Senate Bill 5519 — State of Washington, 67th Legislature, 2022 Regular Session

Summary

Senate Bill 5519, State of Washington, 67th Legislature, 2022 Regular Session, prefiled 12/08/21, read first time 01/10/22 and referred to the Committee on Business, Financial Services & Trade. The bill is an act relating to replacing an inactive certificate status with an inactive license designation, and it amends RCW 18.04.015 and other listed sections. It states that it provides an effective date and an expiration date. The text amends the policy statement for certified public accountants and, in a later section, RCW 18.04.430 on suspending the license of a person certified as not in compliance with a support order.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

     S-3162.1

                                 SENATE BILL 5519


     State of Washington         67th Legislature        2022 Regular Session

     By Senators Dozier, Mullet, Brown, Gildon, Rivers, J. Wilson, and L.
     Wilson

     Prefiled 12/08/21. Read first time 01/10/22.      Referred to Committee
     on Business, Financial Services & Trade.




1        AN ACT Relating to replacing an inactive certificate status with
2    an inactive license designation; amending RCW 18.04.015, 18.04.025,
3    18.04.055, 18.04.065, 18.04.105, 18.04.180, 18.04.195, 18.04.195,
4    18.04.215, 18.04.215, 18.04.295, 18.04.320, 18.04.335, 18.04.345,
5    18.04.345, 18.04.350, 18.04.350, 18.04.370, 18.04.405, and 18.04.430;
6    providing an effective date; and providing an expiration date.


 7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:


 8       Sec. 1.    RCW 18.04.015 and 2001 c 294 s 1 are each amended to
 9   read as follows:
10       (1) It is the policy of this state and the purpose of this
11   chapter:
12       (a) To promote the dependability of information which is used for
13   guidance in financial transactions or for accounting for or assessing
14   the   status    or   performance    of   commercial   and   noncommercial
15   enterprises, whether public, private or governmental; and
16       (b) To protect the public interest by requiring that:
17       (i) Persons who hold themselves out as licensees ((or certificate
18   holders))    conduct    themselves   in   a   competent,   ethical,   and
19   professional manner;
20       (ii) A public authority be established that is competent to
21   prescribe   and    assess   the   qualifications   of  certified   public
                                       p. 1                           SB 5519
 1   accountants((, including certificate holders who are not licensed for
 2   the practice of public accounting));
 3       (iii) Persons other than licensees refrain from using the words
 4   "audit," "review," and "compilation" when designating a report
 5   customarily prepared by someone knowledgeable in accounting;
 6       (iv) A public authority be established to provide for consumer
 7   alerts and public protection information to be published regarding
 8   persons or firms who violate the provisions of chapter 294, Laws of
 9   2001 or board rule and to provide general consumer protection
10   information to the public; and
11       (v) The use of accounting titles likely to confuse the public be
12   prohibited. However as of June 30, 2024, an individual holding a CPA-
13   inactive certificate must be designated as a licensee with an
14   inactive status.
15       (2) The purpose of chapter 294, Laws of 2001 is to make revisions
16   to chapter 234, Laws of 1983 and chapter 103, Laws of 1992 to:
17   Fortify the public protection provisions of chapter 294, Laws of
18   2001; establish one set of qualifications to be a licensee; revise
19   the regulations of certified public accountants; make revisions in
20   the ownership of certified public accounting firms; assure to the
21   greatest extent possible that certified public accountants from
22   Washington state are substantially equivalent with certified public
23   accountants in other states and can therefore perform the duties of
24   certified public accountants in as many states and countries as
25   possible; assure certified public accountants from other states and
26   countries have met qualifications that are substantially equivalent
27   to the certified public accountant qualifications of this state; and
28   clarify the authority of the board of accountancy with respect to the
29   activities of persons holding licenses and certificates under this
30   chapter. It is not the intent of chapter 294, Laws of 2001 to in any
31   way restrict or limit the activities of persons not holding licenses
32   or certificates under this chapter except as otherwise specifically
33   restricted or limited by chapter 234, Laws of 1983 and chapter 103,
34   Laws of 1992.
35       (3) A purpose of chapter 103, Laws of 1992, revising provisions
36   of chapter 234, Laws of 1983, is to clarify the authority of the
37   board of accountancy with respect to the activities of persons
38   holding certificates under this chapter. Furthermore, it is not the
39   intent of chapter 103, Laws of 1992 to in any way restrict or limit
40   the activities of persons not holding certificates under this chapter
                                     p. 2                          SB 5519
1    except as otherwise specifically restricted or limited by chapter
2    234, Laws of 1983.


