Reprinted
February 16, 2001
HOUSE BILL No. 1573
_____
DIGEST OF HB 1573
(Updated February 15, 2001 11:04 AM - DI 87)
Citations Affected: IC 23-1.5; IC 25-2.1; noncode.
Synopsis: CPAs and public accountants. Defines "attest",
"compilation", and other terms. Provides standards for: (1) the
certification in Indiana of a person who is certified as a CPA in another
state and makes Indiana the person's principal place of business; and
(2) the practice in Indiana of a person who is certified as a CPA in
another state and whose principal place of business is in another state.
Makes changes concerning accounting practitioners and public
accountants. Allows the issuance of a CPA firm permit to a CPA firm
that has a member who is not a CPA under certain circumstances.
Imposes a requirement that a firm without a permit issued in Indiana
may issue a compilation report only if the person signing the report is
(Continued next page)
Effective: July 1, 2001.
Kuzman, Buell
January 11, 2001, read first time and referred to Committee on Public Policy, Ethics and
Veterans Affairs.
February 8, 2001, amended, reported _ Do Pass.
February 15, 2001, read second time, amended, ordered engrossed.
Digest Continued
a CPA or public accountant and meets the competency requirements
provided in applicable standards. Requires the board of accountancy to
investigate complaints concerning violations committed in another
state by a CPA licensed in Indiana. Requires the board, before July 1,
2002, to establish a written test to be taken by an applicant for an
accounting practitioner certificate. Requires an applicant for an
accounting practitioner certificate to have two years of experience
prescribed by the board. Provides that the minimum education
requirement for an accounting practitioner certificate is a two year
associate degree from an accredited business college, college, or
university recognized by the board, with the total educational program
to include an accounting concentration or equivalent. Allows
individuals who meet the new two year requirements to take the
accounting practitioner exam after July 1, 2001. Makes related
changes.
Reprinted
February 16, 2001
First Regular Session 112th General Assembly (2001)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in
this style type, and deletions will appear in
this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in
this style type. Also, the
word
NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in
this style type or
this style type reconciles conflicts
between statutes enacted by the 2000 General Assembly.
HOUSE BILL No. 1573
A BILL FOR AN ACT to amend the Indiana Code concerning
professions and occupations.
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 23-1.5-2-3; (01)HB1573.2.1. -->
SECTION 1. IC 23-1.5-2-3 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 3. (a) Except as
provided in subsections (c) and (d) and IC 25-2.1-5, a professional
corporation may be formed to render professional services as follows:
(1) One (1) or more accounting professionals may form a
professional corporation to render services that may legally be
performed only by an accounting professional.
(2) One (1) or more architectural or engineering professionals
may form a professional corporation to render services that may
legally be performed only by an architectural or engineering
professional.
(3) One (1) or more attorneys may form a professional corporation
to render services that may legally be performed only by an
attorney.
(4) One (1) or more health care professionals may form a
professional corporation to render services that may legally be
performed only by a health care professional.
(5) One (1) or more veterinarians may form a professional
corporation to render services that may legally be performed only
by a veterinarian.
(6) One (1) or more real estate professionals may form a
professional corporation to render services that may legally be
performed only by a real estate professional.
(b) A foreign professional corporation may be admitted to render
professional services in Indiana by complying with IC 23-1.5-5.
(c) A domestic professional corporation or a foreign professional
corporation admitted to render professional services in Indiana:
(1) shall have at least one (1) shareholder who is licensed in
Indiana; and
(2) may have at least one (1) shareholder who is licensed under
the laws of another state to render similar professional services.
(d) In addition to the professional services permitted by its articles
of incorporation, a professional corporation may invest its funds in any
type of investment not prohibited by law.
SOURCE: IC 23-1.5-3-1; (01)HB1573.2.2. -->
SECTION 2. IC 23-1.5-3-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1. (a)
Except as
provided in IC 25-2.1-5, a professional corporation may issue shares,
fractional shares, and rights or options to purchase shares only to:
(1) individuals who are authorized by Indiana law or the laws of
another state to render a professional service permitted by the
articles of incorporation of the corporation;
(2) general partnerships in which all the partners are authorized
by Indiana law or the laws of another state to render a
professional service permitted by the articles of incorporation of
the corporation;
(3) professional corporations authorized by Indiana law or the
laws of another state to render a professional service permitted by
the articles of incorporation of the corporation; and
(4) the trustee of a qualified trust.
(b) When determined necessary by the licensing authority for any
profession in order to prevent violations of the ethical standards of the
profession, the licensing authority may by rule further restrict,
condition, or abridge the authority of professional corporations to issue
shares, but no such rule may, of itself, have the effect of causing a
shareholder of a professional corporation at the time the rule becomes
effective to become a disqualified person. All shares issued in violation
of:
(1) this section; or
(2) any rule adopted by a licensing authority as provided by this
section;
are void.
(c) Except as provided in IC 25-2.1-5, a shareholder of a
professional corporation may transfer or pledge shares, fractional
shares, and rights or options to purchase shares of the corporation only
to individuals, general partnerships, professional corporations, and
trustees of qualified trusts qualified under this article to own shares
issued directly to them by the professional corporation. A transfer of
shares in violation of this subsection is void; however, this subsection
does not apply to the transactions described in section 3 of this chapter.
