PROPOSED RULES
Original Notice.
Preproposal statement of inquiry was filed as WSR 00-19-010.
Title of Rule: WAC 4-25-600 Rules of professional conduct -- Preamble.
Purpose: To establish and maintain high standards of competence and ethics of Washington CPAs.
Statutory Authority for Adoption: RCW 18.04.055(2).
Statute Being Implemented: RCW 18.04.055(2).
Summary: Notifies Washington CPAs in a clear rule-writing format that when they accept the right and responsibility to use the CPA title they must accept the duty to comply with rules of professional conduct.
Reasons Supporting Proposal: Rules of professional conduct provide Washington CPAs with guidance in the performance of their professional responsibilities and therefore protect the public.
Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Dana M. McInturff, CPA, 711 South Capitol Way, #400, Olympia, (360) 586-0163.
Name of Proponent: Board of Accountancy, governmental.
Rule is not necessitated by federal law, federal or state court decision.
Explanation of Rule, its Purpose, and Anticipated Effects: The rule advises Washington CPAs (including CPAs practicing outside the United States) of the rules of professional conduct and of their responsibility to comply. These rules are needed to establish and maintain high standards of competence and ethics to address the need to protect the public.
Proposal Changes the Following Existing Rules: The amendment: (1) Changes the title of the rule to "What are the rules of professional conduct and what must I do to comply with these rules?"; (2) clarifies with which specific rules CPAs must comply; and (3) eliminates the out-of-country exception to the requirement to comply with the rules of conduct.
No small business economic impact statement has been prepared under chapter 19.85 RCW. The proposed rule will not have more than minor economic impact on business.
RCW 34.05.328 does not apply to this rule adoption. The Board of Accountancy is not one of the agencies required to submit to the requirements of RCW 34.05.328.
Hearing Location: Capitol Court Building, 110 Capitol Way South, 11th and Capitol Way, Room 135, Olympia, WA, on April 27, 2001, at 9:30 a.m.
Assistance for Persons with Disabilities: Contact Cheryl Sexton, TDD (800) 833-6384, or (360) 664-9194.
Submit Written Comments to: Dana M. McInturff, P.O. Box 9131, Olympia, WA 98507-9131, fax (360) 664-9190, by April 26, 2001.
Date of Intended Adoption: April 27, 2001.
March 8, 2001
Dana M. McInturff, CPA
Executive Director
OTS-4662.1
AMENDATORY SECTION(Amending WSR 93-22-046, filed 10/28/93,
effective 11/28/93)
WAC 4-25-600
((Rules of professional conduct -- Preamble.))
What are the rules of professional conduct and what must I do to
comply with these rules?
((The rules of professional conduct are
intended to provide guidance to all persons using the CPA title
in the performance of their professional responsibilities. Compliance with the rules of professional conduct is the
responsibility of all CPAs. This responsibility is met by
understanding and voluntary actions, reinforcement by peers and
public opinion, and ultimately through disciplinary proceedings,
when necessary, against CPAs who fail to comply with the rules.
Acceptance of the right and responsibility to use the CPA title includes acceptance of a duty to comply with the rules of professional conduct.
The rules of professional conduct consist of both principles and specific rules. Principles are set forth in WAC 4-25-610 and comprise the framework for the rules of professional conduct. Specific rules are set forth in WAC 4-25-620 through 4-25-699. In the interpretation and enforcement of the rules of professional conduct consideration will be given to codes of other regulatory bodies, where applicable, and codes, interpretations and rulings of appropriate bodies within the profession, standards established by the profession and to any other information which is deemed pertinent to achieving compliance with the rules of professional conduct.
The rules of professional conduct apply to all persons using the CPA title and, specifically, to CPAs in the practice of public accounting as defined in RCW 18.04.025(5), except that a CPA who is engaged in the practice of public accountancy outside the United States will not be subject to discipline by the board for departing, with respect to such foreign practice, from the rules of professional conduct, so long as the CPA's conduct is in accordance with the standards of professional conduct applicable to the practice of public accountancy in the country in which the CPA is practicing. However, even in such a case, if a CPA's name is associated with financial statements under circumstances that would entitle the reader to assume that United States practices are followed, the CPA will be expected to comply with the rules of professional conduct.)) All CPAs using the title CPA must comply with:
• The rules of professional conduct established in WAC 4-25-610 through 4-25-699;
• The Professional Code of Conduct issued by the AICPA including interpretations and ethics rulings; and
• Applicable Security and Exchange Commission rules, concept releases, interpretative releases, and policy statements.
When you accept the right and responsibility to use the CPA title you accept the duty to comply with these rules of professional conduct.
These rules of professional conduct consist of both principles and specific rules. When the board interprets and enforces the rules of professional conduct, the board may consider:
• Codes of other regulatory bodies, where applicable;
• Codes, interpretations and rulings of appropriate bodies within the profession;
• Standards established by the profession; and
• Other information which is deemed pertinent to achieving compliance with the rules of professional conduct.
If professional standards differ from board rule, board rule prevails.
[Statutory Authority: RCW 18.40.055. 93-22-046, § 4-25-600, filed 10/28/93, effective 11/28/93.]