 3       Sec. 2.   RCW 18.04.025 and 2016 c 127 s 1 are each amended to
 4   read as follows:
 5       Unless the context clearly requires otherwise, the definitions in
 6   this section apply throughout this chapter.
 7       (1) "Attest" means providing the following services:
 8       (a) Any audit or other engagement to be performed in accordance
 9   with the statements on auditing standards;
10       (b) Any review of a financial statement to be provided in
11   accordance with the statements on standards for accounting and review
12   services;
13       (c) Any engagement to be performed in accordance with the
14   statements on standards for attestation engagements; and
15       (d) Any engagement to be performed in accordance with the public
16   company accounting oversight board auditing standards.
17       (2) "Board" means the board of accountancy created by RCW
18   18.04.035.
19       (3) "Certificate" means ((a certificate as a certified public
20   accountant issued prior to July 1, 2001, as authorized under the
21   provisions of this chapter.
22       (4) "Certificate holder" means the holder of a certificate as a
23   certified public accountant who has not become a licensee, has
24   maintained CPE requirements, and who does not practice public
25   accounting.
26       (5))) an alternative license type issued by the board indicating
27   that the certificate holder had passed the CPA examination, but has
28   not verified the certificate holder's experience and was not fully
29   licensed as a certified public accountant to practice public
30   accounting. The board must allow renewal of certificates until June
31   30, 2024, at which time any then current and valid certificates
32   automatically convert to a CPA license in an inactive status. As of
33   July 1, 2024, board-issued certificates are no longer a recognized
34   form of licensure.
35       (4) "Certified public accountant" or "CPA" means a person holding
36   a certified public accountant license or certificate.
37       (((6))) (5) "Compilation" means providing a service to be
38   performed in accordance with statements on standards for accounting
39   and review services that is presenting in the form of financial
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 1   statements, information that is the representation of management
 2   (owners) without undertaking to express any assurance on the
 3   statements.
 4       (((7))) (6) "CPE" means continuing professional education.
 5       (((8))) (7) "Firm" means a sole proprietorship, a corporation, or
 6   a partnership. "Firm" also means a limited liability company formed
 7   under chapter 25.15 RCW.
 8       (((9))) (8) "Holding out" means any representation to the public
 9   by the use of restricted titles as set forth in RCW 18.04.345 by a
10   person or firm that the person or firm holds a license under this
11   chapter and that the person or firm offers to perform any
12   professional services to the public as a licensee. "Holding out"
13   shall not affect or limit a person or firm not required to hold a
14   license under this chapter from engaging in practices identified in
15   RCW 18.04.350.
16       (((10))) (9) "Inactive" means the ((certificate is in an inactive
17   status because a person who held a valid certificate before July 1,
18   2001, has not met the current requirements of licensure and has been
19   granted inactive certificate holder)) status of a license that is
20   prohibited from practicing public accounting. A person holding an
21   inactive license may apply to the board to return the license to an
22   active status through an approval process established by the board.
23       (((11))) (10) "Individual" means a living, human being.
24       (((12))) (11) "License" means a license to practice public
25   accountancy issued to an individual under this chapter, or a license
26   issued to a firm under this chapter.
27       (((13))) (12) "Licensee" means the holder of a license to
28   practice public accountancy issued under this chapter.
29       (((14))) (13) "Manager" means a manager of a limited liability
30   company licensed as a firm under this chapter.
31       (((15))) (14) "NASBA" means the national association of state
32   boards of accountancy.
33       (((16))) (15) "Peer review" means a study, appraisal, or review
34   of one or more aspects of the attest or compilation work of a
35   licensee or licensed firm in the practice of public accountancy, by a
36   person or persons who hold licenses and who are not affiliated with
37   the person or firm being reviewed, including a peer review, or any
38   internal review or inspection intended to comply with quality control
39   policies and procedures, but not including ((the "quality assurance