(d) Each certificate representing shares of a professional corporation
must state conspicuously upon its face that the shares represented by
that certificate are subject to:
(1) restrictions on transfer imposed by this article; and
(2) such restrictions on transfer as may be imposed by the
licensing authority under this article.
(e) This section does not permit or authorize an individual to
practice within Indiana any profession with respect to which a license
or registration is required by the state without the individual being
licensed or registered under the laws of the state.
SOURCE: IC 25-2.1-1-1; (01)HB1573.2.3. -->
SECTION 3. IC 25-2.1-1-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1. This article may be
cited as "the accountancy act of 1993". 2001".
SOURCE: IC 25-2.1-1-3.3; (01)HB1573.2.4. -->
SECTION 4. IC 25-2.1-1-3.3 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]: Sec. 3.3. "AICPA" refers to the
American Institute of Certified Public Accountants.
SOURCE: IC 25-2.1-1-3.8; (01)HB1573.2.5. -->
SECTION 5. IC 25-2.1-1-3.8 IS ADDED TO THE INDIANA
CODE AS A
NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]:
Sec. 3.8. "Attest" means to provide
any of the following financial statement services:
(1) An audit or other engagement performed in accordance
with the AICPA Statements on Auditing Standards (SAS) or
other similar standards adopted by reference under
IC 25-2.1-2-15.
(2) A review of a financial statement performed in accordance
with the AICPA Statements on Standards for Accounting and
Review Services (SSARS) or other similar standards adopted
by reference under IC 25-2.1-2-15.
(3) An examination of prospective financial information
performed in accordance with the AICPA Statements on
Standards for Attestation Engagements (SSAE) or other
similar standards adopted by reference under IC 25-2.1-2-15.
SOURCE: IC 25-2.1-1-5; (01)HB1573.2.6. -->
SECTION 6. IC 25-2.1-1-5 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 5. "Certificate" means:
(1) a certificate for a certified public accountant issued under
IC 25-2.1-3 or a corresponding certificate for a certified public
accountant that is issued after examination by another state. or
IC 25-2.1-4;
(2) a certificate of registration for an accounting practitioner
issued under IC 25-2.1-6-1; or
(3) a certificate for a certified public accountant, public
accountant, or accounting practitioner renewed under
IC 25-2.1-4.
SOURCE: IC 25-2.1-1-6.3; (01)HB1573.2.7. -->
SECTION 7. IC 25-2.1-1-6.3 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]: Sec. 6.3. "Compilation" means
providing a service to be performed in accordance with AICPA
Statements on Standards for Accounting and Review Services
(SSARS) or other similar standards adopted by reference under
IC 25-2.1-2-15 that is presenting in the form of financial
statements, information that is the representation of the firm's
management or owners without undertaking to express any
assurance on the statements.
SOURCE: IC 25-2.1-1-6.5; (01)HB1573.2.8. -->
SECTION 8. IC 25-2.1-1-6.5 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]: Sec. 6.5. "CPA" means a certified
public accountant.
SOURCE: IC 25-2.1-1-7; (01)HB1573.2.9. -->
SECTION 9. IC 25-2.1-1-7 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 7. "Firm" means a
proprietorship, a general business corporation, a professional
corporation, a limited liability company, a partnership, or other form of
legal entity in which an accounting firm is allowed to practice. issued
a permit under IC 25-2.1-5 or a registration under IC 25-2.1-6.
SOURCE: IC 25-2.1-1-8; (01)HB1573.2.10. -->
SECTION 10. IC 25-2.1-1-8 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 8. "Licensee" means
the holder of:
(1) a certificate; issued under IC 25-2.1-3; or
(2) a firm permit issued under IC 25-2.1-5 or
(3) a holder of a certificate issued under IC 25-2.1-6.
SOURCE: IC 25-2.1-1-8.5; (01)HB1573.2.11. -->
SECTION 11. IC 25-2.1-1-8.5 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]: Sec. 8.5. "PA" means a public
accountant.
SOURCE: IC 25-2.1-1-9; (01)HB1573.2.12. -->
SECTION 12. IC 25-2.1-1-9 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 9. "Permit" means a
permit to practice accountancy as a firm issued under IC 25-2.1-5 or
by another state.
SOURCE: IC 25-2.1-1-10; (01)HB1573.2.13. -->
SECTION 13. IC 25-2.1-1-10 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 10. (a) "Practice of
accountancy" means the performance or the offering to perform by an
individual or firm holding itself out to the public as a licensee of a
service involving:
(1) the use of accounting or auditing skills, including the issuance
of reports on financial statements;
(2) management advisory, financial advisory, or consulting
services; or
(3) the preparation of tax returns or the furnishing of advice on
tax matters.
(b) The term does not include the performance or offering of the
following services if the person performing or offering the services
is not a licensee and no representation is made that the person
performing or offering the service is a licensee:
(1) The selling and installing of data processing or bookkeeping
equipment and forms.
(2) The preparation of tax returns.
(3) The performance of bookkeeping.
SOURCE: IC 25-2.1-1-10.3; (01)HB1573.2.14. -->
SECTION 14. IC 25-2.1-1-10.3 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]: Sec. 10.3. "Professional" means the
following:
(1) For a certified public accountant, arising out of or related
to the specialized knowledge or skills associated with certified
public accountants.
