2015 WISCONSIN ACT
217
An Act
to repeal
442.04 (5) (c); and
to amend
442.04 (5) (b) 3. and 442.04 (5) (b) 4. of the statutes;
relating to:
continuing education and examination requirements for certified public accountants and modifying various administrative rules promulgated by the Accounting Examining Board relating to accounting.
The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:
Section
1
.
442.04 (5) (b) 3. of the statutes is amended to read:
442.04
(5)
(b) 3. The person has completed at least 150 semester hours of education
with an accounting concentration
at an institution
that include course work in accounting and business subjects, as determined by the examining board
, and has received a bachelor's or higher degree
with an accounting concentration from an institution, except as provided in par. (c)
.
Section
2
.
442.04 (5) (b) 4. of the statutes is amended to read:
442.04
(5)
(b) 4. Except as provided in s. 442.05, the person has successfully passed an examination in such subjects affecting accountancy
and business
as the examining board considers necessary. A person is not eligible to take the examination under this subdivision unless the person has completed at least 120 semester hours
under subd. 3.
of education at an institution that include course work in accounting and business subjects, as determined by the examining board.
Section
3
.
442.04 (5) (c) of the statutes is repealed.
Section
4
.
Accy 1.001 (1) of the administrative code is amended to read:
Accy 1.001
(1)
Chapters Accy 1 to
9
6
apply to a person who practices as a certified public accountant in this state.
Section
5
.
Accy 1.001 (2) of the administrative code is amended to read:
Accy 1.001
(2)
A certified public accountant may be held responsible for compliance with the rules of the
examining
board by any person associated with the certified public accountant in a firm who is either under his or her supervision or is a member of the firm.
Section
6
.
Accy 1.001 (3) of the administrative code is amended to read:
Accy 1.001
(3)
A certified public accountant shall not permit others to carry out acts on
his or her
the accountant's
behalf, either with or without compensation, which, if carried out by the certified public accountant, would violate chs. Accy 1 to
9
6
.
Section
7
.
Accy 1.002 (1) and (2) of the administrative code are amended to read:
Accy 1.002
(1)
A person licensed as a certified public accountant that has significant influence over a CPA-related business is considered to be practicing as a certified public accountant in the CPA-related business and all persons with ownership interest in the business shall follow the rules of the
examining
board in the operation of the CPA-related business.
(2)
A person who operates a business and is licensed as a certified public accountant and who advertises or otherwise holds out as a certified public accountant shall follow the rules of the
examining
board in the operation of any business.
Section
8
.
Accy 1.003 (intro.) of the administrative code is amended to read:
Accy 1.003 Definitions.
(intro.) As used in chs. Accy 1 to
9
6
:
Section
9
.
Accy 1.003 (2m), (2r) and (7m) of the administrative code are created to read:
Accy 1.003
(2m)
"Board" means the accounting examining board.
(2r)
"Certified public accountant" or "CPA" means a person considered to be in practice as a certified public accountant under s. 442.02, Stats.
(7m)
"Financial statements" means statements and footnotes related thereto that undertake to present an actual or anticipated financial position as of a point in time, or results of operations, cash flow, or changes in financial position for a period of time, in conformity with generally accepted accounting principles or another comprehensive basis of accounting. "Financial statements" does not include incidental financial data included in management advisory service reports to support recommendations to a client; nor does it include tax returns and supporting schedules.
Section
10
.
Subchapter II (title) of chapter Accy 1 [precedes Accy 1.101] of the administrative code is amended to read:
Chapter accy 1
subchapter II
INDEPENDENCE
PROFESSIONAL
CONDUCT
, INTEGRITY
,
AND OBJECTIVITY
Section
11
.
Accy 1.101 of the administrative code is repealed and recreated to read:
Accy 1.101 Professional conduct. (1)
The board adopts by reference the "Code of Professional Conduct" published by the American Institute of Certified Public Accountants, effective as of December 15, 2014, except that references to "member" are replaced by "a person licensed to practice as a certified public accountant."
(2)
All definitions included in the American Institute of Certified Public Accountants' Code of Professional Conduct shall apply only within that document.
Note:
The AICPA Code of Professional Conduct is available electronically at http://pub.aicpa.org/codeofconduct/Ethics.aspx or may be obtained from:
American Institute of Certified Public Accountants
1211 Avenue of the Americas
New York, NY 10036-8775
Section
12
.
Accy 1.102 of the administrative code is renumbered Accy 1.102 (intro.) and amended to read:
Accy 1.102 Integrity and objectivity.
(intro.) No person licensed to practice as a certified public accountant
, as defined in the statutes, shall knowingly
may do any of the following:
(1)
Knowingly
misrepresent facts
, and when
.
(2)
When
engaged in the practice of public accounting, including the rendering of tax and management advisory services,
shall not
subordinate his or her judgment to others.
In tax practice, a member may resolve doubt in favor of the client as long as there is reasonable support for that position.
Section
13
.
Accy 1.201 (1) (intro.) of the administrative code is amended to read:
Accy 1.201
(1)
(intro.)
All persons
A person
licensed to practice as a certified public accountant
, as defined in the statutes,
shall comply with
all of
the following general standards as interpreted by bodies designated by the American Institute of Certified Public Accountants Council, and must justify any departures therefrom
.
:
Section
14
.
Accy 1.202 of the administrative code is amended to read:
Accy 1.202 Auditing standards.
A person licensed to practice as a certified public accountant shall not permit the certified public accountant's name to be associated with financial statements in such a manner as to imply that the certified public accountant is acting as an independent public accountant unless the certified public accountant has complied with the applicable generally accepted auditing standards promulgated by the American Institute of Certified Public Accountants. Statements on auditing standards used by the American Institute of Certified Public Accountants auditing standards
executive committee
board
are, for purposes of this
rule
chapter
, considered to be interpretations of the generally accepted auditing standards, and departures from such statements must be justified by those who do not follow them.
Section
15
.
