A11695
STATE OF NEW YORK
________________________________________________________________________
11695
IN ASSEMBLY
June 18, 2004
___________
Introduced by COMMITTEE ON RULES -- (at request of M. of A. Canestrari)
-- read once and referred to the Committee on Higher Education
AN ACT to amend the education law, in relation to oversight of account-
ants
The People of the State of New York, represented in Senate and Assem-
bly, do enact as follows:
1 Section 1. Section 7401 of the education law, as amended by chapter
2 994 of the laws of 1971, is amended to read as follows:
3 § 7401. Definition of practice of public accountancy. The practice of
4 the profession of public accountancy is defined as [holding one's self
5 out to the public, in consideration of compensation received or to be
6 received, offering to perform or performing for other persons, services
7 which involve signing, delivering or issuing or causing to be signed,
8 delivered or issued any financial, accounting or related statement or
9 any opinion on, report on, or certificate to such statement if, by
10 reason of the signature, or the stationery or wording employed, or
11 otherwise, it is indicated or implied that the practitioner has acted or
12 is acting, in relation to said financial, accounting or related state-
13 ment, or reporting as an independent accountant or auditor or as an
14 individual having or purporting to have expert knowledge in accounting
15 or auditing]:
16 1. performing or offering to perform attest or compilation services,
17 as defined in section seventy-four hundred one-a of this article;
18 2. incident to the services described in subdivision one of this
19 section, rendering or offering to render professional services to
20 clients in any or all matters relating to accounting concepts and to the
21 recording, presentation, or certification of financial information or
22 data; or
23 3. performing or offering to perform for other persons one or more
24 types of services, exclusive of services within subdivisions one and two
25 of this section, involving the use of professional skills or competen-
26 cies of a licensed accountant as described in the rules of the board of
27 regents, including professional services rendered to one's employer
28 relating to the recording of financial data or information or the prepa-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD09763-19-4
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1 ration or presentation of financial statements, while holding one's self
2 out as a certified public accountant or public accountant or using a
3 "CPA" or "PA" designation.
4 § 2. The education law is amended by adding a new section 7401-a to
5 read as follows:
6 § 7401-a. Definitions. As used in this article:
7 1. "Attest" means providing the following public accountancy services
8 which all require the independence of licensees:
9 a. any audit to be performed in accordance with generally accepted
10 auditing standards or other similar standards developed by a federal
11 governmental agency, commission or board, or by a recognized interna-
12 tional or national professional accountancy organization, acceptable to
13 the department in accordance with the commissioner's regulations that
14 establish auditing standards;
15 b. any review of a financial statement to be performed in accordance
16 with standards developed by an agency, commission or board of the feder-
17 al government, or by a recognized international or national professional
18 accountancy organization, acceptable to the department in accordance
19 with the commissioner's regulations that establish standards for
20 performing such services; or
21 c. any attestation engagement to be performed in accordance with
22 attestation standards developed by an agency, commission or board of the
23 federal government, or by a recognized international or national profes-
24 sional accountancy organization, acceptable to the department in accord-
25 ance with the commissioner's regulations that establish standards for
26 performing such services.
27 2. "Certified public accountant" means any person who has received a
28 license from the department as a certified public accountant for the
29 practice of public accountancy.
30 3. "Compilation" means providing a service to be performed in accord-
31 ance with standards developed by an agency, commission or board of the
32 federal government, or by a recognized international or national profes-
33 sional accountancy organization, acceptable to the department in accord-
34 ance with the commissioner's regulations that establishes such stand-
35 ards, and that is presenting in the form of financial statements
36 information that is the representation of management or owners without
37 undertaking to express any assurance on the statements.
38 4. "Firm" means a sole proprietorship, a professional corporation, a
39 partnership, an unincorporated association, a limited liability company,
40 a limited liability partnership, or any other form of organization
41 engaged in the practice of public accountancy.
42 5. "Public accountant" means any person who has received a license
43 from the department as a public accountant for the practice of public
44 accountancy.
45 6. "Domestic revenues" means earnings within the United States from
46 the provision of services pursuant to the practice of public accountancy
47 as defined in section seventy-four hundred one of this article performed
48 for publicly traded corporations.