                                     p. 4                          SB 5519
 1   review" under subsection (20) of this section)) a quality assurance
 2   review.
 3       (((17))) (16) "Person" means any individual, nongovernmental
 4   organization, or business entity regardless of legal form, including
 5   a sole proprietorship, firm, partnership, corporation, limited
 6   liability company, association, or not-for-profit organization, and
 7   including the sole proprietor, partners, members, and, as applied to
 8   corporations, the officers.
 9       (((18))) (17) "Practice of public accounting" means performing or
10   offering to perform by a person or firm holding itself out to the
11   public as a licensee, for a client or potential client, one or more
12   kinds of services involving the use of accounting or auditing skills,
13   including the issuance of "reports," or one or more kinds of
14   management advisory, or consulting services, or the preparation of
15   tax returns, or the furnishing of advice on tax matters. "Practice of
16   public accounting" shall not include practices that are permitted
17   under the provisions of RCW 18.04.350(10) by persons or firms not
18   required to be licensed under this chapter.
19       (((19))) (18) "Principal place of business" means the office
20   location designated by the licensee for purposes of substantial
21   equivalency and reciprocity.
22       (((20))) (19) "Quality assurance review" means a process
23   established by and conducted at the direction of the board of study,
24   appraisal, or review of one or more aspects of the attest or
25   compilation work of a licensee or licensed firm in the practice of
26   public accountancy, by a person or persons who hold licenses and who
27   are not affiliated with the person or firm being reviewed.
28       (((21))) (20) "Report," when used with reference to any attest or
29   compilation service, means an opinion, report, or other form of
30   language that states or implies assurance as to the reliability of
31   the attested information or compiled financial statements and that
32   also includes or is accompanied by any statement or implication that
33   the person or firm issuing it has special knowledge or competence in
34   the practice of public accounting. Such a statement or implication of
35   special knowledge or competence may arise from use by the issuer of
36   the report of names or titles indicating that the person or firm is
37   involved in the practice of public accounting, or from the language
38   of the report itself. "Report" includes any form of language which
39   disclaims an opinion when such form of language is conventionally
40   understood to imply any positive assurance as to the reliability of
                                     p. 5                          SB 5519
 1   the attested information or compiled financial statements referred to
 2   and/or special competence on the part of the person or firm issuing
 3   such language; and it includes any other form of language that is
 4   conventionally understood to imply such assurance and/or such special
 5   knowledge   or   competence.  "Report"   does  not   include  services
 6   referenced in RCW 18.04.350 (10) or (11) provided by persons not
 7   holding   a   license   under  this   chapter  as   provided  in   RCW
 8   18.04.350(14).
 9       (((22))) (21) "Review committee" means any person carrying out,
10   administering or overseeing a peer review authorized by the reviewee.
11       (((23))) (22) "Rule" means any rule adopted by the board under
12   authority of this chapter.
13       (((24))) (23) "Sole proprietorship" means a legal form of
14   organization owned by one person meeting the requirements of RCW
15   18.04.195.
16       (((25))) (24) "State" includes the states of the United States,
17   the District of Columbia, Puerto Rico, Guam, the United States Virgin
18   Islands, and the Commonwealth of the Northern Mariana Islands at such
19   time as the board determines that the Commonwealth of the Northern
20   Mariana   Islands  is   issuing  licenses   under  the  substantially
21   equivalent standards in RCW 18.04.350(2)(a).
22       (25) "Substantial equivalency" or "substantially equivalent"
23   means a determination by the board or its designee that the
24   education, examination, and experience requirements contained in the
25   statutes and administrative rules of another jurisdiction are
26   comparable to or exceed the education, examination, and experience
27   requirements contained in this chapter or that an individual CPA's
28   education, examination, and experience qualifications are comparable
29   to or exceed the education, examination, and experience requirements
30   contained in this chapter. In ascertaining substantial equivalency
31   and substantially equivalent as used in this chapter the board shall
32   take into account the qualifications without regard to the sequence
33   in which experience, education, or examination requirements were
34   attained.


35       Sec. 3. RCW 18.04.055 and 2019 c 71 s 1 are each amended to read
36   as follows:
37       The board may adopt and amend rules under chapter 34.05 RCW for
38   the orderly conduct of its affairs. The board shall prescribe rules


                                     p. 6                          SB 5519
 1   consistent with this chapter as necessary to implement this chapter.
 2   Included may be:
 3       (1) Rules of procedure to govern the conduct of matters before
 4   the board;
 5       (2)   Rules   of   professional  conduct   for   all   licensees((,
 6   certificate holders,)) and nonlicensee owners of licensed firms, in
 7   order to establish and maintain high standards of competence and
 8   ethics   including   rules   dealing  with   independence,   integrity,
 9   objectivity, and freedom from conflicts of interest;
10       (3) Rules specifying actions and circumstances deemed to
11   constitute holding oneself out as a licensee in connection with the
12   practice of public accountancy;
13       (4) Rules specifying the manner and circumstances of the use of
14   the titles "certified public ((accountant" and "CPA," by holders of
15   certificates who do not also hold licenses)) accountant," "CPA,"
16   "CPA-inactive," and "CPA-retired" by holders of a license under this
17   chapter;
18       (5) Rules specifying the educational requirements to take the
19   certified public accountant examination;
20       (6) Rules designed to ensure that licensees' "reports" meet the
21   definitional requirements for that term as specified in RCW
22   18.04.025;
23       (7) Requirements for CPE to maintain or improve the professional
24   competence of licensees as a condition to maintaining their license
25   ((and certificate holders as a condition to maintaining their
26   certificate under RCW 18.04.215));
27       (8) Rules governing firms issuing or offering to issue attest or
28   compilation reports or providing public accounting services as
29   defined in RCW 18.04.025 using the title "certified public
30   accountant" or "CPA" including, but not limited to, rules concerning
31   their   style,  name,   title,   and   affiliation   with any   other
32   organization, and establishing reasonable practice and ethical
33   standards to protect the public interest;
34       (9) The board may by rule implement a quality assurance review
35   program as a means to monitor licensees' quality of practice and
36   compliance with professional standards. The board may exempt from
37   such program, licensees who undergo periodic peer reviews in programs
38   of the American Institute of Certified Public Accountants, NASBA, or
39   other programs recognized and approved by the board;