Accy 1.301 (2) (d) and (4) of the administrative code are amended to read:
Accy 1.301
(2)
(d) To preclude a certified public accountant from responding to an inquiry made by the Professional Ethics Division of the American Institute of Certified Public Accountants, by the duly constituted investigative or disciplinary body of a state society of certified public accountants, or under any state statutes
or the standards of the Securities and Exchange Commission or the Public Company Accounting Oversight Board
.
(4)
The prohibition in sub. (1) against disclosure of confidential information obtained in the course of a professional engagement does not apply to disclosure of such information when required to properly discharge the certified public accountant's responsibility according to the profession's standards. The prohibition would not apply, for example, to disclosure, as required by
AU-C
section
561
560
of Statement on Auditing Standards
No. 1 , of
, regarding the
subsequent discovery of facts existing at the date of the auditor's report which would have affected the auditor's report had the auditor been aware of such facts.
Section
16
.
Accy 1.302 (1) and (3) of the administrative code are amended to read:
Accy 1.302
(1)
Contingent fees
. Except as provided in sub.
(3)
(2)
, a certified public accountant may charge a contingent fee provided the accountant and the client make a contingent fee agreement in writing, signed by the client, which states the method by which the fee is to be determined and describes all costs and expenses to be charged to the client. Upon conclusion of the contingent fee matter, the accountant shall provide the client with a written statement showing the fee and all the costs and expenses charged to the client.
(3)
Commissions
. Except as provided in sub.
(5)
(4)
, a certified public accountant may receive a commission provided that at the time the referral or recommendation is made, the accountant informs the client in writing of the amount and reason for the commission.
Section
17
.
Accy 1.401 (1) and (2) (a) (intro.), (c) and (e) 2. of the administrative code are amended to read:
Accy 1.401
(1)
No person licensed to practice as a certified public accountant
, as defined in the statutes,
shall commit an act discreditable to the profession.
(2)
(a)
Client's records and accountant's workpapers
. (intro.)
Retention of client records after a demand is made for them is an act discreditable to the profession in violation of this section. It would be a violation of the code to retain a client's records to enforce payment.
A certified public accountant's working papers are
his or her
the
property
of the certified public accountant
and need not be surrendered to the client. However, in some instances working papers will contain data
which
that
should properly be reflected in the client's books and records but
which
that
for convenience have not been duplicated therein, with the result that the client's records are incomplete. In such instances, the portion of the working papers containing such data constitutes part of the client's records, and copies should be made available to the client upon request. If a certified public accountant is engaged to perform certain work for a client and the engagement is terminated prior to the completion of such work, the certified public accountant is required to return or furnish copies of only those records originally given to the certified public accountant by the client. Examples of working papers that are considered to be the client's records would include
all of the following
:
(c)
Duty discharged
. Once the certified public accountant has returned the client's records or furnished the copies of such records
and/or
and
necessary supporting data, the obligation has been discharged in this regard and it is not necessary to comply with any subsequent requests to again furnish such records.
(e) 2. On conviction for willful failure to file an income tax return or
other
another
document
which,
that
the certified public accountant as an individual is required by law to file, for filing a false or fraudulent income tax return or other document on his or her or a client's behalf, or for willful aiding in the preparation
and/or
and
presentation of a false or fraudulent income tax return of a client, or
for
the willful making of a false representation in connection with the determination, collection
,
or refund of any tax, whether it be in his or her own behalf or in behalf of a client, the board will initiate charges in every instance.
Section
18
.
Accy 1.401 (2) (f) of the administrative code is amended to read:
Accy 1.401
(2)
(f)
Notification of convictions.
A certified public accountant shall notify the board in writing within
60 days
48 hours
after being convicted of a crime.
Section
19
.
Accy 1.404 (1) of the administrative code is amended to read:
Accy 1.404
(1)
A person who is engaged in practice as a certified public accountant
, as defined in the statutes,
shall not concurrently engage in any business or occupation
which
that
would create a conflict of interest rendering professional services.
Section
20
.
Accy 1.405 of the administrative code is repealed and recreated to read:
Accy 1.405 Firm Names. (1)
An individual or firm may practice as a certified public accountant in any form of business organization permitted by state law. No person licensed to practice as a certified public accountant may practice under a firm name that is misleading as to the type of organization. A misleading CPA firm name is any of the following:
(a) A name that contains any representation that would be likely to cause a reasonable person to misunderstand or be confused about the legal form of the firm, or about who the owners or members of the firm are, such as a reference to a type of organization or an abbreviation thereof that does not accurately reflect the form under which the firm is organized, including any of the following:
1. A name that implies the existence of a corporation when the firm is not a corporation, such as through the use of the words "corporation," "incorporated," "Ltd.," "professional corporation," or an abbreviation thereof as part of the firm name if the firm is not incorporated or is not a professional corporation.
2. A name that implies the existence of a partnership when there is not a partnership, such as by use of the term "partnership" or "limited liability partnership" or the abbreviation "LLP" if the firm is not such an entity.
3. A name that includes the name of an individual who is not a CPA if the title "CPAs" is included in the firm name.
4. A name that includes information about or indicates an association with persons who are not members of the firm, except as provided in subs. (3) and (4).
5. A name that includes the terms "& Company," "& Associate," or "Group," if the firm does not include, in addition to the named partner, shareholder, owner, or member, at least one other unnamed partner, shareholder, owner, member, or staff employee.
(b) A name that contains any representation that would be likely to cause a reasonable person to have a false or unjustified expectation of favorable results or capabilities, through the use of a false or unjustified statement of fact as to any material matter.
(c) A name that claims or implies the ability to influence a regulatory body or official.
(d) A name that includes the name of an owner whose license has been revoked for disciplinary reasons by the board, whereby the licensee has been prohibited from practicing public accountancy or prohibited from using the title CPA or holding himself or herself out as a certified public accountant.
(2)
Any of the following is a permissible type of CPA firm name if it does not otherwise violate this subchapter:
(a) A firm name that includes the names of one or more former or present owners.
(b) A firm name that excludes the names of one or more former or present owners.
