Oregon Administrative Rules
Chapter 801 - OREGON BOARD OF ACCOUNTANCY
Division 30 - CODE OF PROFESSIONAL CONDUCT
Section 801-030-0005 - Professional Conduct
Universal Citation: OR Admin Rules 801-030-0005
Current through Register Vol. 63, No. 9, September 1, 2024
(1) Independence. The Board adopts the Independence Rule established by the AICPA. The AICPA Interpretations and Ethics Rulings on Independence are adopted as non-exclusive guidance to licensees, prospective licensees, the Board and members of the public. Licensees who perform services that are subject to independence standards promulgated by other regulatory or professional standard setting bodies, agencies and organizations, including but not limited to the Securities and Exchange Commission, the General Accounting Office and the US Department of Labor, or other similarly recognized international bodies must also comply with those standards applicable to the services provided.
(2) Integrity and objectivity.
(a) In
all aspects of public accounting and the practice of public accountancy, a
licensee shall maintain objectivity and integrity, shall be free of conflicts
of interest, and shall not knowingly misrepresent facts or subordinate the
licensee's judgment to the judgment of others.
(b) In tax practice, however, a licensee may
resolve doubt in favor of the client as long as there is reasonable support for
the client's position.
(c) When
accepting new employment or a new engagement, a licensee shall not use
confidential client information in a manner that is adverse to a former client.
Confidential client information is any information communicated to or obtained
by the licensee from a client or employer that relates to services rendered by
the licensee to the client or employer.
(d) The Board adopts the Integrity and
Objectivity Rules established by the AICPA. The AICPA Interpretations and
definitions are adopted as a non-exclusive list to provide guidance to
licensees, prospective licensees, the Board, and members of the
public.
(e) When a licensee
represents two clients at the same time and becomes reasonably aware of divorce
proceedings, the licensee must obtain a signed conflict of interest waiver from
both clients.
(3) Commissions and referral fees. Certified public accountants, public accountants and firms in the practice of public accountancy are permitted to pay and receive commissions and referral fees subject to the requirements of ORS 673.345 and this rule.
(a)
Notice to the Board.
Licensees and Firms who receive or pay commissions or referral fees shall
report this fact on the application for biennial renewal of the
license/registration.
(b)
Related licensure/registration. Prior to accepting commissions,
licensees shall acquire and maintain in good standing any license or
registration required by another governmental or private standard-setting body
for the purpose of receiving commissions. Examples of licensing requirements
include, but are not limited to, the following:
(A) Oregon Department of Consumer and
Business Services;
(B) National
Association of Securities Dealers;
(C) Oregon Real Estate Agency; and
(D) Oregon Appraiser Certification and
Licensure Board.
(c)
Prohibited commissions and referral fees. A certified public
accountant, public accountant or firm engaged in the practice of public
accountancy shall not recommend or refer to a client any product or service, or
recommend or refer any product or service to be supplied by a third party to a
client, in exchange for the payment, acceptance of a commission or referral fee
when the licensee or firm also performs any of the following listed services
for that client:
(A) An attestation
engagement as defined in OAR
801-005-0010(4);
or
(B) A compilation of a financial
statement if the compilation report does not disclose a lack of independence
between the client and the certified public accountant.
(d)
Application of prohibitions.
The prohibitions in this rule apply:
(A) When
the holder of a permit or any partner, officer, shareholder, member, manager or
owner of the firm performs the services listed in this rule, and
(B) During the period in which the certified
public accountant, public accountant or firm is engaged to perform any of the
services listed in this rule, including the period(s) subject of the report and
the period covered by any historical financial statements involved in the
listed services.
(e)
Disclosure requirements. A certified public accountant, public
accountant or firm engaged in the practice of public accountancy who is not
prohibited by this rule from paying or receiving a commission or referral fee
and who is paid or expects to be paid a commission or referral fee, shall
disclose that fact to any client to whom the commission or referral fee
relates.
(A) A copy of each disclosure shall
be provided to the client prior to the time the product or service that is the
basis of the fee is recommended, referred or sold, or prior to the time the
client retains the licensee to whom the client has been referred and for which
the fee or other valuable consideration will be paid.
(B) A copy of the disclosure shall be
retained by the certified public accountant, public accountant or firm for a
period of at least six years after the licensee performs any services for the
client.
(C) In the event of
continuing engagements or a series of related transactions involving similar
products or services with the same client, one written disclosure may cover
more than one recommendation, referral or sale so long as the disclosure is
provided at least annually and is not misleading.
