Chapter 638 Oregon Laws 2001

AN ACT

SB 280

Relating to accountants; creating new provisions; amending ORS 673.010, 673.040, 673.075, 673.150, 673.160, 673.170, 673.185, 673.320, 673.325, 673.455, 673.457 and 673.610; and repealing section 1a, chapter 313, Oregon Laws 2001 (Enrolled Senate Bill 20).

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 673.010 is amended to read:

673.010. As used in ORS 673.010 to 673.457:

(1) “Attest,” “attesting” or “attestation” means the opinion of a licensee as to the reliability or fairness of information that is used for guidance in the financial transactions of, accounting for or assessing the status or performance of, commercial and noncommercial enterprises, whether public or private, following the completion of an audit, in accordance with generally accepted accounting and auditing standards. The board by rule shall further define what constitutes attestation services in conformance, to the extent possible, with professional standards, including but not limited to the Statements on Auditing Standards (SAS) for audits or other engagements, the Statement of Standards for Accounting and Review Services (SSARS) for the review [or compilation] of financial statements and the Statements on Standards for Attestation Engagements (SSAE) for examinations of prospective financial information.

(2) “Board” means the Oregon Board of Accountancy created by ORS 673.410.

(3) “Business organization” means any form of business organization authorized by law, including but not limited to a proprietorship, partnership, corporation, limited liability company, limited liability partnership or professional corporation.

(4) “Certificate” means a certificate of certified public accountant issued under ORS 673.040.

(5) “Client” means a person who agrees with a licensee to receive any professional service from the licensee.

(6) “Compilation” means those services as defined by the board by rule.

[(6) “Contingent fee” means a fee established for the performance of any professional service and directly or indirectly paid to a licensee pursuant to an arrangement in which no fee will be charged unless a specified finding or result is attained, or in which the amount of the fee is otherwise dependent upon the finding or result of such service. A fee is not contingent if the fee:]

[(a) Is fixed by courts or other public authorities; or]

[(b) In tax matters, is determined based on the results of judicial proceedings or the findings of governmental agencies.]

(7) “License” means:

(a) A certificate, permit or registration, or a license issued under ORS 673.100, enabling the holder thereof to practice public accountancy in this state; or

(b) A certificate, permit, registration or other authorization issued by a jurisdiction outside this state enabling the holder thereof to practice public accountancy in that jurisdiction.

(8) “Licensee” means the holder of a license under subsection (7)(a) of this section.

(9) “Manager” means a manager of a limited liability company.

(10) “Member” means a member of a limited liability company.

(11) “Peer review” means a study, appraisal or review of one or more aspects of the public accountancy work of a holder of a permit under ORS 673.150 or of a registered business organization that performs attestation or compilation services. The peer review is conducted by a person or persons who are permitted under ORS 673.150 to practice public accountancy and who are independent of the permit holder or registered business organization being reviewed.

(12) “Permit” means a permit to practice public accountancy issued under ORS 673.150.

(13) “Professional” means arising out of or related to the specialized knowledge or skills associated with certified public accountants and public accountants.

(14) “Public accountant” means a public accountant licensed under ORS 673.100.

(15) “Registration” means the authority issued under ORS 673.160 by the Oregon Board of Accountancy to a business organization to practice public accountancy in this state.

(16) “Report,” when used with reference to attestation or compilation services, means an opinion or other form of written language that states or implies assurance as to the reliability of any financial statements and that also includes or is accompanied by any statement or implication that the person issuing the report has special knowledge or competence in public accountancy. Such a statement or implication of special knowledge or competence may arise from use by the issuer of the report of names or titles indicating that the issuer is a public accountancy professional or organization or may arise from the language of the report itself.

(a) “Report” includes any form of written language that:

(A) Disclaims an opinion when the form of language implies any positive assurance as to the reliability of the financial statements referred to or special knowledge or competence on the part of the person issuing the language;

(B) Implies any positive assurance as to the reliability of the financial statements referred to or special knowledge or competence on the part of the person issuing the language; or

(C) Relates to the financial affairs of a person and that is conventionally used by licensees in reports or financial statements.

(b) “Report” does not include:

(A) The following statement signed by a person who does not hold a certificate, license or permit under ORS 673.010 to 673.457 as long as the statement is not accompanied by any wording indicating the person is an accountant or auditor or any other language prohibited by ORS 673.310 or 673.320:

______________________________________________________________________________

The accompanying balance sheet (or _____) of XYZ Company as of (date), and the related statements of income (or retained earnings or cash flow) for the year then ended have been prepared by me (us).