(c) A firm name that uses the CPA title as part of the firm name when all named individuals are owners of the firm who hold such title or are former owners who held such title at the time they ceased to be owners of the firm.
(d) A firm name that includes the name of a non-CPA owner if the CPA title is not a part of the firm name.
(3)
A network firm may use a common brand name or share common initials as part of the firm name.
(4)
A network firm may use the network name as the firm's name, provided that it also shares one or more of the following characteristics with other firms in the network:
(a) Common control, as defined by generally accepted accounting principles in the U.S., among the firms through ownership, management, or other means.
(b) Profits or costs, excluding costs of operating the association, costs developing audit methodologies, manuals and training courses, and other costs that are immaterial to the firm.
(c) A common business strategy that involves ongoing collaboration among the firms whereby the firms are responsible for implementing the association's strategy and are held accountable for performance pursuant to that strategy.
(d) A significant part of professional resources.
(e) Common quality control policies and procedures that participating firms are required to implement and that are monitored by the association.
Section
21
.
Chapter Accy 2 (title) of the administrative code is created to read:
Chapter accy 2
individual certification and
licensure
Section
22
.
Subchapter I (title) of chapter Accy 2 [precedes Accy 2.001] of the administrative code is created to read:
Chapter accy 2
subchapter I
authority and definitions
Section
23
.
Accy 2.001 of the administrative code is created to read:
Accy 2.001 Authority
. The rules in this chapter are adopted under the authority in ss. 15.08 (5) (b), 227.11 (2), and 442.04, Stats.
Section
24
.
Accy 2.002 of the administrative code is created to read:
Accy 2.002 Definitions.
In this chapter:
(1)
"Accredited" means to be listed by an accrediting agency recognized by the secretary of the federal department of education.
Note:
For a listing of accrediting agencies recognized by the secretary of the federal department of education, see
http:/www2.ed.gov/admins/finaid/accred/accreditation_pg6.html.
(2)
"Bachelor's degree" means a baccalaureate degree normally conferred by universities and colleges at the completion of at least a 4-year, full-time, academic-year program of study.
Note:
Some students complete the 4-year bachelor's degree in less than 4 years by attending summer school or maximum course loads over a number of academic semesters.
Section
25
.
Subchapter II (title) of chapter Accy 2 [precedes Accy 2.101] of the administrative code is created to read:
chapter accy 2
subchapter II
application for certification
of individuals
Section
26
.
Accy 2.101 (Note) of the administrative code is created to read:
Accy 2.101
Note:
Application forms are available upon request to the board's office at 1400 East Washington Avenue, P.O. Box 8935, Madison WI 53708-8935 or on the Internet at www.dsps.wi.gov. An applicant with a disability will be provided reasonable accommodations.
Section
27
.
Accy 2.101 (3), (4) and (5) of the administrative code are created to read:
Accy 2.101
(3)
Evidence of at least one year of public accounting experience as required by s. Accy 2.403 and s. 442.04 (5) (b) 5., Stats.
(4)
Evidence that the applicant has successfully passed each section of the Uniform Certified Public Accountant Examination.
(5)
Successful completion of the open book professional ethics examination on statutes and rules governing the practice of public accounting in Wisconsin as set forth in s. Accy 2.306.
Section
28
.
Subchapter III (title) of chapter Accy 2 [precedes Accy 2.202] of the administrative code is created to read:
chapter accy 2
subchapter III
education
Section
29
.
Accy 2.202 (1) (a) to (f) and (2) of the administrative code are created to read:
Accy 2.202
(1)
(a) Intermediate financial accounting.
(b) Advanced financial accounting.
(c) Cost or managerial accounting.
(d) Taxation.
(e) Auditing.
(f) Accounting information systems.
(2)
At least 24 semester hours in business courses other than accounting courses, at the undergraduate or graduate level, including at least one course in each of the following subjects:
(a) Economics.
(b) Finance.
(c) Marketing.
(d) Management or organizational behavior.
(e) Business law.
(f) Information technology.
Note:
The courses covering the subjects of advanced financial accounting, cost or managerial accounting, taxation, and auditing under s. Accy 2.202 (1), would generally be courses taken beyond the introduction level. A course would generally be considered advanced financial accounting if it covers one or more of the following topics: foreign currency transactions, partnerships, state and local governments, not-for-profit entities, consolidations, mergers and acquisitions, intercompany transactions, fraud investigations, accounting theory, and accounting research.
Section
30
.
Subchapter IV (title) of chapter Accy 2 [precedes Accy 2.301] of the administrative code is created to read:
chapter accy 2
subchapter iv
examination
Section
31
.
Accy 2.305 (1) (g) of the administrative code is created to read:
Accy 2.305
(1)
(g) Falsifying or misrepresenting educational credentials or other information required for admission to the examination.
Section
32
.
Subchapter V (title) of chapter Accy 2 [precedes Accy 2.401] of the administrative code is created to read:
chapter accy 2
subchapter v
experience
Section
33
.
Accy 2.401 (2) of the administrative code is created to read:
Accy 2.401
(2)
Experience may consist of providing any type of services or advice using accounting, attest, compilation, management advisory, financial advisory, tax, or related consulting skills.
Section
34
.
Subchapter VI (title) of chapter Accy 2 [precedes Accy 2.501] of the administrative code is created to read:
Chapter accy 2
subchapter VI
LICENSURE
Section
35
.
Accy 2.501 of the administrative code is created to read:
Accy 2.501 Requirements for renewal and reinstatement of individual licenses. (1)
Renewal before 5 years.
An individual certified public accountant who files an application for renewal of a license within 5 years after the renewal date may renew his or her license by filing with the board all of the following:
(a) An application for renewal on a form prescribed by the department.
(b) The fee determined by the department under s. 440.03 (9) (a), Stats., and the applicable late renewal fee specified in s. 440.08 (3) (a), Stats.
(2)
Renewal after 5 years.
An individual certified public accountant who files an application for renewal of a license 5 years or more after the renewal date may renew his or her license by filing with the board all of the following:
(a) An application for renewal on a form prescribed by the department.
