BILL REQ. #: Z-1044.3
| State of Washington | 61st Legislature | 2010 Regular Session |
Read first time 01/14/10. Referred to Committee on Government Operations & Elections.
AN ACT Relating to transferring the board of accountancy to the department of licensing; amending RCW 18.04.015, 18.04.025, 18.04.035, 18.04.045, 18.04.055, 18.04.065, 18.04.105, 18.04.180, 18.04.183, 18.04.185, 18.04.195, 18.04.205, 18.04.215, 18.04.295, 18.04.335, 18.04.345, 18.04.350, 18.04.405, 18.04.430, and 43.03.028; reenacting and amending RCW 18.235.020; adding a new section to chapter 18.04 RCW; adding a new section to chapter 18.235 RCW; creating a new section; and providing an effective date.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1 RCW 18.04.015 and 2001 c 294 s 1 are each amended to read
as follows:
(1) It is the policy of this state and the purpose of this chapter:
(a) To promote the dependability of information which is used for
guidance in financial transactions or for accounting for or assessing
the status or performance of commercial and noncommercial enterprises,
whether public, private or governmental; and
(b) To protect the public interest by requiring that:
(i) Persons who hold themselves out as licensees or certificate
holders conduct themselves in a competent, ethical, and professional
manner;
(ii) ((A public)) An administrative authority be established ((that
is competent)) to prescribe and assess the qualifications of certified
public accountants, including certificate holders who are not licensed
for the practice of public accounting;
(iii) Persons other than licensees refrain from using the words
"audit," "review," and "compilation" when designating a report
customarily prepared by someone knowledgeable in accounting;
(iv) ((A public)) An administrative authority be established to
provide for consumer alerts and public protection information to be
published regarding persons or firms who violate the provisions of
((chapter 294, Laws of 2001)) this chapter or board rule and to provide
general consumer protection information to the public; and
(v) The use of accounting titles likely to confuse the public be
prohibited.
(2) The purpose of chapter 294, Laws of 2001 is to make revisions
to chapter 234, Laws of 1983 and chapter 103, Laws of 1992 to: Fortify
the public protection provisions of chapter 294, Laws of 2001;
establish one set of qualifications to be a licensee; revise the
regulations of certified public accountants; make revisions in the
ownership of certified public accounting firms; assure to the greatest
extent possible that certified public accountants from Washington state
are substantially equivalent with certified public accountants in other
states and can therefore perform the duties of certified public
accountants in as many states and countries as possible; assure
certified public accountants from other states and countries have met
qualifications that are substantially equivalent to the certified
public accountant qualifications of this state; and clarify the
authority of the board of accountancy with respect to the activities of
persons holding licenses and certificates under this chapter. It is
not the intent of chapter 294, Laws of 2001 to in any way restrict or
limit the activities of persons not holding licenses or certificates
under this chapter except as otherwise specifically restricted or
limited by chapter 234, Laws of 1983 and chapter 103, Laws of 1992.
(3) A purpose of chapter 103, Laws of 1992, revising provisions of
chapter 234, Laws of 1983, is to clarify the authority of the board of
accountancy with respect to the activities of persons holding
certificates under this chapter. Furthermore, it is not the intent of
chapter 103, Laws of 1992 to in any way restrict or limit the
activities of persons not holding certificates under this chapter
except as otherwise specifically restricted or limited by chapter 234,
Laws of 1983.
Sec. 2 RCW 18.04.025 and 2008 c 16 s 2 are each amended to read
as follows:
Unless the context clearly requires otherwise, the definitions in
this section apply throughout this chapter.
(1) "Attest" means providing the following financial statement
services:
(a) Any audit or other engagement to be performed in accordance
with the statements on auditing standards;
(b) Any review of a financial statement to be provided in
accordance with the statements on standards for accounting and review
services;
(c) Any examination of prospective financial information to be
performed in accordance with the statements on standards for
attestation engagements; and
(d) Any engagement to be performed in accordance with the public
company accounting oversight board auditing standards.
(2) "Board" means the board of accountancy created by RCW
18.04.035.
(3) "Certificate" means a certificate as a certified public
accountant issued prior to July 1, 2001, as authorized under the
provisions of this chapter.
(4) "Certificate holder" means the holder of a certificate as a
certified public accountant who has not become a licensee, has
maintained CPE requirements, and who does not practice public
accounting.
(5) "Certified public accountant" or "CPA" means a person holding
a certified public accountant license or certificate.
(6) "Compilation" means providing a service to be performed in
accordance with statements on standards for accounting and review
services that is presenting in the form of financial statements,
information that is the representation of management (owners) without
undertaking to express any assurance on the statements.
(7) "CPE" means continuing professional education.
(8) "Department" means the department of licensing.
(9) "Director" means the director of the department of licensing.
(10) "Firm" means a sole proprietorship, a corporation, or a
partnership. "Firm" also means a limited liability company formed
under chapter 25.15 RCW.
(((9))) (11) "Holding out" means any representation to the public
by the use of restricted titles as set forth in RCW 18.04.345 by a
person or firm that the person or firm holds a license under this
chapter and that the person or firm offers to perform any professional
services to the public as a licensee. "Holding out" shall not affect
or limit a person or firm not required to hold a license under this
chapter from engaging in practices identified in RCW 18.04.350.
(((10))) (12) "Home office" is the location specified by the client
as the address to which a service is directed.
(((11))) (13) "Inactive" means the certificate is in an inactive
status because a person who held a valid certificate before July 1,
2001, has not met the current requirements of licensure and has been
granted inactive certificate holder status through an approval process
established by the board.
(((12))) (14) "Individual" means a living, human being.
(((13))) (15) "License" means a license to practice public
accountancy issued to an individual under this chapter, or a license
issued to a firm under this chapter.
(((14))) (16) "Licensee" means the holder of a license to practice
public accountancy issued under this chapter.
(((15))) (17) "Manager" means a manager of a limited liability
company licensed as a firm under this chapter.
(((16))) (18) "NASBA" means the national association of state
boards of accountancy.
(((17))) (19) "Peer review" means a study, appraisal, or review of
one or more aspects of the attest or compilation work of a licensee or
licensed firm in the practice of public accountancy, by a person or
persons who hold licenses and who are not affiliated with the person or
firm being reviewed, including a peer review, or any internal review or
inspection intended to comply with quality control policies and
procedures, but not including the "quality assurance review" under
subsection (((21))) (23) of this section.
(((18))) (20) "Person" means any individual, nongovernmental
organization, or business entity regardless of legal form, including a
sole proprietorship, firm, partnership, corporation, limited liability
company, association, or not-for-profit organization, and including the
sole proprietor, partners, members, and, as applied to corporations,
the officers.
(((19))) (21) "Practice of public accounting" means performing or
offering to perform by a person or firm holding itself out to the
public as a licensee, for a client or potential client, one or more
kinds of services involving the use of accounting or auditing skills,
including the issuance of "audit reports," "review reports," or
"compilation reports" on financial statements, or one or more kinds of
management advisory, or consulting services, or the preparation of tax
returns, or the furnishing of advice on tax matters. "Practice of
public accounting" shall not include practices that are permitted under
the provisions of RCW 18.04.350(10) by persons or firms not required to
be licensed under this chapter.
(((20))) (22) "Principal place of business" means the office
location designated by the licensee for purposes of substantial
equivalency and reciprocity.
(((21))) (23) "Quality assurance review" means a process
established by and conducted at the direction of the board of study,
appraisal, or review of one or more aspects of the attest or
compilation work of a licensee or licensed firm in the practice of
public accountancy, by a person or persons who hold licenses and who
are not affiliated with the person or firm being reviewed.
(((22))) (24) "Reports on financial statements" means any reports
or opinions prepared by licensees or persons holding practice
privileges under substantial equivalency, based on services performed
in accordance with generally accepted auditing standards, standards for
attestation engagements, or standards for accounting and review
services as to whether the presentation of information used for
guidance in financial transactions or for accounting for or assessing
the status or performance of commercial and noncommercial enterprises,
whether public, private, or governmental, conforms with generally
accepted accounting principles or another comprehensive basis of
accounting. "Reports on financial statements" does not include
services referenced in RCW 18.04.350(10) provided by persons not
holding a license under this chapter.