(2) For a public accountant, arising out of or related to the
specialized knowledge or skills associated with public
accountants.
(3) For an accounting practitioner, arising out of or related to
the specialized knowledge or skills associated with accounting
practitioners.
SOURCE: IC 25-2.1-1-13; (01)HB1573.2.15. -->
SECTION 15. IC 25-2.1-1-13 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 13.
(a) "Report", when
used with reference to financial statements, means an opinion or other
form of language that
provides states or implies assurance as to the
reliability of
a any financial
statement statements and that
also
includes or is accompanied by
a any statement or
an implication that
the individual or firm issuing the statement or implication it has special
knowledge or competence in accounting or auditing. The statement or
implication of special knowledge or competence may arise from use by
the issuer of the report of names or titles indicating that the individual
is an accountant or auditor or from the language of the report.
(b) The term includes any form of language that disclaims an
opinion when the form of the language is conventionally
understood to imply any positive assurance as to:
(1) the reliability of the financial statements referred to; or
(2) special competence on the part of the individual or firm
issuing the language.
(c) The term includes any other form of language that is
conventionally understood to imply an assurance or special
knowledge or competence described in subsection (b).
SOURCE: IC 25-2.1-1-15; (01)HB1573.2.16. -->
SECTION 16. IC 25-2.1-1-15 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]: Sec. 15. "Substantial equivalency"
means a determination by the board or its designee that the:
(1) education, examination, and experience requirements
contained in the laws and administrative rules of another state
are comparable to, or exceed the education, examination, and
experience requirements of this state; or
(2) education, examination, and experience qualifications of
the holder of a certificate granted by another state are
comparable to or exceed the education, examination and
experience requirements of this state.
SOURCE: IC 25-2.1-2-3; (01)HB1573.2.17. -->
SECTION 17. IC 25-2.1-2-3 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 3. (a) The board
consists of six (6) members appointed by the governor.
(b) Four (4) members must meet the following conditions:
(1) Be a resident of Indiana.
(2) Be a certified public accountant under IC 25-2.1-3 or
IC 25-2.1-4.
(c) One (1) member must meet the following conditions:
(1) Be a resident of Indiana.
(2) Be certified as a public accountant or an accounting
practitioner under
IC 25-2.1-3 or IC 25-2.1-4. IC 25-2.1-6.
(d) One (1) member must meet the following conditions:
(1) Be a resident of Indiana.
(2) Be a consumer who is not certified under this article but has
professional or practical experience in the use of accounting
services and financial statements that qualify the individual to
make judgments about the qualifications and conduct of
individuals and firms under this article.
SOURCE: IC 25-2.1-2-15; (01)HB1573.2.18. -->
SECTION 18. IC 25-2.1-2-15 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 15. The board may
adopt rules under IC 4-22-2 governing the administration and
enforcement of this article and the conduct of licensees, including the
following:
(1) The board's meetings and conduct of business.
(2) The procedure of investigations and hearings.
(3) The educational and experience qualifications required for the
issuance of certificates under IC 25-2.1-3 this article and the
continuing professional education required for renewal of
certificates under IC 25-2.1-4.
(4) Rules of professional conduct directed to controlling the
quality and probity of the practice of accountancy by certificate
holders, licensees, including independence, integrity, and
objectivity, competence and technical standards, and
responsibilities to the public and clients.
(5) The actions and circumstances that constitute professing to be
a licensee in connection with the practice of accountancy.
(6) The manner and circumstances of use of the title "certified
public accountant" and the abbreviation "CPA".
(7) Quality reviews that may be required to be performed under
this article.
(8) Methods of applying for and conducting the examinations,
including methods for grading papers examinations and
determining a passing grade required of an applicant for a
certificate. However, the board shall to the extent possible
uniformly grade provide that the examination, grading of the
examination, and issue the passing grades that are uniform with
those applicable in other states.
(9) Substantial equivalency.
SOURCE: IC 25-2.1-3-1; (01)HB1573.2.19. -->
SECTION 19. IC 25-2.1-3-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1. The board shall issue
a CPA certificate to an individual who does the following:
(1) Demonstrates good character through lack of a history of
dishonest or felonious acts.
(2) Meets the education requirements under section 2 of set forth
in this chapter and IC 25-2.1-4.
(3) Pays the fee established by the board.
SOURCE: IC 25-2.1-3-6; (01)HB1573.2.20. -->
SECTION 20. IC 25-2.1-3-6 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 6. (a) To qualify for a
CPA certificate an applicant must pass all sections of the examination
provided for in this chapter.
(b) If at a sitting of the examination an applicant passes at least two
(2) sections, the applicant is credited for those sections that the
applicant has passed and is not required to sit for reexamination in
those sections, if:
(1) the applicant wrote all sections of the examination at one (1)
sitting;
(2) the applicant attained a minimum grade of fifty (50) on each
section not passed at that sitting;
(3) the applicant passes the remaining sections of the examination
within six (6) consecutive examinations given after the
examination at which the first sections were passed;
(4) at each subsequent sitting at which the applicant seeks to pass
any additional sections, the applicant writes all sections not yet
passed; and
(5) in order to receive credit for passing additional sections in
each subsequent sitting, the applicant attains a minimum grade of
fifty (50) on sections written but not passed on that sitting.