The information presented in these financial statements is the representation of management (owners).

______________________________________________________________________________

(B) Any other financial statements or reports that are not and do not purport to be in compliance with national standards, including but not limited to Statements of Standards for Accounting and Review Services (SSARS) and Statements on Standards for Attestation Engagements (SSAE) adopted by the board by rule, when the statements or reports are issued by persons not otherwise subject to regulation by the board under ORS 673.010 to 673.457.

(17) “State” means any state, territory or insular possession of the United States, and the District of Columbia.

(18) “Substantial equivalency” means a determination by the [board or its designee] National Qualification Appraisal Service of the National Association of State Boards of Accountancy that:

(a) The education, examination and experience requirements contained in the statutes and administrative rules of another jurisdiction are equivalent to or exceed the education, examination and experience requirements [contained in ORS 673.040, 673.050 and 673.060 and rules of the board issued thereunder] of the Uniform Accountancy Act; or

(b) An individual’s education, examination and experience qualifications are equivalent to or exceed the education, examination and experience requirements [contained in ORS 673.040, 673.050 and 673.060 and rules of the board issued thereunder] of the Uniform Accountancy Act.

SECTION 1a. If Senate Bill 20 becomes law, section 1 of this 2001 Act (amending ORS 673.010) is repealed and ORS 673.010, as amended by section 1, chapter 313, Oregon Laws 2001 (Enrolled Senate Bill 20), is amended to read:

673.010. As used in ORS 673.010 to 673.457:

(1) “Attest,” “attesting” or “attestation” means the opinion of a licensee as to the reliability or fairness of information that is used for guidance in the financial transactions of, accounting for or assessing the status or performance of, commercial and noncommercial enterprises, whether public or private, following the completion of an audit, in accordance with generally accepted accounting and auditing standards. The board by rule shall further define what constitutes attestation services in conformance, to the extent possible, with professional standards, including but not limited to the Statements on Auditing Standards (SAS) for audits or other engagements, the Statement of Standards for Accounting and Review Services (SSARS) for the review of financial statements and the Statements on Standards for Attestation Engagements (SSAE) for examinations of prospective financial information.

(2) “Board” means the Oregon Board of Accountancy created by ORS 673.410.

(4) “Certificate” means a certificate of certified public accountant issued under ORS 673.040.

(5) “Client” means a person who agrees with a licensee to receive any professional service from the licensee.

(6) “Commission” means money or other consideration recognized as a commission under rules adopted by the board pursuant to section 4, chapter 313, Oregon Laws 2001 (Enrolled Senate Bill 20) [of this 2001 Act].

(7) “Compilation” means those services as defined by the board by rule.

[(7)] (8) “Contingent fee” means a fee established for the performance of any professional service and directly or indirectly paid to a licensee pursuant to an arrangement in which no fee will be charged unless a specified finding or result is attained, or in which the amount of the fee is otherwise dependent upon the finding or result of such service. The board by rule may further define “contingent fee.” A fee is not contingent if the fee:

(a) Is fixed by courts or other public authorities; or

(b) In tax matters, is determined based on the results of judicial proceedings or the findings of governmental agencies.

[(8)] (9) “License” means:

(a) A certificate, permit or registration, or a license issued under ORS 673.100, enabling the holder thereof to practice public accountancy in this state; or

(b) A certificate, permit, registration or other authorization issued by a jurisdiction outside this state enabling the holder thereof to practice public accountancy in that jurisdiction.

[(9)] (10) “Licensee” means the holder of a license under subsection [(8)(a)] (9)(a) of this section.

[(10)] (11) “Manager” means a manager of a limited liability company.

[(11)] (12) “Member” means a member of a limited liability company.

[(12)] (13) “Peer review” means a study, appraisal or review of one or more aspects of the public accountancy work of a holder of a permit under ORS 673.150 or of a registered business organization that performs attestation or compilation services. The peer review is conducted by a person or persons who are permitted under ORS 673.150 to practice public accountancy and who are independent of the permit holder or registered business organization being reviewed.

[(13)] (14) “Permit” means a permit to practice public accountancy issued under ORS 673.150.

[(14)] (15) “Professional” means arising out of or related to the specialized knowledge or skills associated with certified public accountants and public accountants.