                                      p. 7                          SB 5519
 1       (10) The board may by rule require licensed firms to obtain
 2   professional liability insurance if in the board's discretion such
 3   insurance provides additional and necessary protection for the
 4   public;
 5       (11) Rules specifying the experience requirements in order to
 6   qualify for a license;
 7       (12) ((Rules specifying the requirements for certificate holders
 8   to qualify for a license under this chapter which must include
 9   provisions for meeting CPE and experience requirements prior to
10   application for licensure;
11       (13))) Rules specifying the registration requirements, including
12   ethics examination and fee requirements, for resident nonlicensee
13   partners, shareholders, and managers of licensed firms;
14       (((14))) (13) Rules specifying the ethics CPE requirements for
15   ((certificate holders)) an individual with an inactive license and
16   owners of licensed firms, including the process for reporting
17   compliance with those requirements;
18       (((15)))   (14)   Rules   specifying  the   experience  and CPE
19   requirements for licensees offering or issuing reports; and
20       (((16))) (15) Any other rule which the board finds necessary or
21   appropriate to implement this chapter.


22       Sec. 4.   RCW 18.04.065 and 2015 c 215 s 6 are each amended to
23   read as follows:
24       The board shall set its fees at a level adequate to pay the costs
25   of administering this chapter. All fees for licenses, registrations
26   of nonlicensee partners, shareholders, and managers of licensed
27   firms, renewals of licenses, renewals of registrations of nonlicensee
28   partners, shareholders, and managers of licensed firms, ((renewals of
29   certificates,)) reinstatements of lapsed licenses, ((reinstatements
30   of lapsed certificates,)) reinstatements of lapsed registrations of
31   nonlicensee partners, shareholders, and managers of licensed firms,
32   practice privileges under RCW 18.04.350, and delinquent filings
33   received under the authority of this chapter shall be deposited in
34   the certified public accountants' account created by RCW 18.04.105.
35   Appropriation from such account shall be made only for the cost of
36   administering the provisions of this chapter or for the purpose of
37   administering the certified public accounting scholarship program
38   created in chapter 28B.123 RCW.