SOURCE: IC 25-2.1-3-10; (01)HB1573.2.21. -->
SECTION 21. IC 25-2.1-3-10 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 10. An applicant for the
initial issuance of a certificate under this chapter shall show that the
applicant has had three (3) two (2) years of experience. in the practice
of accountancy or its equivalent under the direction or supervision of
a certified public accountant, a public accountant, an accounting
practitioner, or a chartered accountant licensed in a United States,
Canadian, or other jurisdiction meeting the requirements prescribed by
the board. To qualify as experience under this section, an applicant
may provide any type of service or advice that:
(1) constitutes the use of accounting, attest, compilation,
management advisory, financial advisory, tax, or consulting
skills as determined under the rules adopted by the board;
and
(2) is verified by a licensee.
Experience of the type described in this section applies equally
toward meeting the experience requirement of this section
regardless of whether it is gained through employment in
government, industry, academia, or public practice.
SOURCE: IC 25-2.1-3-11; (01)HB1573.2.22. -->
SECTION 22. IC 25-2.1-3-11 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 11. An advanced
degree in accounting or business administration from a college or
university recognized by the board, and the satisfactory completion of
the semester hours in accounting, business administration, economics,
and other related subjects that the board determines are appropriate,
may be substituted for public accounting experience as the board
determines appropriate for experience of the type described in
section 10 of this chapter.
SOURCE: IC 25-2.1-4-1; (01)HB1573.2.23. -->
SECTION 23. IC 25-2.1-4-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1. The board shall grant
or renew a certificate to an individual who issued under this chapter,
IC 25-2.1-3 (certified public accountants) or IC 25-2.1-6 (public
accountants and accounting practitioners), if the holder of the
certificate applies and meets the requirements under this chapter.
SOURCE: IC 25-2.1-4-4; (01)HB1573.2.24. -->
SECTION 24. IC 25-2.1-4-4 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 4.
(a) The board shall
issue a
CPA certificate to a holder of a certificate
license, or permit
issued by another state
if the holder meets the requirements under
subsection (b) or (c).
(b) With regard to applicants who do not qualify for reciprocity
under the substantial equivalency standard set forth in section
10(a)(2) of this chapter, the board shall issue a CPA certificate to
a holder of a certificate issued by another state upon a showing that:
(1) the applicant
has:
(A) passed the examination required for issuance of the
applicant's certificate;
with grades that would have been
passing grades at the time in Indiana; or and
(2) (B) the applicant:
(A) meets all current requirements in Indiana for issuance of
a certificate at the time application is made;
(B) at the time of the issuance of the applicant's certificate in
the other state, met all such requirements then applicable in
Indiana; or
(C) (i) had
five (5) four (4) years of experience
outside in
Indiana
in the practice of accountancy or another state of
the type described in IC 25-2.1-3-10 or meets equivalent
requirements prescribed by the board after passing the
examination on which the applicant's certificate was based
and during the ten (10) years immediately preceding the
applicant's application;
and
(ii) if the applicant's certificate was issued by the other
state more than four (4) years before the application for
issuance of an initial certificate under this chapter, the
applicant has fulfilled the requirements for continuing
professional education that would have been applicable
under section 5 of this chapter.
(c) The board shall issue a CPA certificate to a CPA certified by
another state that seeks to establish the individual's principal place
of business in Indiana if the:
(1) individual requests the issuance of a certificate from the
board before establishing the individual's principal place of
business in Indiana; and
(2) board or its designee determines that the individual's CPA
qualifications are substantially equivalent to the CPA
licensure requirements of Indiana.
SOURCE: IC 25-2.1-4-8; (01)HB1573.2.25. -->
SECTION 25. IC 25-2.1-4-8 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 8. The board shall issue
a CPA certificate to a holder of a designation granted in a foreign
country entitling the holder to engage in the practice of accountancy if:
(1) the foreign authority that granted the designation makes a
similar provision to allow an individual who holds a valid
certificate issued by the board to obtain the foreign authority's
comparable designation;
(2) the foreign designation:
(A) was issued by a foreign authority that regulates the
practice of accountancy and has not expired, been revoked, or
suspended;
(B) entitles the holder to issue reports for financial statements;
and
(C) was issued upon the basis of educational and examination
and experience requirements established by the foreign
authority; and
(3) the applicant:
(A) received the designation, based on educational and
examination standards substantially equivalent to those in
effect in Indiana at the time the foreign designation was
granted;
(B) meets:
(i) an experience requirement substantially equivalent to the
requirement under IC 25-2.1-3-10, in the jurisdiction that
granted the foreign designation;
(ii) has completed five (5) four (4) years of experience in
the practice of accountancy in Indiana or another state of
the type described in IC 25-2.1-3-10; or
(iii) meets equivalent requirements established by the board
within the ten (10) years immediately preceding the
application; and
(C) passed a uniform qualifying examination in national
standards and an examination on the laws, rules, and code of
ethical conduct in effect in Indiana acceptable to the board.
