Text: HF00450 Text: HF00452 Text: HF00400 - HF00499 Text: HF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 HOUSE FILE 451 1 2 1 3 AN ACT 1 4 REGULATING THE PRACTICE OF ACCOUNTING, ESTABLISHING FEES, 1 5 PROVIDING PENALTIES, AND PROVIDING AN EFFECTIVE DATE. 1 6 1 7 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 1 8 1 9 Section 1. NEW SECTION. 542D.1 TITLE. 1 10 This chapter shall be known and may be cited as the "Iowa 1 11 Accountancy Act of 2001". 1 12 Sec. 2. NEW SECTION. 542D.2 LEGISLATIVE INTENT. 1 13 It is the policy of this state, and the purpose of this 1 14 chapter, to promote the reliability of information that is 1 15 used for guidance in financial transactions or for accounting 1 16 for or assessing the financial status or performance of 1 17 commercial, noncommercial, and governmental enterprises. The 1 18 reliance of the public in general and of the business 1 19 community in particular on sound financial reporting imposes 1 20 on persons engaged in such practice certain obligations both 1 21 to their clients and to the public. These obligations, which 1 22 this chapter is intended to enforce, include the obligation to 1 23 maintain independence in thought and action, to strive 1 24 continuously to improve one's professional skills, to observe 1 25 where applicable generally accepted accounting principles and 1 26 generally accepted auditing standards, to promote sound and 1 27 informative financial reporting, to hold the affairs of 1 28 clients in confidence, and to maintain high standards of 1 29 personal conduct in all matters affecting one's fitness to 1 30 practice public accountancy. The public interest requires 1 31 that persons professing special competence in accountancy or 1 32 offering assurance as to the reliability or fairness of 1 33 presentation of such information shall have demonstrated their 1 34 qualifications to do so, and that persons who have not 1 35 demonstrated and maintained such qualifications not be 2 1 permitted to represent themselves as having such special 2 2 competence or to offer such assurance; that the conduct of 2 3 persons licensed as having special competence in accountancy 2 4 be regulated in all aspects of their professional work; that a 2 5 public authority competent to prescribe and assess the 2 6 qualifications and to regulate the conduct of licensees be 2 7 established; and that the use of titles that have a capacity 2 8 or tendency to deceive the public as to the status or 2 9 competence of the persons using such titles be prohibited. 2 10 Sec. 3. NEW SECTION. 542D.3 DEFINITIONS. 2 11 As used in this chapter, unless the context otherwise 2 12 requires: 2 13 1. "Attest" or "attest service" means providing any of the 2 14 following services: 2 15 a. An audit or other engagement to be performed in 2 16 accordance with the statements on auditing standards. 2 17 b. A review of a financial statement to be performed in 2 18 accordance with the statements on standards for accounting and 2 19 review services. 2 20 c. An examination of prospective financial information to 2 21 be performed in accordance with the statements on standards 2 22 for attestation engagements. For purposes of this subsection, 2 23 the statements on standards for attestation engagements means 2 24 those standards adopted by the board, by rule, by reference to 2 25 the standards developed for general application by the 2 26 American institute of certified public accountants, or other 2 27 recognized national accountancy organization. 2 28 2. "Board" means the Iowa accountancy examining board 2 29 established under section 542D.4 or its predecessor under 2 30 prior law. 2 31 3. "Certificate" means a certificate as a certified public 2 32 accountant issued under section 542D.6 or 542D.19, or a 2 33 certificate issued under corresponding prior law. 2 34 4. "Certified public accountant" means a person licensed 2 35 by the board who holds a certificate issued under this chapter 3 1 or corresponding prior law. 3 2 5. "Certified public accounting firm" means a sole 3 3 proprietorship, a corporation, a partnership, a limited 3 4 liability company, or any other form of organization issued a 3 5 permit to practice as a firm of certified public accountants 3 6 under section 542D.7. 3 7 6. "Client" means a person or entity that agrees with a 3 8 licensee or licensee's employer to receive a professional 3 9 service. 3 10 7. "Commission" means a brokerage or other participation 3 11 fee. "Commission" does not include a contingent fee. 3 12 8. "Compilation" means a service performed in accordance 3 13 with statements on standards for accounting and review 3 14 services and presented in the form of financial statements, 3 15 which provides information that is the representation of 3 16 management without undertaking to express any assurance on the 3 17 statements. 3 18 9. "Contingent fee" means a fee established for the 3 19 performance of a service pursuant to an arrangement under 3 20 which a fee will not be charged unless a specified finding or 3 21 result is attained, or under which the amount of the fee is 3 22 otherwise dependent upon the finding or result of such 3 23 service. "Contingent fee" does not mean a fee fixed by a 3 24 court or other public authority, or a fee related to any tax 3 25 matter which is based upon the results of a judicial 3 26 proceeding or the findings of a governmental agency. 3 27 10. "License" means a certificate issued under section 3 28 542D.6 or 542D.19, a permit issued under section 542D.7, or a 3 29 license issued under section 542D.8; or a certificate, permit, 3 30 or license issued under corresponding prior law. 3 31 11. "Licensed public accountant" means a person licensed 3 32 by the board who does not hold a certificate as a certified 3 33 public accountant under this chapter, and who offers to 3 34 perform or performs for the public any of the following 3 35 services: 4 1 a. Records financial transactions in books of record. 4 2 b. Makes adjustments of financial transactions in books of 4 3 record. 4 4 c. Makes trial balances from books of record. 4 5 d. Prepares internal verification and analysis of books or 4 6 accounts of original entry. 4 7 e. Prepares financial statements, schedules, or reports. 4 8 f. Devises and installs systems or methods of bookkeeping, 4 9 internal controls of financial data, or the recording of 4 10 financial data. 4 11 g. Prepares compilations. 4 12 Nothing contained in this definition or elsewhere in this 4 13 chapter shall be construed to permit a licensed public 4 14 accountant to give an opinion attesting to the reliability of 4 15 any representation embracing financial information. 4 16 12. "Licensed public accounting firm" means a sole 4 17 proprietorship, a corporation, a partnership, a limited 4 18 liability company, or any other form of organization issued a 4 19 permit to practice as a firm of licensed public accountants 4 20 under section 542D.8. 4 21 13. "Licensee" means the holder of a license. 4 22 14. "Manager" means a manager of a limited liability 4 23 company. 4 24 15. "Member" means a member of a limited liability 4 25 company. 4 26 16. "Peer review" means a study, appraisal, or review of 4 27 one or more aspects of the professional work of a licensee or 4 28 firm that performs attest or compilation services, by a 4 29 licensed person or persons who are not affiliated with the 4 30 licensee or firm being reviewed. "Peer review" does not 4 31 include a peer review conducted pursuant to chapter 272C in 4 32 connection with a disciplinary investigation. 4 33 17. "Peer review records" means a file, report, or other 4 34 information relating to the professional competence of an 4 35 applicant in the possession of a peer review team, or 5 1 information concerning the peer review developed by a peer 5 2 review team in the possession of an applicant. 5 3 18. "Peer review team" means a person or organization 5 4 participating in the peer review function, but does not 5 5 include the board. 5 6 19. "Permit" means a permit to practice as either a 5 7 certified public accounting firm issued under section 542D.7 5 8 or licensed public accounting firm under section 542D.8 or 5 9 under corresponding provisions of prior law. 5 10 20. "Practice of public accounting" means the performance 5 11 or the offering to perform, by a person holding oneself out to 5 12 the public as a certified public accountant or a licensed 5 13 public accountant, one or more kinds of professional services 5 14 involving the use of accounting, attest, or auditing skills, 5 15 including the issuance of reports on financial statements, or 5 16 of one or more kinds of management advisory, financial 5 17 advisory, or consulting services, or the preparation of tax 5 18 returns or the furnishing of advice on tax matters. However, 5 19 with respect to licensed public accountants, the "practice of 5 20 public accounting" shall not include attest or auditing 5 21 services or the rendering of an opinion attesting to the 5 22 reliability of any representation embracing financial 5 23 information. 5 24 21. "Report", when used with reference to financial 5 25 statements, means a report, opinion, or other form of a 5 26 writing that states or implies assurance as to the reliability 5 27 of any financial statements and that includes or is 5 28 accompanied by a statement or implication that the person or 5 29 firm issuing the report has special knowledge or competence in 5 30 accounting or auditing. Such statement or implication of 5 31 special knowledge or competence may arise from use by the 5 32 issuer of the report of names or titles indicating that the 5 33 person or firm is an accountant or auditor, or from the 5 34 language of the report itself. "Report" includes any form of 5 35 language which disclaims an opinion when such form of language 6 1 is conventionally understood to imply a positive assurance as 6 2 to the reliability of the financial statements referred to or 6 3 special knowledge or competence on the part of the person or 6 4 firm issuing the language, and any other form of language that 6 5 is conventionally understood to imply such assurance or such 6 6 special knowledge or competence. 6 7 22. "State" means a state of the United States, the 6 8 District of Columbia, Puerto Rico, the United States Virgin 6 9 Islands, or Guam. 6 10 23. "Substantial equivalency" is a determination by the 6 11 board that the education, examination, and experience 6 12 requirements contained in the statutes and administrative 6 13 rules of another jurisdiction are comparable to, or exceed, 6 14 the education, examination, and experience requirements 6 15 contained in this chapter or that an individual licensee's 6 16 education, examination, and experience qualifications are 6 17 comparable to or exceed the education, examination, and 6 18 experience requirements contained in this chapter. 6 19 Sec. 4. NEW SECTION. 542D.4 IOWA ACCOUNTANCY EXAMINING 6 20 BOARD. 6 21 1. An Iowa accountancy examining board is created within 6 22 the professional licensing and regulation division of the 6 23 department of commerce to administer and enforce this chapter. 