(((23))) (25) "Review committee" means any person carrying out,
administering or overseeing a peer review authorized by the reviewee.
(((24))) (26) "Rule" means any rule adopted by the board or the
department under authority of this chapter.
(((25))) (27) "Sole proprietorship" means a legal form of
organization owned by one person meeting the requirements of RCW
18.04.195.
(((26))) (28) "State" includes the states of the United States, the
District of Columbia, Puerto Rico, Guam, the United States Virgin
Islands, and the Commonwealth of the Northern Mariana Islands at such
time as the board determines that the Commonwealth of the Northern
Mariana Islands is issuing licenses under the substantially equivalent
standards in RCW 18.04.350(2)(a).
Sec. 3 RCW 18.04.035 and 2004 c 159 s 1 are each amended to read
as follows:
(1) There is created a board of accountancy ((for the state of
Washington to be known as the Washington state board of accountancy.
Effective June 30, 2001, the board shall consist)) consisting of nine
members appointed by the governor. Members of the board shall include
six persons who have been licensed in this state continuously for the
previous ten years. Three members shall be public members qualified to
judge whether the qualifications, activities, and professional practice
of those regulated under this chapter conform with standards to protect
the public interest, including one public member qualified to represent
the interests of clients of individuals and firms licensed under this
chapter.
(2) The members of the board shall be appointed by the governor to
a term of three years. Vacancies occurring during a term shall be
filled by appointment for the unexpired term. Upon the expiration of
a member's term of office, the member shall continue to serve until a
successor has been appointed and has assumed office. The governor
shall remove from the board any member whose license to practice has
been revoked or suspended and may, after hearing, remove any member of
the board for neglect of duty or other just cause. No person who has
served three successive complete terms is eligible for reappointment.
Appointment to fill an unexpired term is not considered a complete
term. ((In order to stagger their terms, of the two new appointments
made to the board upon June 11, 1992, the first appointed member shall
serve a term of two years initially.))
Sec. 4 RCW 18.04.045 and 2001 c 294 s 4 are each amended to read
as follows:
(1) The board shall annually elect a chair, a vice-chair, and a
secretary from its members.
(2) A majority of the board constitutes a quorum for the
transaction of business.
(3) The board shall have a seal which shall be judicially noticed.
(4) The board shall keep records of its proceedings, and of any
proceeding in court arising from or founded upon this chapter. Copies
of these records certified as correct under the seal of the board are
admissible in evidence as tending to prove the content of the records.
(5) The ((governor)) director shall ((appoint)) employ an executive
((director of the board, who shall serve at the pleasure of the
governor)) secretary. The ((executive)) director may employ such
personnel as is appropriate for carrying out the purposes of this
chapter. The executive ((director)) secretary shall hold a valid
Washington license. ((The board may arrange for such volunteer
assistance as it requires to perform its duties. Individuals or
committees assisting the board constitute volunteers for purposes of
chapter 4.92 RCW.))
(6) The board shall ((file)) prepare an annual report of its
activities ((with the governor)). The report shall include, but not be
limited to, a statement of all receipts and disbursements. ((Upon
request, the board shall mail a copy of each annual report to any
member of the public.)) The report shall be posted on the department's
web site.
(7) In making investigations concerning alleged violations of the
provisions of this chapter and in all proceedings under RCW 18.04.295
or chapter 34.05 RCW, the board chair, or a member of the board, or a
board designee acting in the chair's place, may administer oaths or
affirmations to witnesses appearing before the board, subpoena
witnesses and compel their attendance, take testimony, and require that
documentary evidence be submitted.
(8) The board may review the publicly available professional work
of licensees on a general and random basis, without any requirement of
a formal complaint or suspicion of impropriety on the part of any
particular licensee. If as a result of such review the board discovers
reasonable grounds for a more specific investigation, the board may
proceed under its investigative and disciplinary rules.
(9) The board may provide for consumer alerts and public protection
information to be published regarding persons or firms who violate the
provisions of this chapter or board rule and may provide general
consumer protection information to the public.
(10) As provided in RCW 18.04.370, the board may enter into
stipulated agreements and orders of assurance with persons who have
violated the provisions of RCW 18.04.345 or certify the facts to the
prosecuting attorney of the county in which such person resides for
criminal prosecution.
Sec. 5 RCW 18.04.055 and 2001 c 294 s 5 are each amended to read
as follows:
The board may adopt and amend rules under chapter 34.05 RCW for the
orderly conduct of its affairs. The board shall prescribe rules
consistent with this chapter as necessary to implement this chapter.
Included may be:
(1) Rules of procedure to govern the conduct of matters before the
board;
(2) Rules of professional conduct for all licensees, certificate
holders, and nonlicensee owners of licensed firms, in order to
establish and maintain high standards of competence and ethics
including rules dealing with independence, integrity, objectivity, and
freedom from conflicts of interest;
(3) Rules specifying actions and circumstances deemed to constitute
holding oneself out as a licensee in connection with the practice of
public accountancy;
(4) Rules specifying the manner and circumstances of the use of the
titles "certified public accountant" and "CPA," by holders of
certificates who do not also hold licenses under this chapter;
(5) Rules specifying the educational requirements to take the
certified public accountant examination;
(6) Rules designed to ensure that licensees' "reports on financial
statements" meet the definitional requirements for that term as
specified in RCW 18.04.025;
(7) Requirements for CPE to maintain or improve the professional
competence of licensees as a condition to maintaining their license and
certificate holders as a condition to maintaining their certificate
under RCW 18.04.215;
(8) Rules governing firms issuing or offering to issue reports on
financial statements or using the title "certified public accountant"
or "CPA" including, but not limited to, rules concerning their style,
name, title, and affiliation with any other organization, and
establishing reasonable practice and ethical standards to protect the
public interest;
(9) The board may by rule implement a quality assurance review
program as a means to monitor licensees' quality of practice and
compliance with professional standards. The board may exempt from such
program, licensees who undergo periodic peer reviews in programs of the
American Institute of Certified Public Accountants, NASBA, or other
programs recognized and approved by the board;
(10) The board may by rule require licensed firms to obtain
professional liability insurance if in the board's discretion such
insurance provides additional and necessary protection for the public;
(11) Rules specifying the experience requirements in order to
qualify for a license;
(12) Rules specifying the requirements for certificate holders to
qualify for a license under this chapter which must include provisions
for meeting CPE and experience requirements prior to application for
licensure;
(13) Rules specifying the registration requirements, including
ethics examination ((and fee requirements)), for resident nonlicensee
partners, shareholders, and managers of licensed firms;
(14) Rules specifying the ethics CPE requirements for certificate
holders and owners of licensed firms, including the process for
reporting compliance with those requirements;
(15) Rules specifying the experience and CPE requirements for
licensees offering or issuing reports on financial statements; and
(16) Any other rule which the board finds necessary or appropriate
to implement this chapter.
Sec. 6 RCW 18.04.065 and 2001 c 294 s 6 are each amended to read
as follows:
The ((board)) department shall set ((its)) fees required under this
chapter at a level adequate to pay the costs of administering this
chapter. All fees for licenses, registrations of nonlicensee partners,
shareholders, and managers of licensed firms, renewals of licenses,
renewals of registrations of nonlicensee partners, shareholders, and
managers of licensed firms, renewals of certificates, reinstatements of
lapsed licenses, reinstatements of lapsed certificates, reinstatements
of lapsed registrations of nonlicensee partners, shareholders, and
managers of licensed firms, practice privileges under RCW 18.04.350,
and delinquent filings received under the authority of this chapter
shall be deposited in the certified public accountants' account created
by RCW 18.04.105. Appropriation from such account shall be made only
for the cost of administering the provisions of this chapter.