49 § 3. Section 7402 of the education law, as amended by chapter 994 of
50 the laws of 1971, is amended to read as follows:
51 § 7402. Practice of public accountancy and use of title "certified
52 public accountant" or "public accountant". 1. Only a person licensed or
53 otherwise authorized to practice under this article shall practice
54 public accountancy and use the title "certified public accountant" or
55 the designation ["C.P.A."] CPA or "public accountant" or any other
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1 derivative or designation provided in section seventy-four hundred eight
2 of this article.
3 2. Only a certified public accountant or public accountant or person
4 otherwise authorized or exempted pursuant to this article shall engage
5 in the practice of public accountancy, as defined in subdivisions one
6 and two of section seventy-four hundred one of this article.
7 3. Nothing in this article shall prevent an individual enrolled to
8 practice before the United States internal revenue service, pursuant to
9 regulations promulgated by the internal revenue service, from using the
10 designation "enrolled agent" or the letters "E.A.". This article shall
11 not apply to any designations authorized by a national credentialing
12 body recognized by the department.
13 4. An individual not licensed pursuant to this article, or an entity
14 not registered pursuant to this article, may offer the services set
15 forth in subdivision three of section seventy-four hundred one of this
16 article or prepare a compilation as defined in subdivision three of
17 section seventy-four hundred one-a of this article, if the person or
18 other entity does not hold himself, herself or itself out as a certified
19 public accountant or public accountant, a registered partnership, a
20 professional service corporation, professional service limited liability
21 partnership, or professional service limited liability company, licensed
22 or authorized to practice public accountancy, or otherwise solicit or
23 advertise for clients using a "CPA" or "PA" designation or other similar
24 designation in violation of subdivision two of section seventy-four
25 hundred eight of this article.
26 § 4. Section 7403 of the education law, as amended by chapter 245 of
27 the laws of 1977, is amended to read as follows:
28 § 7403. State board for public accountancy. 1. A state board for
29 public accountancy shall be appointed by the board of regents on recom-
30 mendation of the commissioner for the purpose of assisting the board of
31 regents and the department on matters of professional licensing and
32 professional conduct in accordance with section sixty-five hundred eight
33 of this title. The board shall be composed of not less than twenty
34 licensed accountants, not less than fifteen of whom shall be licensed as
35 certified public accountants in this state, and the board should be kept
36 in such proportion if it is ever increased. In appointing members of the
37 state board for public accountancy who are licensed accountants, the
38 board of regents should seek to appoint individuals with a broad range
39 of practice experience and from geographic regions throughout the state.
40 An executive secretary to the board shall be appointed by the board of
41 regents on recommendation of the commissioner and shall be a certified
42 public accountant licensed in this state.
43 2. No public representative appointed to the state board for public
44 accountancy pursuant to section sixty-five hundred eight of this title
45 shall have been at any time: (a) a licensee or the immediate family
46 member of a licensee; (b) a current or former public accountant or
47 certified public accountant licensed in another state, or the immediate
48 family member of such person; (c) an employee of a licensee, or an
49 employee of a firm engaged in the practice of public accountancy; or (d)
50 a person with a financial interest in the business of a licensee or a
51 firm engaged in the practice of public accountancy.
52 § 5. The education law is amended by adding three new sections 7407-a,
53 7407-b and 7407-c to read as follows:
54 § 7407-a. Substantial equivalency. 1. An individual whose principal
55 place of business is not in this state, having a valid certificate or
56 license as a certified public accountant from any state or jurisdiction
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1 which the department has verified to have substantially equivalent
2 certified public accountant licensure requirements, as defined in the
3 regulations of the commissioner, shall be presumed to have qualifica-
4 tions substantially equivalent to New York's requirements and shall have
5 all the privileges of licensees of this state without the need to obtain
6 a license under section seventy-four hundred four of this article for a
7 one-year period, upon receipt of such verification from the department,
8 unless such privilege is rejected pursuant to subdivision three of this
9 section. Such individuals shall annually notify the department of their
10 intent to perform public accountant services in this state under this
11 section and pay a notification fee in accordance with the regulations of
12 the commissioner.