                                     p. 8                          SB 5519
 1       Sec. 5.   RCW 18.04.105 and 2016 c 127 s 3 are each amended to
 2   read as follows:
 3       (1) A license to practice public accounting shall be granted by
 4   the board to any person:
 5       (a) Who is of good character. Good character, for purposes of
 6   this section, means lack of a history of dishonest or felonious acts.
 7   The board may refuse to grant a license on the ground of failure to
 8   satisfy this requirement only if there is a substantial connection
 9   between the lack of good character of the applicant and the
10   professional and ethical responsibilities of a licensee and if the
11   finding by the board of lack of good character is supported by a
12   preponderance of evidence. When an applicant is found to be
13   unqualified for a license because of a lack of good character, the
14   board shall furnish the applicant a statement containing the findings
15   of the board and a notice of the applicant's right of appeal;
16       (b) Who has met the educational standards established by rule as
17   the board determines to be appropriate;
18       (c) Who has passed an examination;
19       (d) Who has had one year of experience which is gained:
20       (i) Through the use of accounting, issuing reports, management
21   advisory, financial advisory, tax, tax advisory, or consulting
22   skills;
23       (ii) While employed in government, industry, academia, or public
24   practice; and
25       (iii) Meeting the competency requirements in a manner as
26   determined by the board to be appropriate and established by board
27   rule; and
28       (e) Who has paid appropriate fees as established by rule by the
29   board.
30       (2) The examination described in subsection (1)(c) of this
31   section shall test the applicant's knowledge of the subjects of
32   accounting and auditing, and other related fields the board may
33   specify by rule. The time for holding the examination is fixed by the
34   board and may be changed from time to time. The board shall prescribe
35   by rule the methods of applying for and taking the examination,
36   including methods for grading examinations and determining a passing
37   grade required of an applicant for a license. The board shall to the
38   extent possible see to it that the grading of the examination, and
39   the passing grades, are uniform with those applicable to all other
40   states. The board may make use of all or a part of the uniform
                                     p. 9                          SB 5519
 1   certified public accountant examination and advisory grading service
 2   of the American Institute of Certified Public Accountants and may
 3   contract with third parties to perform administrative services with
 4   respect to the examination as the board deems appropriate to assist
 5   it in performing its duties under this chapter. The board shall
 6   establish by rule provisions for transitioning to a new examination
 7   structure or to a new media for administering the examination.
 8       (3) The board shall charge each applicant an examination fee for
 9   the initial examination or for reexamination. The applicable fee
10   shall be paid by the person at the time he or she applies for
11   examination,    reexamination,    or   evaluation    of    educational
12   qualifications. Fees for examination, reexamination, or evaluation of
13   educational qualifications shall be determined by the board under
14   this chapter ((18.04 RCW)). There is established in the state
15   treasury an account to be known as the certified public accountants'
16   account. All fees received from candidates to take any or all
17   sections of the certified public accountant examination shall be used
18   only for costs related to the examination.
19       (4) ((Persons who on June 30, 2001, held valid certificates
20   previously issued under this chapter shall be deemed to be
21   certificate holders, subject to the following:
22       (a) Certificate holders may, prior to June 30, 2006, petition the
23   board to become licensees by documenting to the board)) Individuals
24   whose certificates are current and valid on June 30, 2024, will
25   automatically be converted to a licensee in an inactive status. To
26   activate a license and become an active licensee, the individual must
27   apply to the board to activate his or her license and must meet the
28   following requirements:
29       (a) For applications to activate, the licensees must submit to
30   the board documentation that they have gained one year of experience
31   through the use of accounting, issuing reports, management advisory,
32   financial advisory, tax, tax advisory, or consulting skills, without
33   regard to the eight-year limitation set forth in (b) of this
34   subsection, while employed in government, industry, academia, or
35   public practice.
36       (b) ((Certificate holders who do not petition to become licensees
37   prior to June 30, 2006, may after that date petition the board to
38   become licensees by documenting)) For applications submitted to the
39   board   before   January  1,  2024,   the   individual  must  provide
40   documentation to the board that they have one year of experience
                                     p. 10                         SB 5519
 1   acquired within eight years prior to applying for a license through
 2   the use of accounting, issuing reports, management advisory,
 3   financial advisory, tax, tax advisory, or consulting skills in
 4   government, industry, academia, or public practice.
 5       (c) ((Certificate holders who petition the board pursuant to (a)
 6   or (b) of this subsection must also meet)) Meet competency
 7   requirements in a manner as determined by the board to be appropriate
 8   and established by board rule.
 9       (d) ((Any certificate holder petitioning the board pursuant to
10   (a) or (b) of this subsection to become a licensee must submit))
11   Submit to the board satisfactory proof of having completed an
12   accumulation of one hundred twenty hours of CPE during the thirty-six
13   months preceding the date of filing the petition.
14       (e) ((Any certificate holder petitioning the board pursuant to
15   (a) or (b) of this subsection to become a licensee must pay)) Pay the
16   appropriate fees established by rule by the board.
17       (5) ((Certificate holders shall comply with the prohibition
18   against the practice of public accounting in RCW 18.04.345.
19       (6) Persons who on June 30, 2001, held valid certificates
20   previously issued under this chapter are deemed to hold inactive
21   certificates, subject to renewal as inactive certificates, until they
22   have petitioned the board to become licensees and have met the
23   requirements of subsection (4) of this section. No individual who did
24   not hold a valid certificate before July 1, 2001, is eligible to
25   obtain an inactive certificate.
26       (7) Persons deemed to hold inactive certificates under subsection
27   (6) of this section shall comply with the prohibition against the
28   practice of public accounting in subsection (8)(b) of this section
29   and RCW 18.04.345, but are not required to display the term inactive
30   as part of their title, as required by subsection (8)(a) of this
31   section until renewal. Certificates renewed to any persons after June
32   30, 2001, are inactive certificates and the inactive certificate
33   holders are subject to the requirements of subsection (8) of this
34   section.
35       (8) Persons holding an inactive certificate:
36       (a) Must use or attach the term "inactive" whenever using the
37   title CPA or certified public accountant or referring to the
38   certificate, and print the word "inactive" immediately following the
39   title, whenever the title is printed on a business card, letterhead,
40   or any other document, including documents published or transmitted
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 1   through electronic media, in the same font and font size as the
 2   title; and
 3       (b)   Are   prohibited    from    practicing public   accounting))
 4   Individuals who did not hold a valid certificate on the conversion
 5   date of June 30, 2024, and who wish to apply for a license must apply
 6   as a new licensee and meet the requirements under subsection (1) of
 7   this section for initial licensure.
 8       (6) Any licensee in good standing may request to have his or her
 9   license placed on inactive status. All licensees in inactive status,
10   including those who converted from certificate to a license, are
11   subject to the following conditions:
12       (a) The licensee is prohibited from practicing public accounting;
13       (b) The licensee must pay a renewal fee to maintain this status;
14       (c)   The  licensee    must    comply   with the  applicable   CPE
15   requirements;
16       (d) The licensee is subject to the requirements of this chapter
17   and the rules adopted by the board.