[(15)] (16) “Public accountant” means a public accountant licensed under ORS 673.100.

[(16)] (17) “Referral fee” means a fee recognized as a referral fee under rules adopted by the board pursuant to section 4, chapter 313, Oregon Laws 2001 (Enrolled Senate Bill 20) [of this 2001 Act].

[(17)] (18) “Registration” means the authority issued under ORS 673.160 by the Oregon Board of Accountancy to a business organization to practice public accountancy in this state.

[(18)] (19) “Report,” when used with reference to attestation or compilation services, means an opinion or other form of written language that states or implies assurance as to the reliability of any financial statements and that also includes or is accompanied by any statement or implication that the person issuing the report has special knowledge or competence in public accountancy. Such a statement or implication of special knowledge or competence may arise from use by the issuer of the report of names or titles indicating that the issuer is a public accountancy professional or organization or may arise from the language of the report itself.

(a) “Report” includes any form of written language that:

(B) Implies any positive assurance as to the reliability of the financial statements referred to or special knowledge or competence on the part of the person issuing the language; or

(C) Relates to the financial affairs of a person and that is conventionally used by licensees in reports or financial statements.

(b) “Report” does not include:

______________________________________________________________________________

The accompanying balance sheet (or _____) of XYZ Company as of (date), and the related statements of income (or retained earnings or cash flow) for the year then ended have been prepared by me (us).

The information presented in these financial statements is the representation of management (owners).

______________________________________________________________________________

[(19)] (20) “State” means any state, territory or insular possession of the United States, and the District of Columbia.

[(20)] (21) “Substantial equivalency” means a determination by the [board or its designee] National Qualification Appraisal Service of the National Association of State Boards of Accountancy that:

SECTION 2. Section 3 of this 2001 Act is added to and made a part of ORS 673.010 to 673.457.

SECTION 3. (1) The Oregon Board of Accountancy may authorize a holder of a license with a principal place of business in another state to practice public accountancy in this state if the holder holds in good standing a valid certificate and license as a certified public accountant from:

(a) Another state that is verified to be of substantial equivalency, as defined in ORS 673.010 (18)(a).

(b) Another state that is not verified to be of substantial equivalency, as defined in ORS 673.010 (18)(a), but the holder’s skills are verified to be of substantial equivalency, as defined in ORS 673.010 (18)(b).

(2) A holder authorized under subsection (1) of this section shall be presumed to meet this state’s requirements to practice public accountancy and shall have all the rights and privileges of certificate holders and licensees of this state without the need to obtain a certificate under ORS 673.040 or a permit under ORS 673.150.

(3) A holder of a license from another state who is engaged in the practice of public accountancy under this section shall:

(a) Notify the board of the holder’s intent to practice public accountancy in this state on a form provided by the board;

(b) Pay an annual fee in an amount and by the date determined by the board by rule;

(c) Consent to the personal and subject matter jurisdiction of the board;

(d) Comply with the requirements of ORS 673.010 to 673.457 and any rules adopted thereunder; and

(e) Agree to the appointment of the other state’s licensing authority as the agent of the holder, upon whom process may be served in any action or proceeding by the board against the holder.

SECTION 3a. If Senate Bill 20 becomes law, section 3 of this 2001 Act is amended to read:

Sec. 3. (1) The Oregon Board of Accountancy may authorize a holder of a license with a principal place of business in another state to practice public accountancy in this state if the holder holds in good standing a valid certificate and license as a certified public accountant from:

(a) Another state that is verified to be of substantial equivalency, as defined in ORS 673.010 [(18)(a)] (21)(a).

(b) Another state that is not verified to be of substantial equivalency, as defined in ORS 673.010 [(18)(a)] (21)(a), but the holder’s skills are verified to be of substantial equivalency, as defined in ORS 673.010 [(18)(b)] (21)(b).

(3) A holder of a license from another state who is engaged in the practice of public accountancy under this section shall:

(a) Notify the board of the holder’s intent to practice public accountancy in this state on a form provided by the board;

(b) Pay an annual fee in an amount and by the date determined by the board by rule;

(d) Comply with the requirements of ORS 673.010 to 673.457 and any rules adopted thereunder; and

(e) Agree to the appointment of the other state’s licensing authority as the agent of the holder, upon whom process may be served in any action or proceeding by the board against the holder.