Sec. 7 RCW 18.04.105 and 2004 c 159 s 2 are each amended to read
as follows:
(1) A license to practice public accounting shall be ((granted))
issued by the department to any person certified by the board ((to any
person)):
(a) Who is of good character. Good character, for purposes of this
section, means lack of a history of dishonest or felonious acts. The
board may refuse to ((grant)) authorize the department to issue a
license on the ground of failure to satisfy this requirement only if
there is a substantial connection between the lack of good character of
the applicant and the professional and ethical responsibilities of a
licensee and if the finding by the board of lack of good character is
supported by ((a preponderance of)) clear and convincing evidence.
When an applicant is found to be unqualified for a license because of
a lack of good character, the board shall furnish the applicant a
statement containing the findings of the board and a notice of the
applicant's right of appeal;
(b) Who has met the educational standards established by rule as
the board determines to be appropriate;
(c) Who has passed an examination;
(d) Who has had one year of experience which is gained:
(i) Through the use of accounting, issuing reports on financial
statements, management advisory, financial advisory, tax, tax advisory,
or consulting skills;
(ii) While employed in government, industry, academia, or public
practice; and
(iii) Meeting the competency requirements in a manner as determined
by the board to be appropriate and established by board rule; and
(e) Who has paid appropriate fees as established by rule by the
((board)) department.
(2) The examination described in subsection (1)(c) of this section
shall test the applicant's knowledge of the subjects of accounting and
auditing, and other related fields the board may specify by rule. The
time for holding the examination is fixed by the board and may be
changed from time to time. The board shall prescribe by rule the
methods of applying for and taking the examination, including methods
for grading examinations and determining a passing grade required of an
applicant for a license. The board shall to the extent possible see to
it that the grading of the examination, and the passing grades, are
uniform with those applicable to all other states. The board may make
use of all or a part of the uniform certified public accountant
examination and advisory grading service of the American Institute of
Certified Public Accountants and may contract with third parties to
perform administrative services with respect to the examination as the
board deems appropriate to assist it in performing its duties under
this chapter. The board shall establish by rule provisions for
transitioning to a new examination structure or to a new media for
administering the examination.
(3) The board shall charge each applicant an examination fee for
the initial examination or for reexamination. The applicable fee shall
be paid by the person at the time he or she applies for examination,
reexamination, or evaluation of educational qualifications. Fees for
examination, reexamination, or evaluation of educational qualifications
shall be determined by ((the board under chapter 18.04 RCW)) rule of
the department. There is established in the state treasury an account
to be known as the certified public accountants' account. All fees
received from candidates to take any or all sections of the certified
public accountant examination shall be used only for costs related to
the examination.
(4) Persons who on June 30, 2001, held valid certificates
previously issued under this chapter shall be deemed to be certificate
holders, subject to the following:
(a) ((Certificate holders may, prior to June 30, 2006, petition the
board to become licensees by documenting to the board that they have
gained one year of experience through the use of accounting, issuing
reports on financial statements, management advisory, financial
advisory, tax, tax advisory, or consulting skills, without regard to
the eight-year limitation set forth in (b) of this subsection, while
employed in government, industry, academia, or public practice.)) Certificate holders who ((
(b)do)) did not petition to become
licensees prior to June 30, 2006, may after that date petition the
board to become licensees by documenting to the board that they have
one year of experience acquired within eight years prior to applying
for a license through the use of accounting, issuing reports on
financial statements, management advisory, financial advisory, tax, tax
advisory, or consulting skills in government, industry, academia, or
public practice.
(((c))) (b) Certificate holders who petition the board pursuant to
(a) ((or (b))) of this subsection must also meet competency
requirements in a manner as determined by the board to be appropriate
and established by board rule.
(((d))) (c) Any certificate holder petitioning the board pursuant
to (a) ((or (b))) of this subsection to become a licensee must submit
to the board satisfactory proof of having completed an accumulation of
one hundred twenty hours of CPE during the thirty-six months preceding
the date of filing the petition.
(((e))) (d) Any certificate holder petitioning the board pursuant
to (a) ((or (b))) of this subsection to become a licensee must pay the
appropriate fees established by rule by the ((board)) department.
(5) Certificate holders shall comply with the prohibition against
the practice of public accounting in RCW 18.04.345.
(6) Persons who on June 30, 2001, held valid certificates
previously issued under this chapter are deemed to hold inactive
certificates, subject to renewal as inactive certificates, until they
have petitioned the board to become licensees and have met the
requirements of subsection (4) of this section. No individual who did
not hold a valid certificate before July 1, 2001, is eligible to obtain
an inactive certificate.
(7) Persons deemed to hold inactive certificates under subsection
(6) of this section shall comply with the prohibition against the
practice of public accounting in subsection (8)(b) of this section and
RCW 18.04.345, but are not required to display the term inactive as
part of their title, as required by subsection (8)(a) of this section
until renewal. Certificates renewed to any persons after June 30,
2001, are inactive certificates and the inactive certificate holders
are subject to the requirements of subsection (8) of this section.
(8) Persons holding an inactive certificate:
(a) Must use or attach the term "inactive" whenever using the title
CPA or certified public accountant or referring to the certificate, and
print the word "inactive" immediately following the title, whenever the
title is printed on a business card, letterhead, or any other document,
including documents published or transmitted through electronic media,
in the same font and font size as the title; and
(b) Are prohibited from practicing public accounting.
Sec. 8 RCW 18.04.180 and 2004 c 159 s 3 are each amended to read
as follows:
(1) The board ((shall)) may authorize the department to issue a
license to a holder of a certificate/valid license issued by another
state that entitles the holder to practice public accountancy, provided
that:
(a) Such state makes similar provision to grant reciprocity to a
holder of a valid certificate or license in this state;
(b) The applicant meets the CPE requirements of RCW 18.04.215(5);
(c) The applicant meets the good character requirements of RCW
18.04.105(1)(a); and
(d) The applicant passed the examination required for issuance of
his or her ((certificate or)) license with grades that would have been
passing grades at that time in this state and meets all current
requirements in this state for issuance of a license at the time
application is made; or at the time of the issuance of the applicant's
license in the other state, met all the requirements then applicable in
this state; or has three years of experience within the five years
immediately preceding application or had five years of experience
within the ten years immediately preceding application in the practice
of public accountancy that meets the requirements prescribed by the
board.
(2) The board may accept NASBA's designation of the applicant as
substantially equivalent to national standards as meeting the
requirement of subsection (1)(d) of this section.
(3) A licensee who has been granted a license under the reciprocity
provisions of this section shall notify the board within thirty days if
the license or certificate issued in the other jurisdiction has lapsed
or if the status of the license or certificate issued in the other
jurisdiction becomes otherwise invalid.
Sec. 9 RCW 18.04.183 and 2001 c 294 s 9 are each amended to read
as follows:
The board ((shall grant)) may authorize the department to issue a
license as a certified public accountant to a holder of a permit,
license, or certificate issued by a foreign country's board, agency, or
institute, provided that:
(1) The foreign country where the foreign permit, license, or
certificate was issued is a party to an agreement on trade with the
United States that encourages the mutual recognition of licensing and
certification requirements for the provision of covered services by the
parties under the trade agreement;
(2) Such foreign country's board, agency, or institute makes
similar provision to allow a person who holds a valid license issued by
this state to obtain such foreign country's comparable permit, license,
or certificate;
(3) The foreign permit, license, or certificate:
(a) Was duly issued by such foreign country's board, agency, or
institute that regulates the practice of public accountancy; and
(b) Is in good standing at the time of the application; and
(c) Was issued upon the basis of educational, examination,
experience, and ethical requirements substantially equivalent currently
or at the time of issuance of the foreign permit, license, or
certificate to those in this state;
(4) The applicant has within the thirty-six months prior to
application completed an accumulation of one hundred twenty hours of
CPE as required under RCW 18.04.215(5). The board shall provide for
transition from existing to new CPE requirements;
(5) The applicant's foreign permit, license, or certificate was the
type of permit, license, or certificate requiring the most stringent
qualifications if, in the foreign country, more than one type of
permit, license, or certificate is issued. This state's board shall
decide which are the most stringent qualifications;
(6) The applicant has passed a written examination or its
equivalent, approved by the board, that tests knowledge in the areas of
United States accounting principles, auditing standards, commercial
law, income tax law, and Washington state rules of professional ethics;
and
(7) The applicant has within the eight years prior to applying for
a license under this section, demonstrated, in accordance with the
rules issued by the board, one year of public accounting experience,
within the foreign country where the foreign permit, license, or
certificate was issued, equivalent to the experience required under RCW
18.04.105(1)(d) or such other experience or employment which the board
in its discretion regards as substantially equivalent.