SOURCE: IC 25-2.1-4-9; (01)HB1573.2.26. -->
SECTION 26. IC 25-2.1-4-9 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 9. An applicant under
this chapter for initial issuance or renewal of a certificate shall in the
application list each jurisdiction where the applicant has applied for or
holds a designation to practice accountancy and each holder of a
certificate issued under this chapter article shall notify the board in
writing, not more than thirty (30) days after its occurrence of any
issuance, denial, revocation, or suspension of a designation, or the
commencement of a disciplinary or enforcement action by any
jurisdiction.
SOURCE: IC 25-2.1-4-10; (01)HB1573.2.27. -->
SECTION 27. IC 25-2.1-4-10 IS ADDED TO THE INDIANA
CODE AS A
NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]:
Sec. 10. (a) An individual:
(1) whose principal place of business is not in Indiana; and
(2) either:
(A) who has a valid certificate as a CPA from any state
that the board or its designee has determined to be in
substantial equivalence with the CPA licensure
requirements of this state; or
(B) whose individual CPA qualifications have been
determined by the board or its designee as substantially
equivalent to the CPA licensure requirements of Indiana;
shall be presumed to have qualifications substantially equivalent
to this state's requirements and shall have all the privileges
granted to the holder of a CPA certificate under IC 25-2.1-3
without the need to obtain a certificate under IC 25-2.1-3 or a
permit under IC 25-2.1-5.
(b) An individual to which subsection (a) applies shall notify the
board of the individual's intent to enter the state under subsection
(a).
(c) An individual of another state exercising the privilege
granted under this section consents, as a condition of the grant of
this privilege to:
(1) the personal and subject matter jurisdiction and
disciplinary authority of the board;
(2) comply with this article and the board's rules; and
(3) the appointment of the state board or agency that issued
the individual's license as the individual's agent on whom
process may be served in any action or proceeding by this
board against the individual.
SOURCE: IC 25-2.1-5-1; (01)HB1573.2.28. -->
SECTION 28. IC 25-2.1-5-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1. The board shall grant
or renew a permit to practice accountancy to a CPA or PA firm that
applies and meets the requirements under this chapter.
SOURCE: IC 25-2.1-5-2; (01)HB1573.2.29. -->
SECTION 29. IC 25-2.1-5-2 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 2. An initial and
renewed certificate permit expires at the earlier of the following:
(1) Three (3) years after issuance.
(2) At a time established by the board.
SOURCE: IC 25-2.1-5-3; (01)HB1573.2.30. -->
SECTION 30. IC 25-2.1-5-3 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 3. (a) An application
for a certificate permit must be made:
(1) in a form; and
(2) in the case of an application for renewal, between the dates the
board specifies.
(b) The board shall grant or deny an application within ninety (90)
days after the application is properly filed.
(c) When the applicant seeks the opportunity to show that issuance
or renewal of a certificate permit was mistakenly denied, or when the
board is not able to determine whether a certificate permit should be
granted or denied, the board may issue to the applicant a temporary
certificate permit that expires ninety (90) days after issuance or when
the board determines whether to issue or renew the certificate. permit.
SOURCE: IC 25-2.1-5-4; (01)HB1573.2.31. -->
SECTION 31. IC 25-2.1-5-4 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 4.
(a) An applicant for
initial issuance or renewal of a permit to practice under this chapter
must show:
that each partner, member, officer, or shareholder who
regularly works in Indiana, and each employee holding a certificate
who regularly works in Indiana, except employees who have not yet
accumulated sufficient experience to qualify for a certificate under
IC 25-2.1-3-10, holds a valid individual certificate issued under
IC 25-2.1-4 and that each other partner, member, officer, or
shareholder holds a certificate and is licensed to practice accountancy
in another state.
(1) a simple majority of the ownership of the firm, in terms of
financial interests and voting rights of all partners, officers,
shareholders, members, or managers, belongs to holders of an
active CPA certificate issued under this article or a
corresponding certificate that is issued after examination by
another state; and
(2) the partners, officers, shareholders, members, or
managers whose principal place of business is in Indiana and
who practice accountancy in Indiana hold a valid CPA
certificate issued under this article.
(b) For firms of public accountants, at least a simple majority
of ownership of the firm, in terms of financial interests and voting
rights, must belong to public accountants certified under
IC 25-2.1-6.
(c) A firm issued a permit under this section may include
nonlicensee owners if:
(1) the firm designates a licensee who is responsible for the
proper registration of the firm and identifies that individual
to the board;
(2) all nonlicensee owners are active individual participants in
the CPA or PA firm or affiliated entities; and
(3) the firm complies with the other requirements that the
board may impose by rule.
(d) An individual licensee who is responsible for supervising
attest or compilation services and signs or authorizes an individual
to sign the accountant's report on the financial statements on
behalf of the firm, shall meet the competency requirements set out
in the professional standards adopted by the board for the services.
(e) An individual licensee who signs or authorizes an individual
to sign the accountant's report on the financial statements on
behalf of the firm shall meet the competency requirement of
subsection (d).
SOURCE: IC 25-2.1-5-5; (01)HB1573.2.32. -->
SECTION 32. IC 25-2.1-5-5 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 5.
(a) An applicant for
initial issuance or renewal of a permit to practice
as a CPA firm under
this chapter must:
(1) register each office of the firm within Indiana with the board;
and
(2) show that
each office is all attest and compilation services
rendered in this state are under the charge of an individual
holding a valid
CPA certificate issued under
IC 25-2.1-4. this
article or the corresponding provisions of another state.
