Bill Text: IA SF198 | 2015-2016 | 86th General Assembly | Enrolled
Bill Title: A bill for an act relating to the regulation of certified public accountants and certified public accounting firms. (Formerly SSB 1060.) Effective 7-1-15.
Sponsorship: Committee Bill
Status: (Passed) 2015-03-31 - Signed by Governor. S.J. 756. [SF198 Detail]
Download: Iowa-2015-SF198-Enrolled.html
Senate File 198 - Enrolled
SENATE FILE
BY COMMITTEE ON STATE
GOVERNMENT
(SUCCESSOR TO SSB
1060)
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A BILL FOR
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Senate File 198
AN ACT
RELATING TO THE REGULATION OF CERTIFIED PUBLIC ACCOUNTANTS AND
CERTIFIED PUBLIC ACCOUNTING FIRMS.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
Section 1. Section 80A.2, Code 2015, is amended by adding
the following new subsection:
NEW SUBSECTION. 10. A certified public accountant
authorized to practice pursuant to chapter 542, while
performing duties as a certified public accountant.
Sec. 2. Section 542.3, subsection 26, Code 2015, is amended
to read as follows:
26. "Report", when used with reference to financial
statements any attest or compilation services, means a report,
opinion, or other form of a writing that states or implies
assurance as to the reliability of any the attested information
or compiled financial statements and that includes or is
accompanied by a statement or implication that the person or
firm issuing the report has special knowledge or competence
in accounting or auditing. Such statement or implication
of special knowledge or competence may arise from use by
the issuer of the report of names or titles indicating that
the person or firm is an accountant or auditor, or from the
language of the report itself. "Report" includes any form
of language which disclaims an opinion when such form of
language is conventionally understood to imply a positive
assurance as to the reliability of the attested information or
compiled financial statements referred to or special knowledge
or competence on the part of the person or firm issuing the
language, and any other form of language that is conventionally
understood to imply such assurance or such special knowledge
or competence.
Sec. 3. Section 542.7, subsection 3, Code 2015, is amended
by adding the following new paragraph:
NEW PARAGRAPH. 0c. (1) Notwithstanding chapter 496C or
any other provision of law to the contrary, a certified public
accounting firm organized as a professional corporation under
chapter 496C may have nonlicensee owners provided that the firm
complies with the requirements of this section.
(2) Notwithstanding chapter 489, article 11, or any other
provision of law to the contrary, a certified public accounting
firm organized as a professional limited liability company
under chapter 489, article 11, may have nonlicensee members
provided that the professional limited liability company
complies with the requirements of this section.
Sec. 4. Section 542.7, subsection 3, paragraphs c and d,
Code 2015, are amended to read as follows:
c. A licensee or person with a practice privilege under
section 542.20 who is responsible for supervising attest
or compilation services and signs or authorizes someone to
sign the accountant's report on the financial statements on
behalf of the firm shall meet the experience or competency
requirements set out in nationally recognized professional
standards for such services.
d. A licensee or person with a practice privilege under
section 542.20 who signs or authorizes someone to sign the
accountant's report on the financial statements on behalf of
the firm shall meet the experience or competency requirements
established in paragraph "c".
Sec. 5. Section 542.7, subsection 6, paragraph a, Code 2015,
is amended by striking the paragraph.
Sec. 6. Section 542.7, subsection 8, paragraph a, Code 2015,
is amended to read as follows:
a. The board, by rule, shall require as a condition
of renewal of a permit to practice as a certified public
accounting firm, that an applicant undergo, no more frequently
than once every three years, a peer review conducted in such
manner as the board specifies. The review shall include a
verification that any individual in the firm who is responsible
for supervising attest and compilation services and who signs
or authorizes someone to sign the accountant's report on a
financial statement on behalf of the firm meets the competency
requirements set forth in the professional standards for such
services.
Sec. 7. Section 542.7, subsection 9, paragraph a, Code 2015,
is amended to read as follows:
a. The applicant does not engage in, and does not intend to
engage in during the following year, financial reporting areas
of practice, including but not limited to financial audits,
compilations, and reviews. An applicant granted a waiver
pursuant to this paragraph shall immediately notify the board
if the applicant engages in such practice, and shall be subject
to peer review.
Sec. 8. Section 542.13, subsections 8 and 11, Code 2015, are
amended to read as follows:
8. A nonlicensee shall not use language in any statement
relating to the financial affairs of a person or entity which
is conventionally used by licensees in reports on financial
statements or any attest service. The board shall develop and
issue language which nonlicensees may use in connection with
such financial information.
11. This section does not apply to a person or firm holding
a certification, designation, degree, or license granted in a
foreign country entitling the holder to engage in the practice
of public accountancy or its equivalent in such country, whose
activities in this state are limited to providing professional
services to a person or firm who is a resident of, government
of, or business entity of the country in which the person holds
such entitlement, who does not perform attest or compilation
services, and who does not issue reports with respect to the
financial statements information of any other person, firm, or
governmental unit in this state, and who does not use in this
state any title or designation other than the one under which
the person practices in such country, followed by a translation
of such title or designation into the English language, if it
is in a different language, and by the name of such country.
Sec. 9. Section 542.17, unnumbered paragraph 1, Code 2015,
is amended to read as follows:
A licensee shall not voluntarily disclose information
communicated to the licensee by a client relating to and
in connection with services rendered to the client by the
licensee, except with the permission of the client, or an
heir, successor, or personal representative of the client.
Such information is deemed to be confidential. However, this
section shall not be construed as prohibiting the disclosure of
information required to be disclosed by the standards of the
public accounting profession in reporting on the examination of
financial statements or in the performance of an attest service
or as prohibiting disclosures in a court proceeding, in an
investigation or proceeding under this chapter or chapter 272C,
in an ethical investigation conducted by a private professional
organization, in the course of a peer review, to another person
active in the licensee's firm performing services for that
client on a need=to=know basis, to persons associated with the
investigative entity who need this information for the sole
purpose of assuring quality control, or as otherwise required
by law.
PAM JOCHUM
President of the Senate
KRAIG PAULSEN
Speaker of the House
I hereby certify that this bill originated in the Senate and
is known as Senate File 198, Eighty=sixth General Assembly.
MICHAEL E. MARSHALL
Secretary of the Senate
Approved , 2015
TERRY E. BRANSTAD
Governor
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