(D) Disclosures under this rule shall:
(i) Be in clear and legible writing, in no
less than 12 point font (if typed) and provided on a separate form that is
acknowledged in writing by the client with the client's signature and date of
acknowledgement;
(ii) State the
amount of the commission or referral fee or the basis on which the payment will
be calculated;
(iii) Identify the
source of the payment and the relationship between the source of the payment
and the person receiving the payment; and
(iv) Specify the services to be performed by
the Licensee for the compensation to be received by the licensee.
(f)
Transactions
not prohibited. This rule does not prohibit the following transactions:
(A) Payments for the purchase of all or a
material part of an accounting practice;
(B) Retirement payments to persons formerly
engaged in the practice of public accountancy or payments to the heirs or
estates of such persons; or
(C)
Payments, including incentive or bonus payments, to employees or members of an
accounting firm as compensation for their services.
(g)
Audit of disclosure
requirements. Licensees are subject to audits conducted by the Board or
its designee to determine licensee compliance with the provisions of this rule.
Licensees shall, upon request, furnish to the Board copies of disclosure
records required under this rule.
(4) Contingent fees. Certified public accountants, public accountants, and firms in the practice of public accountancy may perform professional services for a client in exchange for a contingent fee subject to the requirements of ORS 673.345 and this rule.
(a)
Notice to the Board.
Licensees and firms who receive contingent fees in exchange for professional
services shall report this fact on the application for biennial renewal of the
license/registration.
(b)
Prohibited contingent fees.
(A) A
certified public accountant, public accountant, or firm in the practice of
public accountancy may not perform professional services for a client in
exchange for a contingent fee when the certified public accountant, public
accountant or firm also performs any of the following listed services for that
client:
(i) An attestation engagement as
defined in OAR 801-005-0010(4);
or
(ii) A compilation of a
financial statement if the compilation report does not disclose a lack of
independence between the client and the licensee.
(B) A certified public accountant, public
accountant, or firm in the practice of public accountancy may not prepare an
original or amended tax return or a claim for a tax refund for any client in
exchange for a contingent fee.
(c)
Application of prohibitions.
The prohibitions stated in paragraph (4)(b)(A) of this rule apply during the
period in which the licensee or the licensee's firm is engaged to perform any
of the services listed in this rule and during any period covered by any
historical or prospective financial statements involved with or related to such
services.
(d)
Requirement for
written agreement. Every agreement to perform services in exchange for a
contingent fee shall be in writing and shall be signed by the client.
(A) A copy of the agreement shall be provided
to the client prior to the time the client retains the licensee for the service
or prior to the time that the service that is subject to the agreement is
performed.
(B) Agreements under
this rule shall:
(i) Be in clear and legible
writing in no less than 12 point font (if typed);
(ii) Include the signatures of all parties
and date of each signature; and
(iii) State the amount of the contingent fee
or the basis on which the fee will be calculated.
(C) A copy of the agreement shall be retained
by the certified public accountant, public accountant, or firm for a period of
at least six years after the licensee performs the disclosed services for the
client.
(e)
Contingent fee transactions not prohibited. Fees are not
contingent if fixed by courts or other public authorities, or in tax matters if
such fees are determined based on the results of judicial proceedings or the
findings of governmental agencies.
(f)
Audit of contingent fee
agreements. Licensees are subject to audits conducted by the Board or
its designee to determine licensee compliance with the provisions of this rule.
Licensees shall, upon request, furnish to the Board copies of contingent fee
agreements required under this rule.
(5) Improper use of CPA and PA designation.
(a)
Non-public
accounting business. Licensees engaged in a business or occupation other
than the practice of public accountancy or performance of attestation services
may use the "CPA" or "PA" designation in oral or other communications such as
business cards, stationery or comparable forms if the use of the designation
does not indicate in any way that the licensee is authorized to perform public
accountancy or attestation services as part of the licensee's other business or
occupation.
(b)
Commissions
or contingent fees. Licensees shall not engage in any activity for which
the licensee receives commissions or contingent fees while holding out to the
public as a CPA or PA, except as provided under sections (3) and (4) of this
rule.
(c)
Non-licensee
owners.
(A) A non-licensee owner of a
business organization registered in Oregon under the provisions of ORS
673.160(4)
shall not use any name or title that indicates or suggests that such owner is a
certified public accountant or public accountant. This does not preclude a
non-licensee owner from using the title "principal," "partner," "officer,"
"member" or "shareholder" to describe the ownership interest in the business
organization.
(B) A business
organization that includes non-licensee owners shall not use a firm name that
includes both the name of a non-licensee owner and the title or designation for
"certified public accountant", "public accountant", or any other words or
description that would imply that the non-licensee owner included in the firm
name is authorized to provide public accounting services.
Statutory/Other Authority: ORS 670.310, 673.410 & OL 2001 & Ch. 313
Statutes/Other Implemented: ORS 673.160, 673.320 & 673.345
Disclaimer: These regulations may not be the most recent version. Oregon may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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