(b) An applicant for initial issuance or renewal of a permit to
practice as a PA firm under this chapter must:
(1) register each office of the firm within Indiana with the
board; and
(2) show that all attest and compilation services rendered in
this state are under the charge of an individual holding a valid
CPA or PA certificate issued under this article or the
corresponding provision of another state.
SOURCE: IC 25-2.1-5-7; (01)HB1573.2.33. -->
SECTION 33. IC 25-2.1-5-7 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 7. (a) An applicant for
initial issuance or renewal of a permit under this chapter shall:
(1) list each state in which the applicant has applied for or holds
a permit to practice accountancy as a firm; and
(2) list any past denial, revocation, or suspension of a permit
by another state; and
(3) notify the board in writing, not more than thirty (30) days after
a change:
(A) in the identities of partners, members, officers, or
shareholders who work regularly in Indiana;
(B) in the number or location of offices in Indiana;
(C) in the identity of the individuals in charge of the offices;
and
(D) of the issuance, denial, revocation, or suspension of a
permit by another state.
(b) Firms that fail to comply with this chapter due to changes in
firm ownership or personnel, after receiving or renewing a permit,
shall take corrective action to bring the firm into compliance as
quickly as possible. The board may grant a reasonable time for a
firm to take corrective action. Failure to bring the firm into
compliance within a reasonable period as determined by the board
shall result in the suspension or revocation of the firm permit.
SOURCE: IC 25-2.1-6-1; (01)HB1573.2.34. -->
SECTION 34. IC 25-2.1-6-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1.
(a) A certificate shall
be granted by the board to any individual who:
(1) is at least eighteen (18) years of age;
(2) has not been convicted of:
(A) an act that would constitute a ground for disciplinary
sanction under IC 25-2.1-8; or
(B) a felony that has a direct bearing on the applicant's ability
to practice competently;
(3) has met either of the following education and examination
requirements:
(A) Graduation
with a two (2) year associate degree from an
accredited
high school, business college, college, or university
recognized by the board,
the total educational program to
include an accounting concentration or equivalent, and
passage of
a written an examination established by the board
in accounting theory and practice.
(B) Graduation with a baccalaureate degree conferred by a
college or university recognized by the board and the
satisfactory completion of the semester hours in accounting,
business administration, economics, and other related subjects
as the board determines to be appropriate, and passage of a
written examination established by the board in accounting
theory; and
(4) meets the experience requirements set forth in subsection
(b).
(b) A person who submits an application for the initial issuance
of a certificate under this chapter after June 30, 2001, shall show
that the applicant has two (2) years of experience that meet the
requirements of the board. To qualify as experience under this
section, the experience must be verified by a licensee.
SOURCE: IC 25-2.1-6-2; (01)HB1573.2.35. -->
SECTION 35. IC 25-2.1-6-2 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 2. A candidate who
meets the education requirements of graduation from a business college
or university recognized by the board under section 1(a)(3) of this
chapter is eligible to take the examination under this chapter if the
applicant also meets the requirements under section 1(2) 1(a)(2)of this
chapter.
SOURCE: IC 25-2.1-6-5; (01)HB1573.2.36. -->
SECTION 36. IC 25-2.1-6-5 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 5. An individual who
is registered with the board to practice accounting as an accounting
practitioner and holds a valid certificate issued under IC 25-2.1-6-1 or
renewed under IC 25-2.1-4 may be known as an "accounting
practitioner" and may use the abbreviation "AP". However, an
individual registered as an accounting practitioner may not prepare or
render accounting opinions or certificates for any purpose, including
financial statements, schedules, reports, or exhibits for publication,
credit purposes, and use in a court.
SOURCE: IC 25-2.1-6-6; (01)HB1573.2.37. -->
SECTION 37. IC 25-2.1-6-6 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 6. A firm engaged in
Indiana in the practice of accountancy as accounting practitioners shall
register with the board as a firm of accounting practitioners, and have
and maintain all of the following requirements:
(1) A least one (1) partner must be a certified public accountant,
a public accountant, or an accounting practitioner who holds an
active certificate to practice in Indiana.
(2) Each partner personally engaged within Indiana in the practice
of accountancy as a member of the firm must be a certified public
accountant, a public accountant, or an accounting practitioner
who holds an active certificate to practice in Indiana.
(3) Each partner:
(A) shall be a certified public accountant, a public accountant,
or an accounting practitioner in good standing of a state; or
(B) who is a nonresident of the United States and who is not a
certified public accountant, a public accountant, or an
accounting practitioner in good standing of a state shall hold
a license or rating in a foreign country that is equivalent to that
of a certified public accountant, a public accountant, or an
accounting practitioner in the United States.
(4) Each resident manager in charge of an office of a firm in
Indiana must be a certified public accountant, a public
accountant, or an accounting practitioner who holds a certificate
to practice in Indiana.
SOURCE: IC 25-2.1-6-7; (01)HB1573.2.38. -->
SECTION 38. IC 25-2.1-6-7 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 7. (a) An application
for registration must be verified by a partner, a member, an officer, or
a shareholder of the firm who holds a certificate to practice in Indiana
as a certified public accountant, a public accountant, or an accounting
practitioner.
(b) The board shall determine whether each applicant is eligible for
registration.