(b) The fee determined by the department under s. 440.03 (9) (a), Stats., and the applicable late renewal fee specified in s. 440.08 (3) (a), Stats.
(c) Verification of successful completion of examinations specified in s. Accy 2.301 or education specified in s. Accy 2.202 or both as may be prescribed by the board.
(3)
Reinstatement.
(a) Notwithstanding the board's authority under s. 442.12 (1) (g), Stats., to grant a hearing pursuant to an application in writing and notice, an individual certified public accountant who has a license with unmet disciplinary requirements and who has failed to renew the license within 5 years after the renewal date, or an individual whose license has been surrendered or revoked, may apply for reinstatement of his or her license. The request shall be in writing and be accompanied by all of the following:
1. The materials and fee specified in sub. (2) (a) to (c).
2. Evidence of completion of disciplinary requirements, if applicable.
3. Evidence of rehabilitation or change in circumstances warranting reinstatement of the credential.
(b) The board shall grant reinstatement of a license following an application for reinstatement under par. (a) if the board determines the individual has satisfied the requirements under par. (a) 1. to 3. and the board determines reinstatement is warranted.
Section
36
.
Chapter Accy 3 (title) of the administrative code is repealed and recreated to read:
chapter accy 3
endorsement
Section
37
.
Subchapter I (title) of chapter Accy 3 [precedes Accy 3.001] of the administrative code is created to read:
chapter accy 3
subchapter i
authority and definitions
Section
38
.
Accy 3.01 of the administrative code is repealed.
Section
39
.
Accy 3.02 of the administrative code is renumbered Accy 2.301 and amended to read:
Accy 2.301 Examination.
A candidate for a certified public accountant certificate shall successfully pass the certified public accountant examination set forth in s. Accy
3.03
2.302
and the professional ethics examination set forth in s. Accy
3.10
2.306
.
Section
40
.
Accy 3.03 of the administrative code is renumbered Accy 2.302, and Accy 2.302 (1), as renumbered, is amended to read:
Accy 2.302
(1)
The subjects covering the discipline of accounting in the certified public accountant examination shall be as provided
in the 4 sections of the
by the
board of examiners of the American
institute of certified public accountants uniform certified public accountant examination
Institute of Certified Public Accountants Uniform Certified Public Accountant Examination
. The passing grade on each section is 75 or higher.
Section
41
.
Accy 3.03 (1) (Note) of the administrative code is repealed.
Section
42
.
Accy 3.04 of the administrative code is renumbered Accy 2.303 and amended to read:
Accy 2.303 Education
required for examination
.
A candidate for the certified public accountant examination must
possess a bachelor's or higher degree with a resident major in accounting, as defined in s. Accy 7.02 (3), or the reasonable equivalence of a resident major in accounting, as defined in s. Accy 7.03 (1), or reasonably expect to receive a degree with a resident major in accounting or its reasonable equivalence within 45 days following the date of examination
complete 120 semester hours of education, including courses covering each of the subjects and the semester hours specified in s. Accy 2.202 (1) and (2)
.
Section
43
.
Accy 3.05 (title) and (1) (intro.) and (a) of the administrative code are renumbered Accy 2.101 (title), (intro.) and (1), and Accy 2.101 (title) and (intro.), as renumbered, are amended to read:
Accy 2.101
(title)
Examination application
Application
.
(intro.) A candidate
for the certified public accountant examination
applying for a certificate as a certified public accountant
shall apply on an application form provided by the board
and file the application in the board office no later than 60 days prior to the examination date
. The application shall be supported by all of the following:
Section
44
.
Accy 3.05 (1) (b) (intro.) and 1. of the administrative code are consolidated, renumbered Accy 2.101 (2) and amended to read:
Accy 2.101
(2)
Proof of fulfilling the educational requirements
specified in s. Accy 2.202 and s. 442.04 (5), Stats.
, by submitting
either: 1. Certified
certified
copies of transcripts for all academic work completed at an institution
,
as defined in s. 442.04 (5) (a), Stats., at least one of which must reflect the award of a bachelor's or higher degree
, if the candidate has graduated prior to filing the application
and the completion of 150 semester hours, including in courses covering each of the subjects and the semester hours specified in s. Accy 2.202 (1) and (2)
.
Section
45
.
Accy 3.05 (1) (b) 2. and 3. and (c), (2) and (3) of the administrative code are repealed.
Section
46
.
Accy 3.05 (3) (Note) of the administrative code is repealed.
Section
47
.
Accy 3.055 of the administrative code is repealed.
Section
48
.
Accy 3.06 of the administrative code is renumbered Accy 2.304, and Accy 2.304 (title), (1), (3) and (4), as renumbered, are amended to read:
Accy 2.304
(title)
Examination
Candidates for examination
.
(1)
A candidate shall be allowed to sit for each section of the uniform certified public accountant examination individually
and in any order
.
(3)
A candidate must pass all
4
sections of the uniform certified public accountant examination within a rolling 18-month period
which
that
begins on the date that the first section is passed.
(4)
If
all 4 sections
any section
of the uniform certified public accountant examination
are
is
not passed within the rolling 18-month period, credit for any section passed outside the 18-month period shall expire and that section shall be retaken.
Section
49
.
Accy 3.07 of the administrative code is repealed.
Section
50
.
Accy 3.08 of the administrative code is repealed.
Section
51
.
Accy 3.09 of the administrative code is renumbered Accy 2.305, and Accy 2.305 (1) (intro.), (a) to (d), (2) and (4), as renumbered, are amended to read:
Accy 2.305
(1)
(intro.) Cheating on the certified public accountant examination is a serious breach of integrity and indicates a lack of good professional character. Cheating on an examination includes
, but is not limited to
any of the following
:
(a) Communications concerning an examination being
written
taken
between candidates inside or outside of the examination room, or copying another's answers.
(b) Communications concerning an examination being
written
taken
with accomplices outside of the examination room.
(c) Substitution by a candidate of another person to sit in the examination room for the candidate and
write
take
one or more of the examination questions
or papers
for the candidate.
