Ala. Admin. Code r. 30-X-6-.05 - Other Responsibilities And Practices

Current through Register Vol. 40, No. 6, March 31, 2022

(1) Conduct in General. A Certified Public Accountant or Public Accountant shall conduct himself in a manner which will contribute to the honor and dignity of the State and the profession and shall not at any time commit an act or engage in any conduct discreditable to the public accounting profession.
(2) Disbarment by Treasury, Agencies, or Boards. A Certified Public Accountant or a Public Accountant shall conduct himself in a manner which will not cause him to be suspended or disbarred from practice before the Treasury Department or other federal agency, or have his CPA certificate issued by any other state or territory revoked or suspended. Such disbarment, revocation or suspension shall automatically raise the question of unprofessional conduct.
(3) Advertising and Other Forms of Solicitation. A registrant shall not seek to obtain clients by advertising or other forms of solicitation in a manner that is false, misleading, or deceptive.
(4) Commissions.
(a) Prohibited Commissions. A member in public practice shall not for a commission recommend or refer to a client any product or service, or for a commission recommend or refer any product or service to be supplied by a client, or receive a commission, when the member or the member's firm also performs for that client
1. an audit or review of a financial statement; or
2. a compilation of a financial statement when the member expects, or reasonably might expect, that a third party will use the financial statement and that member's compilation report does not disclose a lack of independence; or
3. an examination of prospective financial information.

This prohibition applies during the period in which the member is engaged to perform any of the services listed above the period covered by any historical financial statements involved in such listed services.

(b) Disclosure of Permitted Commissions. A member in public practice who is not prohibited by this rule from performing services for or receiving a commission and who is paid or expects to be paid a commission shall disclose that fact to any person or entity to whom the member recommends or refers a product or service to which the commission relates.
(c) Referral Fees. Any member who accepts a referral fee for recommending or referring any service of a CPA to any person or entity or who pays a referral fee to obtain a client shall disclose such acceptance or payment to the client.
(5) Incompatible Occupations. A person who is engaged in the practice of public accounting shall not concurrently engage in any business or occupation which would create a conflict of interest in rendering professional services.
(6) Form of Practice and Name. A registrant may practice public accounting, whether as an owner or employee, only in the form of a sole proprietorship, a partnership, a professional association, professional corporation, limited liability company, limited liability partnership, or any other form of business entity now or hereafter recognized by Alabama law. All firms regardless of their business form shall be duly registered with the Board. A registrant shall not practice public accounting under a firm name which is misleading or is misleading as to the type of organization (proprietorship, partnership, or corporation). However, names of one or more past partners or shareholders may be included in the firm name of a successor business entity recognized by Alabama law.
(7) Professional Corporations. Professional corporations practicing public accounting in Alabama, in addition to matters covered by other rules of the Board, shall comply with the following:
(a) All shares of stock shall be owned by Certified Public Accountants if practicing as Certified Public Accountants, or by Certified Public Accountants or Public Accountants if practicing as Public Accountants.
(b) Members of the Board of Directors need not be shareholders of the professional corporation or professional association, provided, however, that at least one member of the Board shall be duly licensed to practice public accountancy either as a Certified Public Accountant or Public Accountant in the State of Alabama, and provided further that no member of the Board who is not duly licensed to practice as a Certified Public Accountant or Public Accountant in the State of Alabama shall participate in any decisions affecting the technical aspects of public accountancy.
(c) The chief executive officer shall be a Certified Public Accountant or Public Accountant.
(d) Revocation or suspension of the CPA certificate or permit held by the chief executive office shall also affect a corresponding revocation or suspension of the right to practice public accounting by the professional corporation, unless the Board specifically grants a continuance of such right to practice.
(8) Each office established or maintained in this State by a certified public accountancy ("Practice unit") shall comply with the annual registration, reporting, and response requirements of Code of Ala. 1975, § 34-1-10, and Chapter 30-X-8.

Notes

Ala. Admin. Code r. 30-X-6-.05
Filed September 3, 1982. Amended: Filed July 9, 1987. Amended: Filed March 21, 1994; effective April 25, 1994. Amended: Filed May 14, 1996; effective June 18, 1996. Amended: Filed September 30, 1999; effective November 4, 1999. Amended by Alabama Administrative Monthly Volume XXXVI, Issue No. 04, January 31, 2018, eff. 3/8/2018.

Author: Alabama Board of Public Accountancy

Statutory Authority: Code of Ala. 1975, § 34-1-3.

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