13 2. An individual whose principal place of business is not in this
14 state, having a valid certificate or license as a certified public
15 accountant from any state or jurisdiction that the department has not
16 verified to have substantially equivalent certified public accountant
17 licensure requirements, as defined in the regulations of the commission-
18 er, may obtain from the department verification that such individual's
19 certified public accountant licensure qualifications are substantially
20 equivalent to New York's requirements, as defined in the regulations of
21 the commissioner. Such individuals shall annually notify the department
22 of their intent to perform public accountancy services in this state and
23 shall pay a notification fee in accordance with the regulations of the
24 commissioner. Upon receipt of such verification by the department, the
25 individual may perform the services defined in section seventy-four
26 hundred one of this article and shall have all the privileges of licen-
27 sees of this state without the need to obtain a license under section
28 seventy-four hundred four of this article for the one-year period speci-
29 fied in such verification unless such privilege is rejected pursuant to
30 subdivision three of this section.
31 3. The department may reject the privilege to practice in this state
32 for an individual who would otherwise qualify for such privilege pursu-
33 ant to subdivision one or two of this section, based on a determination
34 that such individual lacks good moral character, his or her certificate
35 or license to practice as a certified public accountant in such other
36 state or jurisdiction is not in good standing, or such individual has
37 been found guilty of improper professional practice or professional
38 misconduct or is the subject of pending disciplinary charges in such
39 state or jurisdiction where the conduct upon which the disciplinary
40 action was based would, if committed in New York state, constitute prac-
41 ticing the profession beyond its authorized scope, with negligence or
42 incompetence, under the laws of New York state. Upon rejection for any
43 reason, such individual shall cease performing public accountancy
44 services in this state immediately upon receipt of the notice of
45 rejection. Where the rejection is based on lack of good moral character,
46 a certificate or license not in good standing or pending disciplinary
47 charges, the individual may request a hearing to be conducted in the
48 same manner as a hearing on denial of a license based on lack of good
49 moral character pursuant to the rules of the board of regents.
50 4. Any licensee of another state or jurisdiction practicing in New
51 York under the provisions of this section shall consent, as a condition
52 of practicing in New York, pursuant to the provisions of this section:
53 a. to the personal and subject matter jurisdiction and disciplinary
54 authority of the department and the board of regents, including the
55 imposition of any disciplinary penalty provided in section sixty-five
56 hundred eleven of this title or sections seventy-four hundred twelve and
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1 seventy-four hundred thirteen of this article, including but not limited
2 to, the revocation or suspension of any privilege granted under this
3 section;
4 b. to comply with the provisions of this chapter and the rules of the
5 board of regents and the regulations of the commissioner relating to the
6 practice of public accountancy, including but not limited to, continuing
7 education requirements;
8 c. to provide his or her address of record in the state or jurisdic-
9 tion of licensure or certification where process may be served in any
10 action or proceeding by the department or the board of regents against
11 the licensee; or, as an alternative to the submission of an address of
12 record, the address of the state board or the equivalent licensing body
13 of the state or jurisdiction which issued such license or certification
14 and has been designated by such state or jurisdiction as such individ-
15 ual's agent upon whom process may be served in any action or proceeding
16 against the licensee; and
17 d. to report to the department any pending disciplinary charges
18 brought against the individual as a licensee in public accountancy by
19 another state or other jurisdiction, and any disposition of such charg-
20 es, within the time prescribed by the department.
21 5. An individual practicing under the provisions of this section
22 acknowledges his or her obligation to apply for conversion of the privi-
23 lege to practice public accountancy pursuant to this section to a New
24 York state license within thirty days of any time such individual estab-
25 lishes this state as his or her principal place of business. The commis-
26 sioner shall establish via regulation a procedure for converting the
27 right to practice under this section to a license pursuant to section
28 seventy-four hundred four of this article.
29 6. The privilege to practice pursuant to this section may be renewed
30 by the department no more than four times such that an individual shall
31 practice for no more than five years under the provisions of this
32 section. In addition, the department shall not grant the privilege to
33 practice pursuant to this section to more than the number of individuals
34 equal to three percent of the partners whose principal place of business
35 and primary residence is in New York state. Provided, however, that no
36 fewer than one individual may have such privilege in any firm.