18       Sec. 6.   RCW 18.04.180 and 2004 c 159 s 3 are each amended to
19   read as follows:
20       (1) The board shall issue a license to a holder of a certificate/
21   valid license issued by another state that entitles the holder to
22   practice public accountancy, provided that:
23       (a) Such state makes similar provision to grant reciprocity to a
24   holder of a valid certificate or license in this state;
25       (b)   The   applicant   meets  the   CPE   requirements  of   RCW
26   18.04.215(((5))) (4);
27       (c) The applicant meets the good character requirements of RCW
28   18.04.105(1)(a); and
29       (d) The applicant passed the examination required for issuance of
30   his or her certificate or license with grades that would have been
31   passing grades at that time in this state and meets all current
32   requirements in this state for issuance of a license at the time
33   application is made; or at the time of the issuance of the
34   applicant's license in the other state, met all the requirements then
35   applicable in this state; or has three years of experience within the
36   five years immediately preceding application or had five years of
37   experience within the ten years immediately preceding application in
38   the practice of public accountancy that meets the requirements
39   prescribed by the board.
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1        (2) The board may accept NASBA's designation of the applicant as
2    substantially equivalent to national standards as meeting the
3    requirement of subsection (1)(d) of this section.
4        (3) A licensee who has been granted a license under the
5    reciprocity provisions of this section shall notify the board within
6    thirty days if the license or certificate issued in the other
7    jurisdiction has lapsed or if the status of the license or
8    certificate issued in the other jurisdiction becomes otherwise
9    invalid.