6 24 The board shall consist of eight members, appointed by the 6 25 governor and subject to senate confirmation, all of whom shall 6 26 be residents of this state. Five of the eight members shall 6 27 be holders of certificates issued under section 542D.6, one 6 28 member shall be the holder of a license issued under section 6 29 542D.8, and two shall not be certified public accountants or 6 30 licensed public accountants and shall represent the general 6 31 public. Not fewer than three of the holders of certificates 6 32 issued under section 542D.6 shall also be qualified to 6 33 supervise attest services as provided in section 542D.7. A 6 34 certified or licensed member of the board shall be actively 6 35 engaged in practice as a certified public accountant or as a 7 1 licensed public accountant and shall have been so engaged for 7 2 five years preceding appointment, the last two of which shall 7 3 have been in this state. Professional associations or 7 4 societies composed of certified public accountants or licensed 7 5 public accountants may recommend the names of potential board 7 6 members to the governor. However, the governor is not bound 7 7 by the recommendations. A board member is not required to be 7 8 a member of any professional association or society composed 7 9 of certified public accountants or licensed public 7 10 accountants. The term of each member of the board shall be 7 11 three years, as designated by the governor, and appointments 7 12 to the board are subject to the requirements of sections 7 13 69.16, 69.16A, and 69.19. Members of the board appointed and 7 14 serving pursuant to chapter 542C, Code 2001, on the effective 7 15 date of this Act shall serve out the terms for which they were 7 16 appointed. Vacancies occurring during a term shall be filled 7 17 by appointment by the governor for the unexpired term. Upon 7 18 the expiration of the member's term of office, a member shall 7 19 continue to serve until a successor shall have been appointed 7 20 and taken office. The public members of the board shall be 7 21 allowed to participate in administrative, clerical, or 7 22 ministerial functions incident to giving the examinations, but 7 23 shall not determine the content or determine the correctness 7 24 of the answers. The licensed public accountant member shall 7 25 not determine the content of the certified public accountant 7 26 examination or determine the correctness of the answers. Any 7 27 member of the board whose certificate under section 542D.6 or 7 28 license under section 542D.8 is revoked or suspended shall 7 29 automatically cease to be a member of the board, and the 7 30 governor may, after a hearing, remove any member of the board 7 31 for neglect of duty or other just cause. A person who has 7 32 served three successive complete terms shall not be eligible 7 33 for reappointment, but appointment to fill an unexpired term 7 34 shall not be considered a complete term for this purpose. 7 35 2. The board shall elect annually from among its members a 8 1 chairperson and such other officers as the board may determine 8 2 to be appropriate. The board shall meet at such times and 8 3 places as may be fixed by the board. A majority of the board 8 4 members in office shall constitute a quorum at any meeting. 8 5 The board shall maintain a registry of the names and addresses 8 6 of all licensees and permittees under this chapter. 8 7 3. Members of the board are entitled to receive a per diem 8 8 as specified in section 7E.6 for each day spent on performance 8 9 of duties as members and shall be reimbursed for all actual 8 10 and necessary expenses incurred in the performance of duties 8 11 as members. 8 12 4. All moneys collected by the board from fees authorized 8 13 to be charged by this chapter shall be received and accounted 8 14 for by the board and shall be paid monthly to the treasurer of 8 15 state for deposit in the general fund of the state. Expenses 8 16 of administering this chapter shall be paid from 8 17 appropriations made by the general assembly, which expenses 8 18 may include, but shall not be limited to, the costs of 8 19 conducting investigations and of taking testimony and 8 20 procuring the attendance of witnesses before the board or its 8 21 committees; all legal proceedings taken under this chapter for 8 22 the enforcement of this chapter; and educational programs for 8 23 the benefit of the public and licensees and their employees. 8 24 5. A member of the board shall maintain the 8 25 confidentiality of information relating to the following: 8 26 a. Criminal history or prior misconduct of the applicant. 8 27 b. Information relating to the contents of the 8 28 examination. 8 29 c. Information relating to the examination results other 8 30 than final score except for information about the results of 8 31 the examination given to the person examined. 8 32 A member of the board who willfully communicates or seeks 8 33 to communicate such information in a manner which violates 8 34 confidentiality requirements, and any person who willfully 8 35 requests, obtains, or seeks to obtain such information, is 9 1 guilty of a simple misdemeanor. 9 2 6. The administrator of the professional licensing and 9 3 regulation division of the department of commerce shall 9 4 provide staffing assistance to the board for implementing this 9 5 chapter. 9 6 7. The board may join professional organizations and 9 7 associations to promote the improvement of the standards of 9 8 the practice of accountancy and for the protection and welfare 9 9 of the public. 9 10 8. The board shall have the power to take all action that 9 11 is necessary and proper to effectuate the purposes of this 9 12 chapter, including the power to sue and be sued in its 9 13 official name as an agency of this state. The board shall 9 14 also have the power to issue subpoenas to compel the 9 15 attendance of witnesses and the production of documents; to 9 16 administer oaths; to take testimony; to cooperate with the 9 17 appropriate authorities in other states in investigation and 9 18 enforcement concerning violations of this chapter and 9 19 comparable statutes of other states; and to receive evidence 9 20 concerning all matters within the scope of this chapter. In 9 21 case of disobedience of a subpoena, the board may invoke the 9 22 aid of any district court in requiring the attendance and 9 23 testimony of witnesses and the production of documentary 9 24 evidence. 9 25 9. The board shall adopt rules pursuant to chapter 17A 9 26 governing the administration and enforcement of this chapter 9 27 and the conduct of licensees and permittees. Rules adopted 9 28 shall include, but not be limited to, the following: 9 29 a. Rules governing the board's meetings and the conduct of 9 30 its business. 9 31 b. Rules of procedure governing the conduct of 9 32 investigations and hearings by the board. 9 33 c. Rules specifying the educational and experience 9 34 qualifications required for the issuance of a certificate 9 35 under section 542D.6 and the continuing professional education 10 1 required for renewal of a certificate under section 542D.6. 10 2 d. Rules specifying the educational and experience 10 3 qualifications required for the issuance of a license under 10 4 section 542D.8 and the continuing professional education 10 5 required for renewal of a license under section 542D.8. 10 6 e. Rules of professional conduct directed to control the 10 7 quality and probity of services provided by a licensee, and, 10 8 among other areas, pertaining to a licensee's independence, 10 9 integrity, and objectivity; competence and technical 10 10 standards; responsibilities to the public; and 10 11 responsibilities to a client. 10 12 f. Rules relating to the propriety of opinions on 10 13 financial statements by a certified public accountant who is 10 14 not independent. 10 15 g. Rules relating to actions discreditable to the practice 10 16 as a certified public accountant or licensed public 10 17 accountant. 10 18 h. Rules relating to professional confidences between a 10 19 certified public accountant or licensed public accountant and 10 20 a client. 10 21 i. Rules governing technical competence and the expression 10 22 of opinions on financial statements. 10 23 j. Rules governing the failure to disclose a material fact 10 24 known to the certified public accountant or licensed public 10 25 accountant. 10 26 k. Rules relating to a material misstatement known to the 10 27 certified public accountant or licensed public accountant. 10 28 l. Rules governing negligent conduct in an examination or 10 29 in making a report on an examination. 10 30 m. Rules governing failure to direct attention to any 10 31 material departure from generally accepted accounting 10 32 principles. 10 33 n. Rules governing the professional standards applicable 10 34 to a licensee. 10 35 o. Rules governing the manner and circumstances of use of 11 1 the titles "certified public accountant" and "CPA". 11 2 p. Rules governing the manner and circumstances of use of 11 3 the titles "accounting practitioner" and "AP", and "licensed 11 4 public accountant" and "LPA". 11 5 q. Rules regarding peer review that may be required to be 11 6 performed under this chapter. 11 7 r. Rules on substantial equivalency under section 542D.19. 11 8 s. Such other rules as the board deems necessary or 11 9 appropriate for administering this chapter, including, but not 11 10 limited to, rules establishing fees and rules of professional 11 11 conduct, pertaining to corporations or limited liability 11 12 companies practicing accounting, which the board deems 11 13 consistent with or required by the public welfare. The board 11 14 may adopt rules governing the style, name, and title of 11 15 corporations and limited liability companies and governing the 11 16 affiliation of corporations and limited liability companies 11 17 with other organizations. 11 18 Sec. 5. NEW SECTION. 542D.5 QUALIFICATIONS FOR A 11 19 CERTIFICATE AS A CERTIFIED PUBLIC ACCOUNTANT. 11 20 1. A certificate as a certified public accountant may be 11 21 granted to a person of good moral character who makes 11 22 application pursuant to section 542D.6 and who satisfies the 11 23 education, experience, and examination requirements of this 11 24 section and rules adopted pursuant to this section. 11 25 2. An applicant for a certificate who has been convicted 11 26 of forgery, embezzlement, obtaining money under false 11 27 pretenses, theft, extortion, conspiracy to defraud, or other 11 28 similar offense, or of any crime involving moral character or 11 29 honesty, in a court of competent jurisdiction in this state, 11 30 or another state, territory, or a district of the United 11 31 States, or in a foreign jurisdiction, may be denied a 11 32 certificate by the board on the grounds of the conviction. 11 33 For purposes of this subsection, "conviction" means a 11 34 conviction for an indictable offense and includes a guilty 11 35 plea, deferred judgment from the time of entry of the deferred 12 1 judgment until the time the defendant is discharged by the 12 2 court without entry of judgment, or other finding of guilt by 12 3 a court of competent jurisdiction. 12 4 3. An applicant for a certificate who has had a 12 5 professional license of any kind revoked in this or any other 12 6 jurisdiction may be denied a certificate by the board on the 12 7 grounds of the revocation. 12 8 4. A person who makes a false statement of material fact 12 9 on an application for a certificate, or who causes to be 12 10 submitted, or has been a party to preparing or submitting a 12 11 false application for a certificate, may be denied a 12 12 certificate by the board on the grounds of the false statement 12 13 or submission. A certificate holder found to have made such a 12 14 false statement or who has caused to be submitted, or was a 12 15 party to preparing or submitting any false application for a 12 16 certificate, may have the holder's certificate suspended or 12 17 revoked by the board on the grounds of the false statement or 12 18 submission. 12 19 5. A certified public accountant shall notify the board of 12 20 such accountant's conviction of an offense included in 12 21 subsection 2, within thirty days of such conviction. Failure 12 22 of the certified public accountant to notify the board of the 12 23 conviction within thirty days of the date of the conviction is 12 24 sufficient grounds for revocation of the certificate. 12 25 6. The board, when considering the denial or revocation of 12 26 a certificate pursuant to subsections 2 through 5, shall 12 27 consider the nature of the offense; any aggravating or 12 28 extenuating circumstances which are documented; the time 12 29 lapsed since the revocation, conduct, or conviction; the 12 30 rehabilitation, treatment, or restitution performed by the 12 31 applicant or certificate holder; and any other factors the 12 32 board deems relevant. Character references may be required, 12 33 but shall not be obtained from certified public accountants. 12 34 An applicant shall not be denied a certificate because of age, 12 35 citizenship, race, religion, marital status, or national 13 1 origin, although the application may require citizenship 13 2 information. 13 3 7. An applicant shall complete at least one hundred fifty 13 4 semester hours, or the trimester or quarter equivalent of one 13 5 hundred fifty semester hours, of college education, and 13 6 receive a baccalaureate or higher degree conferred by a 13 7 college or university recognized by the board, the total 13 8 educational program to include a concentration in accounting 13 9 or what the board determines to be substantially equivalent. 