(d) Reference to "crib notes," test books
, electronic media,
or other materials
, other than those provided to the candidate as part of the examination,
inside or outside
of
the examination room during periods examinations are being
written
taken
.
(2)
Penalties imposed by the board for cheating on the examination shall be related to the seriousness of the offense. Cheating
which
that
was planned in advance is the most serious offense. Penalties may include the entering of a failing grade on all sections
written
taken
for the examinations in which cheating occurred and suspension of the right to
write
take
the next scheduled examination after the examination in which cheating occurred
or to the entering of a failing grade on all sections written for the examinations in which cheating occurred and suspension of the right to write for as many as the next 6 scheduled examinations after the examination in which cheating occurred
. Time within which conditional credit previously earned for passing part of the examination may be extended by board action in situations where penalties are levied, and by as long as the period of suspension.
(4)
Other jurisdictions to which a candidate may apply to
write
take
the certified public accountant examination during a period of suspension of the right to
write
take the examination
shall be notified of the penalty levied in Wisconsin.
Section
52
.
Accy 3.10 of the administrative code is renumbered Accy 2.306.
Section
53
.
Subchapter II (title) of chapter Accy 3 [precedes Accy 3.101] of the administrative code is created to read:
chapter accy 3
subchapter II
certification by endorsement
Section
54
.
Accy 3.11 of the administrative code is renumbered Accy 2.307, and Accy 2.307 (1), as renumbered, is amended to read:
Accy 2.307
(1)
Applicants
An applicant
for the certified public accountant examination may request a review of
their examination papers from the American Institute of certified public accountants advisory grading service
his or her examination from the National Association of State Boards of Accountancy
.
Section
55
.
Subchapter III (title) of chapter Accy 3 [precedes Accy 3.201] of the administrative code is created to read:
chapter accy 3
subchapter IIi
foreign endorsement candidates
Section
56
.
Chapter Accy 4 (title) of the administrative code is repealed and recreated to read:
chapter accy 4
enforcement
Section
57
.
Subchapter I of chapter Accy 4 [precedes Accy 4.001] of the administrative code is created to read:
chapter accy 4
subchapter i
authority
Accy 4.001 Authority.
The rules in this chapter are adopted pursuant to the authority in ss. 15.08 (5) (b), 227.11 (2) and 442.12, Stats.
Section
58
.
Accy 4.01 of the administrative code is renumbered Accy 5.301.
Section
59
.
Accy 4.02 of the administrative code is renumbered Accy 5.101 and amended to read:
Accy 5.101 Firm license.
A firm shall meet the ownership requirements of s. 442.08 (2) (c) 2., Stats., and be licensed as a certified public accountant if any member of the firm practices as a certified public accountant in Wisconsin
other than on a temporary basis as described in s. 442.025 (4), Stats
. An individual licensed as a CPA may only provide attest services, as defined in s. 442.001 (1), Stats., in a CPA firm that has a firm license
.
Section
60
.
Accy 4.03 of the administrative code is renumbered Accy 5.201.
Section
61
.
Accy 4.035 of the administrative code is repealed.
Section
62
.
Accy 4.037 of the administrative code is renumbered Accy 5.102, and Accy 5.102 (3) (d), as renumbered, is amended to read:
Accy 5.102
(3)
(d)
That the applicant has satisfied the peer review requirements in s. 442.087, Stats., and ch. Accy
9
6
.
Section
63
.
Accy 4.04 of the administrative code is renumbered Accy 5.302 and amended to read:
Accy 5.302
Firms without office in this state.
Firms without a bona fide office in this state, as described in s. Accy
4.06
5.303
(2), may be licensed if there is a licensed Wisconsin certified public accountant designated as the individual responsible for the firm's compliance with ch. 442, Stats., for the Wisconsin engagement or engagements.
Section
64
.
Accy 4.05 of the administrative code is renumbered Accy 5.103.
Section
65
.
Accy 4.06 of the administrative code is renumbered Accy 5.303.
Section
66
.
Accy 4.07 (title) of the administrative code is renumbered Accy 5.401 (title) and amended to read:
Accy 5.401
(title)
Change in
member
members
of a firm.
Section
67
.
Accy 4.07 (1) of the administrative code is renumbered Accy 5.401 (1) (intro.) and amended to read:
Accy 5.401
(1)
(intro.) The board
is to
shall
be notified
by the firm
in writing of changes in the
member
members
of the firm or firm name
or any of the following
no later than 30 days after the change
.
:
Section
68
.
Accy 4.07 (2) of the administrative code is renumbered 5.401 (3).
Section
69
.
Subchapter II of chapter Accy 4 [precedes Accy 4.101] of the administrative code is created to read:
chapter accy 4
subchapter iI
discipline
Accy 4.101 Grounds for discipline.
Grounds for discipline include all of the following:
(1)
Engaging in dishonesty, fraud, or deceit in obtaining a certificate or license, including submitting to the board any evidence known to be false or forged in, or in support of, an application for a certificate or license or cheating on an examination.
(2)
Knowingly making misleading, deceptive, or untrue representations in the performance of services.
(3)
Using the CPA title or providing attest services in this state without a certificate or license or without properly qualifying to practice across state lines.
(4)
Using or attempting to use a certificate or license that has been suspended or revoked.
(5)
Making any false, misleading, or deceptive statement in support of an application for a license filed by another person.
(6)
Failing to comply with professional standards as to the attest or compilation competency requirements for those who supervise attest or compilation engagements and sign reports on financial statements or other compilation communications with respect to financial statements.
(7)
Failing to comply with the applicable peer review requirements set out in ch. Accy 6.
(8)
Engaging in conduct reflecting adversely upon the licensee's fitness to perform services, including conduct constituting incompetence. In this subsection, "conduct constituting incompetence" includes gross negligence, recklessness, or repeated acts of negligence in the licensee's record of professional practice.
