(1) A licensee who is not prohibited from
performing services or receiving consideration or a commission and who is paid
or expects to be paid consideration or a commission shall disclose that fact in
compliance with the requirements of this rule to any person to whom the
licensee recommends or refers a product or service to which the commission
relates.
(2) Any licensee who
accepts consideration or a commission for a referral shall disclose such
acceptance or payment to the client in compliance with the requirements of this
rule.
(3) Any licensee who accepts
or agrees to accept a contingent fee shall disclose the terms of such
contingent fee to the client in compliance with the requirements of this
rule.
(4) The disclosure must:
(a) Be in writing and be clear and
conspicuous;
(b) State the amount
of the consideration or commission or the basis on which it will be computed;
and
(c) Be made at or prior to the
time of the recommendation or referral of the product or service for which
consideration or commission is paid or prior to the client retaining the
licensee to whom the client has been referred for which a referral fee is paid;
or
(d) Be made prior to the time
the licensee undertakes representation of or performance of the service upon
which a contingent fee will be charged.
(5) The following form may be used to comply
with the disclosures required by this rule and Tenn. Code Ann.
§§62-1-122 and 62-1-123. A form which contains additional information
may be used by a licensee if the form includes the minimum disclosure
requirements.
STATEMENT OF DISCLOSURE OF COMMISSIONS, CONTINGENT FEES, AND
OTHER CONSIDERATION
Certified public accountants and public accountants are
required by law to disclose to clients the receipt or payment of certain
commissions and contingent fees.
The purpose of this disclosure statement is to acknowledge that
proper disclosure has been made and that a copy of this statement has been
provided to each of the signatories thereof.
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Notes
Tenn. Comp. R. & Regs. 0020-03-.06
Original rule filed June 9,
1981; effective August 18, 1981. Amendment filed February 18, 1993; effective
April 3, 1993. Amendment filed February 16, 1998; effective May 2, 1998. Repeal
and new rule filed June 10, 1999; effective August 24, 1999. Amendment filed
August 15, 2006; effective October 29, 2006.
Authority: T.C.A. §§
62-1-105,
62-1-111,
62-1-122 and 62-1-123.
