Preproposal statement of inquiry was filed as WSR 00-19-010.
Title of Rule: WAC 4-25-610 Principles of conduct; and repealing WAC 4-25-620 When must I comply with the rules of conduct requiring integrity and objectivity? and 4-25-630 Competence.
Purpose: To identify the standards of conduct with which and when a Washington CPA using the CPA title must comply. To repeal WAC 4-25-620 and 4-25-630 that are being consolidated into WAC 4-25-610.
Statutory Authority for Adoption: RCW 18.04.055(2).
Statute Being Implemented: RCW 18.04.055(2).
Summary: Lists the principles of conduct in a clear rule-writing style with which and when a Washington CPA using the CPA title must abide. Repeals WAC 4-25-620 and 4-25-630 that are being consolidated into WAC 4-25-610.
Reasons Supporting Proposal: Clearly identifying the standards for Washington CPAs addresses the legislative directive to protect the public. The consolidation and subsequent repeal of WAC 4-25-620 and 4-25-630 promotes clarity. There is no need for short concise rules like WAC 4-25-620 and 4-25-630 to be restated in separate rules.
Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Dana M. McInturff, CPA, 711 South Capitol Way, #400, Olympia, (360) 586-0163.
Name of Proponent: Board of Accountancy, governmental.
Rule is not necessitated by federal law, federal or state court decision.
Explanation of Rule, its Purpose, and Anticipated Effects: The rule advises Washington CPAs of the standards of conduct and when they must comply with these standards. These standards are needed to establish and maintain high standards of competence and ethics to address the need to protect the public. The board proposes to consolidate WAC 4-25-620 and 4-25-630 into this rule and repeal WAC 4-25-620 and 4-25-630. WAC 4-25-620 and 4-25-630 are very short concise rules that are better included in this listing of standards. The goal of the amendment is to promote clarity; ensure effective communication; ensure fairness in interpretation and application of the rule; and promote efficiencies through minimizing gray areas.
Proposal Changes the Following Existing Rules: The amendment: (1) Changes the title of the rule to "What are the principles of conduct and when must I comply?"; (2) incorporates the provisions of WAC 4-25-620 When must I comply with the rules of conduct requiring integrity and objectivity and repeals WAC 4-25-620; (3) incorporates the provision of WAC 4-25-630 Competence and repeals WAC 4-25-620 [4-25-630]; and (4) is written in a clear rule-writing format.
No small business economic impact statement has been prepared under chapter 19.85 RCW. The proposed rule will not have more than minor economic impact on business.
RCW 34.05.328 does not apply to this rule adoption. The Board of Accountancy is not one of the agencies required to submit to the requirements of RCW 34.05.328.
Hearing Location: Capitol Court Building, 110 Capitol Way South, 11th and Capitol Way, Room 135, Olympia, WA, on April 27, 2001, at 9:30 a.m.
Assistance for Persons with Disabilities: Contact Cheryl Sexton by April 20, 2001, TDD (800) 833-6384, or (360) 664-9194.
Submit Written Comments to: Dana M. McInturff, P.O. Box 9131, Olympia, WA 98507-9131, fax (360) 664-9190, by April 26, 2001.
Date of Intended Adoption: April 27, 2001.
March 9, 2001
Dana M. McInturff, CPA
AMENDATORY SECTION(Amending WSR 93-22-046, filed 10/28/93, effective 11/28/93)
WAC 4-25-610 ((
Principles of conduct.)) What are the
principles of conduct and when must I comply with the principles?
(( The principles of conduct are as follows:
Professional demeanor - In carrying out their responsibilities, professional persons using the CPA title shall exercise professional judgment in all their activities.
The public interest - Persons using the CPA title shall accept the obligation to act in a way that will serve the public interest, honor the public trust, and demonstrate commitment to professionalism.
Integrity - To maintain and broaden public confidence persons using the CPA title shall perform all professional responsibilities with the highest sense of honesty.
Objectivity - Objectivity is to be maintained by persons using the CPA title. Specifically, persons using the CPA title shall:
(1) Avoid rendering professional services where actual or perceived conflicts of interest exist;
(2) Be independent in fact and appearance when providing auditing or other attestation services.
Due care - Persons using the CPA title shall comply with state law and the profession's technical and ethical standards, maintain competence and strive to improve the quality of services, and discharge professional responsibility to the best of the CPA's ability.)) If you use the title CPA, you must comply with the following principles of conduct. You must:
(1) Act in a way that will serve the public interest, maintain and honor the public's trust and demonstrate a commitment to professionalism;
(2) Maintain and broaden public confidence by performing all professional responsibilities with the highest sense of integrity and honesty;
(3) Not misrepresent facts or subordinate your professional judgment to others;
(4) Maintain objectivity;
(5) Avoid rendering professional services where actual or perceived conflicts of interest exist and remain free of conflicts of interest unless such conflicts are specifically permitted by board rule and professional standards; and
(6) Be independent in fact and appearance when providing attestation services.
(7) Demonstrate due care by:
• Complying with all federal and state laws and the profession's technical and ethical standards;
• Maintaining competence;
• Striving to improve the quality of services; and
• Discharging your professional responsibility to the best of your ability.
(8) Not undertake any endeavor for the performance of services as a CPA unless you reasonably expect to complete those services with professional competence.
[Statutory Authority: RCW 18.40.055. 93-22-046, § 4-25-610, filed 10/28/93, effective 11/28/93.]