(9)
Engaging in professional practice while having any condition, whether physical or mental, that endangers the public by impairing skill and care in providing professional services. Evidence of such a condition includes evidence that the person has been adjudicated as mentally incompetent.
(10)
Presenting a license issued to another person as one's own.
(11)
Concealing information regarding violations by other licensees when questioned or requested by the board.
(12)
Willfully failing to file a report or record required by state or federal law; willfully impeding or obstructing the filing of such a report or record or inducing another person to impede or obstruct such filing by another person; or making or filing such a report or record that one knows to be false. A finding, adjudication, consent order, or conviction by a federal or state court, agency, or regulatory authority or by the Public Company Accounting Oversight Board that a licensee has willfully failed to file a required report or record shall be prima facie evidence of a violation of this subsection.
(13)
Having an active or stayed revocation or suspension of any occupational license or other privilege to practice any licensed occupation by or before any state, federal, foreign, or other licensing or regulatory authority, provided that the grounds for the revocation or suspension include wrongful conduct such as fraud, dishonesty, or deceit or any other conduct that evidences an unfitness of the applicant to practice public accountancy.
Section
70
.
Chapter Accy 5 (title) of the administrative code is repealed and recreated to read:
chapter accy 5
firm licensure
Section
71
.
Accy 5.01 (title) of the administrative code is renumbered Accy 2.401 (title) and amended to read:
Accy 2.401
(title)
Review
dates
of candidate's experience
.
Section
72
.
Accy 5.01 of the administrative code is renumbered Accy 2.401 (1) and amended to read:
Accy 2.401
(1)
Following the successful passing of
the written
each section of the
uniform CPA examination and upon written request by a candidate, a candidate's experience shall be reviewed by the board. The written request shall include employer verification statements and information on experience to update the experience data already in the candidate's file. Such evaluation will determine whether the candidate qualifies at that time under the requirement of having at least one year of public accounting experience or its equivalent, the sufficiency of the experience or the equivalency to be judged by the
examining
board. The board shall inform the candidate if additional experience is needed. Upon gaining the required additional experience, the candidate shall notify the board and provide verification.
Section
73
.
Accy 5.02 of the administrative code is renumbered Accy 2.402.
Section
74
.
Accy 5.03 of the administrative code is renumbered Accy 2.403 and amended to read:
Accy 2.403 Public accounting experience.
An individual must have at least one year of public accounting experience or its equivalent as determined by the board. Experience shall be acquired after the applicant has earned
a degree described in s. 442.04 Stats., that qualifies the applicant to take the CPA examination
120 semester hours of education from an accredited college or university, including courses covering each of the subjects and the semester hours specified in s. Accy 2.202 (1) and (2). This experience must have been acquired within 5 years prior to applying for the certification as a certified public accountant
.
Section
75
.
Accy 5.04 of the administrative code is renumbered Accy 2.404.
Section
76
.
Accy 5.05 of the administrative code is renumbered Accy 2.405.
Section
77
.
Accy 5.06 of the administrative code is repealed.
Section
78
.
Accy 5.07 of the administrative code is renumbered Accy 2.406.
Section
79
.
Subchapter I (title) of chapter Accy 5 [precedes Accy 5.101] of the administrative code is created to read:
chapter accy 5
subchapter I
APPLICATION FOR FIRM LICENSURE
Section
80
.
Subchapter II (title) of chapter Accy 5 [precedes Accy 5.201] of the administrative code is created to read:
chapter accy 5
subchapter II
SOLE PROPRIETOR
Section
81
.
Subchapter III (title) of chapter Accy 5 [precedes Accy 5.301] of the administrative code is created to read:
chapter accy 5
subchapter III
OFFICEs; internet practice
Section
82
.
Accy 5.304 of the administrative code is created to read:
Accy 5.304 Internet practice.
A CPA firm offering or rendering professional services via an Internet site shall provide in the Internet site's homepage, a name, an address, and a principal state of licensure as a means for regulators and the public to contact a responsible licensee in charge at the firm regarding complaints, questions, or regulatory compliance.
Section
83
.
Subchapter IV (title) of chapter Accy 5 [precedes Accy 5.401] of the administrative code is created to read:
chapter accy 5
subchapter IV
firm MEMBERs
Section
84
.
Accy 5.401 (1) (a) to (d) and (2) of the administrative code are created to read:
Accy 5.401
(1)
(a) Formation of a new firm.
(b) Termination of a firm.
(c) Change in the management of any branch office in this state.
(d) Establishment of a new branch office or the closing or change of address of a branch office in this state.
(2)
The board shall be notified by a firm in writing of any addition of a partner, member, manager or shareholder or the retirement, withdrawal or death of a partner, member, manager or shareholder as of January 1 of each year.
Section
85
.
Subchapter I of chapter Accy 6 [precedes Accy 6.001] of the administrative code is created to read:
chapter accy 6
subchapter I
authority and definitions
Accy 6.001 Authority.
The rules in this chapter are adopted pursuant to the authority in ss. 15.08 (5) (b), 227.11 (2) and 442.087 (3), Stats.
Accy 6.002 Definitions.
As used in this chapter:
(1)
"Engagement review" means a peer review in which the peer reviewer evaluates and reports on engagements submitted by a firm that performs at its highest level of service, only services under SSARS, or services under the SSAE that are not included in a system review in order for the peer reviewer to determine whether the engagements submitted for review conform to applicable professional standards in all material respects.
(2)
"PCAOB" means the Public Company Accounting Oversight Board that conducts firm inspection of certified public accounting firms' Securities and Exchange Commission issuer practices and other engagements subject to its inspection process.
(3)
"Peer review" means a study, appraisal, or review of one or more aspects of the attest services work of a licensee of a registered firm in the practice of public accounting, in accordance with a peer-review program, by a person or persons who hold licenses in this jurisdiction or another jurisdiction and who are not affiliated with the person or firm being reviewed.
(4)
(a) "Peer-review program" means the peer-review process developed and maintained by the American Institute of Certified Professional Accountants and administered by any of the following:
1. The Wisconsin Institute of Certified Professional Accountants.
2. A peer-review program administrator approved by a board that regulates certified public accountants in any other CPA licensing jurisdiction.