37 § 7407-b. Disciplinary action for out-of-state practice. Notwithstand-
38 ing any other provision of law, rule or regulation to the contrary, a
39 licensee of this state offering or rendering services or using the title
40 "certified public accountant" or the designation "CPA" in another state
41 shall be subject to disciplinary action in this state for an act commit-
42 ted in another state for which the licensee would be subject to disci-
43 pline if he or she was a licensee of such state, or would subject the
44 licensee to discipline in New York if such act were committed in New
45 York. Notwithstanding any provision of law, rule or regulation to the
46 contrary, the department shall investigate any complaint made by the
47 board of accountancy of another state.
48 § 7407-c. Temporary practice. On recommendation of the board, an indi-
49 vidual who is the holder of a valid certification or license as a certi-
50 fied public accountant from any state or jurisdiction and who applies to
51 the department for a license as a certified public accountant under
52 section seventy-four hundred four of this article may, after submitting
53 an application for licensure and after providing evidence of qualifying
54 continuing education, perform the services defined in section seventy-
55 four hundred one of this article until the time his or her application
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1 for licensure is granted or rejected or until one year from the date
2 such privilege was granted, whichever occurs earlier.
3 § 6. Section 7408 of the education law, as added by chapter 987 of
4 the laws of 1971, the opening paragraph of subdivision 1 and subdivision
5 2 as amended by chapter 994 of the laws of 1971 and paragraph e of
6 subdivision 1 as amended by chapter 62 of the laws of 1989, is amended
7 to read as follows:
8 § 7408. Special provisions. 1. Nothing contained in this article
9 shall be deemed to prohibit two or more certified public accountants or
10 two or more public accountants, or any combination thereof, from forming
11 a [partnership] firm; provided, however, that no [partnership] firm
12 shall use the words "certified public accountant" or "certified public
13 accountants" or the letters ["C.P.A.'s"] "CPA" or "CPAs" in connection
14 with its name unless the sole proprietor or each partner, owner or
15 shareholder of such [partnership] firm, resident or engaged within the
16 United States in practice is in good standing as a certified public
17 accountant of one or more of the states or political subdivisions of the
18 United States, and the sole proprietor or each partner, owner or share-
19 holder thereof resident or engaged in practice within the state is
20 licensed under this article; and provided further that such firm is
21 registered pursuant to the provisions of this section.
22 a. A registration shall be issued to a [partnership] firm upon payment
23 of the fee prescribed by the commissioner upon application showing that:
24 (1) At least one partner, owner or shareholder of such [partnership]
25 firm or the sole proprietorship is licensed under this article and his
26 or her license to practice is not currently suspended, annulled or
27 revoked in any jurisdiction and he or she is regularly engaged in prac-
28 tice on behalf of the [partnership] firm within the state;
29 (2) The [partnership] firm, other than a sole proprietorship, consists
30 of at least two [present members] partners, owners or shareholders; and
31 (3) The [partnership] firm, other than a sole proprietorship, contains
32 at least as many [present] partners, owners or shareholders as the total
33 number of names in the firm name, or, where the word "company" or abbre-
34 viation "co." is used, the number of [present] partners, owners or
35 shareholders shall be greater than the number of names in the firm name.
36 Such application shall include a list of the locations of all offices
37 within this state, including the names of the persons in charge of such
38 offices and shall also include a list of all states or jurisdictions in
39 which the firm has applied for or holds registrations, licenses or
40 permits as a public accounting firm and a list of any past denial, revo-
41 cation, or suspension of a registration or permit by any other state or
42 jurisdiction.