13 10 8. An applicant must pass an examination which shall be 13 11 offered at least twice per year and which shall test the 13 12 applicant's knowledge of the subjects of accounting and 13 13 auditing, and such other related subjects as the board may 13 14 specify by rule, including but not limited to business law and 13 15 taxation. The examination shall be held at a time determined 13 16 by the board and may be changed from time to time. The board 13 17 shall prescribe by rule the methods of applying for and 13 18 conducting the examination, including methods for grading and 13 19 determining a passing grade required of an applicant for a 13 20 certificate. However, the board, to the extent possible, 13 21 shall ensure the examination, grading of the examination, and 13 22 the passing grades are uniform with those applicable in all 13 23 other states. The board may make such use of all or any part 13 24 of a nationally recognized uniform certified public accountant 13 25 examination and advisory grading service, and may contract 13 26 with third parties to perform such administrative services 13 27 with respect to the examination as it deems appropriate to 13 28 perform the duties of the board with respect to examination. 13 29 Except as otherwise provided under this section, a person who 13 30 has partially passed the examination required by this 13 31 subsection by passing one or more subjects prior to December 13 32 31, 2000, has until December 31, 2003, to successfully 13 33 complete the examination process and qualify for a certificate 13 34 under the educational requirements in effect prior to December 13 35 31, 2000. 14 1 9. The board may admit to the examination a candidate who 14 2 will complete the educational requirements for a baccalaureate 14 3 degree with a concentration in accounting or what the board 14 4 determines by rule to be substantially equivalent to a 14 5 concentration in accounting within one hundred twenty days 14 6 immediately following the date of the examination or who has 14 7 completed those requirements. However, the board shall not 14 8 report the results of the examination until the candidate has 14 9 met the educational requirements for a baccalaureate degree 14 10 and shall not issue the certificate until the candidate has 14 11 fully satisfied the requirements of subsection 7. 14 12 10. Applicants who fail the examination once shall be 14 13 allowed to take the examination again at a time determined by 14 14 the board. Applicants who fail the examination twice shall be 14 15 allowed to take the examination again at the discretion of the 14 16 board. The board may by rule prescribe the terms and 14 17 conditions under which a candidate who passes two or more 14 18 subjects of the examination conducted in this state or by the 14 19 licensing authority of another state may be reexamined in only 14 20 the failed subjects and receive credit for the passed 14 21 subjects. An applicant who has failed the examination may 14 22 request in writing information from the board concerning the 14 23 applicant's examination grade and subject areas or questions 14 24 which the applicant failed to answer correctly, except that if 14 25 the board administers a uniform, standardized examination, the 14 26 board shall only be required to provide the examination grade 14 27 and such other information concerning the applicant's 14 28 examination results which are available to the board. 14 29 11. The board, by rule, may establish an examination fee 14 30 to be charged each applicant by the board or by a third party 14 31 administering the examination. 14 32 12. An applicant for initial issuance of a certificate 14 33 must have no less than one year of experience. The experience 14 34 shall include providing any type of service or advice 14 35 involving the use of accounting, attest, compilation, 15 1 management advisory, financial advisory, tax, or consulting 15 2 skills, as verified by a licensee, meeting requirements 15 3 prescribed by the board by rule. The experience is acceptable 15 4 if it was gained through employment in government, industry, 15 5 academia, or public practice. 15 6 13. A person holding a certificate as a certified public 15 7 accountant issued by the state prior to July 1, 2002, is 15 8 deemed to have met the requirements of this section. 15 9 Sec. 6. NEW SECTION. 542D.6 ISSUANCE AND RENEWAL OF 15 10 CERTIFICATES – MAINTENANCE OF COMPETENCY. 15 11 1. a. The board shall issue a certificate to a person who 15 12 makes application on a form prescribed and furnished by the 15 13 board and who demonstrates either of the following: 15 14 (1) That the person's qualifications, including where 15 15 applicable the qualifications prescribed by section 542D.5, 15 16 satisfy the requirements of this section, or that the person 15 17 holds a certificate issued under prior law. 15 18 (2) That the person holds in good standing a certificate 15 19 or license to practice as a certified public accountant in 15 20 another state or equivalent designation from a foreign 15 21 country, and is eligible under the substantial equivalency or 15 22 other provisions of section 542D.19. 15 23 b. The holder of a certificate issued under this section 15 24 shall only provide attest services in a certified public 15 25 accounting firm that is issued a permit under section 542D.7. 15 26 2. A certificate shall be initially issued, and renewed, 15 27 for a period of not more than three years, but in any event 15 28 shall expire on a date specified by rule. A person who fails 15 29 to renew a certificate as a certified public accountant by the 15 30 expiration date shall be allowed to do so within thirty days 15 31 following its expiration, but the board may assess a 15 32 reasonable penalty. The board shall specify by rule the 15 33 conditions under which a lapsed certificate may be reinstated, 15 34 including the imposition of administrative penalties. 15 35 3. A certificate holder, for renewal of a certificate 16 1 under this section, shall participate in a program of learning 16 2 designed to maintain professional competency. Such program of 16 3 learning must comply with rules adopted by the board. The 16 4 board, by rule, may grant an exception to this requirement for 16 5 a certificate holder who does not perform or offer to perform 16 6 for the public one or more kinds of services involving the use 16 7 of accounting or auditing skills, including issuance of 16 8 reports on financial statements or the use of one or more 16 9 kinds of management advisory, financial advisory, or 16 10 consulting services, or the preparation of tax returns or the 16 11 furnishing of advice on tax matters. A certificate holder 16 12 entitled to an exception by rule of the board shall place the 16 13 word "inactive" adjacent to the holder's certified public 16 14 accountant title on any business card, letterhead, or other 16 15 document or device, with the exception of the certificate 16 16 holder's certified public accountant certificate, on which the 16 17 certificate holder's certified public accountant title 16 18 appears. 16 19 4. The board shall charge an application fee for initial 16 20 issuance or renewal of a certificate in an amount prescribed 16 21 by the board by rule. 16 22 5. An applicant for initial issuance or renewal of a 16 23 certificate shall list in the application all states in which 16 24 the applicant has applied for or holds a certificate, license, 16 25 or permit and list any past denial, revocation, or suspension 16 26 of a certificate, license, or permit. A holder of or 16 27 applicant for a certificate under this section shall notify 16 28 the board in writing, within thirty days after its occurrence, 16 29 of any issuance, denial, revocation, or suspension of a 16 30 certificate, license, or permit by another state. 16 31 6. The board, by rule, shall require as a condition for 16 32 renewal of a certificate under this section, by any 16 33 certificate holder who performs compilation services for the 16 34 public other than through a certified public accounting firm, 16 35 that such individual undergo, no more frequently than once 17 1 every three years, a peer review conducted in such manner as 17 2 the board shall by rule specify, and such review shall include 17 3 verification that such individual has met the competency 17 4 requirements set out in professional standards for such 17 5 services. 17 6 Sec. 7. NEW SECTION. 542D.7 FIRM PERMITS TO PRACTICE – 17 7 ATTEST EXPERIENCE AND PEER REVIEW. 17 8 1. The board shall issue or renew a permit to practice to 17 9 a certified public accounting firm that makes application and 17 10 demonstrates the qualifications set forth in this section, or 17 11 to a qualified certified public accounting firm originally 17 12 licensed in another state that establishes an office in this 17 13 state or otherwise provides services for clients in this state 17 14 on a regular or recurring basis. A certified public 17 15 accounting firm licensed and located in another state or 17 16 foreign jurisdiction shall be allowed to audit a business unit 17 17 located in Iowa without a permit to practice if the Iowa 17 18 business unit is part of a multistate company whose principal 17 19 offices are located outside of this state. A person or firm 17 20 holding a permit to practice issued by this state prior to 17 21 July 1, 2002, is deemed to have met the requirements of this 17 22 section. A firm must hold a permit issued under this section 17 23 in order to provide attest services or to use the title "CPAs" 17 24 or "CPA firm". 17 25 2. A permit shall be initially issued and renewed for a 17 26 period of not more than three years, but in any event shall 17 27 expire on a date specified by rule. An application for a 17 28 permit shall be made in such form, and in the case of an 17 29 application for renewal, between such dates as the board may 17 30 by rule specify. 17 31 3. a. An applicant for initial issuance or renewal of a 17 32 permit to practice as a firm must show that notwithstanding 17 33 any other provision of law, a simple majority of the ownership 17 34 of the firm, in terms of financial interests and voting rights 17 35 of all partners, officers, shareholders, members, and managers 18 1 belongs to holders of a certificate issued by a state, and 18 2 that such partners, officers, shareholders, members, and 18 3 managers, who perform professional services in this state or 18 4 for clients in this state, hold a certificate issued under 18 5 section 542D.6 or 542D.19. 18 6 b. A certified public accounting firm may include a 18 7 nonlicensee owner provided all of the following occur: 18 8 (1) Such firm designates a licensee who is responsible for 18 9 the proper registration of the firm, and identifies that 18 10 individual to the board. 18 11 (2) All nonlicensee owners are active participants in the 18 12 firm or an affiliated entity. 18 13 (3) All nonlicensee owners participate in a program of 18 14 learning designed to maintain professional competency in 18 15 compliance with rules adopted by the board which shall include 18 16 requiring compliance with requirements imposed by a regulatory 18 17 authority charged with regulation of a nonlicensee owner's 18 18 professional or occupational license which is relevant to the 18 19 firm's services. 18 20 (4) All nonlicensee owners comply with all applicable 18 21 rules of professional conduct adopted by the board, and their 18 22 own regulatory authority. 18 23 (5) Such firm complies with other requirements as 18 24 established by the board by rule. 18 25 c. A licensee who is responsible for supervising attest or 18 26 compilation services and signs or authorizes someone to sign 18 27 the accountant's report on the financial statements on behalf 18 28 of the firm, shall meet the experience or competency 18 29 requirements set out in nationally recognized professional 18 30 standards for such services. 18 31 d. A licensee who signs or authorizes someone to sign the 18 32 accountant's report on the financial statements on behalf of 18 33 the firm shall meet the experience or competency requirements 18 34 established in paragraph "c". 18 35 4. An applicant for initial issuance or renewal of a 19 1 permit to practice as a certified public accounting firm is 19 2 required to register each office of the firm within this state 19 3 with the board and to show that all attest and compilation 19 4 services rendered in this state are under the charge of a 19 5 person holding a valid certificate issued under section 542D.6 19 6 or 542D.19. 