(c) A firm that is registered and holds a firm permit issued under
IC 25-2.1-5 this chapter may use the words "accounting practitioners"
or the abbreviation "APs" in connection with the firm's name.
(d) Notification must be given the board, at least thirty (30) days
after the admission to or withdrawal of a partner, a member, an officer,
or a shareholder residing in Indiana from a registered firm.
SOURCE: IC 25-2.1-6-8; (01)HB1573.2.39. -->
SECTION 39. IC 25-2.1-6-8 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2001]: Sec. 8. (a) The board shall issue or renew a permit to an
accounting practitioner firm that applies and meets the
requirements under this chapter.
(b) Applications and renewals under this chapter are subject to
IC 25-2.1-5-2 and IC 25-2.1-5-3.
SOURCE: IC 25-2.1-8-1; (01)HB1573.2.40. -->
SECTION 40. IC 25-2.1-8-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1.
(a) The board may
impose sanctions for any of the following reasons:
(1) A violation of IC 25-1-11-5.
(2) Revocation or suspension of the right to practice before a state
or federal agency.
(3) Dishonesty, fraud, or gross negligence in the practice of
accountancy or in the filing of or failure to file the licensee's own
income tax returns.
(4) Any conduct reflecting adversely on the licensee's fitness to
engage in the practice of accountancy.
(5) Failure to complete continuing education requirements
satisfactorily.
(6) Failure to furnish evidence, when required, of satisfactory
completion of continuing education requirements.
(b) A holder of a CPA certificate issued under this article is
subject to disciplinary action in this state if the CPA certificate
holder:
(1) offers or renders services or uses the CPA title in another
state; and
(2) commits an act in that other state for which the CPA
certificate holder would be subject to discipline in the other
state if the CPA certificate holder were licensed in the other
state.
SOURCE: IC 25-2.1-9-1; (01)HB1573.2.41. -->
SECTION 41. IC 25-2.1-9-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1. (a) The board may,
upon receipt of a complaint or other information suggesting a violation
of this article or IC 25-1-11, conduct an investigation to determine
whether a violation has occurred.
(b) The board shall investigate any complaint made by the
board of accountancy of another state against the holder of a CPA
certificate issued under this article who offers or renders services
in that state.
SOURCE: IC 25-2.1-12-2; (01)HB1573.2.42. -->
SECTION 42. IC 25-2.1-12-2 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 2. (a) Except as
provided in subsection (b), an individual or a firm not holding a valid
CPA or public accountant certificate under this article or permit
under IC 25-2.1-4 or IC 25-2.1-5 may not issue a report on financial
statements of another individual, member, organization, or
governmental unit.
(b) Notwithstanding subsection (a):
(1) an officer, a partner, or an employee of a firm or an
organization may sign a statement or report in reference to the
financial affairs of the firm or organization with any wording
designating the position, title, or office that the signor holds; and
(2) a public official or employee may, in the performance by an
individual of other services, use accounting skills, including the
preparation of tax returns, management advisory services, and the
preparation of financial statements without the issuance of reports
related to those documents.
(c) A CPA or public accountant may not issue a report in
standard form upon a compilation of financial information through
any form of business that does not hold a valid permit issued under
IC 25-2.1-5 unless the report discloses the name of the business
through which the individual is issuing the report, and the
individual:
(1) signs the compilation report identifying the individual as
a CPA or public accountant; and
(2) meets the competency requirement provided in applicable
standards.
SOURCE: IC 25-2.1-12-3.5; (01)HB1573.2.43. -->
SECTION 43. IC 25-2.1-12-3.5 IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]: Sec. 3.5. A holder of a CPA or PA
certificate issued under this article may not perform attest services
except through a firm that holds a valid permit under IC 25-2.1-5.
SOURCE: IC 25-2.1-12-4; (01)HB1573.2.44. -->
SECTION 44. IC 25-2.1-12-4 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 4. (a) An individual not
holding a valid certificate may not use the title or designation "certified
public accountant", or the abbreviation "CPA" or any other title,
designation, words, letters, abbreviation, sign, card, or device tending
to indicate that the individual is a certified public accountant unless
the individual:
(1) holds a valid CPA certificate;
(2) meets the substantial equivalency standards of this article;
or
(3) is an employee of a firm holding a permit under
IC 25-2.1-5 and has not been an employee long enough to meet
the experience requirement under IC 25-2.1-3-10 for a
certificate.
(b) A licensee who has selected inactive status on the licensee's
renewal form may not use the title or designation "certified public
accountant" or the abbreviation "CPA" unless the title, designation, or
abbreviation is immediately followed by the word "inactive".
SOURCE: IC 25-2.1-12-5; (01)HB1573.2.45. -->
SECTION 45. IC 25-2.1-12-5 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 5. A firm may not
provide attest services or use the title or designation "certified public
accountant", or the abbreviation "CPA", or any other title, designation,
words, letters, abbreviation, sign, card, or device tending to indicate
that the firm is composed of certified public accountants, unless:
(1) the firm holds a valid permit issued under IC 25-2.1-5; and
(2)
each partner, member, officer, and shareholder of the firm
holds a certificate. ownership of the firm meets the
requirements of this article and the rules adopted by the
board.