43 b. [Such registration may be revoked] The board of regents may revoke
44 or take other disciplinary action after a hearing conducted in accord-
45 ance with the provisions of section sixty-five hundred ten of this title
46 upon proof:
47 (1) That the registration was obtained by either misrepresentation or
48 suppression of any material fact;
49 (2) That the license or authorization to practice of any partner, sole
50 proprietor, owner or shareholder is suspended, annulled or revoked in
51 any jurisdiction;
52 (3) That any partner, sole proprietor, owner or shareholder in such a
53 [partnership] firm is or has been engaged in the practice of public
54 accountancy in this state who is not licensed in this state or otherwise
55 authorized to practice; [or]
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1 (4) That the [partnership] firm failed to file the written notifica-
2 tion required pursuant to paragraph d of this subdivision [of this
3 section.]; or
4 (5) That the firm has engaged in professional misconduct pursuant to
5 section sixty-five hundred nine of this title or section seventy-four
6 hundred ten of this article, or has violated the provisions of section
7 seventy-four hundred eleven of this article.
8 c. Personal service on any general partner, sole proprietor, owner or
9 shareholder of a notice of hearing to revoke a [partnership] firm regis-
10 tered hereunder shall be deemed service on the [partnership] firm.
11 d. A [partnership] firm registered to practice pursuant to this
12 section shall file with the department on or before [July first] the
13 anniversary date of the firm's registration of each year written notifi-
14 cation of:
15 (1) Any admission of a partner, owner or shareholder,
16 (2) Any resignation, termination, retirement or death of a partner or
17 owner or shareholder,
18 (3) Any termination of [partnership] a firm, or
19 (4) Any occurrence of any event or events which would eliminate as to
20 such [partnership] firm conformity with the applicable requirements of
21 this section.
22 e. [Partnerships] Firms shall register triennially [and pay a fee of
23 fifty dollars].
24 2. a. No firm shall engage in the practice of public accountancy as
25 defined in subdivisions one, two and three of section seventy-four
26 hundred one of this article or use the title "CPA" or "CPA firm" or the
27 title "PA" or title "PA firm" without a registration from the depart-
28 ment. As a condition of registration or renewal, the firm shall demon-
29 strate that it has complied with the provisions of this article, any
30 other applicable laws and such other requirements as the department may
31 impose, consistent with this article.
32 b. The commissioner, in consultation with the board of regents, shall
33 establish in regulations a registration process for certified public
34 accountancy firms and public accountancy firms, including the imposition
35 of application and registration fees and procedures to suspend or revoke
36 a registration for cause.
37 3. Any person shall be guilty of a class A misdemeanor who shall use,
38 in connection with the practice of public accountancy, or in any manner
39 tending to imply that he is an independent accountant or auditor, the
40 designations "chartered accountant", "certified accountant", "expert
41 accountant", "certified tax accountant", "tax accountant", "enrolled
42 accountant", "enrolled public accountant", "registered accountant",
43 "licensed accountant", "incorporated accountant", "registered public
44 accountant", "licensed public accountant", or any abbreviation thereof,
45 or the letters "C.A.", "E.A.", "C.T.A.", "T.A.", "E.P.A.", "R.A.",
46 "L.A.", "I.A.", "P.A.", "R.P.A.", or, "L.P.A.", except as provided else-
47 where in this article, or any other designation tending to imply that he
48 or she has expert knowledge in accounting or auditing. The title
49 "enrolled agent" or the designation "E.A." may only be used by individ-
50 uals so designated by the United States Internal Revenue Service.
51 § 7. The education law is amended by adding four new sections 7410,
52 7411, 7412 and 7413 to read as follows:
53 § 7410. Conflicts of interest. 1. It shall be a violation for any
54 firm to perform any attestation service for a publicly traded corpo-
55 ration if a chief executive officer, controller, chief financial offi-
56 cer, chief accounting officer, managing partner or any person serving in
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1 an equivalent position for the corporation was employed by such firm and
2 participated in any capacity in the attestation of that corporation
3 during the one-year period preceding the date of the initiation of the
4 attestation.
5 2. It shall be a violation for any licensee to accept employment with
6 a publicly traded corporation within twelve months of the date of issu-
7 ance of a financial statement by such corporation if:
8 a. the licensee has participated in an attestation engagement for the
9 corporation and held responsibility, with respect to the attestation
10 engagement, requiring the licensee to exercise significant judgment in
11 the attestation engagement process, including but not limited to posi-
12 tions, however titled, where the licensee was the person in charge of
13 the fieldwork, up through positions where the licensee was a partner on
14 the engagement; and
15 b. the employment would permit the licensee to exercise significant
16 authority over accounting or financial reporting, including authority
17 over the controls related to those functions.