10       Sec. 7. RCW 18.04.195 and 2019 c 71 s 2 are each amended to read
11   as follows:
12       (1) The board shall grant or renew licenses to practice as a CPA
13   firm to applicants that demonstrate their qualifications therefore in
14   accordance with this section.
15       (a) The following must hold a license issued under this section:
16       (i) Any firm with an office in this state performing or offering
17   to perform attest services as defined in RCW 18.04.025(1) or
18   compilations as defined in RCW 18.04.025(((6))) (5); or
19       (ii) Any firm that does not have an office in this state but
20   offers or renders attest services described in RCW 18.04.025 in this
21   state, unless it meets each of the following requirements:
22       (A) Complies with the qualifications described in subsection
23   (3)(c), (4)(a), or (5)(c) of this section;
24       (B)   Meets    the  board's  quality   assurance  review    program
25   requirements    authorized   by  RCW   18.04.055(9)  and    the   rules
26   implementing such section;
27       (C) Performs such services through an individual with practice
28   privileges under RCW 18.04.350(2); and
29       (D) Can lawfully do so in the state where said individuals with
30   practice privileges have their principal place of business.
31       (b) A chartered professional accounting firm registered in the
32   Canadian province of British Columbia may provide compilation or
33   attest services in accordance with RCW 18.04.350(15) without
34   obtaining a Washington state CPA firm license.
35       (c) A firm that is not subject to the requirements of subsection
36   (1)(a) of this section may perform compilation services described in
37   RCW 18.04.025(((6))) (5) and other nonattest professional services
38   while using the title "CPA" or "CPA firm" in this state without a
39   license issued under this section only if:
                                      p. 13                         SB 5519
 1       (i) The firm performs such services through an individual with
 2   practice privileges under RCW 18.04.350(2); and
 3       (ii) The firm can lawfully do so in the state where said
 4   individuals with practice privileges have their principal place of
 5   business.
 6       (2) A sole proprietorship that performs or offers to perform
 7   attest or compilation services as defined in RCW 18.04.025 is
 8   required to obtain a license under subsection (1) of this section
 9   (([and])) and shall license, as a firm, every three years with the
10   board.
11       (a) The sole proprietor shall hold and renew a license to
12   practice under RCW 18.04.105 and 18.04.215, or, in the case of a sole
13   proprietorship that must obtain a license pursuant to subsection
14   (1)(a)(iii) of this section, be a licensee of another state who meets
15   the requirements in RCW 18.04.350(2);
16       (b) Each resident individual in charge of an office located in
17   this state shall hold and renew a license to practice under RCW
18   18.04.105 and 18.04.215; and
19       (c) The licensed firm must meet requirements established by rule
20   by the board.
21       (3) A partnership that performs or offers to perform attest or
22   compilation services as defined in RCW 18.04.025 is required to
23   obtain a license under subsection (1) of this section(([,])), shall
24   license as a firm every three years with the board, and shall meet
25   the following requirements:
26       (a) At least one general partner of the partnership shall hold
27   and renew a license to practice under RCW 18.04.105 and 18.04.215,
28   or, in the case of a partnership that must obtain a license pursuant
29   to subsection (1)(a)(iii) of this section, be a licensee of another
30   state who meets the requirements in RCW 18.04.350(2);
31       (b) Each resident individual in charge of an office in this state
32   shall hold and renew a license to practice under RCW 18.04.105 and
33   18.04.215;
34       (c) At least a simple majority of the ownership of the licensed
35   firm in terms of financial interests and voting rights of all
36   partners or owners shall be held by persons who are licensees or
37   holders of a valid license issued under this chapter or by another
38   state. The principal partner of the partnership and any partner
39   having authority over issuing reports shall hold a license under this
40   chapter or issued by another state; and
                                     p. 14                         SB 5519
 1       (d) The licensed firm must meet requirements established by rule
 2   by the board.
 3       (4) A corporation that performs or offers to perform attest or
 4   compilation services as defined in RCW 18.04.025 is required to
 5   obtain a license under subsection (1) of this section(([,])), shall
 6   license as a firm every three years with the board(([,])), and shall
 7   meet the following requirements:
 8       (a) At least a simple majority of the ownership of the licensed
 9   firm in terms of financial interests and voting rights of all
10   shareholders or owners shall be held by persons who are licensees or
11   holders of a valid license issued under this chapter or by another
12   state and is principally employed by the corporation or actively
13   engaged in its business. The principal officer of the corporation and
14   any officer or director having authority over issuing reports shall
15   hold a license under this chapter or issued by another state;
16       (b) At least one shareholder of the corporation shall hold a
17   license under RCW 18.04.105 and 18.04.215, or, in the case of a
18   corporation that must obtain a license pursuant to subsection
19   (1)(a)(iii) of this section, be a licensee of another state who meets
20   the requirements in RCW 18.04.350(2);
21       (c) Each resident individual in charge of an office located in
22   this state shall hold and renew a license under RCW 18.04.105 and
23   18.04.215;
24       (d) A written agreement shall bind the corporation or its
25   shareholders to purchase any shares offered for sale by, or not under
26   the ownership or effective control of, a qualified shareholder, and
27   bind any holder not a qualified shareholder to sell the shares to the
28   corporation or its qualified shareholders. The agreement shall be
29   noted on each certificate of corporate stock. The corporation may
30   purchase any amount of its stock for this purpose, notwithstanding
31   any impairment of capital, as long as one share remains outstanding;
32       (e) The corporation shall comply with any other rules pertaining
33   to corporations practicing public accounting in this state as the
34   board may prescribe; and
35       (f) The licensed firm must meet requirements established by rule
36   by the board.
37       (5) A limited liability company that performs or offers to
38   perform attest or compilation services as defined in RCW 18.04.025 is
39   required to obtain a license under subsection (1) of this


