La. Admin. Code tit. 46, § XIX-1707 - Other Responsibilities and Practices
A. Acting through Others
1. A licensee or CPA firm shall not permit
others to carry out on his behalf or on the firm's behalf, either with or
without compensation, acts which, if carried out by the licensee or CPA firm,
would place him or the CPA firm in violation of the rules of professional
conduct, professional standards, or any provisions of the Act.
2.Acting through an affiliated entity.
a. Definition
i. Affiliated Entity. Affiliated entities for
purpose of this rule refers to entities which share elements of ownership
structure with a CPA firm and which offer to clients, or the public,
professional services or products related to the skills associated with CPAs.
Conversely, entities that offer services or products that do not relate to
matters of accounting and financial reporting, tax, finance, investment advice
or financial planning, management, or consultation are excluded.
ii. Similar Name. A similar name is one that
contains one or more names, or initials of the names, or reference to
that/those names that are included in a CPA firm applying for or currently
holding a firm permit.
b.
On and after January 1, 2008, a CPA firm shall not affiliate with an entity
that has a similar name unless:
i. the
affiliated entity is owned in accordance with
§1707.A.2.d i;
or
ii. has been issued a firm
permit by the board pursuant to
§1707.A.2.d ii;
or
iii. the CPA firm has entered
into a written agreement with the board pursuant to
§1707.A.2.d
ii.
c. a CPA firm seeking
issuance, renewal, or reinstatement of a firm permit, to be effective on and
after January 1, 2008 shall, as a condition thereof, satisfy the requirements
of this Paragraph,
§1707. A 2;
d. Repealed.
e.depending on the ownership structure, an
affiliated entity may be required to obtain a firm permit in order to use a
similar name which indicates that the C P A o r CPA firm is providing services
through the affiliated entity.
i. affiliated
entities wholly owned either by the owners of the CPA firm, on the same basis
as the CPA firm is owned, or directly by the CPA firm may use a similar name
and would not be required to obtain a firm permit;
ii. affiliated entities that are
majority-owned (not wholly owned) by the owners of the CPA firm or by the CPA
firm, or that are wholly owned but in different percentages are required to
obtain a firm permit if the affiliated entity uses a similar name. If the
affiliated entity does not qualify for a firm permit under
R.S.
37:77, the CPA firm (i.e., one that does hold
a firm permit) must enter into a written agreement with and acceptable to the
board that sets forth that the CPA firm is responsible to the board for the
actions of the affiliated entity and its owners;
iii. if the CPA firm and/or its owners
(whether individually CPA licensed or not) own 50 percent or less of the other
affiliated entity, a similar name may not be used for the affiliated
entity;
f. under
R.S.
37:77(C), a majority of the
ownership of a CPA firm (in terms of financial interests and voting rights of
all partners, officers, shareholder, members, or managers) must belong to
holders of valid licenses. Thus an unlicensed "holding company" cannot own a
majority or 100 percent of a CPA firm. Therefore, such a "holding company"
would have to apply for a CPA firm permit and qualify as such. The holding
company and the CPA firm must both be registered as firms with the board even
though the holding company will not directly offer services to clients. If the
holding company does not otherwise meet the requirements to be licensed (e.g.,
the requirements that a majority ownership interest is held by licensees; the
owners must be active in the firm or affiliates; and, the name must not be
misleading) then such a firm structure would not be permissible.
B. Use of the "CPA
Inactive" or "CPA Retired" Designation
1.
Certificate only holders under prior law.
a.
Prior to applying for and obtaining a certificate under
R.S.
37:75.I, individuals who annually register in
inactive status may use the "CPA inactive" designation in connection with an
employment position held in industry, government or academia, or in personal
correspondence.
b. Any such
individual who offers to perform or performs, for the public, professional
services of any type involving the use of accounting, management advisory,
financial advisory, tax, or consulting skills shall not use the designation CPA
or "CPA inactive" in connection therewith or in any other manner or in
connection with any employment.
2. Certificate Holders Subject to CPE
Exemption
a. Individuals granted an exception
to continuing education requirements under
R.S.
37:76(D)(2) shall not
perform or offer to perform for the public one or more kinds of services
involving the use of accounting, attest, management advisory, financial
advisory, tax, or consulting skills and must place the word "inactive" or
"retired", as applicable based on the individuals registered status, adjacent
to their CPA title on any business card, letterhead, or any other document or
device.
b. Any individual
referenced in
R.S.
37:76(D)(2) who after being
granted an exemption under that Section offers to perform or performs for the
public professional services of any type involving the use of accounting,
management advisory, financial advisory, tax, or consulting skills shall no
longer qualify for the use of the designation and shall immediately cease all
uses of the designation "CPA inactive" or "CPA-retired" in connection therewith
or in any other manner or in connection with any employment or on any
letterhead, business card, email signature, etc.
c. A "CPA-retired" may perform uncompensated
volunteer services as long as the individual does not sign any documents
related to such services as a CPA.
C. Firm Name
1. The name under which a licensee practices
public accounting must indicate clearly whether he is an individual practicing
in his own name or a named member of a firm. If the name includes the
designation "and Company" or "and Associates" or "Group" or abbreviations
thereof, there must be at least two licensees involved in the practice, who may
be either partners, shareholders, members or employees of the firm. However,
names of one or more past partners, shareholders, or members may be included in
the firm name of a successor firm.
2. A partner, member or shareholder surviving
the death or withdrawal of all other partners, members or shareholders may
continue to practice under the partnership or corporate name for up to two
years after becoming a sole practitioner, sole member or sole
shareholder.
3. A CPA firm name is
misleading within the meaning of
R.S.
37:83(G) if, among other
things:
a. the CPA firm name implies the
existence of a corporation when the firm is not a corporation; or
b. the CPA firm name includes the name of a
person who is not a CPA and is not a past partner, shareholder, or member of
the firm.
4. A firm name
not consisting of the names of one or more present or former partners, members,
or shareholders may not be used by a CPA firm unless such name has been
approved by the board as not being false or misleading.
D. Communications. A holder of a certificate
or firm permit, or an individual in inactive or retired status shall, when
requested, respond to communications from the board in the manner requested by
the board within 30 days of the mailing of such communications by certified
mail, or by such other delivery methods available to the board.
E. Applicability. All of the rules of
professional conduct shall apply to and be observed by Louisiana licensees and
CPAs licensed in other states who may be granted rights under the substantial
equivalency provisions of
R.S.
37:94. Notwithstanding anything herein to the
contrary, they shall also apply to and be observed by individuals registered in
inactive or retired status, where applicable.
F. Cooperation with Board Inquiry or
Investigation. A certificate holder, or CPA licensed in another state who has
provided professional services to Louisiana clients, or CPA licensed in another
state who may be granted rights under the substantial equivalency provisions of
R.S.
37:94, shall fully cooperate with the board
in connection with any inquiry or investigation made by the board. Full
cooperation includes, but is not limited to, fully responding in a timely
manner to all inquiries of the board or representatives of the board and
claiming board correspondence from the U.S. Postal Service and from other
delivery services used by the board.
G. Denial, Suspension, or Revocation by
another state. Pursuant to
R.S.
37:76 (F), each holder of or applicant for a
certificate shall notify the board in writing within 30 days after the
occurrence of any denial, revocation, or suspension of a certificate, license
or permit by another state.
Notes
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