SECTION 4. ORS 673.040 is amended to read:

673.040. (1) A certificate of certified public accountant shall be granted to any applicant who meets the requirements of this section and ORS 673.050 and 673.060 and who passes an examination on the code of professional ethics adopted by the Oregon Board of Accountancy.

(2) An applicant for a certificate shall show that after meeting the eligibility requirements for the examination required by ORS 673.050, the applicant has had one year of experience, meeting requirements prescribed by the board by rule, under the direct supervision of a public accountant or of a certified public accountant who is licensed and in good standing in this state or another jurisdiction.

[(3) The board may issue a certificate to a holder in good standing of a license of certified public accountant issued by another state or by a foreign country upon a showing that the holder meets requirements that are substantially equivalent to the education, experience and other requirements that must be satisfied for the issuance of a certificate of certified public accountant under ORS 673.010 to 673.457.]

[(4)] (3) The board shall charge a fee for each application for issuance of a certificate under this section in an amount prescribed by the board by rule.

[(5)] (4) The board by rule shall prescribe:

(a) Information required of applicants regarding the practice of public accountancy outside this state; and

(b) Information required of licensees regarding changes in the ability or authority of the licensee to practice public accountancy.

[(6)] (5) Any certified public accountant may also be known as a “public accountant.”

SECTION 5. ORS 673.075 is amended to read:

673.075. (1) The Oregon Board of Accountancy may, in accordance with its rules, grant credit to an applicant who has successfully completed an examination given by the licensing authority in any other state. The board may grant credit under this subsection if the applicant has successfully completed an examination in any two or more subjects described in ORS 673.060 or required by the board to be part of the examination in this state.

(2) Any examination for which credit is granted an applicant under subsection (1) of this section shall be substantially equivalent[, in the judgment of the board, to the most recent examination given by the board at the time of the granting of the credit] to examination requirements described in ORS 673.060.

SECTION 6. ORS 673.150 is amended to read:

673.150. (1) [Permits] A permit to engage in the practice of public accountancy in this state shall be issued by the Oregon Board of Accountancy biennially to [applicants who are] an applicant who is:

(a) [Holders] A holder of the certificate of certified public accountant issued under ORS 673.040 to 673.075; or

[(b) Holders of a license as defined in ORS 673.010 (7)(b) issued by another jurisdiction, if the license requirements meet the education, examination and experience requirements established by the board by rule as substantially equivalent to the requirements for a certificate under ORS 673.040, 673.050, 673.060 and 673.075; or]

[(c)] (b) A public [accountants] accountant licensed under ORS 673.100.

(2) The board by rule shall cause all permits issued under this section to be renewed biennially.

(3) Applications for permits or for renewals of permits may be submitted to the board on a form prescribed by the board within such time periods as the board prescribes by rule. Applications for permits or for renewals of permits shall be accompanied by a fee determined by the board by rule.

(4) Applications for renewals of permits shall be accompanied by evidence satisfactory to the board that the applicant has complied with continuing education requirements under ORS 673.165 unless those requirements have been waived by the board.

(5) A permit that is not renewed by the close of the permit period may be restored upon payment to the board of a delinquent renewal fee in an amount determined by the board by rule. Any permit that is not renewed within 60 days after the close of the permit period for which it was issued or renewed shall lapse. The board may restore a lapsed permit upon payment to it of all past unpaid renewal fees and the delinquent renewal fee. However, the board may restore a permit issued or renewed for a permit period that ended more than five years prior to the date of the application for restoration only upon demonstration satisfactory to the board that the applicant is qualified to engage in the practice of public accountancy.

(6) Notwithstanding subsection (3) of this section, the board may by rule prescribe a reduced fee for renewal of permits of those certified public accountants and public accountants who have reached the age of 65 years.

SECTION 6a. If Senate Bill 20 becomes law, section 1a, chapter 313, Oregon Laws 2001 (Enrolled Senate Bill 20) (amending ORS 673.150), is repealed.

SECTION 7. ORS 673.160 is amended to read:

673.160. (1) Business organizations of certified public accountants or of public accountants shall register with the Oregon Board of Accountancy if the business organization:

(a) Uses the terms “certified public accountants” or “public accountants” or abbreviations for such terms in this state;

(b) Holds itself out to clients in this state or the public in this state as a business organization engaged in the practice of public accountancy; or

(2) Nothing in this section shall be construed to require a holder of a permit under ORS 673.150 to register under this section unless the permit holder:

(a) Holds the permit holder out to clients in this state or the public in this state as a business organization composed of more than one licensee; or

(b) Performs attestation or compilation services in this state.