19 7 5. The board, by rule, shall establish and charge an 19 8 application fee for each application for initial issuance or 19 9 renewal of a permit. 19 10 6. An applicant for initial issuance or renewal of a 19 11 permit shall list in the application all states in which the 19 12 applicant has applied for or holds a permit as a certified 19 13 public accounting firm and list any past denial, revocation, 19 14 or suspension of a permit by another state. A holder of or 19 15 applicant for a permit shall notify the board in writing 19 16 within thirty days after an occurrence of any of the 19 17 following: 19 18 a. A change in the identity of a partner, officer, 19 19 shareholder, member, or manager who performs professional 19 20 services in this state or for clients in this state. 19 21 b. A change in the number or location of offices within 19 22 this state. 19 23 c. A change in the identity of a person in charge of such 19 24 offices. 19 25 d. The issuance, denial, revocation, or suspension of a 19 26 permit by another state. 19 27 7. A firm, after receiving or renewing a permit which is 19 28 not in compliance with this section as a result of a change in 19 29 firm ownership or personnel, shall take corrective action to 19 30 bring the firm back into compliance as quickly as possible or 19 31 apply to modify or amend the permit. The board may grant a 19 32 reasonable period of time for a firm to take such corrective 19 33 action. Failure to comply within a reasonable period as 19 34 deemed by the board shall result in the suspension or 19 35 revocation of the firm permit. 20 1 8. The board, by rule, shall require as a condition to 20 2 renewal of a permit to practice as a certified public 20 3 accounting firm, that an applicant undergo, no more frequently 20 4 than once every three years, a peer review conducted in such 20 5 manner as the board specifies. The review shall include a 20 6 verification that any individual in the firm who is 20 7 responsible for supervising attest and compilation services 20 8 and who signs or authorizes someone to sign the accountant's 20 9 report on a financial statement on behalf of the firm meets 20 10 the competency requirements set forth in the professional 20 11 standards for such services. 20 12 Such rules shall include reasonable provision for 20 13 compliance by an applicant showing that the applicant, within 20 14 the preceding three years, has undergone a peer review that is 20 15 a satisfactory equivalent to the peer review required under 20 16 this subsection. An applicant's completion of a peer review 20 17 program endorsed or supported by the American institute of 20 18 certified public accountants, or other substantially similar 20 19 review as determined by the board, satisfies the requirements 20 20 of this subsection. 20 21 9. An applicant for a permit to practice as a certified 20 22 public accounting firm, at the time of renewal, may request in 20 23 writing upon forms provided by the board, a waiver from the 20 24 requirements of subsection 8. The board may grant a waiver 20 25 upon a showing satisfactory to the board of any of the 20 26 following: 20 27 a. The applicant does not engage in, and does not intend 20 28 to engage in during the following year, financial reporting 20 29 areas of practice, including but not limited to financial 20 30 audits, compilations, and reviews. An applicant granted a 20 31 waiver pursuant to this paragraph shall immediately notify the 20 32 board if the applicant engages in such practice, and shall be 20 33 subject to peer review. 20 34 b. Reasons of health. 20 35 c. Military service. 21 1 d. Instances of hardship. 21 2 e. Other good cause as determined by the board. 21 3 10. Peer review records are privileged and confidential, 21 4 and are not subject to discovery, subpoena, or other means of 21 5 legal compulsion. Peer review records are not admissible in 21 6 evidence in a judicial, administrative, or arbitration 21 7 proceeding. Information or documents discoverable from 21 8 sources other than a peer review team do not become 21 9 nondiscoverable from such other sources because they are made 21 10 available to or are in the possession of a peer review team. 21 11 Information or documents publicly available from the American 21 12 institute of certified public accountants relating to quality 21 13 or peer review are not privileged or confidential under this 21 14 subsection. A person or organization participating in the 21 15 peer review process shall not testify as to the findings, 21 16 recommendations, evaluations, or opinions of a peer review 21 17 team in a judicial, administrative, or arbitration proceeding. 21 18 11. A person is not liable as a result of an act, 21 19 omission, or decision made in connection with the person's 21 20 service on a peer review team, unless the act, omission, or 21 21 decision is made with actual malice. A person is not liable 21 22 as a result of providing information to a peer review team, or 21 23 for disclosure of privileged matters to a peer review team. 21 24 12. The costs of the peer review shall be paid by the 21 25 applicant. 21 26 Sec. 8. NEW SECTION. 542D.8 QUALIFICATIONS FOR AND 21 27 ISSUANCE OF A LICENSE AS A LICENSED PUBLIC ACCOUNTANT – 21 28 RENEWAL OF LICENSE – FIRM REGISTRATION – PEER REVIEW. 21 29 1. The license of a licensed public accountant shall be 21 30 granted by the board to any person who meets one of the 21 31 following requirements: 21 32 a. The applicant holds a license as an accounting 21 33 practitioner issued under the laws of this state in full force 21 34 and effect on the effective date of this Act and has completed 21 35 additional educational requirements as prescribed by the 22 1 board. 22 2 b. The applicant has satisfactorily completed the 22 3 examination prescribed in subsection 2 after having met one of 22 4 the following: 22 5 (1) The applicant has had two or more years' actual 22 6 experience in practice as an accountant as an employee of a 22 7 certified public accountant, an accounting practitioner, or a 22 8 licensed public accountant. 22 9 (2) The applicant submits evidence satisfactory to the 22 10 board that the applicant is a graduate of a four-year college 22 11 or university accredited by the north central accreditation 22 12 association or other regional accreditation association having 22 13 equivalent standards, with a major in accounting, or that the 22 14 applicant is a graduate in accountancy from a business or 22 15 correspondence school accredited by the accrediting commission 22 16 for business schools or the accrediting commission of the 22 17 national home study council. 22 18 (3) The applicant submits evidence of at least five years 22 19 of continuous experience engaged in performing any of the 22 20 services delineated in section 542D.3, subsection 11, on a 22 21 full-time basis. 22 22 2. An examination shall be conducted by the board as often 22 23 as deemed necessary, but not less than two times per year. 22 24 3. The examination shall be designed and given in a manner 22 25 as to fairly test the applicant's knowledge of accounting. 22 26 The examination shall not include questions relating to the 22 27 subject of auditing. 22 28 4. The board, in its discretion, may use all or any part 22 29 of a standard or uniform examination and advisory grading 22 30 service that is provided or furnished by a national accounting 22 31 organization or society to assist the board in the performance 22 32 of its duties under this chapter. The identity of the person 22 33 taking the examination shall be concealed until after the 22 34 examination papers have been graded. 22 35 5. If an applicant has partially passed an examination 23 1 given in another state determined by the board to be 23 2 substantially equivalent to the examination required by this 23 3 state and meets eligibility requirements that the board finds 23 4 to be substantially equivalent to those prescribed by this 23 5 state, the results of the other state's examination shall be 23 6 accepted as though given in this state. 23 7 6. An applicant who successfully passes all subjects in 23 8 which examined shall be issued a license as a licensed public 23 9 accountant by the board. The cost of the license shall be 23 10 based upon the administrative costs of the board and the costs 23 11 of issuing the license. 23 12 7. An applicant who fails the examination once shall be 23 13 allowed to take the examination at the next scheduled time. 23 14 Thereafter, the applicant shall be allowed to take the 23 15 examination at the discretion of the board. An applicant who 23 16 passes a portion of the examination shall have the right to be 23 17 reexamined in the remaining subjects at a future examination, 23 18 and if the applicant passes the remaining subjects, the 23 19 applicant shall be considered to have passed the entire 23 20 examination. An applicant who fails the examination may 23 21 request in writing information from the board concerning the 23 22 applicant's examination grade and subject areas or questions 23 23 which the applicant failed to answer correctly, except that if 23 24 the board administers a uniform, standardized examination, the 23 25 board shall only be required to provide the examination grade 23 26 and such other information concerning the applicant's 23 27 examination results which is available to the board. 23 28 8. An applicant for initial issuance of a license must 23 29 have no less than one year of experience. The experience 23 30 shall include providing any type of service or advice 23 31 involving the use of accounting, compilation, management 23 32 advisory, financial advisory, tax, or consulting skills, as 23 33 verified by a licensee, meeting requirements prescribed by the 23 34 board by rule. The experience is acceptable if gained through 23 35 employment in government, industry, academia, or public 24 1 practice. 24 2 9. a. The licensed public accountant license shall expire 24 3 in multiyear intervals as determined by the board. The board 24 4 shall notify a person licensed under this chapter of the date 24 5 of expiration of the license and the amount of the fee 24 6 required for its renewal. The notice shall be mailed at least 24 7 one month in advance of the expiration date. A person who 24 8 fails to renew a license as a licensed public accountant by 24 9 the expiration date shall be allowed to do so within thirty 24 10 days following its expiration, but the board may assess a 24 11 reasonable penalty. 24 12 b. A licensee, for renewal of a license under this 24 13 section, shall participate in a program of learning designed 24 14 to maintain professional competency. Such program of learning 24 15 must comply with rules adopted by the board. The board, by 24 16 rule, may grant an exception to this requirement for a 24 17 licensee who does not perform or offer to perform for the 24 18 public one or more kinds of services involving the use of 24 19 accounting or auditing skills, including issuance of reports 24 20 on financial statements or the use of one or more kinds of 24 21 management advisory, financial advisory, or consulting 24 22 services, or the preparation of tax returns or the furnishing 24 23 of advice on tax matters. A licensee entitled to an exception 24 24 by rule of the board shall place the word "inactive" adjacent 24 25 to the licensee's licensed public accountant title on any 24 26 business card, letterhead, or other document or device, with 24 27 the exception of the licensee's licensed public accountant 24 28 license, on which the licensee's licensed public accountant 24 29 title appears. 24 30 10. The board, in its discretion, may waive an examination 24 31 and issue a license as a licensed public accountant to an 24 32 applicant for one of the following: 24 33 a. The applicant holds a license as a licensed public 24 34 accountant, an accounting practitioner, or similar title 24 35 issued, after examination, by a state which extends by 25 1 substantial equivalency privileges to a licensed public 25 2 accountant of this state, and who, at the time of issuance of 25 3 the registration, possessed the basic qualifications set forth 25 4 in subsection 1. 25 5 b. The applicant has passed the examination required under 25 6 the laws of another state and possesses the basic 25 7 qualifications set forth in subsection 1 at the time the 25 8 applicant applied for registration in this state. 