(b) "Peer-review program" includes the standards for administering, performing, and reporting on peer reviews, oversight procedures, and training and related guidance materials.
Note:
The AICPA Standards for Performing and Reporting on Peer Reviews are available on the Internet at http://www.aicpa.org/Research/Standards/Peer- Review/DownloadableDocuments/PeerReviewStandards.pdf.
(5)
"Peer-review reports" means reports issued by the peer reviewer or peer-reviewing firm in accordance with a peer-review program and that program's peer-review standards.
(6)
"Peer-review standards" means professional standards for administering, performing, and reporting on peer reviews under a peer-review program.
(7)
"Peer reviewer" means a certified public accountant or accounting firm responsible for conducting the peer review holding a valid and active license to practice public accounting in good standing issued by this jurisdiction or another jurisdiction who meets the peer reviewer requirements established in the peer-review standards.
(8)
"SAS" means the Statements on Auditing Standards issued by the auditing standards board of the American Institute of Certified Public Accountants.
(9)
"SSAE" means the Statements on Standards for Attestation Engagements issued by the auditing standards board of the American Institute of Certified Public Accountants.
(10)
"SSARS" means the Statements on Standards for Accounting and Review Services issued by the accounting and review services committee of the American Institute of Certified Public Accountants.
(11)
"System review" means a peer review in which the peer reviewer determines whether the firm's system of quality control for its accounting and auditing practice is designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards, including the Statements on Quality Control Standards, No. 8 of the American Institute of Certified Public Accountants, in all material respects for firms that at the firm's highest level of service, perform engagements under the SAS, Government Auditing Standards, examinations under the SSAE, or pursuant to the standards of the PCAOB not subject to permanent inspection by the PCAOB.
Section
86
.
Subchapter II (title) of chapter Accy 6 [precedes Accy 6.101] of the administrative code is created to read:
chapter accy 6
subchapter Ii
firm renewal
Section
87
.
Subchapter III (title) of chapter Accy 6 [precedes Accy 6.201] of the administrative code is created to read:
chapter accy 6
subchapter IiI
reports
Section
88
.
Subchapter IV (title) of chapter Accy 6 [precedes Accy 6.301] of the administrative code is created to read:
chapter accy 6
subchapter IV
conducting peer reviews
Section
89
.
Accy 6.303 of the administrative code is created to read:
Accy 6.303 Extensions.
The organization administering the peer-review program may grant extensions for completing peer reviews as long as the organization is notified by the firm within 14 days prior to the due date of the peer review. Extensions may be granted for any of the following reasons:
(1)
An adverse health condition, including an illness or injury.
(2)
Military service.
(3)
Other good cause clearly outside of the control of the public accounting firm.
Section
90
.
Accy 6.304 of the administrative code is created to read:
Accy 6.304 Firm structure changes.
In the event a firm is merged, otherwise combined, dissolved, or separated, the organization administering the peer review shall determine which firm, if any, is considered to be the succeeding firm. The succeeding firm shall retain its peer review status and the review due date.
Section
91
.
Chapter Accy 7 (title) of the administrative code is repealed.
Section
92
.
Accy 7.01 of the administrative code is repealed.
Section
93
.
Accy 7.02 of the administrative code is repealed.
Section
94
.
Accy 7.03 of the administrative code is repealed.
Section
95
.
Accy 7.035 (intro.) and (2) of the administrative code are consolidated, renumbered Accy 2.202 (intro.) and amended to read:
Accy 2.202 Education required
to take the examination
for certification
.
(intro.) A
person may not take the examination leading to the
candidate applying for a
certificate to practice as a certified public accountant
unless the person has, as part of
must, in the course of having completed
the 150 semester hours
of
education
, met one of the following conditions:
(2)
Earned
have earned
a
baccalaureate or
graduate degree from
a
an accredited
business school or college of business
that is accredited by an accrediting agency recognized by the board
and completed
at
all of the following:
(1)
At
least 24 semester hours in accounting at the undergraduate level or 15 semester hours at the graduate level, or an equivalent combination, including
courses covering the subjects of financial accounting, auditing, U.S. taxation, and management accounting.
at least one course in each of the following subjects:
Section
96
.
Accy 7.035 (1), (3), (4) and (5) of the administrative code are repealed.
Section
97
.
Accy 7.04 (1) of the administrative code is renumbered Accy 2.308 and amended to read:
Accy 2.308 Transfer of
credit applicant
scores
.
Applicants who have passed all or part of the uniform certified public accountant examination in another jurisdiction but who have not yet received their certified public accountant certificate shall be able to transfer
grades
scores
in subjects passed to Wisconsin provided that:
(1)
Grades
Scores
transferred must be certified to the board by the other jurisdiction and must be passed in accordance with rules applicable to Wisconsin candidates.
(2)
Transfer of
grades
scores
must be accepted by board action and the applicant notified in a manner similar to the action on
grades
scores
for Wisconsin applicants.
Section
98
.
Accy 7.04 (2) of the administrative code is repealed.
Section
99
.
Accy 7.05 of the administrative code is renumbered Accy 3.101, and Accy 3.101 (1) (c), as renumbered, is amended to read:
Accy 3.101
(1)
(c) The applicant has been approved under s. Accy
8.05
3.202
.
Section
100
.
Accy 7.06 of the administrative code is repealed.
Section
101
.
Accy 7.07 of the administrative code is renumbered Accy 2.102.
Section
102
.
Chapter Accy 8 (title) of the administrative code is repealed.
Section
103
.
Accy 8.01 (title) of the administrative code is renumbered Accy 3.001 (title).
Section
104
.
Accy 8.01 (1) of the administrative code is renumbered Accy 3.001.
Section
105
.
Accy 8.02 of the administrative code is renumbered Accy 3.002.
Section
106
.
Accy 8.03 (title), (1), (3), (4), (5) and (6) of the administrative code are renumbered Accy 3.102 (title), (1), (2), (3), (4) and (5).