SOURCE: IC 25-2.1-12-6; (01)HB1573.2.46. -->
SECTION 46. IC 25-2.1-12-6 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 6. (a) An individual
may not use the title or designation "public accountant", or "accounting
practitioner" or the abbreviation "PA", or "AP", or any other title,
designation, words, letters, abbreviation, sign, card, or device tending
to indicate that the individual is a public accountant or an accounting
practitioner unless the individual holds a valid certificate. issued under
IC 25-2.1-4.
(b) A licensee who has selected inactive status on the licensee's
renewal form may not use the title or designation "public accountant"
or "accounting practitioner" or the abbreviation "PA" or the
abbreviation "AP" unless the title, designation, or abbreviation is
immediately followed by the word "inactive".
SOURCE: IC 25-2.1-12-8; (01)HB1573.2.47. -->
SECTION 47. IC 25-2.1-12-8 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 8. (a) An individual or
a firm not holding a valid certificate or permit issued under IC 25-2.1-4
or IC 25-2.1-5 this article may not use the title or designation
"certified accountant", "chartered accountant", "enrolled accountant",
"licensed accountant", "registered accountant", "accredited
accountant", or other title or designation likely to be confused with the
titles "certified public accountant" or "public accountant", or
"accounting practitioner" or use any of the abbreviations "CA", "EA",
"LA", "RA", "AA", or similar abbreviation likely to be confused with
the abbreviations "CPA", "PA", or "AP".
(b) The title "enrolled agent" or "EA" may only be used by
individuals who are so designated by the Internal Revenue Service
under 31 CFR 10.
SOURCE: IC 25-2.1-12-9; (01)HB1573.2.48. -->
SECTION 48. IC 25-2.1-12-9 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 9. (a) An individual or
a firm not holding a valid certificate or permit issued under IC 25-2.1-4
or IC 25-2.1-5 this article may not use a title or designation that
includes the words "accountant", "auditor", or "accounting", in
connection with any other words, including statements in a report that
imply that the individual or firm holds a certificate or permit or has
special competence as an accountant or auditor.
(b) Notwithstanding subsection (a), this section does not prohibit an
officer, a member, a partner, a public official, an employee, a firm, or
an organization from signing a statement in reference to the financial
affairs of the firm, office, or organization with any wording designating
the position, title, or office that the signor holds.
SOURCE: IC 25-2.1-12-11; (01)HB1573.2.49. -->
SECTION 49. IC 25-2.1-12-11 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 11. An individual
holding a certificate under this article licensee may not engage in the
practice of accountancy in a firm holding a permit under this article
using a professional or firm name or designation that is misleading
about:
(1) the legal form of the firm;
(2) the individuals who are partners, members, officers, or
shareholders of the firm; or
(3) about any other matter.
However, the names of former partners or shareholders may be
included in the name of a firm or a firm's successor.
SOURCE: IC 25-2.1-13-1; (01)HB1573.2.50. -->
SECTION 50. IC 25-2.1-13-1 IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 1. (a) Whenever, as a
result of an investigation under IC 25-2.1-9, the board believes that an
individual or a firm has engaged or is about to engage in an act or a
practice that constitutes or will constitute a violation of IC 25-2.1-12,
the board may apply to a circuit or superior court for an order enjoining
the act or practice.
(b) If the board proves determines that the individual or firm has
engaged or is about to engage in an act or practice, an injunction,
restraining order, or other appropriate order may be granted by the
court.
SOURCE: IC 25-2.1-12-10; (01)HB1573.2.51. -->
SECTION 51. IC 25-2.1-12-10 IS REPEALED [EFFECTIVE JULY
1, 2001].
SOURCE: ; (01)HB1573.2.52. -->
SECTION 52. [EFFECTIVE JULY 1, 2001] (a) The Indiana board
of accountancy shall adopt emergency rules to implement
IC 25-2.1-2-15(9), IC 25-2.1-3-10, IC 25-2.1-4-4, and IC 25-2.1-5-4,
all as amended by this act, and IC 25-2.1-4-10, as added by this act,
in the manner provided for the adoption of emergency rules under
IC 4-22-2-37.1. An emergency rule adopted under this SECTION
expires on the earlier of:
(1) The date permanent rules are adopted under IC 4-22-2 to
replace the emergency rules adopted under this SECTION.
(2) July 1, 2003.
(b) This SECTION expires July 2, 2003.
SOURCE: ; (01)HB1573.2.53. -->
SECTION 53. [EFFECTIVE JULY 1, 2001]
(a) Not later than July
1, 2002, the Indiana board of accountancy shall establish a written
test to be taken by an applicant for an accounting practitioner
certificate under IC 25-2.1-6. The examination established by the
board must test competency skills in accounting theory and
practice.
(b) Subject to subsection (c), a person who submits an
application for an accounting practitioner's certificate after June
30, 2002, must pass the test established by the board under
subsection (a) in order to receive an accounting practitioner's
certificate under IC 25-2.1-6.
(c) If a person submits an application for an accounting
practitioner's certificate after June 30, 2002, and the board has not
established the test required under subsection (a), the board shall
give an applicant the test established by the board before July 1,
2002. An applicant subject to this subsection shall be required to
pass the test established by the board before July 1, 2002, in order
to receive an accounting practitioner's certificate under
IC 25-2.1-6.
(d) This SECTION expires July 1, 2005.