25 9 11. A person applying for a license as a licensed public 25 10 accountant shall pay a fee as determined by the board based 25 11 upon the costs of issuing such licenses. 25 12 12. The board shall issue or renew a permit to practice as 25 13 a licensed public accounting firm to a person that makes 25 14 application and demonstrates the qualification set forth in 25 15 this section or to a licensed public accounting firm 25 16 originally registered in another state that provides evidence 25 17 that the qualifications met in the other state are 25 18 substantially equivalent to those required by this section. A 25 19 firm must hold a permit issued under this section in order to 25 20 use the title "LPA" or "Licensed Public Accountants" in a firm 25 21 name. 25 22 a. An applicant for initial issuance or renewal of a 25 23 permit to practice as a firm under this section must show that 25 24 notwithstanding any other provision of law, a simple majority 25 25 of the ownership of the firm, in terms of financial interests 25 26 and voting rights of all partners, officers, shareholders, 25 27 members, and managers belongs to the holders of a certificate 25 28 or license issued by a state, and that such partners, 25 29 officers, shareholders, members, and managers, who perform 25 30 professional services in this state or for clients in this 25 31 state, hold a certificate issued under section 542D.6 or a 25 32 license issued under section 542D.8. 25 33 b. A licensed public accounting firm may include a 25 34 nonlicensee owner provided all of the following occur: 25 35 (1) Such firm designates a licensee who is responsible for 26 1 the proper registration of the firm, and identifies that 26 2 individual to the board. 26 3 (2) All nonlicensee owners are active participants in the 26 4 firm or an affiliated entity. 26 5 (3) All nonlicensee owners participate in a program of 26 6 learning designed to maintain professional competency in 26 7 compliance with rules adopted by the board which shall include 26 8 requiring compliance with requirements imposed by a regulatory 26 9 authority charged with regulation of a nonlicensee owner's 26 10 professional or occupational license which is relevant to the 26 11 firm's services. 26 12 (4) All nonlicensee owners comply with all applicable 26 13 rules of professional conduct adopted by the board, and their 26 14 own regulatory authority. 26 15 (5) Such firm complies with other requirements as 26 16 established by the board by rule. 26 17 c. An individual licensee who is responsible for 26 18 compilation services and signs or authorizes someone to sign 26 19 the accountant's report on the financial statements on behalf 26 20 of the firm shall meet the competency requirements set out in 26 21 nationally recognized professional standards for such 26 22 services. 26 23 d. An individual licensee who signs or authorizes someone 26 24 to sign the accountant's report on the financial statements on 26 25 behalf of the firm shall meet the competency requirements set 26 26 out in nationally recognized professional standards for such 26 27 services. 26 28 13. An applicant for initial issuance or renewal of a 26 29 permit to practice as a licensed public accounting firm is 26 30 required to register each office of the firm within this state 26 31 with the board and to show that all compilation services 26 32 rendered in this state are under the charge of a person 26 33 holding a valid certificate issued under section 542D.6 or 26 34 542D.19, or a license issued under section 542D.8. 26 35 14. The board, by rule, shall establish and charge an 27 1 application fee for each application for initial issuance or 27 2 renewal of a permit. 27 3 15. An applicant for initial issuance or renewal of a 27 4 permit shall list in the application all states in which the 27 5 applicant has applied for or holds a permit as a certified 27 6 public accountant or a licensed public accounting firm and 27 7 list any past denial, revocation, or suspension of a permit by 27 8 another state. A holder of or applicant for a permit shall 27 9 notify the board in writing within thirty days after an 27 10 occurrence of any of the following: 27 11 a. A change in the identity of a partner, officer, 27 12 shareholder, member, or manager who performs professional 27 13 services in this state or for clients in this state. 27 14 b. A change in the number or location of offices within 27 15 this state. 27 16 c. A change in the identity of a person in charge of such 27 17 offices. 27 18 d. The issuance, denial, revocation, or suspension of a 27 19 permit by another state. 27 20 16. A firm, after receiving or renewing a permit which is 27 21 not in compliance with this section as a result of a change in 27 22 firm ownership or personnel, shall take corrective action to 27 23 bring the firm back into compliance as quickly as possible or 27 24 apply to modify or amend the permit. The board may grant a 27 25 reasonable period of time for a firm to take such corrective 27 26 action. Failure to comply within a reasonable period as 27 27 deemed by the board shall result in the suspension or 27 28 revocation of the firm permit. 27 29 17. The board, by rule, shall require as a condition to 27 30 renewal of a permit to practice as a licensed public 27 31 accounting firm, that an applicant undergo, no more frequently 27 32 than once every three years, a peer review conducted in such 27 33 manner as the board specifies. The review shall include 27 34 verification that any individual in the firm who is 27 35 responsible for supervising compilation services and who signs 28 1 or authorizes someone to sign the accountant's report on a 28 2 financial statement on behalf of the firm meets the competency 28 3 requirements set forth in the professional standards for such 28 4 services. Such rules shall include reasonable provision for 28 5 compliance by an applicant showing that the applicant, within 28 6 the preceding three years, has undergone a peer review that is 28 7 a satisfactory equivalent to the peer review required under 28 8 this subsection. An applicant's completion of a peer review 28 9 program endorsed or supported by the national society of 28 10 accountants, or other substantially similar review as 28 11 determined by the board, satisfies the requirements of this 28 12 subsection. 28 13 18. An applicant for a permit to practice as a licensed 28 14 public accounting firm, at the time of renewal, may request in 28 15 writing upon forms provided by the board, a waiver from the 28 16 requirements of subsection 17. The board may grant a waiver 28 17 upon a showing satisfactory to the board of any of the 28 18 following: 28 19 a. The applicant does not engage in, and does not intend 28 20 to engage in during the following year, financial reporting 28 21 areas of practice, including but not limited to compilations. 28 22 An applicant granted a waiver pursuant to this paragraph shall 28 23 immediately notify the board if the applicant engages in such 28 24 practice, and shall be subject to peer review. 28 25 b. Reasons of health. 28 26 c. Military service. 28 27 d. Instances of hardship. 28 28 e. Other good cause as determined by the board. 28 29 19. Peer review records are privileged and confidential, 28 30 and are not subject to discovery, subpoena, or other means of 28 31 legal compulsion. Peer review records are not admissible in 28 32 evidence in a judicial, administrative, or arbitration 28 33 proceeding. Information or documents discoverable from 28 34 sources other than a peer review team do not become 28 35 nondiscoverable from such other sources because they are made 29 1 available to or are in the possession of a peer review team. 29 2 Information or documents publicly available from the national 29 3 society of accountants relating to quality or peer review are 29 4 not privileged or confidential under this subsection. A 29 5 person or organization participating in the peer review 29 6 process shall not testify as to the findings, recommendations, 29 7 evaluations, or opinions of a peer review team in a judicial, 29 8 administrative, or arbitration proceeding. 29 9 20. A person is not liable as a result of an act, 29 10 omission, or decision made in connection with the person's 29 11 service in a peer review team, unless the act, omission, or 29 12 decision is made with actual malice. A person is not liable 29 13 as a result of providing information to a peer review team, or 29 14 for disclosure of privileged matters to a peer review team. 29 15 21. The costs of the peer review shall be paid by the 29 16 applicant. 29 17 Sec. 9. NEW SECTION. 542D.9 APPOINTMENT OF SECRETARY OF 29 18 STATE AS AGENT. 29 19 Application for a certificate under section 542D.6, a 29 20 license under section 542D.8, a permit to practice under 29 21 section 542D.7, or a certificate under section 542D.19 by a 29 22 person or a firm not a resident of this state constitutes 29 23 appointment of the secretary of state as the applicant's agent 29 24 upon whom process may be served in any action or proceeding 29 25 against the applicant arising out of a transaction or 29 26 operation connected with or incidental to services performed 29 27 by the applicant while a licensee within this state. 29 28 Sec. 10. NEW SECTION. 542D.10 ENFORCEMENT AGAINST A 29 29 HOLDER OF A CERTIFICATE, PERMIT, OR LICENSE. 29 30 1. After notice and hearing pursuant to section 542D.11, 29 31 the board may revoke, suspend for a period of time not to 29 32 exceed two years, or refuse to renew a license; reprimand, 29 33 censure, or limit the scope of practice of any licensee; 29 34 impose an administrative penalty not to exceed one thousand 29 35 dollars per violation; or place any licensee on probation; all 30 1 with or without terms, conditions, and in combinations of 30 2 remedies, for any one or more of the following reasons: 30 3 a. Fraud or deceit in obtaining a license, which may also 30 4 result in permanent revocation of the license. 30 5 b. Dishonesty, fraud, or gross negligence in the practice 30 6 of public accounting. 30 7 c. Engaging in any activity prohibited under section 30 8 542D.13 or permitting persons under the licensee's supervision 30 9 to do so. 30 10 d. Violation of a rule of professional conduct adopted by 30 11 the board under the authority granted by this chapter. 30 12 e. Conviction of a felony under the laws of any state of 30 13 the United States. 30 14 f. Conviction of any crime, any element of which is 30 15 dishonesty or fraud as provided in section 542D.5, subsection 30 16 2, under the laws of any state of the United States. 30 17 g. Cancellation, revocation, suspension, or refusal to 30 18 renew the authority to practice as a certified public 30 19 accountant, licensed public accountant, or accounting 30 20 practitioner, or the acceptance of the voluntary surrender of 30 21 a license to practice as a certified public accountant, 30 22 licensed public accountant, or accounting practitioner to 30 23 conclude a pending disciplinary action, by any other state or 30 24 foreign authority for any cause other than failure to pay 30 25 appropriate fees in the other jurisdiction. 30 26 h. Suspension or revocation of the right to practice 30 27 before any state or federal agency. 30 28 i. Conduct discreditable to the public accounting 30 29 profession. 30 30 j. Violation of section 272C.10. 30 31 2. Multiple violations arising from the same factual 30 32 circumstances or from different factual circumstances 30 33 containing a common error shall be considered as a single 30 34 violation for the purpose of imposition of an administrative 30 35 penalty. 31 1 3. In lieu of or in addition to any remedy specifically 31 2 provided in subsection 1, the board may require a licensee to 31 3 satisfy a peer review or desk review process on such terms as 31 4 the board may specify, satisfactorily complete a continuing 31 5 education program, or such additional remedies as the board 31 6 may specify by rule. 31 7 Sec. 11. NEW SECTION. 542D.11 INVESTIGATIONS AND 31 8 HEARINGS. 31 9 1. The board may initiate proceedings under this chapter 31 10 upon written complaint or on its own motion pursuant to other 31 11 information received by the board suggesting violations of 31 12 this chapter or board rules. The board may conduct an 31 13 investigation as needed to determine whether probable cause 31 14 exists to initiate such proceedings. In aid of such 31 15 investigation, the board may issue subpoenas to compel 31 16 witnesses to testify or persons to produce evidence consistent 31 17 with the provisions of section 272C.6, subsection 3. The 31 18 board may also review the publicly available public accounting 31 19 work product of licensees on a general or random basis to 31 20 determine whether reasonable grounds exist to initiate 31 21 proceedings under this chapter or to conduct a more specific 31 22 investigation. 