authorized to practice public accounting or is a certified public accountant or a public accountant.
B. No individual or firm shall when referring to accounting or accounting practices assume or use the title or designation "chartered accountant", "certified accountant", "enrolled accountant", "registered accountant", "licensed accountant", "certified tax accountant", "certified tax consultant" or any other title or designation likely or intended to be confused with "certified public accountant" or "public accountant" unless the individual or firm has received from the board a certificate to practice as a certified public accountant or as a public accountant issued under the laws of this state, the individual is a limited reciprocity privilege holder under section 32‑725 or the partnership, corporation or other entity is permitted to practice accounting in this state pursuant to section 32‑725, subsection G. No individual or firm shall assume or use any of the abbreviations "C.A.", "E.A.", "R.A.", "C.T.A.", "C.T.C.", "L.A." or similar abbreviations likely or intended to be confused with "C.P.A.", "CPA", "P.A." or "PA". An individual who is qualified as a certified public accountant in this state and who also holds a comparable title under the laws of another country may use the title in conjunction with the title "certified public accountant", "C.P.A." or "CPA", and an individual enrolled to practice before the internal revenue service and recognized as an enrolled agent may use the abbreviation "E.A.".
C. This section does not apply to or affect or limit the right to continuous use of a partnership name, or a modification of a partnership name, by successor firms formed by the remaining partner or partners or added partner or partners even though the individuals whose names are included in the partnership name are not partners, but the successor firm shall conform to all other provisions of this chapter. This section does not apply to or affect or limit the right to continuous use of a professional corporation's name as provided pursuant to this chapter or title 10, chapter 20 or a professional limited liability company's name pursuant to this chapter or title 29, chapter 4.
D. No corporation or professional limited liability company shall be permitted to practice public accounting in this state, except that this subsection does not apply to a professional corporation incorporated under the laws of this state or to a professional limited liability company, either of which is properly qualified to do business within this state and is otherwise qualified to practice accounting under this chapter.
E. If an individual violates this chapter, or represents himself to the public as having received a certificate or registration to practice after a certificate or registration has been revoked or suspended, the individual is guilty of a class 2 misdemeanor unless another classification is specifically prescribed in this chapter. Each day an offense is committed constitutes a separate offense.
F. The displaying or uttering by an individual or firm of any card, sign, advertisement or other printed, engraved or written instrument or device bearing an individual's or firm's name and intended to be confused with the words "certified public accountant" or "public accountant" or an abbreviation of either shall be prima facie evidence in a prosecution, proceeding or hearing brought under this section that the individual or firm whose name is so displayed caused or procured the displaying or uttering of the card, sign, advertisement or other printed, engraved or written instrument or device.
Sec. 19. Section 32-747.01, Arizona Revised Statutes, is amended to read:
32-747.01. Attest services; requirements
Except as provided in section 32‑725, subsection G, an individual who holds a certificate issued by the board to practice as a certified public accountant or a public accountant may provide restricted financial attest services only if the individual provides restricted financial attest services through a firm registered pursuant to this chapter.
Sec. 20. Repeal
Section 32-748, Arizona Revised Statutes, is repealed.
Sec. 21. Certified public accountant certificates; firm registrations; suspension; expiration
A. Notwithstanding any other law, a certificate of a certified public accountant or public accountant that was suspended for nonregistration by the Arizona state board of accountancy before July 21, 1997, and that remains suspended on the effective date of this act is expired.
B. Notwithstanding any other law, a firm registration to practice public accounting that was suspended for nonregistration by the Arizona board of accountancy before September 26, 2008, and that remains suspended on the effective date of this act is expired.
APPROVED BY THE GOVERNOR APRIL 29, 2013.
FILED IN THE OFFICE OF THE SECRETARY OF STATE APRIL 30, 2013.