The board may adopt by rule new CPE standards that differ from
those in subsection (4) of this section or RCW 18.04.215 if the new
standards are consistent with the CPE standards of other states so as
to provide to the greatest extent possible, consistent national
standards.
A licensee who has been granted a license under the reciprocity
provisions of this section shall notify the board within thirty days if
the permit, license, or certificate issued in the other jurisdiction
has lapsed or if the status of the permit, license, or certificate
issued in the other jurisdiction becomes otherwise invalid.
Sec. 10 RCW 18.04.185 and 2001 c 294 s 10 are each amended to
read as follows:
Application for a license to practice public accounting in this
state by a certified public accountant or CPA firm who holds a license
or permit to practice issued by another state constitutes the
appointment of the ((secretary of state)) director or designee as an
agent for service of process in any action or proceeding against the
applicant arising from any transaction or operation connected with or
incidental to the practice of public accounting in this state by the
holder of the license to practice.
Sec. 11 RCW 18.04.195 and 2008 c 16 s 3 are each amended to read
as follows:
(1) The board shall ((grant)) may authorize the department to issue
or renew licenses to practice as a CPA firm to applicants that
demonstrate their qualifications therefore in accordance with this
section.
(a) The following must hold a license issued under this section:
(i) Any firm with an office in this state performing attest
services as defined in RCW 18.04.025(1) or compilations as defined in
RCW 18.04.025(6);
(ii) Any firm with an office in this state that uses the title
"CPA" or "CPA firm"; or
(iii) Any firm that does not have an office in this state but
performs attest services described in RCW 18.04.025(1) (a), (c), or (d)
for a client having its home office in this state.
(b) A firm that is not subject to the requirements of subsection
(1)(a)(iii) of this section may perform other professional services
while using the title "CPA" or "CPA firm" in this state without a
license issued under this section only if:
(i) The firm performs such services through an individual with
practice privileges under RCW 18.04.350(2);
(ii) The firm can lawfully do so in the state where said
individuals with practice privileges have their principal place of
business; and
(iii) A firm performing services described in RCW 18.04.025 (1)(b)
and (6) meets the board's quality assurance (([review])) review program
requirements authorized by RCW 18.04.055(9) and the rules implementing
that section.
(2) A sole proprietorship required to obtain a license under
subsection (1) of this section shall license, as a firm, every three
years ((with)) through the ((board)) department.
(a) The sole proprietor shall hold and renew a license to practice
under RCW 18.04.105 and 18.04.215, or, in the case of a sole
proprietorship that must obtain a license pursuant to subsection
(1)(a)(iii) of this section, be a licensee of another state who meets
the requirements in RCW 18.04.350(2);
(b) Each resident individual in charge of an office located in this
state shall hold and renew a license to practice under RCW 18.04.105
and 18.04.215; and
(c) The licensed firm must meet competency requirements established
by rule by the board.
(3) A partnership required to obtain a license under subsection (1)
of this section shall license as a firm every three years ((with))
through the ((board)) department, and shall meet the following
requirements:
(a) At least one general partner of the partnership shall hold and
renew a license to practice under RCW 18.04.105 and 18.04.215, or, in
the case of a partnership that must obtain a license pursuant to
subsection (1)(a)(iii) of this section, be a licensee of another state
who meets the requirements in RCW 18.04.350(2);
(b) Each resident individual in charge of an office in this state
shall hold and renew a license to practice under RCW 18.04.105 and
18.04.215;
(c) At least a simple majority of the ownership of the licensed
firm in terms of financial interests and voting rights of all partners
or owners shall be held by persons who are licensees or holders of a
valid license issued under this chapter or by another state. The
principal partner of the partnership and any partner having authority
over issuing reports on financial statements shall hold a license under
this chapter or issued by another state; and
(d) The licensed firm must meet competency requirements established
by rule by the board.
(4) A corporation required to obtain a license under subsection (1)
of this section shall license as a firm every three years ((with))
through the ((board)) department and shall meet the following
requirements:
(a) At least a simple majority of the ownership of the licensed
firm in terms of financial interests and voting rights of all
shareholders or owners shall be held by persons who are licensees or
holders of a valid license issued under this chapter or by another
state and is principally employed by the corporation or actively
engaged in its business. The principal officer of the corporation and
any officer or director having authority over issuing reports on
financial statements shall hold a license under this chapter or issued
by another state;
(b) At least one shareholder of the corporation shall hold a
license under RCW 18.04.105 and 18.04.215, or, in the case of a
corporation that must obtain a license pursuant to subsection
(1)(a)(iii) of this section, be a licensee of another state who meets
the requirements in RCW 18.04.350(2);
(c) Each resident individual in charge of an office located in this
state shall hold and renew a license under RCW 18.04.105 and 18.04.215;
(d) A written agreement shall bind the corporation or its
shareholders to purchase any shares offered for sale by, or not under
the ownership or effective control of, a qualified shareholder, and
bind any holder not a qualified shareholder to sell the shares to the
corporation or its qualified shareholders. The agreement shall be
noted on each certificate of corporate stock. The corporation may
purchase any amount of its stock for this purpose, notwithstanding any
impairment of capital, as long as one share remains outstanding;
(e) The corporation shall comply with any other rules pertaining to
corporations practicing public accounting in this state as the board
may prescribe; and
(f) The licensed firm must meet competency requirements established
by rule by the board.
(5) A limited liability company required to obtain a license under
subsection (1) of this section shall license as a firm every three
years ((with)) through the ((board)) department, and shall meet the
following requirements:
(a) At least one member of the limited liability company shall hold
a license under RCW 18.04.105 and 18.04.215, or, in the case of a
limited liability company that must obtain a license pursuant to
subsection (1)(a)(iii) of this section, be a licensee of another state
who meets the requirements in RCW 18.04.350(2);
(b) Each resident manager or member in charge of an office located
in this state shall hold and renew a license under RCW 18.04.105 and
18.04.215;
(c) At least a simple majority of the ownership of the licensed
firm in terms of financial interests and voting rights of all owners
shall be held by persons who are licensees or holders of a valid
license issued under this chapter or by another state. The principal
member or manager of the limited liability company and any member
having authority over issuing reports on financial statements shall
hold a license under this chapter or issued by another state; and
(d) The licensed firm must meet competency requirements established
by rule by the board.
(6) Application for a license as a firm with an office in this
state shall be made upon the affidavit of the proprietor or individual
designated as managing partner, member, or shareholder for Washington.
This individual shall hold a license under RCW 18.04.215.
(7) In the case of a firm licensed in another state and required to
obtain a license under subsection (1)(a)(iii) of this section, the
application for the firm license shall be made upon the affidavit of an
individual who qualifies for practice privileges in this state under
RCW 18.04.350(2) who has been authorized by the applicant firm to make
the application. The board shall determine in each case whether the
applicant is eligible for a license.
(8) The board shall be given notification within ninety days after
the admission or withdrawal of a partner, shareholder, or member
engaged in this state in the practice of public accounting from any
partnership, corporation, or limited liability company so licensed.
(9) Licensed firms that fall out of compliance with the provisions
of this section due to changes in firm ownership, after receiving or
renewing a license, shall notify the board in writing within ninety
days of its falling out of compliance and propose a time period in
which they will come back into compliance. The board may grant a
reasonable period of time for a firm to be in compliance with the
provisions of this section. Failure to bring the firm into compliance
within a reasonable period of time, as determined by the board, may
result in suspension, revocation, or imposition of conditions on the
firm's license.