31 23 2. A written notice stating the nature of the charge or 31 24 charges against the accused and the time and place of the 31 25 hearing before the board on the charges shall be served on the 31 26 accused not less than thirty days prior to the date of hearing 31 27 either personally or by mailing a copy by restricted certified 31 28 mail to the last known address of the accused. 31 29 3. At any hearing the accused may appear in person or by 31 30 counsel, produce evidence and witnesses on behalf of the 31 31 accused, cross-examine witnesses, and examine evidence which 31 32 is produced against the accused. A firm may appear by a 31 33 partner, officer, director, shareholder, member, or manager. 31 34 4. The board may issue subpoenas in any proceeding to 31 35 compel witnesses to testify and to produce documentary 32 1 evidence on behalf of the board and shall issue such subpoenas 32 2 upon the application of the accused, pursuant to section 32 3 17A.13, subsection 1, and section 272C.6, subsection 3. 32 4 5. Evidence supporting the board's charges may be 32 5 presented at any hearing by an assistant attorney general. 32 6 6. The decision of the board shall be by a majority vote 32 7 of a quorum of the board. Licensee discipline shall only be 32 8 imposed upon the majority vote of the members of the board not 32 9 disqualified pursuant to section 17A.17, subsection 8, or 32 10 other applicable law. 32 11 7. Judicial review may be sought in accordance with 32 12 chapter 17A. 32 13 Sec. 12. NEW SECTION. 542D.12 REINSTATEMENT. 32 14 1. In any case in which the board has suspended, revoked, 32 15 or restricted a license, refused to renew a license, or 32 16 accepted the voluntary surrender of a license to conclude a 32 17 pending disciplinary investigation or action, the board may, 32 18 upon written application, modify or terminate the suspension, 32 19 reissue the license, or modify or remove the restriction, with 32 20 or without terms and conditions. 32 21 2. The board is vested with discretionary authority to 32 22 specify by rule the manner in which such applications shall be 32 23 made, the times within which they shall be made, the 32 24 circumstances in which a hearing will be held, and the grounds 32 25 upon which such applications will be decided. The rules shall 32 26 provide at a minimum that the burden is on the licensee to 32 27 produce evidence that the basis for revocation, suspension, 32 28 restriction, refusal to renew, or voluntarily surrender no 32 29 longer exists and that it will be in the public interest for 32 30 the board to grant the application on such terms and 32 31 conditions as the board deems desirable. 32 32 Sec. 13. NEW SECTION. 542D.13 UNLAWFUL ACTS. 32 33 1. Only a certified public accountant may issue a report 32 34 on financial statements of a person, firm, organization, or 32 35 governmental unit, or offer to render or render any attest 33 1 service. Only a certified public accountant or licensed 33 2 public accountant may render compilation services. This 33 3 restriction does not prohibit such acts by a public official 33 4 or public employee in the performance of that person's duties; 33 5 or prohibit the performance by any nonlicensee of other 33 6 services involving the use of accounting skills, including the 33 7 preparation of tax returns, management advisory services, and 33 8 the preparation of financial statements without the issuance 33 9 of reports on such financial statements. A nonlicensee may 33 10 prepare financial statements and issue nonattest transmittals 33 11 or information on such statements or transmittals which do not 33 12 purport to be in compliance with the statements on standards 33 13 for accounting and review services. 33 14 2. A licensee performing attest or compilation services 33 15 must provide those services consistent with professional 33 16 standards. 33 17 3. A person not holding a certificate shall not use or 33 18 assume the title "certified public accountant" or the 33 19 abbreviation "CPA" or any other title, designation, words, 33 20 letters, abbreviation, sign, card, or device tending to 33 21 indicate that such person is a certified public accountant. 33 22 4. A firm shall not provide attest services or assume or 33 23 use the title "certified public accountants" or the 33 24 abbreviation "CPAs" or any other title, designation, words, 33 25 letters, abbreviation, sign, card, or device tending to 33 26 indicate that such firm is a certified public accounting firm 33 27 unless the firm holds a permit issued under section 542D.7 and 33 28 ownership of the firm satisfies the requirements of this 33 29 chapter and rules adopted by the board. 33 30 5. A person shall not assume or use the title "licensed 33 31 public accountant" or the abbreviation "LPA" or any other 33 32 title, designation, words, letters, abbreviation, sign, card, 33 33 or device tending to indicate that such person is a licensed 33 34 public accountant unless that person holds a license issued 33 35 under section 542D.8. 34 1 6. A firm not holding a permit issued under section 542D.8 34 2 shall not provide compilation services or assume or use the 34 3 title "licensed public accountant", the abbreviation "LPA", or 34 4 any other title, designation, words, letters, abbreviation, 34 5 sign, card, or device tending to indicate that such firm is 34 6 composed of licensed public accountants. 34 7 7. A person or firm not holding a certificate, permit, or 34 8 license issued under section 542D.6, 542D.7, 542D.8, or 34 9 542D.19 shall not assume or use the title "certified 34 10 accountant", "chartered accountant", "enrolled accountant", 34 11 "licensed accountant", "registered accountant", "accredited 34 12 accountant", or any other title or designation likely to be 34 13 confused with the title "certified public accountant" or 34 14 "licensed public accountant", or use any of the abbreviations 34 15 "CA", "LA", "RA", "AA", or similar abbreviation likely to be 34 16 confused with the abbreviation "CPA" or "LPA". The title 34 17 "enrolled agent" or "EA" may be used by individuals so 34 18 designated by the Internal Revenue Service. Nothing in this 34 19 section shall restrict truthful advertising of a bona fide 34 20 credential or title which in context is not deceptive or 34 21 misleading to the public. 34 22 8. A nonlicensee shall not use language in any statement 34 23 relating to the financial affairs of a person or entity which 34 24 is conventionally used by licensees in reports on financial 34 25 statements. The board shall develop and issue language which 34 26 nonlicensees may use in connection with such financial 34 27 information. 34 28 9. A person or firm not holding a certificate, permit, or 34 29 license issued under section 542D.6, 542D.7, 542D.8, or 34 30 542D.19 shall not assume or use any title or designation that 34 31 includes the word "accountant", "auditor", or "accounting", in 34 32 connection with any other language that implies that such 34 33 person or firm holds such a certificate, permit, or license or 34 34 has special competence as an accountant or auditor. However, 34 35 this subsection does not prohibit an officer, partner, member, 35 1 manager, or employee of a firm or organization from affixing 35 2 that person's own signature to a statement in reference to the 35 3 financial affairs of such firm or organization with wording 35 4 which designates the position, title, or office that the 35 5 person holds, or prohibit any act of a public official or 35 6 employee in the performance of such person's duties. This 35 7 subsection does not prohibit the use of the title or 35 8 designation "accountant" by persons other than those holding a 35 9 certificate or license under this chapter. 35 10 10. A person holding a certificate or license or firm 35 11 holding a permit under this chapter shall not use a 35 12 professional or firm name or designation that is misleading 35 13 about the legal form of the firm, or about the persons who are 35 14 partners, officers, members, managers, or shareholders of the 35 15 firm, or about any other matter. However, the name of one or 35 16 more former partners, members, managers, or shareholders may 35 17 be included in the name of a firm or its successor. 35 18 11. This section does not apply to a person or firm 35 19 holding a certification, designation, degree, or license 35 20 granted in a foreign country entitling the holder to engage in 35 21 the practice of public accountancy or its equivalent in such 35 22 country, whose activities in this state are limited to 35 23 providing professional services to a person or firm who is a 35 24 resident of, government of, or business entity of the country 35 25 in which the person holds such entitlement, who does not 35 26 perform attest or compilation services, and who does not issue 35 27 reports with respect to the financial statements of any other 35 28 person, firm, or governmental unit in this state, and who does 35 29 not use in this state any title or designation other than the 35 30 one under which the person practices in such country, followed 35 31 by a translation of such title or designation into the English 35 32 language, if it is in a different language, and by the name of 35 33 such country. 35 34 12. A holder of a certificate issued under section 542D.6 35 35 or 542D.19 shall not perform attest services in a firm that 36 1 does not hold a permit issued under section 542D.7. 36 2 13. An individual licensee shall not issue a report in 36 3 standard form upon a compilation of financial information 36 4 through any form of business that does not hold a permit 36 5 issued under section 542D.7 unless the report discloses the 36 6 name of the business through which the individual is issuing 36 7 the report and the individual licensee does all of the 36 8 following: 36 9 a. Signs the compilation report identifying the individual 36 10 as a certified public accountant or licensed public 36 11 accountant. 36 12 b. Meets competency requirements provided in applicable 36 13 standards. 36 14 c. Undergoes, no less frequently than once every three 36 15 years, a peer review conducted in a manner as specified by the 36 16 board. The review shall include verification that such 36 17 individual has met the competency requirements set out in 36 18 professional standards for such services. 36 19 14. This section does not prohibit a practicing attorney 36 20 from preparing or presenting records or documents customarily 36 21 prepared by an attorney in connection with the attorney's 36 22 professional work in the practice of law. 36 23 15. a. A licensee shall not for a commission recommend or 36 24 refer a client to any product or service, or for a commission 36 25 recommend or refer another person to any product or service to 36 26 be supplied by a client, or receive a commission, when the 36 27 licensee also performs for that client any of the following: 36 28 (1) An audit or review of a financial statement. 36 29 (2) A compilation of a financial statement when the 36 30 licensee expects, or reasonably might expect, that a third 36 31 party will use the financial statement and the licensee's 36 32 compilation report does not disclose a lack of independence. 36 33 (3) An examination of prospective financial information. 36 34 The prohibitions under this paragraph "a" apply during the 36 35 period in which the licensee is engaged to perform any of the 37 1 services identified in subparagraphs (1) through (3), and the 37 2 period covered by any historical financial statements involved 37 3 in such services. 37 4 b. A licensee who is not prohibited by this section from 37 5 performing services for or receiving a commission and who is 37 6 paid or expects to be paid a commission shall disclose that 37 7 fact to any person or entity to whom the licensee recommends 37 8 or refers a product or service to which the commission 37 9 relates. 