18 3. It shall be a violation for any firm to perform any attestation
19 service for a publicly traded corporation if the lead or coordinating
20 attestation partner having primary responsibility for the attestation,
21 or the attestation partner responsible for reviewing the attestation,
22 has performed such attestation services for that corporation in each of
23 the five previous fiscal years of that corporation.
24 4. It shall be a violation for any licensee to perform any attestation
25 service for a publicly traded corporation if the licensee or the immedi-
26 ate family member of a licensee has a direct or material indirect finan-
27 cial interest in such corporation. It shall be a violation for any firm
28 to perform any attestation service for such a corporation if any part-
29 ner, sole proprietor, owner or shareholder of the firm, or the immediate
30 family member of such person, has a direct or material indirect finan-
31 cial interest in such corporation.
32 5. It shall be a violation for any licensee or firm that performs any
33 attestation of a publicly traded corporation to provide such corpo-
34 ration, contemporaneously with the attestation, any non-attestation
35 services, including:
36 a. bookkeeping or other services related to the accounting records or
37 financial statements of the attestation client;
38 b. financial information systems design and implementation;
39 c. appraisal or valuation services, fairness opinions, or contribu-
40 tion-in-kind reports;
41 d. actuarial services;
42 e. internal audit outsourcing services;
43 f. management or human resources functions;
44 g. broker or dealer, investment adviser, or investment banking
45 services;
46 h. legal services and expert services unrelated to the attestation;
47 and
48 i. any services determined by the public company accounting oversight
49 board established pursuant to the federal Sarbanes-Oxley act of two
50 thousand two to be impermissible.
51 A firm may engage in any non-attestation service, including tax
52 services, that is not described in any of paragraphs a through i of this
53 subdivision for an attestation client, only if the activity is approved
54 in advance by the audit committee of the client (or, in the case of an
55 attestation client that is not required by law to have an audit commit-
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1 tee, such other person or persons as the commissioner shall designate to
2 pre-approve such non-attestation services).
3 The commissioner may, on a case-by-case basis, after consultation with
4 the board of regents, exempt any licensee or transaction from the prohi-
5 bitions set forth in this subdivision, to the extent that such exemption
6 is necessary or appropriate in the public interest; provided that any
7 exemptions granted by the public company accounting oversight board
8 pursuant to the federal Sarbanes-Oxley act of two thousand two shall be
9 deemed to be in the public interest and shall result in an automatic
10 exemption under this paragraph.
11 § 7411. Investigations of certain professional misconduct and disci-
12 plinary proceedings by the department. 1. Notwithstanding any other
13 provision of law to the contrary, in any investigation of a licensee
14 under subdivision one of section sixty-five hundred ten of this title in
15 which misconduct involving fraud, deceit or manipulation is alleged, the
16 licensee being investigated shall have the right to be interviewed in
17 order to provide an explanation of the issues under investigation,
18 unless such right shall be determined to not be in the public interest.
19 The licensee may have counsel present during the interview, and shall
20 have the right in advance of such interview to a particularized written
21 statement of the alleged professional misconduct and issues under inves-
22 tigation by the department. The licensee may submit written comments and
23 expert opinion at any time during the investigation to the extent prac-
24 ticable. Providing an opportunity for the interview shall be a condition
25 precedent to any service of charges under paragraph c of subdivision one
26 of section sixty-five hundred ten of this title.
27 2. Notwithstanding any other provision of law to the contrary, in any
28 proceeding as defined in subdivision three of section sixty-five hundred
29 ten of this title resulting from an investigation in which misconduct
30 involving fraud, deceit or manipulation is alleged, the licensee shall
31 have the right in advance of the hearing to examine and copy any report
32 of investigation and documentary or testimonial evidence and summaries
33 of evidence in the department's possession relating to the subject
34 matter of the complaint and charges against the licensee that the
35 department will introduce at the proceeding; provided however, that the
36 department shall redact from such evidence information that if disclosed
37 would: (a) constitute an unwarranted invasion of personal privacy; (b)
38 identify a confidential source; or (c) disclose confidential information
39 relating to a criminal investigation or interfere with on-going law
40 enforcement investigations or criminal proceedings. The board may
41 charge a reasonable fee for such copying, not to exceed the actual cost
42 of such copying.