(3) Registrations shall be issued and renewed for periods of not more than two years. Applications for registration shall be made in a form prescribed by the board by rule. Applications for renewal shall be made between the dates prescribed by the board by rule.

(4) The following requirements must be satisfied before a registration may be issued or renewed under this section:

(a) Notwithstanding any other provision of law, a simple majority of the ownership of the business organization, in terms of financial interests and voting rights of all partners, officers, shareholders, members or managers, shall belong to holders of permits or holders of certificates who are licensed in any state, and the partners, officers, shareholders, members or managers of the business organization whose principal place of business is in this state and who perform public accountancy services in this state, shall be holders of permits under ORS 673.150. If a majority of the ownership of the business organization is held by holders of permits who are public accountants holding licenses issued under ORS 673.100, the business organization may not use the name “CPA Firm” or any similar name indicating that a majority of the ownership of the firm holds certificates issued under ORS 673.040;

(b) In the case of a business organization that includes owners who are not holders of permits under ORS 673.150, a holder of a permit in this state shall be responsible for the management and proper registration of the business organization;

(c) All owners of the business organization who are not holders of permits under ORS 673.150 shall be active individual participants in the business organization or affiliated entities; and

(d) Any person who is responsible for supervising attestation or compilation services and who signs or authorizes someone to sign the accountant’s report on the financial statements on behalf of the business organization in this state, shall hold a permit under ORS 673.150 and meet the competency requirements established by the board by rule.

(5) An application for registration or renewal of registration under this section shall:

(a) List all states in which the business organization has applied for or holds permits to practice public accountancy; and

(b) Provide evidence that the requirements of subsection (4) of this section are satisfied.

(6) Each applicant for registration or renewal under this section and each registrant shall notify the board in writing, within the time period specified by the board by rule, of:

(a) The identities of partners, officers, shareholders, members, managers or owners of the business organization who work regularly in this state;

(b) The number or location of offices in this state;

(d) Any issuance, denial, revocation, lapse or suspension of authority to perform professional or other services in any jurisdiction against a partner, officer, shareholder, member, manager or owner of the applicant or registrant that seeks registration or is registered in this state; and

(e) The filing of a lawsuit relating to professional services of the business organization, the commencement of any civil action an essential element of which involves fraud, dishonesty or misrepresentation, or of any criminal action against the applicant or registrant that seeks registration or is registered in this state or against a partner, officer, shareholder, member, manager or owner of the applicant or registrant that seeks registration or is registered in this state.

(7) The board shall charge a fee for each application for issuance or renewal of registration under this section in an amount prescribed by the board by rule.

(8) Applicants for renewals of registrations under this section shall undergo a peer review as provided under ORS 673.455, unless the registrant notifies the board that the registrant is exempt from peer review requirements because the registrant does not perform attestation or compilation services in this state.

SECTION 8. ORS 673.170 is amended to read:

673.170. (1) The Oregon Board of Accountancy may take any of the following disciplinary actions:

(a) Revoke, suspend or refuse to issue any certificate issued under ORS 673.040 to 673.075.

(b) Revoke, suspend or refuse to issue any public accountant’s license issued under ORS 673.100.

(d) Revoke, suspend, refuse to renew or refuse to issue authorization to practice public accountancy in this state under section 3 of this 2001 Act.

[(d)] (e) Censure the holder of any permit described in ORS 673.150 or authorization described in section 3 of this 2001 Act.

[(e)] (f) Revoke, suspend, refuse to renew or refuse to issue any registration issued under ORS 673.160.

[(f)] (g) Censure the holder of any registration issued under ORS 673.160.

(2) The board may take any of the actions described in subsection (1) of this section for any one or any combination of the following causes:

(a) Fraud or deceit in obtaining or applying for:

(A) A certificate under ORS 673.040 to 673.075;

(B) A public accountant’s license under ORS 673.100;

(D) A permit under ORS 673.150; [or]

(E) Authorization to practice public accountancy in this state under the provisions of section 3 of this 2001 Act; or

[(E)] (F) Admission to the roster of authorized accountants referred to in ORS 297.670.

(b) Dishonesty, fraud or gross negligence in the practice of public accountancy.