Section
107
.
Accy 8.04 of the administrative code is renumbered Accy 3.201 and amended to read:
Accy 3.201
Foreign candidates.
(1)
Candidates holding certifications from foreign countries shall establish their qualifications for a certificate by endorsement as set forth in ss. Accy
8.02 and 8.03
3.002 and 3.102
, or in s. Accy
8.05
3.202
.
(2)
Except as provided in s. Accy
8.05
3.202
, education qualifications in foreign countries are not comparable to those in Wisconsin. As no foreign school is accredited by
the North Central Association of Colleges and Schools or its regional equivalent
an accrediting agency that is recognized by the secretary of the federal department of education
, evidence of acceptance without deficiency into a graduate program in a school accredited by
the North Central Association of Colleges and Schools or its regional equivalent
an agency that is recognized by the secretary of the federal department of education
will be accepted as evidence of equivalence for a bachelor's or higher degree.
The education acquired must constitute the reasonable equivalence of a resident major s set forth in s. Accy 7.03.
(3)
Except as provided in s. Accy
8.05
3.202
, examinations in foreign countries have not been established as being comparable to those in the United States. Candidates must establish at least minimum qualifications in United States practice related to areas of business law, federal income taxes, generally accepted auditing standards, and generally accepted accounting principles. The
writing
taking
of uniform certified public accountant examinations in these areas would be adequate evidence, although other evidence may be accepted if validated.
(4)
Except as provided in s. Accy
8.05
3.202
, experience must include practice using United States related techniques as noted in sub. (3). Experience will be considered on its merit without restriction as to where it was acquired, so long as it is relevant to United States practice.
Section
108
.
Accy 8.05 of the administrative code is renumbered Accy 3.202, and Accy 3.202 (2) (d), as renumbered, is amended to read:
Accy 3.202
(2)
(d) The applicant has successfully completed the professional ethics examination in s. Accy
3.10
2.306
.
Section
109
.
Chapter Accy 9 (title) of the administrative code is renumbered Chapter Accy 6 (title).
Section
110
.
Accy 9.01 of the administrative code is repealed.
Section
111
.
Accy 9.02 (Note) of the administrative code is renumbered Accy 6.101 (Note) and amended to read:
Accy 6.101
Note:
The following questions are intended to assist firms in determining whether a peer review is required for renewal. An affirmative response to any part of any question means that a peer review is required. Caution: This list is not exclusive. Refer to the standards if in doubt.
1. Does your firm audit SEC clients, including employer-sponsored plans required to file a form 11-K with the SEC?
2. Does your firm currently perform the following types of engagements?
•
Engagements applying
Statements on Auditing Standards (SASs) - Audits?
•
Agreed-upon procedures?
•
Engagements applying
Statements on Standards for Accounting and Review Services (SSARS)?
•
Reviews of financial statements?
•
Compilations of financial statements with disclosures?
•
Compilations of financial statements where "Selected Information-Substantially All Disclosures Required Are Not Included?"
•
Compilations of financial statements that omit substantially all disclosures?
•
Engagements applying
Statements on Standards for Attestation Engagements (SSAE)?
•
Engagements applying International Financial Reporting Standards (IFRS) or International Auditing Standards (IAS)?
•
Examinations of prospective financial statements under SAARS?
•
Compilations of prospective financial statements under SAARS?
•
Agreed-upon procedures of prospective financial statements?
•
Examinations of written assertions?
•
Reviews of written assertions?
•
Agreed-upon procedures of written assertions?
•
Engagements under Government Auditing Standards (Yellow Book)?
•
Engagements applying PCAOB Auditing Standards?
•
Engagements applying PCAOB Attestation Standards?
•
Work performed as subject to requirements of the AICPA peer-review program?
Section
112
.
Accy 9.02 of the administrative code is renumbered Accy 6.101, and Accy 6.101 (1) and (2), as renumbered, are amended to read:
Accy 6.101
(1)
After January 1, 2005, an
An
application for renewal by a certified public accounting firm that provides or offers to provide attest services shall include a description of at least one peer review of the firm undergone
through a peer review program approved by the board, or approved by a board that regulates certified public accountants in another state,
within 3 years preceding the application for renewal. The description shall identify the
board-approved
peer review program
administrator, if administered by a peer-review program administrator approved by a board that regulates certified public accountants in any other CPA licensing jurisdiction
, the outcome of the review
,
and the year under review.
(2)
A firm is exempt from the peer review requirements in this section if it does not offer or perform attest services
as defined in s. 442.001 (1), Stats
.
Section
113
.
Accy 9.03 of the administrative code is renumbered Accy 6.201, and Accy 6.201 (intro.), as renumbered, is amended to read:
Accy 6.201
Reports
Report
from
board-approved review programs
peer-review program
.
(intro.)
Each board-approved peer review
The peer-review
program
described under s. Accy 6.002 (4) (a) 1.
shall report the following to the board by December 1 of each even-numbered year:
Section
114
.
Accy 9.04 of the administrative code is repealed.
Section
115
.
Accy 9.05 of the administrative code is repealed.
Section
116
.
Accy 9.06 of the administrative code is repealed.
Section
117
.
Nonstatutory provisions.
(1)
The accounting examining board shall research the feasibility of rules establishing continuing education requirements for renewal of a license under section 442.08 (1) of the statutes. The board shall prepare a report describing its findings and recommendations, including a description of any suggested changes to the statutes or the board's rules, and shall submit the report to the appropriate standing committees of the legislature in the manner provided under section 13.172 (3) of the statutes no later than December 31, 2016.
(2)
The requirements under sections 227.21 (2) (a) and 442.01 (2) of the statutes to obtain the consent of the attorney general and to hold a public hearing do not apply with respect to the enactment of this act.
Section
118
.
Effective dates.
This act takes effect on the day after publication, except as follows:
(1)
Notwithstanding section 227.265 of the statutes, the treatments of provisions of the administrative code take effect on the first day of the 3rd month following publication of this act in the Wisconsin Administrative Register.