(10) The department shall establish fees for the license as a firm
and for notification ((of)) to the board of the admission or withdrawal
of a partner, shareholder, or member ((shall be determined by the
board)). Fees shall be paid by the firm at the time the license
application form or notice of admission or withdrawal of a partner,
shareholder, or member is filed with the ((board)) department.
(11) Nonlicensee owners of licensed firms are:
(a) Required to fully comply with the provisions of this chapter
and board rules;
(b) Required to be an individual;
(c) Required to be an active individual participant in the licensed
firm or affiliated entities as these terms are defined by board rule;
and
(d) Subject to discipline by the board for violation of this
chapter.
(12) Resident nonlicensee owners of licensed firms are required to
meet:
(a) The ethics examination((,)) and registration((, and fee))
requirements as established by the board rules and the fee requirement
as established by department rules; and
(b) The ethics CPE requirements established by the board rules.
(13)(a) Licensed firms must notify the board within thirty days
after:
(i) Sanction, suspension, revocation, or modification of their
professional license or practice rights by the securities exchange
commission, internal revenue service, or another state board of
accountancy;
(ii) Sanction or order against the licensee or nonlicensee firm
owner by any federal or other state agency related to the licensee's
practice of public accounting or violation of ethical or technical
standards established by board rule; or
(iii) The licensed firm is notified that it has been charged with
a violation of law that could result in the suspension or revocation of
the firm's license by a federal or other state agency, as identified by
board rule, related to the firm's professional license, practice
rights, or violation of ethical or technical standards established by
board rule.
(b) The board must adopt rules to implement this subsection and may
also adopt rules specifying requirements for licensees to report to the
((board)) department sanctions or orders relating to the licensee's
practice of public accounting or violation of ethical or technical
standards entered against the licensee by a nongovernmental
professionally related standard-setting entity.
Sec. 12 RCW 18.04.205 and 2008 c 16 s 4 are each amended to read
as follows:
(1) Each office established or maintained in this state for the
purpose of offering to issue or issuing attest or compilation reports
in this state or that uses the title "certified public accountant" or
"CPA," shall register with the ((board)) department under this chapter
every three years.
(2) Each office established or maintained in this state shall be
under the direct supervision of a resident licensee holding a license
under RCW 18.04.105 and 18.04.215.
(3) The board shall by rule prescribe the procedure to be followed
to register and maintain offices established in this state for the
purpose of offering to issue or issuing attest or compilation reports
or that use the title "certified public accountant" or "CPA."
(4) Fees for the registration of offices shall be ((determined))
established by the ((board)) department. Fees shall be paid by the
applicant at the time the registration form is filed with the ((board))
department.
Sec. 13 RCW 18.04.215 and 2003 c 290 s 2 are each amended to read
as follows:
(1) Three-year licenses shall be authorized by the board and issued
by the ((board)) department:
(a) To persons meeting the requirements of RCW 18.04.105(1),
18.04.180, or 18.04.183.
(b) To certificate holders meeting the requirements of RCW
18.04.105(4).
(c) To firms under RCW 18.04.195, meeting the requirements of RCW
18.04.205.
(2) The board shall, by rule, provide for a system of certificate
and license renewal and reinstatement. Applicants for renewal or
reinstatement shall, at the time of filing their applications, list
with the board all states and foreign jurisdictions in which they hold
or have applied for certificates, permits or licenses to practice.
(3) An inactive certificate is renewed every three years with
renewal subject to the requirements of ethics CPE prescribed by the
board, and the payment of fees((, prescribed)) required by rule of the
((board)) department. Failure to renew the inactive certificate shall
cause the inactive certificate to lapse and be subject to
reinstatement. The ((board)) department shall adopt rules providing
for fees, and the board shall adopt rules providing for procedures for
renewal and reinstatement of inactive certificates.
(4) A license is issued every three years with renewal subject to
requirements of CPE prescribed by the board and payment of fees((,
prescribed by the board)) as required by rule of the department.
Failure to renew the license shall cause the license to lapse and
become subject to reinstatement. Persons holding a lapsed license are
prohibited from using the title "CPA" or "certified public accountant."
Persons holding a lapsed license are prohibited from practicing public
accountancy. The ((board)) department shall adopt rules providing for
fees, and the board shall adopt rules providing for procedures for
issuance, renewal, and reinstatement of licenses.
(5) The board shall adopt rules providing for CPE for licensees and
certificate holders. The rules shall:
(a) Provide that a licensee shall verify to the ((board))
department that he or she has completed at least an accumulation of one
hundred twenty hours of CPE during the last three-year period to
maintain the license;
(b) Establish CPE requirements; and
(c) Establish when new licensees shall verify that they have
completed the required CPE.
(6) A certified public accountant who holds a license issued by
another state, and applies for a license in this state, may practice in
this state from the date of filing a completed application with the
board, until the board has acted upon the application provided the
application is made prior to holding out as a certified public
accountant in this state and no sanctions or investigations, deemed by
the board to be pertinent to public accountancy, by other jurisdictions
or agencies are in process.
(7) A licensee shall submit to the board satisfactory proof of
having completed an accumulation of one hundred twenty hours of CPE
recognized and approved by the board during the preceding three years.
Failure to furnish this evidence as required shall make the license
lapse and subject to reinstatement procedures, unless the ((board))
department determines the failure to have been due to retirement or
reasonable cause.
The board in its discretion may authorize the department to renew
a certificate or license despite failure to furnish evidence of
compliance with requirements of CPE upon condition that the applicant
follow a particular program of CPE. In issuing rules and individual
orders with respect to CPE requirements, the board, among other
considerations, may rely upon guidelines and pronouncements of
recognized educational and professional associations, may prescribe
course content, duration, and organization, and may take into account
the accessibility of CPE to licensees and certificate holders and
instances of individual hardship.
(8) Fees for renewal or reinstatement of certificates and licenses
in this state shall be determined by the ((board)) department under
this chapter. Fees shall be paid by the applicant at the time the
application form is filed with the ((board)) department. The ((board))
department, by rule, may provide for proration of fees for licenses or
certificates issued between normal renewal dates.
(9)(a) Licensees, certificate holders, and nonlicensee owners must
notify the board within thirty days after:
(i) Sanction, suspension, revocation, or modification of their
professional license or practice rights by the securities exchange
commission, internal revenue service, or another state board of
accountancy;
(ii) Sanction or order against the licensee, certificate holder, or
nonlicensee owner by any federal or other state agency related to the
licensee's practice of public accounting or the licensee's, certificate
holder's, or nonlicensee owner's violation of ethical or technical
standards established by board rule; or
(iii) The licensee, certificate holder, or nonlicensee owner is
notified that he or she has been charged with a violation of law that
could result in the suspension or revocation of a license or
certificate by a federal or other state agency, as identified by board
rule, related to the licensee's, certificate holder's, or nonlicensee
owner's professional license, practice rights, or violation of ethical
or technical standards established by board rule.
(b) The board must adopt rules to implement this subsection and may
also adopt rules specifying requirements for licensees, certificate
holders, and nonlicensee owners to report to the board sanctions or
orders relating to the licensee's practice of public accounting or the
licensee's, certificate holder's, or nonlicensee owner's violation of
ethical or technical standards entered against the licensee,
certificate holder, or nonlicensee owner by a nongovernmental
professionally related standard-setting entity.