(c) Incompetence in the practice of public accountancy. A holder of a license issued under ORS 673.100, certificate, permit or registration is incompetent in the practice of public accountancy if the holder:

(A) Engages or has engaged in conduct that evidences a lack of ability or fitness to discharge the duty owed to a client or the general public; or

(B) Engages or has engaged in conduct that evidences a lack of knowledge or ability to apply principles or skills of the practice of public accountancy, as adopted by the board.

(d) Violation of any of the provisions of ORS 673.010 to 673.457.

(e) Violation of any of the provisions of ORS 297.405 to 297.555.

(f) Violation of any provision of the Code of Professional Conduct adopted by the board under the authority granted by ORS 673.010 to 673.457, or rules adopted by the board under ORS 670.310.

(g) Conduct resulting in a conviction of a felony under the laws of any state, of any foreign jurisdiction or of the United States. However, such conduct may be considered only to the extent permissible under the provisions of ORS 670.280.

(h) Conviction of any crime, an essential element of which is dishonesty, fraud or misrepresentation, under the laws of any state, of any foreign jurisdiction or of the United States.

(i) Conviction of willful failure to pay any tax, file any tax return, keep records or supply information required under the tax laws of any state, of any foreign jurisdiction or of the United States, or conviction of the willful making, rendering, delivery, disclosure, signing or verifying of any false or fraudulent list, return, account, statement or other document, or of supplying any false or fraudulent information, required under the tax laws of any state, of any foreign jurisdiction or of the United States.

(j) Cancellation, revocation, suspension or refusal to renew, authority to practice as a certified public accountant or a public accountant in any state or foreign jurisdiction.

(k) Cancellation, suspension, revocation or refusal to renew by any state, any foreign jurisdiction or any federal agency of the right to practice law, to practice as an enrolled agent before the Internal Revenue Service pursuant to 31 C.F.R. part 10, or to practice under other regulatory law if the cancellation, suspension, revocation or refusal to renew was related to the practice of public accountancy or if dishonesty, fraud or deception was involved.

(L) Failure to comply with the continuing education requirements under ORS 673.165 unless such requirements have been waived by the board.

(m) Failure to pay a civil penalty imposed by the board after the period for requesting a hearing on the civil penalty terminates if the person or business organization against whom the penalty is imposed has not requested a hearing, or after the period for seeking judicial review of the order assessing the civil penalty has passed.

(n) Failure to comply with the terms of a consent agreement described in subsection (3) of this section.

(o) Failure to comply with any reporting or other requirement established by the board by rule.

(3) In lieu of disciplinary actions under subsection (1) of this section, the board may enter into a consent agreement with the holder of any certificate described in ORS 673.040 to 673.075, the holder of any public accountant’s license, the holder of any registration described in ORS 673.160, [or] the holder of any permit described in ORS 673.150[,] or the holder of any authorization described in section 3 of this 2001 Act, under which the holder [of any certificate, license, registration or permit] agrees to comply with conditions prescribed by the board.

(4) In addition to the causes in subsection (2) of this section, the board may take any of the actions described in subsection (1) of this section for dishonesty, fraud or misrepresentation not in the practice of public accountancy.

(5) In lieu of or in addition to any action described in subsection (1) of this section, the board may take any of the following actions:

(a) Require a holder of a permit under ORS 673.150 that provides compilation services or a business organization registered under ORS 673.160 to undergo a peer review conducted as the board may specify; or

(b) Require a holder of a permit under ORS 673.150 to complete any continuing professional education programs the board may specify.

(6) In the case of a registered business organization, the board may take any of the actions described in subsection (1) of this section for any of the following additional causes:

(a) The cancellation, revocation or suspension of, or refusal to renew, the authority to provide professional services, in this state or any other jurisdiction, of any partner, officer, shareholder, member, manager or owner of the business organization; or

(b) The cancellation, revocation or suspension of, or refusal to renew, the authority of the business organization to practice public accountancy or provide other professional services in any other state or foreign jurisdiction.

(7) Notwithstanding any protective order issued under ORCP 36 C, upon motion of the board, the court shall order disclosure of materials or information subject to a protective order under ORCP 36 C. The board may use the material or information to take disciplinary action under this section.