43 3. Any hearing conducted pursuant to subdivision three of section
44 sixty-five hundred ten of this title shall be commenced within one
45 hundred eighty days of the service of charges under paragraph c of
46 subdivision one of such section, except that an adjournment of the
47 initial hearing date may be granted by the administrative officer
48 assigned to the hearing panel, upon good cause shown. The written
49 report of the hearing panel pursuant to paragraph d of subdivision three
50 of section sixty-five hundred ten of this title shall be rendered within
51 ninety days of the last hearing date.
52 4. Notwithstanding any other provision of law to the contrary, the
53 department shall notify the licensee at least thirty days before the
54 meeting of the regents review committee pursuant to paragraph b of
55 subdivision four of section sixty-five hundred ten of this title. The
56 regents review committee shall transmit a written report of its review
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1 to the board of regents under paragraph b of subdivision four of such
2 section within sixty days of the conclusion of the meeting of the
3 regents review committee.
4 5. With respect to any hearing conducted by the department under
5 section sixty-five hundred ten of this title, the regents shall render a
6 decision and order under paragraph c of subdivision four of such section
7 within sixty days of its receipt of the written report of the regents
8 review committee.
9 § 7412. Penalties for professional misconduct. 1. A licensee that is
10 found guilty of professional misconduct may be subject to the penalties
11 set forth in section sixty-five hundred eleven of this title upon each
12 specification of charges of which the respondent is determined to be
13 guilty.
14 2. In addition to the penalties set forth in section sixty-five
15 hundred eleven of this title, a licensee that is found guilty of profes-
16 sional misconduct involving fraud, deceit or manipulation, including but
17 not limited to knowing preparation, publication or dissemination of
18 false, fraudulent, or materially incomplete or misleading financial,
19 accounting or related statements, reports, or information or embezzle-
20 ment, theft, misappropriation of funds or property, or obtaining money,
21 property, or other valuable consideration by fraudulent means or false
22 pretenses, may be subject to a fine not to exceed fifty thousand dollars
23 upon each specification of charges of which the respondent is determined
24 to be guilty.
25 § 7413. Authority to investigate firms and impose penalties for a
26 pattern of misconduct. 1. If, in the course of an investigation
27 conducted pursuant to section sixty-five hundred ten of this title
28 regarding a certified public accountant or public accountant, the
29 department determines there is reasonable cause to believe a pattern or
30 course of misconduct, or an act of misconduct in which more than one
31 licensee has participated, involving fraud, deceit or manipulation
32 exists in a firm, including but not limited to, knowing preparation,
33 publication or dissemination of false, fraudulent, or materially incom-
34 plete or misleading financial, accounting or related statements,
35 reports, or information; or embezzlement, theft, misappropriation of
36 funds or property; or obtaining money, property, or other valuable
37 consideration by fraudulent means or false pretenses, the investigation
38 may be expanded to include more than the subject of the original
39 complaint.
40 2. If a firm which has annual domestic revenues of less than one
41 billion dollars is found guilty of a pattern or course of misconduct or
42 an act of misconduct as defined in subdivision one of this section, such
43 firm may be subject to a fine not to exceed two hundred fifty thousand
44 dollars upon each specification of charges of which the firm is deter-
45 mined to be guilty.
46 3. If a firm which has annual domestic revenues of more than one
47 billion dollars is found guilty of a pattern or course of misconduct or
48 an act of misconduct as defined in subdivision one of this section, such
49 firm may be subject to a fine not to exceed seven hundred fifty thousand
50 dollars upon each specification of charges of which the firm is deter-
51 mined to be guilty.
52 § 8. This act shall take effect on the one hundred eightieth day after
53 it shall have become a law; provided, however, that the provisions of
54 section four of this act shall apply only to those members who are
55 appointed after the effective date of this act.