37 10 c. A licensee who accepts a referral fee for recommending 37 11 a service of a licensee or referring a licensee to any person 37 12 or entity or who pays a referral fee to obtain a client shall 37 13 disclose such acceptance or payment to the client. 37 14 16. a. A licensee shall not do any of the following: 37 15 (1) Perform professional services for a contingent fee, or 37 16 receive such fee from a client for whom the licensee or the 37 17 licensee's firm performs any of the following: 37 18 (a) An audit or review of a financial statement. 37 19 (b) A compilation of a financial statement when the 37 20 licensee expects, or reasonably might expect, that a third 37 21 party will use the financial statement and the licensee's 37 22 compilation report does not disclose a lack of independence. 37 23 (c) An examination of prospective financial information. 37 24 (2) Prepare for a client an original or amended tax return 37 25 or claim for a tax refund for a contingent fee. 37 26 b. Paragraph "a" applies during the period in which the 37 27 licensee is engaged to perform any of the listed services and 37 28 the period covered by any historical financial statements 37 29 involved in such listed services. 37 30 c. For purposes of this subsection, a contingent fee is a 37 31 fee established for the performance of a service pursuant to 37 32 an arrangement in which a fee will not be charged unless a 37 33 specified finding or result is attained, or in which the 37 34 amount of the fee is otherwise dependent upon the finding or 37 35 result of such service. A fee shall not be considered as 38 1 being a contingent fee if fixed by a court or other public 38 2 authority, or, in a tax matter, if determined based on the 38 3 results of a judicial proceeding or the findings of a 38 4 governmental agency. A licensee's fee may vary depending on 38 5 the complexity of the services rendered. 38 6 d. Nothing contained in this chapter shall be construed to 38 7 authorize any person engaged in the practice as a certified 38 8 public accountant or licensed public accountant or any member 38 9 or employee of such firm to engage in the practice of law 38 10 individually or within entities licensed under this chapter. 38 11 Sec. 14. NEW SECTION. 542D.14 INJUNCTION AGAINST 38 12 UNLAWFUL ACTS, CIVIL PENALTIES, AND CONSENT AGREEMENTS. 38 13 1. If, as a result of an investigation under section 38 14 542D.11 or otherwise, the board believes that a person or firm 38 15 has engaged, or is about to engage, in an act or practice 38 16 which constitutes or will constitute a violation of section 38 17 542D.13, the board may make application to the district court 38 18 for an order enjoining such act or practice. Upon a showing 38 19 by the board that such person or firm has engaged, or is about 38 20 to engage, in any such act or practice, an injunction, 38 21 restraining order, or other order as may be appropriate shall 38 22 be granted by the court. 38 23 2. In addition to a criminal penalty provided for in 38 24 section 542D.15, the board may issue an order to require 38 25 compliance with section 542D.13 and may impose a civil penalty 38 26 not to exceed one thousand dollars for each offense upon a 38 27 person who is not a licensee under this chapter and who 38 28 engages in conduct prohibited by section 542D.13. Each day of 38 29 a continued violation constitutes a separate offense. 38 30 3. The board, in determining the amount of a civil penalty 38 31 to be imposed, may consider any of the following: 38 32 a. Whether the amount imposed will be a substantial 38 33 economic deterrent to the violation. 38 34 b. The circumstances leading to the violation. 38 35 c. The severity of the violation and the risk of harm to 39 1 the public. 39 2 d. The economic benefits gained by the violator as a 39 3 result of noncompliance. 39 4 e. The interest of the public. 39 5 4. The board, before issuing an order under this section, 39 6 shall provide the person written notice and the opportunity to 39 7 request a hearing. The hearing must be requested within 39 8 thirty days after receipt of the notice and shall be conducted 39 9 in the same manner as provided for disciplinary proceedings 39 10 involving a licensee under this chapter. 39 11 5. The board, in connection with a proceeding under this 39 12 section, may issue subpoenas to compel the attendance and 39 13 testimony of witnesses and the disclosure of evidence, and may 39 14 request the attorney general to bring an action to enforce the 39 15 subpoena. 39 16 6. A person aggrieved by the imposition of a civil penalty 39 17 under this section may seek judicial review pursuant to 39 18 section 17A.19. 39 19 7. If a person fails to pay a civil penalty within thirty 39 20 days after entry of an order imposing the civil penalty, or if 39 21 the order is stayed pending an appeal, within ten days after 39 22 the court enters a final judgment in favor of the board, the 39 23 board shall notify the attorney general. The attorney general 39 24 may commence an action to recover the amount of the penalty, 39 25 including reasonable attorney fees and costs. 39 26 8. An action to enforce an order under this section may be 39 27 joined with an action for an injunction. 39 28 9. The board, in its discretion and in lieu of prosecuting 39 29 a first offense under this section, may enter into a consent 39 30 agreement with a violator, or with a person guilty of aiding 39 31 or abetting a violator, which acknowledges the violation and 39 32 the violator's agreement to refrain from any further 39 33 violations. 39 34 Sec. 15. NEW SECTION. 542D.15 CRIMINAL PENALTIES. 39 35 1. A person who violates a provision of section 542D.13 is 40 1 guilty of a serious misdemeanor. 40 2 2. If the board has reason to believe that a person has 40 3 committed a violation subject to subsection 1, the board may 40 4 certify the facts to the attorney general of this state, or to 40 5 the county attorney of the county where the person maintains a 40 6 business office, who, in the attorney general's or county 40 7 attorney's discretion, may initiate an appropriate criminal 40 8 proceeding. 40 9 3. If, after an investigation under section 542D.11 or 40 10 otherwise, the board has reason to believe that a person or 40 11 firm has knowingly engaged in an act or practice that 40 12 constitutes a violation subject to subsection 1, the board may 40 13 submit its information to the attorney general of any state, 40 14 or other appropriate law enforcement official, who, in such 40 15 official's discretion, may initiate an appropriate criminal 40 16 proceeding. 40 17 Sec. 16. NEW SECTION. 542D.16 SINGLE ACT EVIDENCE OF 40 18 PRACTICE. 40 19 In an action brought under section 542D.14 or 542D.15, 40 20 evidence of the commission of a single act prohibited by this 40 21 chapter is sufficient to justify a penalty, injunction, 40 22 restraining order, or conviction, without evidence of a 40 23 general course of conduct. 40 24 Sec. 17. NEW SECTION. 542D.17 CONFIDENTIAL 40 25 COMMUNICATIONS. 40 26 A licensee shall not voluntarily disclose information 40 27 communicated to the licensee by a client relating to and in 40 28 connection with services rendered to the client by the 40 29 licensee, except with the permission of the client, or an 40 30 heir, successor, or personal representative of the client. 40 31 Such information is deemed to be confidential. However, this 40 32 section shall not be construed as prohibiting the disclosure 40 33 of information required to be disclosed by the standards of 40 34 the public accounting profession in reporting on the 40 35 examination of financial statements or as prohibiting 41 1 disclosures in a court proceeding, in an investigation or 41 2 proceeding under this chapter or chapter 272C, in an ethical 41 3 investigation conducted by a private professional 41 4 organization, in the course of a peer review, to another 41 5 person active in the licensee's firm performing services for 41 6 that client on a need-to-know basis, to persons associated 41 7 with the investigative entity who need this information for 41 8 the sole purpose of assuring quality control, or as otherwise 41 9 required by law. 41 10 This section does not preclude a licensee from filing a 41 11 complaint with, or responding to an inquiry made by, the 41 12 board, a taxing authority or law enforcement authority of this 41 13 state, or a licensing or similar authority of another state or 41 14 the United States. 41 15 Sec. 18. NEW SECTION. 542D.18 LICENSEES' WORKING PAPERS 41 16 – CLIENTS' RECORDS. 41 17 1. Subject to section 542D.17, all statements, records, 41 18 schedules, working papers, and memoranda made by a licensee or 41 19 a partner, shareholder, officer, director, member, manager, or 41 20 employee of a licensee, incident to, or in the course of, 41 21 rendering services to a client, except reports submitted by 41 22 the licensee to the client and except for records that are 41 23 part of the client's records, are the property of the licensee 41 24 in the absence of an express agreement between the licensee 41 25 and the client to the contrary. Such statement, record, 41 26 schedule, working paper, or memorandum shall not be sold, 41 27 transferred, or bequeathed, without the consent of the client 41 28 or the client's personal representative or assignee, to anyone 41 29 other than a surviving partner, stockholder, or member of the 41 30 licensee, or any combined or merged firm or successor in 41 31 interest to the licensee. This section shall not be construed 41 32 as prohibiting a temporary transfer of working papers or other 41 33 material necessary in the course of carrying out peer reviews 41 34 or as otherwise interfering with the disclosure of information 41 35 pursuant to section 542D.17. 42 1 2. A licensee shall furnish to a client or former client, 42 2 upon request and reasonable notice, the following: 42 3 a. A copy of the licensee's working papers, to the extent 42 4 that such working papers include records that would ordinarily 42 5 constitute part of the client's records and are not otherwise 42 6 available to the client. 42 7 b. Accounting or other records belonging to, or obtained 42 8 from or on behalf of, the client that the licensee removed 42 9 from the client's premises or received for the client's 42 10 account. The licensee may make and retain copies of such 42 11 documents of the client when they form the basis for work done 42 12 by the licensee. 42 13 3. This chapter does not require a licensee to keep any 42 14 working papers beyond the period prescribed in any other 42 15 applicable statute. 42 16 Sec. 19. NEW SECTION. 542D.19 SUBSTANTIAL EQUIVALENCY. 42 17 1. An individual whose principal place of business is not 42 18 in this state shall be granted a certificate to practice as a 42 19 certified public accountant in this state if the board 42 20 determines that the individual holds in good standing a valid 42 21 certificate or license to practice as a certified public 42 22 accountant in the state in which the individual's principal 42 23 place of business is located, and that the individual 42 24 satisfies one of the following conditions: 42 25 a. The other state's licensing standards are substantially 42 26 equivalent to those required by this chapter. 42 27 b. The applicant's individual qualifications are 42 28 substantially equivalent to those required by section 542D.5. 42 29 c. The applicant satisfies all of the following: 42 30 (1) The applicant passed the examination required for 42 31 issuance of the applicant's certificate or license with grades 42 32 that would have been passing grades at the time in this state; 42 33 (2) The applicant has at least four years of experience 42 34 within the ten years immediately preceding the application 42 35 which occurred after passing the examination upon which the 43 1 applicant's certificate or license was based and which in the 43 2 board's opinion is substantially equivalent to that required 43 3 by section 542D.5, subsection 12; and, 43 4 (3) If the applicant's certificate or license was issued 43 5 more than four years prior to the filing of the application in 43 6 this state, the applicant has fulfilled the continuing 43 7 professional education requirements described in section 43 8 542D.6, subsection 3. 43 9 2. An individual who holds in good standing a valid 43 10 certificate or license to practice as a certified public 43 11 accountant in another state and who desires to establish the 43 12 holder's principal place of business in this state shall 43 13 request the issuance of a certificate from the board prior to 43 14 establishing such principal place of business. The board 43 15 shall issue a certificate to an individual who satisfies one 43 16 or more of the conditions described in subsection 1. 