Sec. 14 RCW 18.04.295 and 2004 c 159 s 4 are each amended to read
as follows:
(1) The board shall have the power to: Revoke, suspend, or refuse
to issue, renew, or reinstate a license or certificate; impose a fine
in an amount not to exceed thirty thousand dollars plus the board's
investigative and legal costs in bringing charges against a certified
public accountant, a certificate holder, a licensee, a licensed firm,
an applicant, a non-CPA violating the provisions of RCW 18.04.345, or
a nonlicensee holding an ownership interest in a licensed firm; may
impose full restitution to injured parties; may impose conditions
precedent to renewal of a certificate or a license; or may prohibit a
nonlicensee from holding an ownership interest in a licensed firm, for
any of the following causes:
(((1))) (a) Fraud or deceit in obtaining a license, or in any
filings with the department or board;
(((2))) (b) Dishonesty, fraud, or negligence while representing
oneself as a nonlicensee owner holding an ownership interest in a
licensed firm, a licensee, or a certificate holder;
(((3))) (c) A violation of any provision of this chapter;
(((4))) (d) A violation of a rule of professional conduct
promulgated by the board under the authority granted by this chapter;
(((5))) (e) Conviction of a crime or an act constituting a crime
under:
(((a))) (i) The laws of this state;
(((b))) (ii) The laws of another state, and which, if committed
within this state, would have constituted a crime under the laws of
this state; or
(((c))) (iii) Federal law;
(((6))) (f) Cancellation, revocation, suspension, or refusal to
renew the authority to practice as a certified public accountant by any
other state for any cause other than failure to pay a fee or to meet
the requirements of CPE in the other state;
(((7))) (g)(i) Suspension or revocation of the right to practice
matters relating to public accounting before any state or federal
agency;
(ii) For purposes of ((subsections (6) and (7))) (f) and (g)(i) of
this ((section)) subsection, a certified copy of such revocation,
suspension, or refusal to renew shall be prima facie evidence;
(((8))) (h) Failure to maintain compliance with the requirements
for issuance, renewal, or reinstatement of a certificate or license, or
to report changes to the ((board)) department;
(((9))) (i) Failure to cooperate with the department or board by:
(((a))) (i) Failure to furnish any papers or documents requested or
ordered by the department or board;
(((b))) (ii) Failure to furnish in writing a full and complete
explanation covering the matter contained in the complaint filed with
the department or board or the inquiry of the department or board;
(((c))) (iii) Failure to respond to subpoenas issued by the board,
whether or not the recipient of the subpoena is the accused in the
proceeding;
(((10))) (j) Failure by a nonlicensee owner of a licensed firm to
comply with the requirements of this chapter or department or board
rule; and
(((11))) (k) Failure to comply with an order of the board.
(2) The board shall also have the power to impose such other
disciplinary action authorized under RCW 18.235.110, upon determination
that a certified public accountant, a certificate holder, a licensee,
a licensed firm, an applicant, a non-CPA violating the provisions of
RCW 18.04.345, or a nonlicensee holding an ownership interest in a
licensed firm, has engaged in unprofessional conduct as defined by RCW
18.235.130.
Sec. 15 RCW 18.04.335 and 2001 c 294 s 16 are each amended to
read as follows:
(1) Upon application in writing and after hearing pursuant to
notice, the board may:
(a) Modify the suspension of, or authorize the department to
reissue a certificate or a license to, an individual whose certificate
or license has been revoked or suspended; or
(b) Modify the suspension of, or authorize the department to
reissue a license to a firm whose license has been revoked, suspended,
or which the board has refused to renew.
(2) In the case of suspension for failure to comply with a support
order under chapter 74.20A RCW, if the person has continued to meet all
other requirements for reinstatement during the suspension, reissuance
of a certificate or a license shall be automatic upon the board's
receipt of a release issued by the department of social and health
services stating that the individual is in compliance with the order.
Sec. 16 RCW 18.04.345 and 2009 c 116 s 1 are each amended to read
as follows:
(1) No individual may assume or use the designation "certified
public accountant-inactive" or "CPA-inactive" or any other title,
designation, words, letters, abbreviation, sign, card, or device
tending to indicate that the individual is a certified public
accountant-inactive or CPA-inactive unless the individual holds a
certificate. Individuals holding only a certificate may not practice
public accounting.
(2) No individual may hold himself or herself out to the public or
assume or use the designation "certified public accountant" or "CPA" or
any other title, designation, words, letters, abbreviation, sign, card,
or device tending to indicate that the individual is a certified public
accountant or CPA unless the individual qualifies for the privileges
authorized by RCW 18.04.350(2) or holds a license under RCW 18.04.105
and 18.04.215.
(3) No firm with an office in this state may perform or offer to
perform attest services as defined in RCW 18.04.025(1) or compilation
services as defined in RCW 18.04.025(6) or assume or use the
designation "certified public accountant" or "CPA" or any other title,
designation, words, letters, abbreviation, sign, card, or device
tending to indicate that the firm is composed of certified public
accountants or CPAs, unless the firm is licensed under RCW 18.04.195
and all offices of the firm in this state are maintained and registered
under RCW 18.04.205. This subsection does not limit the services
permitted under RCW 18.04.350(10) by persons not required to be
licensed under this chapter.
(4) No firm may perform the services defined in RCW 18.04.025(1)
(a), (c), or (d) for a client with its home office in this state unless
the firm is licensed under RCW 18.04.195, renews the firm license as
required under RCW 18.04.215, and all offices of the firm in this state
are maintained and registered under RCW 18.04.205.
(5) No individual, partnership, limited liability company, or
corporation offering public accounting services to the public may hold
himself, herself, or itself out to the public, or assume or use along,
or in connection with his, hers, or its name, or any other name the
title or designation "certified accountant," "chartered accountant,"
"licensed accountant," "licensed public accountant," "public
accountant," or any other title or designation likely to be confused
with "certified public accountant" or any of the abbreviations "CA,"
"LA," "LPA," or "PA," or similar abbreviations likely to be confused
with "CPA."
(6) No licensed firm may operate under an alias, a firm name,
title, or "DBA" that differs from the firm name that is registered with
the board.
(7) No individual with an office in this state may sign, affix, or
associate his or her name or any trade or assumed name used by the
individual in his or her business to any report prescribed by
professional standards unless the individual holds a license to
practice under RCW 18.04.105 and 18.04.215, a firm holds a license
under RCW 18.04.195, and all of the individual's offices in this state
are registered under RCW 18.04.205.
(8) No individual licensed in another state may sign, affix, or
associate a firm name to any report prescribed by professional
standards, or associate a firm name in conjunction with the title
certified public accountant, unless the individual:
(a) Qualifies for the practice privileges authorized by RCW
18.04.350(2); or
(b) Is licensed under RCW 18.04.105 and 18.04.215, and all of the
individual's offices in this state are maintained and registered under
RCW 18.04.205.
(9) No individual, partnership, limited liability company, or
corporation not holding a license to practice under RCW 18.04.105 and
18.04.215, or firm not licensed under RCW 18.04.195 or firm not
registering all of the firm's offices in this state under RCW
18.04.205, or not qualified for the practice privileges authorized by
RCW 18.04.350(2), may hold himself, herself, or itself out to the
public as an "auditor" with or without any other description or
designation by use of such word on any sign, card, letterhead, or in
any advertisement or directory.
(10) For purposes of this section, because individuals practicing
using practice privileges under RCW 18.04.350(2) are deemed
substantially equivalent to licensees under RCW 18.04.105 and
18.04.215, every word, term, or reference that includes the latter
shall be deemed to include the former, provided the conditions of such
practice privilege, as set forth in RCW 18.04.350 (4) and (5) are
maintained.
(11) Notwithstanding anything to the contrary in this section, it
is not a violation of this section for a firm that does not hold a
valid license under RCW 18.04.195 and that does not have an office in
this state to provide its professional services in this state so long
as it complies with the requirements of RCW 18.04.195(1)(b).
Sec. 17 RCW 18.04.350 and 2008 c 16 s 6 are each amended to read
as follows:
(1) Nothing in this chapter prohibits any individual not holding a
license and not qualified for the practice privileges authorized by
subsection (2) of this section from serving as an employee of a firm
licensed under RCW 18.04.195 and 18.04.215. However, the employee
shall not issue any compilation, review, audit, or examination report
on financial or other information over his or her name.