SECTION 9. ORS 673.185 is amended to read:

673.185. (1) [Where] When the Oregon Board of Accountancy proposes to refuse to issue a certificate under ORS 673.040, license under ORS 673.100, permit under ORS 673.150, [or] registration under ORS 673.160 or authorization under section 3 of this 2001 Act, proposes to refuse to renew a permit or registration or proposes to revoke or suspend a certificate, registration, license, [issued under ORS 673.100 or] permit or authorization, opportunity for hearing shall be accorded as provided in ORS 183.310 to 183.550 and chapter 734, Oregon Laws 1971.

(2) When the board institutes or continues a disciplinary action under ORS 673.170, the surrender, retirement or other forfeiture, expiration, lapse or revocation of a license issued by the board does not deprive the board of its authority to institute or continue the disciplinary action against the licensee.

[(2)] (3) Adoption of rules, conduct of hearings, issuance of orders and judicial review of rules and orders shall be in accordance with ORS 183.310 to 183.550 and chapter 734, Oregon Laws 1971.

[(3)] (4) The decision of the board under subsection (1) of this section shall be by majority vote.

SECTION 10. ORS 673.320 is amended to read:

673.320. (1) A person or business organization in this state shall not provide attestation or compilation services for or issue a report on financial statements of any other person, firm, organization or governmental unit unless the person or business organization holds a permit or registration issued under ORS 673.010 to 673.457. The prohibitions of this subsection do not apply to:

(a) An officer, partner, employee, shareholder, member, manager or owner of any firm or organization affixing that person’s own signature to any statement or report in reference to the financial affairs of the firm or organization with wording designating the position, title or office that the person holds in the firm or organization;

(b) Any act of a public official or employee in the performance of official duties; or

(c) The performance by any person, other than a licensee or registrant, of other services, including the preparation of tax returns, management advisory services and the preparation of financial statements, without the issuance of reports thereon.

(2) Any transmission of financial statements or information using language as specified in ORS 673.325 or as adopted by the Oregon Board of Accountancy by rule under this subsection shall not be considered a report.

(3) A person shall not assume or use the title or designation “certified public accountant,” or the abbreviation “CPA,” or any other title, designation, words, letters, abbreviation, sign, card or device tending to indicate that the person is a certified public accountant, unless the person holds a valid certificate of certified public accountant issued under ORS 673.040 and a permit issued pursuant to ORS 673.150.

(4) A business organization shall not assume or use the title or designation “certified public accountant,” or the abbreviation “CPA,” or any other title, designation, words, letters, abbreviation, sign, card or device tending to indicate that the business organization is composed of certified public accountants unless the business organization is registered under ORS 673.160.

(5) A person shall not assume or use the title or designation “public accountant,” or the abbreviation “PA,” or any other title, designation, words, letters, abbreviation, sign, card or device tending to indicate that the person is a public accountant unless that person holds a valid license issued under ORS 673.100 and permit issued under ORS 673.150.

(6) A business organization shall not assume or use the title or designation “public accountant,” or the abbreviation “PA,” or any other title, designation, words, letters, abbreviation, sign, card or device tending to indicate that the business organization is composed of public accountants, unless the business organization is registered under ORS 673.160.

(7) A person or business organization shall not assume or use any title or designation likely to be confused with the titles “certified public accountant” or “public accountant,” or any abbreviations likely to be confused with the abbreviations “CPA” or “PA,” unless the person or business organization holds a valid permit or registration issued under ORS 673.010 to 673.457. This subsection does not restrict the use of any title, designation or abbreviation awarded by institutions that are recognized by the board by rule.

(8) A person or business organization shall not assume or use any title or designation that includes the words “accountant,” “auditor” or “accounting” in connection with any other wording, including that of a report, that implies that the person or business organization holds a permit or registration or has special competence as an accountant or auditor, unless the person or business organization holds a permit or registration issued under ORS 673.010 to 673.457. This subsection does not prohibit:

(a) A partner, officer, employee, shareholder, member, manager or owner of any firm or organization from affixing that person’s own signature to any statement or report in reference to the financial affairs of the firm or organization with wording designating the position, title or office that the person holds in the firm or organization;

(b) Any act of a public official or employee in the performance of official duties; or

(c) Use of the words “accountant” or “accounting” by a person or business offering services that are not restricted to a person or business organization holding a license or permit to practice public accountancy.

(9) A person or business organization holding a permit or registration under ORS 673.010 to 673.457 shall not use a professional or business name or designation that is misleading about the legal form of the business organization, about the persons who are partners, officers, shareholders, members, managers or owners of the business organization or about any other matter. The board by rule may specify the appropriate use by licensees of abbreviations and initials in a professional or business name. Notwithstanding any provision of this subsection, the names of one or more former partners, shareholders, members or managers may be included in the name of a registered business organization or its successor.