43 17 3. The board shall issue a certificate to a holder of a 43 18 substantially equivalent foreign designation, upon 43 19 satisfaction of all of the following: 43 20 a. The foreign authority which issued the designation 43 21 allows a person who holds a valid certificate issued by this 43 22 state to obtain such foreign authority's comparable 43 23 designation. 43 24 b. The foreign designation satisfies all of the following: 43 25 (1) The designation was issued by a foreign authority that 43 26 regulates the practice of public accountancy and the foreign 43 27 designation has not expired or been revoked or suspended. 43 28 (2) The designation entitles the holder to issue reports 43 29 on financial statements. 43 30 (3) The designation was issued upon the basis of 43 31 education, examination, and experience requirements 43 32 established by the foreign authority or by law. 43 33 c. The applicant satisfies all of the following: 43 34 (1) The designation was issued based on education and 43 35 examination standards substantially equivalent to those in 44 1 effect in this state at the time the foreign designation was 44 2 granted. 44 3 (2) The applicant satisfies an experience requirement, 44 4 substantially equivalent to the requirement set out in section 44 5 542D.5, subsection 12, in the jurisdiction which issued the 44 6 foreign designation or has completed four years of 44 7 professional experience in this state; or meets equivalent 44 8 requirements prescribed by the board by rule, within the ten 44 9 years immediately preceding the application. 44 10 (3) The applicant has passed qualifying examinations in 44 11 national standards and the laws, rules, and code of ethical 44 12 conduct in effect in this state. 44 13 (4) The applicant shall list in the application all 44 14 jurisdictions, foreign and domestic, in which the applicant 44 15 has applied for or holds a designation to practice public 44 16 accountancy. A holder of a certificate issued under this 44 17 section shall notify the board in writing, within thirty days 44 18 after its occurrence, of any issuance, denial, revocation, or 44 19 suspension of a designation or commencement of a disciplinary 44 20 or enforcement action by any jurisdiction. 44 21 4. An applicant under this section shall comply with all 44 22 applicable provisions of section 542D.5, subsections 1 through 44 23 6, and section 542D.6. 44 24 5. The board shall adopt rules to implement this section 44 25 which will expedite the application process to the extent 44 26 reasonably possible. 44 27 Sec. 20. Section 15E.208, subsection 5, paragraph d, 44 28 subparagraph (4), Code 2001, is amended to read as follows: 44 29 (4) The manner of oversight required by the department or 44 30 the auditor of state. The articles must provide that the 44 31 corporation shall submit a report to the governor, the general 44 32 assembly, and the department. The report shall provide a 44 33 description of the corporation's activities and a summary of 44 34 its finances, including financial awards. The report shall be 44 35 submitted not later than January 10 of each year. The 45 1 articles shall provide that an audit of the corporation must 45 2 be conducted each year for the preceding year by a certified 45 3 public accountant licensed pursuant to chapter542C542D. The 45 4 auditor of state may audit the books and accounts of the 45 5 corporation at any time. The results of the annual audit and 45 6 any audit for the current year conducted by the auditor of 45 7 state shall be included as part of the report. 45 8 Sec. 21. Section 99D.20, Code 2001, is amended to read as 45 9 follows: 45 10 99D.20 AUDIT OF LICENSEE OPERATIONS. 45 11 Within ninety days after the end of each race meet, the 45 12 licensee shall transmit to the commission an audit of the 45 13 financial transactions and condition of the licensee's 45 14 operations conducted under this chapter. Additionally, within 45 15 ninety days after the end of the licensee's fiscal year, the 45 16 licensee shall transmit to the commission an audit of the 45 17 financial transactions and condition of the licensee's total 45 18 operations. All audits shall be conducted by certified public 45 19 accountants registered in the state of Iowa under chapter542C45 20 542D. 45 21 Sec. 22. Section 99F.13, Code 2001, is amended to read as 45 22 follows: 45 23 99F.13 ANNUAL AUDIT OF LICENSEE OPERATIONS. 45 24 Within ninety days after the end of the licensee's fiscal 45 25 year, the licensee shall transmit to the commission an audit 45 26 of the financial transactions and condition of the licensee's 45 27 total operations. All audits shall be conducted by certified 45 28 public accountants registered or licensed in the state of Iowa 45 29 under chapter542C542D. 45 30 Sec. 23. Section 203.16, subsection 7, Code 2001, is 45 31 amended to read as follows: 45 32 7. Where released at the request of the Iowaboard of45 33 accountancy examining board for licensee review and discipline 45 34 in accordance with chapters 272C and542C542D and subject to 45 35 the confidentiality requirements of section 272C.6. 46 1 Sec. 24. Section 203C.24, subsection 7, Code 2001, is 46 2 amended to read as follows: 46 3 7. Where released at the request of the Iowaboard of46 4 accountancy examining board for licensee review and discipline 46 5 in accordance with chapters 272C and542C542D and subject to 46 6 the confidentiality requirements of section 272C.6. 46 7 Sec. 25. Section 272C.1, subsection 6, paragraph c, Code 46 8 2001, is amended to read as follows: 46 9 c. The Iowa accountancy examining board, created pursuant 46 10 to chapter542C542D. 46 11 Sec. 26. Section 272C.3, subsection 2, paragraph a, Code 46 12 2001, is amended to read as follows: 46 13 a. Revoke a license, or suspend a license either until 46 14 further order of the board or for a specified period, upon any 46 15 of the grounds specified in section 147.55, 148.6, 148B.7, 46 16 152.10, 153.34, 154A.24, 169.13, 542B.21,542C.21542D.10, 46 17 543B.29, 544A.13, 544B.15, or 602.3203 or chapter 151, 155, 46 18 507B or 522, as applicable, or upon any other grounds 46 19 specifically provided for in this chapter for revocation of 46 20 the license of a licensee subject to the jurisdiction of that 46 21 board, or upon failure of the licensee to comply with a 46 22 decision of the board imposing licensee discipline; 46 23 Sec. 27. Section 272C.4, subsection 6, Code 2001, is 46 24 amended to read as follows: 46 25 6. Define by rule acts or omissions which are grounds for 46 26 revocation or suspension of a license under section 147.55, 46 27 148.6, 148B.7, 152.10, 153.34, 154A.24, 169.13, 455B.191, 46 28 542B.21,542C.21542D.10, 543B.29, 544A.13, 544B.15, or 46 29 602.3203 or chapter 151, 155, 507B or 522, as applicable, and 46 30 to define by rule acts or omissions which constitute 46 31 negligence, careless acts or omissions within the meaning of 46 32 section 272C.3, subsection 2, paragraph "b", which licensees 46 33 are required to report to the board pursuant to section 46 34 272C.9, subsection 2; 46 35 Sec. 28. Section 272C.5, subsection 2, paragraph c, Code 47 1 2001, is amended to read as follows: 47 2 c. Shall state whether the procedures are an alternative 47 3 to or an addition to the procedures stated in sections 147.58 47 4 through 147.71, 148.6 through 148.9, 152.10 and 152.11, 153.23 47 5 through 153.30, 153.33, and 154A.23, 542B.22,542C.23542D.11, 47 6 543B.35, 543B.36, 544B.16. 47 7 Sec. 29. Section 272C.6, subsection 6, unnumbered 47 8 paragraph 1, Code 2001, is amended to read as follows: 47 9 A board created pursuant to chapter 147, 154A, 155, 169, 47 10 542B,542C542D, 543B, 543D, 544A, or 544B may charge a fee 47 11 not to exceed seventy-five dollars for conducting a 47 12 disciplinary hearing pursuant to this chapter which results in 47 13 disciplinary action taken against the licensee by the board, 47 14 and in addition to the fee, may recover from a licensee the 47 15 costs for the following procedures and associated personnel: 47 16 Sec. 30. Section 272C.9, subsection 2, Code 2001, is 47 17 amended to read as follows: 47 18 2. A licensee has a continuing duty to report to the 47 19 licensing board by whom the person is licensed those acts or 47 20 omissions specified by rule of the board pursuant to section 47 21 272C.4, subsection 6, when committed by another person 47 22 licensed by the same licensing board. This subsection does 47 23 not apply to licensees under chapter542C542D when the 47 24 observations are a result of participation in programs of 47 25 practice review, peer review and quality review conducted by 47 26 professional organizations of certified public accountants, 47 27 for educational purposes and approved by the accountancy 47 28 examining board. 47 29 Sec. 31. Section 502.102, subsection 11, paragraph c, 47 30 subparagraphs (3) and (4), Code 2001, are amended to read as 47 31 follows: 47 32 (3) An attorney licensed to practice law in this state, a 47 33 certified public accountant licensed pursuant to chapter542C47 34 542D, a professional engineer licensed pursuant to chapter 47 35 542B, or a certified teacher, if the person's performance of 48 1 these services is solely incidental to the practice of the 48 2 person's profession. 48 3 (4) An attorney licensed to practice law in this state or 48 4 a certified public accountant licensed pursuant to chapter 48 5542C542D who does not do any of the following: 48 6 Sec. 32. Section 522.1, subsection 2, Code 2001, is 48 7 amended to read as follows: 48 8 2. A certified public accountant licensed pursuant to 48 9 chapter542C542D. 48 10 Sec. 33. Section 546.10, subsection 1, paragraph b, Code 48 11 2001, is amended to read as follows: 48 12 b. The Iowa accountancy examining board created pursuant 48 13 to chapter542C542D. 48 14 Sec. 34. Section 546.10, subsection 5, Code 2001, is 48 15 amended to read as follows: 48 16 5. Fees collected under chapters 542B,542C542D, 543B, 48 17 543D, 544A, and 544B shall be paid to the treasurer of state 48 18 and credited to the general fund of the state. All expenses 48 19 required in the discharge of the duties and responsibilities 48 20 imposed upon the professional licensing division of the 48 21 department of commerce, the administrator, and the licensing 48 22 boards by the laws of this state shall be paid from moneys 48 23 appropriated by the general assembly for those purposes. All 48 24 fees deposited into the general fund of the state, as provided 48 25 in this subsection, shall be subject to the requirements of 48 26 section 8.60. 48 27 Sec. 35. Section 669.14, subsection 11, unnumbered 48 28 paragraph 1, Code 2001, is amended to read as follows: 48 29 Any claim for financial loss based upon an act or omission 48 30 in financial regulation, including but not limited to 48 31 examinations, inspections, audits, or other financial 48 32 oversight responsibilities, pursuant to chapters 87, 203, 48 33 203A, 203C, 203D, 421B, 486, 487, and 490 through 553, 48 34 excluding chapters 540A, 542B,542C542D, 543B, 543C, 543D, 48 35 544A, and 544B. 49 1 Sec. 36. Chapter 542C, Code 2001, is repealed, effective 49 2 July 1, 2002. However, this Act shall not be construed to 49 3 invalidate or affect any action taken or any proceeding 49 4 instituted under any law in effect prior to the effective date 49 5 of this Act. 49 6 Sec. 37. CONSTRUCTION. This Act shall be construed to 49 7 fully recognize a certificate, license, or permit issued 49 8 pursuant to chapter 542C prior to July 1, 2002, as though 49 9 issued under this Act. 49 10 Sec. 38. EFFECTIVE DATE. This Act takes effect July 1, 49 11 2002. 49 12 49 13 49 14 49 15 BRENT SIEGRIST 49 16 Speaker of the House 49 17 49 18 49 19 49 20 MARY E. KRAMER 49 21 President of the Senate 49 22 49 23 I hereby certify that this bill originated in the House and 49 24 is known as House File 451, Seventy-ninth General Assembly. 49 25 49 26 49 27 49 28 MARGARET THOMSON 49 29 Chief Clerk of the House 49 30 Approved , 2001 49 31 49 32 49 33 49 34 THOMAS J. VILSACK 49 35 Governor
Text: HF00450 Text: HF00452 Text: HF00400 - HF00499 Text: HF Index Bills and Amendments: General Index Bill History: General Index
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