(2) An individual whose principal place of business is not in this
state shall be presumed to have qualifications substantially equivalent
to this state's requirements and shall have all the privileges of
licensees of this state without the need to obtain a license under RCW
18.04.105 if the individual:
(a) Holds a valid license as a certified public accountant from any
state that requires, as a condition of licensure, that an individual:
(i) Have at least one hundred fifty semester hours of college or
university education including a baccalaureate or higher degree
conferred by a college or university;
(ii) Achieve a passing grade on the uniform certified public
accountant examination; and
(iii) Possess at least one year of experience including service or
advice involving the use of accounting, attest, compilation, management
advisory, financial advisory, tax, or consulting skills, all of which
was verified by a licensee; or
(b) Holds a valid license as a certified public accountant from any
state that does not meet the requirements of (a) of this subsection,
but such individual's qualifications are substantially equivalent to
those requirements. Any individual who passed the uniform certified
public accountant examination and holds a valid license issued by any
other state prior to January 1, 2012, may be exempt from the education
requirements in (a)(i) of this subsection for purposes of this section.
(3) Notwithstanding any other provision of law, an individual who
qualifies for the practice privilege under subsection (2) of this
section may offer or render professional services, whether in person or
by mail, telephone, or electronic means, and no notice, fee, or other
submission shall be provided by any such individual. Such an
individual shall be subject to the requirements of subsection (4) of
this section.
(4) Any individual licensee of another state exercising the
privilege afforded under subsection (2) of this section and the firm
that employs that licensee simultaneously consent, as a condition of
exercising this privilege:
(a) To the personal and subject matter jurisdiction and
disciplinary authority of the board;
(b) To comply with this chapter and the board's and department's
rules;
(c) That in the event the license from the state of the
individual's principal place of business is no longer valid, the
individual will cease offering or rendering professional services in
this state individually and on behalf of a firm; and
(d) To the appointment of the state board which issued the
certificate or license as their agent upon whom process may be served
in any action or proceeding by this state's board against the
certificate holder or licensee.
(5) An individual who qualifies for practice privileges under
subsection (2) of this section may, for any entity with its home office
in this state, perform the following services only through a firm that
has obtained a license under RCW 18.04.195 and 18.04.215:
(a) Any financial statement audit or other engagement to be
performed in accordance with statements on auditing standards;
(b) Any examination of prospective financial information to be
performed in accordance with statements on standards for attestation
engagements; or
(c) Any engagement to be performed in accordance with public
company accounting oversight board auditing standards.
(6) A licensee of this state offering or rendering services or
using ((their)) his or her CPA title in another state shall be subject
to disciplinary action in this state for an act committed in another
state for which the licensee would be subject to discipline for an act
committed in the other state. Notwithstanding RCW 18.04.295 and this
section, the board shall cooperate with and investigate any complaint
made by the board of accountancy of another state or jurisdiction.
(7) Nothing in this chapter prohibits a licensee, a licensed firm,
any of their employees, or persons qualifying for practice privileges
by this section from disclosing any data in confidence to other
certified public accountants, quality assurance or peer review teams,
partnerships, limited liability companies, or corporations of certified
public accountants or to the board or the department or any of ((its))
their employees engaged in conducting quality assurance or peer
reviews, or any one of their employees in connection with quality or
peer reviews of that accountant's accounting and auditing practice
conducted under the auspices of recognized professional associations.
(8) Nothing in this chapter prohibits a licensee, a licensed firm,
any of their employees, or persons qualifying for practice privileges
by this section from disclosing any data in confidence to any employee,
representative, officer, or committee member of a recognized
professional association, or to the board or the department, or any of
((its)) their employees or committees in connection with a professional
investigation held under the auspices of recognized professional
associations or the board.
(9) Nothing in this chapter prohibits any officer, employee,
partner, or principal of any organization:
(a) From affixing his or her signature to any statement or report
in reference to the affairs of the organization with any wording
designating the position, title, or office which he or she holds in the
organization; or
(b) From describing himself or herself by the position, title, or
office he or she holds in such organization.
(10) Nothing in this chapter prohibits any person or firm composed
of persons not holding a license under this chapter from offering or
rendering to the public bookkeeping, accounting, tax services, the
devising and installing of financial information systems, management
advisory, or consulting services, the preparation of tax returns, or
the furnishing of advice on tax matters, the preparation of financial
statements, written statements describing how such financial statements
were prepared, or similar services, provided that persons,
partnerships, limited liability companies, or corporations not holding
a license who offer or render these services do not designate any
written statement as an "audit report," "review report," or
"compilation report," do not issue any written statement which purports
to express or disclaim an opinion on financial statements which have
been audited, and do not issue any written statement which expresses
assurance on financial statements which have been reviewed.
(11) Nothing in this chapter prohibits any act of or the use of any
words by a public official or a public employee in the performance of
his or her duties.
(12) Nothing contained in this chapter prohibits any person who
holds only a valid certificate from assuming or using the designation
"certified public accountant-inactive" or "CPA-inactive" or any other
title, designation, words, letters, sign, card, or device tending to
indicate the person is a certificate holder, provided, that such person
does not perform or offer to perform for the public one or more kinds
of services involving the use of accounting or auditing skills,
including issuance of reports on financial statements or of one or more
kinds of management advisory, financial advisory, consulting services,
the preparation of tax returns, or the furnishing of advice on tax
matters.
(13) Nothing in this chapter prohibits the use of the title
"accountant" by any person regardless of whether the person has been
granted a certificate or holds a license under this chapter. Nothing
in this chapter prohibits the use of the title "enrolled agent" or the
designation "EA" by any person regardless of whether the person has
been granted a certificate or holds a license under this chapter if the
person is properly authorized at the time of use to use the title or
designation by the United States department of the treasury. The board
shall by rule allow the use of other titles by any person regardless of
whether the person has been granted a certificate or holds a license
under this chapter if the person using the titles or designations is
authorized at the time of use by a nationally recognized entity
sanctioning the use of board authorized titles.
Sec. 18 RCW 18.04.405 and 2001 c 294 s 22 are each amended to
read as follows:
(1) A licensee, certificate holder, or licensed firm, or any of
their employees shall not disclose any confidential information
obtained in the course of a professional transaction except with the
consent of the client or former client or as disclosure may be required
by law, legal process, the standards of the profession, or as
disclosure of confidential information is permitted by RCW 18.04.350
(((3))) (7) and (((4))) (8), 18.04.295(((8))) (1)(i), 18.04.390, and
this section in connection with quality assurance, or peer reviews,
investigations, and any proceeding under chapter 34.05 RCW.
(2) This section shall not be construed as limiting the authority
of this state or of the United States or an agency of this state, the
board, or of the United States to subpoena and use such confidential
information obtained by a licensee, or any of their employees in the
course of a professional transaction in connection with any
investigation, public hearing, or other proceeding, nor shall this
section be construed as prohibiting a licensee or certified public
accountant whose professional competence has been challenged in a court
of law or before an administrative agency from disclosing confidential
information as a part of a defense to the court action or
administrative proceeding.
(3) The proceedings, records, and work papers of a review committee
shall be privileged and shall not be subject to discovery, subpoena, or
other means of legal process or introduction into evidence in any civil
action, arbitration, administrative proceeding, or board proceeding and
no member of the review committee or person who was involved in the
peer review process shall be permitted or required to testify in any
such civil action, arbitration, administrative proceeding, or board
proceeding as to any matter produced, presented, disclosed, or
discussed during or in connection with the peer review process, or as
to any findings, recommendations, evaluations, opinions, or other
actions of such committees, or any members thereof. Information,
documents, or records that are publicly available are not to be
construed as immune from discovery or use in any civil action,
arbitration, administrative proceeding, or board proceeding merely
because they were presented or considered in connection with the
quality assurance or peer review process.
Sec. 19 RCW 18.04.430 and 1997 c 58 s 811 are each amended to
read as follows:
The board shall immediately suspend the certificate or license of
a person who has been certified pursuant to RCW 74.20A.320 by the
department of social and health services as a person who is not in
compliance with a support order ((or a residential or visitation
order)). If the person has continued to meet all other requirements
for reinstatement during the suspension, reissuance of the license or
certificate shall be automatic upon the board's receipt of a release
issued by the department of social and health services stating that the
licensee is in compliance with the order.