(10) A person holding a permit issued under ORS 673.150 shall not perform attestation or compilation services in any business organization that does not hold a valid registration under ORS 673.160.

(11) Subsections (1) to (10) of this section apply to a person or business organization holding a certification, license, permit, designation or degree granted in another jurisdiction entitling the holder to engage in the practice of public accountancy or its equivalent in the other jurisdiction unless:

(a) The activities of the person or business organization in this state are limited to the provision of professional services to clients in this state, where the clients are residents of, governments of or business entities in the other jurisdiction in which the person holds the entitlement;

(b) The person or business organization does not provide attestation or compilation services or issue reports regarding the financial statements of any other persons, organizations or governmental units in this state; and

(c) The person or business organization does not hold out to clients, potential clients or the public in this state that the person or business organization is licensed or registered under ORS 673.010 to 673.457 and does not use any title or designation other than the one under which the person or business organization practices in the other jurisdiction, followed by the name of the other jurisdiction and, if applicable, any translation of the title or designation into the English language.

SECTION 11. ORS 673.325 is amended to read:

673.325. The following statement signed by a person who does not hold a permit issued under ORS 673.150 or the authorization granted under section 3 of this 2001 Act shall not constitute a report under ORS 673.320, so long as the statement is not accompanied by any wording indicating the person is an accountant or auditor or other language prohibited by ORS 673.310 or 673.320:

“The accompanying balance sheet of XYZ Company as of___________, 2__, and the related statements of income (or retained earnings or cash flow) for the year then ended have been prepared by me (us).

“The information presented in these financial statements is the representation of management (owners).”

SECTION 12. ORS 673.455 is amended to read:

673.455. (1) The Oregon Board of Accountancy shall appoint a Peer Review Oversight Committee. The board may also approve applications for operation of alternative peer review programs such as programs provided by the American Institute of Certified Public Accountants and the National Society of Accountants.

(2) Each holder of a permit under ORS 673.150 and each business organization registered under ORS 673.160 that performs attestation or compilation services shall participate in a peer review program described in this section. The peer review shall be conducted by the board or by an alternative peer review program approved by the board under subsection (1) of this section.

(3) The members of the committee serve at the pleasure of the board.

(4) A member of the committee appointed under this section is entitled to compensation and expenses as provided in ORS 292.495.

(5) The committee also may review:

(a) Any financial statement or report filed with the state or any political subdivision and prepared by a certified public accountant or public accountant; and

(b) Any procedure, working paper or supporting document relating to the financial statement or report.

(6) If the client grants permission or if all information identifying the client has been removed, the committee also may review any financial statement not described in subsection (5) of this section and prepared by a licensee, or any procedure, working paper or supporting document relating to the financial statement.

(7) The failure or refusal by any licensee to comply with a request for review or explanation, or both, of such financial statement as set forth in this section constitutes a violation of ORS 673.170 (2)(b).

SECTION 13. ORS 673.457 is amended to read:

673.457. A review of the accountancy practice of a holder of a permit under ORS 673.150 that provides compilation services or of a registered business organization by an alternative peer review program approved under ORS 673.455 shall not preclude the Oregon Board of Accountancy from conducting a review of specified aspects of the professional services of any licensee affiliated with the permit holder or business organization or of the permit holder or business organization itself.

SECTION 14. ORS 673.610 is amended to read:

673.610. ORS 673.605 to 673.740 do not apply to:

(1) Any full or part-time employee hired to fill a permanent position, who in connection with the duties as an employee has the incidental duty of preparing income tax returns for the business of the employer only.

(2) Any attorney at law rendering services in the performance of the duties of an attorney at law.

(3) While acting as such, any fiduciary, or the regular employees thereof, acting on behalf of the fiduciary estate, the testator, trustor, grantor, or beneficiaries thereof.

(4) Any certified public accountant or public accountant holding a valid permit, or a registered business organization, under ORS 673.010 to 673.457.

(5) Any employee of a certified public accountant, public accountant or registered business organization described in subsection (4) of this section.

[(5)] (6) Any person employed by a local, state or federal governmental agency but only in performance of official duties.

Approved by the Governor June 27, 2001

Filed in the office of Secretary of State June 27, 2001

Effective date January 1, 2002

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