NEW SECTION. Sec. 20 A new section is added to chapter 18.04 RCW
to read as follows:
The uniform regulation of business and professions act, chapter
18.235 RCW, governs unlicensed practice, the issuance and denial of
licenses, and the discipline of licensees under this chapter. If there
is a conflict between this chapter and chapter 18.235 RCW, the
provision in this chapter prevails.
NEW SECTION. Sec. 21 A new section is added to chapter 18.235
RCW to read as follows:
If there is a conflict between this chapter and chapter 18.04 RCW,
the provision in chapter 18.04 RCW prevails.
Sec. 22 RCW 18.235.020 and 2009 c 412 s 22, 2009 c 370 s 20, and
2009 c 102 s 5 are each reenacted and amended to read as follows:
(1) This chapter applies only to the director and the boards and
commissions having jurisdiction in relation to the businesses and
professions licensed under the chapters specified in this section.
This chapter does not apply to any business or profession not licensed
under the chapters specified in this section.
(2)(a) The director has authority under this chapter in relation to
the following businesses and professions:
(i) Auctioneers under chapter 18.11 RCW;
(ii) Bail bond agents and bail bond recovery agents under chapter
18.185 RCW;
(iii) Camping resorts' operators and salespersons under chapter
19.105 RCW;
(iv) Commercial telephone solicitors under chapter 19.158 RCW;
(v) Cosmetologists, barbers, manicurists, and estheticians under
chapter 18.16 RCW;
(vi) Court reporters under chapter 18.145 RCW;
(vii) Driver training schools and instructors under chapter 46.82
RCW;
(viii) Employment agencies under chapter 19.31 RCW;
(ix) For hire vehicle operators under chapter 46.72 RCW;
(x) Limousines under chapter 46.72A RCW;
(xi) Notaries public under chapter 42.44 RCW;
(xii) Private investigators under chapter 18.165 RCW;
(xiii) Professional boxing, martial arts, and wrestling under
chapter 67.08 RCW;
(xiv) Real estate appraisers under chapter 18.140 RCW;
(xv) Real estate brokers and salespersons under chapters 18.85 and
18.86 RCW;
(xvi) Security guards under chapter 18.170 RCW;
(xvii) Sellers of travel under chapter 19.138 RCW;
(xviii) Timeshares and timeshare salespersons under chapter 64.36
RCW;
(xix) Whitewater river outfitters under chapter 79A.60 RCW; ((and))
(xx) Home inspectors under chapter 18.280 RCW; and
(xxi) Body artists, body piercers, and tattoo artists, and body
art, body piercing, and tattooing shops and businesses, under chapter
18.300 RCW.
(b) The boards and commissions having authority under this chapter
are as follows:
(i) The board of accountancy established in chapter 18.04 RCW;
(ii) The state board of registration for architects established in
chapter 18.08 RCW;
(((ii))) (iii) The Washington state collection agency board
established in chapter 19.16 RCW;
(((iii))) (iv) The state board of registration for professional
engineers and land surveyors established in chapter 18.43 RCW governing
licenses issued under chapters 18.43 and 18.210 RCW;
(((iv))) (v) The funeral and cemetery board established in chapter
18.39 RCW governing licenses issued under chapters 18.39 and 68.05 RCW;
(((v))) (vi) The state board of licensure for landscape architects
established in chapter 18.96 RCW; and
(((vi))) (vii) The state geologist licensing board established in
chapter 18.220 RCW.
(3) In addition to the authority to discipline license holders, the
disciplinary authority may grant or deny licenses based on the
conditions and criteria established in this chapter and the chapters
specified in subsection (2) of this section. This chapter also governs
any investigation, hearing, or proceeding relating to denial of
licensure or issuance of a license conditioned on the applicant's
compliance with an order entered under RCW 18.235.110 by the
disciplinary authority.
Sec. 23 RCW 43.03.028 and 2007 c 241 s 3 are each amended to read
as follows:
(1) There is hereby created a state committee on agency officials'
salaries to consist of seven members, or their designees, as follows:
The president of the University of Puget Sound; the chairperson of the
council of presidents of the state's four-year institutions of higher
education; the chairperson of the Washington personnel resources board;
the president of the Association of Washington Business; the president
of the Pacific Northwest Personnel Managers' Association; the president
of the Washington State Bar Association; and the president of the
Washington State Labor Council. If any of the titles or positions
mentioned in this subsection are changed or abolished, any person
occupying an equivalent or like position shall be qualified for
appointment by the governor to membership upon the committee.
(2) The committee shall study the duties and salaries of the
directors of the several departments and the members of the several
boards and commissions of state government, who are subject to
appointment by the governor or whose salaries are fixed by the
governor, and of the chief executive officers of the following agencies
of state government:
The arts commission; the human rights commission; ((the board of
accountancy;)) the board of pharmacy; the eastern Washington historical
society; the Washington state historical society; the recreation and
conservation office; the criminal justice training commission; the
department of personnel; the state library; the traffic safety
commission; the horse racing commission; the advisory council on
vocational education; the public disclosure commission; the state
conservation commission; the commission on Hispanic affairs; the
commission on Asian Pacific American affairs; the state board for
volunteer firefighters and reserve officers; the transportation
improvement board; the public employment relations commission; the
forest practices appeals board; and the energy facilities site
evaluation council.
The committee shall report to the governor or the chairperson of
the appropriate salary fixing authority at least once in each fiscal
biennium on such date as the governor may designate, but not later than
seventy-five days prior to the convening of each regular session of the
legislature during an odd-numbered year, its recommendations for the
salaries to be fixed for each position.
(3) Committee members shall be reimbursed by the department of
personnel for travel expenses under RCW 43.03.050 and 43.03.060.
NEW SECTION. Sec. 24 (1) The board of accountancy is transferred
to the department of licensing.
(2)(a) All reports, documents, surveys, books, records, files,
papers, or written material in the possession of the board of
accountancy shall be delivered to the custody of the department of
licensing. All cabinets, furniture, office equipment, motor vehicles,
and other tangible property employed by the board of accountancy shall
be made available to the department of licensing. All funds, credits,
or other assets held by the board of accountancy shall be assigned to
the department of licensing.
(b) Any appropriations made to the board of accountancy shall, on
the effective date of this section, be transferred and credited to the
department of licensing.
(c) If any question arises as to the transfer of any personnel,
funds, books, documents, records, papers, files, equipment, or other
tangible property used or held in the exercise of the powers and the
performance of the duties and functions transferred, the director of
financial management shall make a determination as to the proper
allocation and certify the same to the state agencies concerned.
(3) All employees of the board of accountancy are transferred to
the jurisdiction of the department of licensing. All employees
classified under chapter 41.06 RCW, the state civil service law, are
assigned to the department of licensing to perform their usual duties
upon the same terms as formerly, without any loss of rights, subject to
any action that may be appropriate thereafter in accordance with the
laws and rules governing state civil service.
(4) All rules and all pending business before the board of
accountancy shall be continued and acted upon by the department of
licensing. All existing contracts and obligations shall remain in full
force and shall be performed by the department of licensing.
(5) The transfer of the powers, duties, functions, and personnel of
the board of accountancy shall not affect the validity of any act
performed before the effective date of this section.
(6) If apportionments of budgeted funds are required because of the
transfers directed by this section, the director of financial
management shall certify the apportionments to the agencies affected,
the state auditor, and the state treasurer. Each of these shall make
the appropriate transfer and adjustments in funds and appropriation
accounts and equipment records in accordance with the certification.
(7) All classified employees of the board of accountancy assigned
to the department of licensing under this act whose positions are
within an existing bargaining unit description at the department of
licensing shall become a part of the existing bargaining unit at the
department of licensing and shall be considered an appropriate
inclusion or modification of the existing bargaining unit under the
provisions of chapter 41.80 RCW.
NEW SECTION. Sec. 25 This act takes effect July 1, 2010.