                                     p. 15                         SB 5519
 1   section(([,])), shall license as a firm every three years with the
 2   board, and shall meet the following requirements:
 3       (a) At least one member of the limited liability company shall
 4   hold a license under RCW 18.04.105 and 18.04.215, or, in the case of
 5   a limited liability company that must obtain a license pursuant to
 6   subsection (1)(a)(iii) of this section, be a licensee of another
 7   state who meets the requirements in RCW 18.04.350(2);
 8       (b) Each resident manager or member in charge of an office
 9   located in this state shall hold and renew a license under RCW
10   18.04.105 and 18.04.215;
11       (c) At least a simple majority of the ownership of the licensed
12   firm in terms of financial interests and voting rights of all owners
13   shall be held by persons who are licensees or holders of a valid
14   license issued under this chapter or by another state. The principal
15   member or manager of the limited liability company and any member
16   having authority over issuing reports shall hold a license under this
17   chapter or issued by another state; and
18       (d) The licensed firm must meet requirements established by rule
19   by the board.
20       (6) Application for a license as a firm with an office in this
21   state shall be made upon the affidavit of the proprietor or
22   individual designated as managing partner, member, or shareholder for
23   Washington. This individual shall hold a license under RCW 18.04.215.
24       (7) In the case of a firm licensed in another state and required
25   to obtain a license under subsection (1)(a)(iii) of this section, the
26   application for the firm license shall be made upon the affidavit of
27   an individual who qualifies for practice privileges in this state
28   under RCW 18.04.350(2) who has been authorized by the applicant firm
29   to make the application. The board shall determine in each case
30   whether the applicant is eligible for a license.
31       (8) The board shall be given notification within ninety days
32   after the admission or withdrawal of a partner, shareholder, or
33   member engaged in this state in the practice of public accounting
34   from any partnership, corporation, or limited liability company so
35   licensed.
36       (9) Licensed firms that fall out of compliance with the
37   provisions of this section due to changes in firm ownership, after
38   receiving or renewing a license, shall notify the board in writing
39   within ninety days of its falling out of compliance and propose a
40   time period in which they will come back into compliance. The board
                                     p. 16                         SB 5519
 1   may grant a reasonable period of time for a firm to be in compliance
 2   with the provisions of this section. Failure to bring the firm into
 3   compliance within a reasonable period of time, as determined by the
 4   board, may result in suspension, revocation, or imposition of
 5   conditions on the firm's license.
 6       (10) Fees for the license as a firm and for notification of the
 7   board of the admission or withdrawal of a partner, shareholder, or
 8   member shall be determined by the board. Fees shall be paid by the
 9   firm at the time the license application form or notice of admission
10   or withdrawal of a partner, shareholder, or member is filed with the
11   board.
12       (11) Nonlicensee owners of licensed firms are:
13       (a) Required to fully comply with the provisions of this chapter
14   and board rules;
15       (b) Required to be an individual;
16       (c) Required to be of good character, as defined in RCW
17   18.04.105(1)(a), and an active individual participant in the licensed
18   firm or affiliated entities as these terms are defined by board rule;
19   and
20       (d) Subject to discipline by the board for violation of this
21   chapter.
22       (12) Resident nonlicensee owners of licensed firms are required
23   to meet:
24       (a) The ethics examination, registration, and fee requirements as
25   established by the board rules; and
26       (b) The ethics CPE requirements established by the board rules.
27       (13)(a) Licensed firms must notify the board within thirty days
28   after:
29       (i) Sanction, suspension, revocation, or modification of their
30   professional license or practice rights by the securities exchange
31   commission, internal revenue service, or another state board of
32   accountancy;
33       (ii) Sanction or order against the licensee or nonlicensee firm
34   owner by any federal or other state agency related to the licensee's
35   practice of public accounting or violation of ethical or technical
36   standards established by board rule; or
37       (iii) The licensed firm is notified that it has been charged with
38   a violation of law that could result in the suspension or revocation
39   of the firm's license by a federal or other state agency, as
40   identified by board rule, related to the firm's professional license,
                                     p. 17                         SB 5519
1    practice rights, or violation of ethical or technical standards
2    established by board rule.
3        (b) The board must adopt rules to implement this subsection and
4    may also adopt rules specifying requirements for licensees to report
5    to the board sanctions or orders relating to the licensee's practice
6    of public accounting or violation of ethical or technical standards
7    entered against the licensee by a nongovernmental professionally
8    related standard-setting entity.

 9       Sec. 8. RCW 18.04.195 and 2019 c 71 s 3 are each amended to read
10   as follows:
11       (1) The board shall grant or renew licenses to practice as a CPA
12   firm to applicants that demonstrate their qualifications therefore in
13   accordance with this section.
14       (a) The following must hold a license issued under this section:
15       (i) Any firm with an office in this state performing or offering
16   to perform attest services as defined in RCW 18.04.025(1) or
17   compilations as defined in RCW 18.04.025(((6))) (5); or
18       (ii) Any firm that does not have an office in this state but
19   offers or renders attest services described in RCW 18.04.025 in this
20   state, unless it meets each of the following requirements:
21       (A) Complies with the qualifications described in subsection
22   (3)(c), (4)(a), or (5)(c) of this section;
23       (B)   Meets    the  board's  quality   assurance  review    program
24   requirements    authorized   by  RCW   18.04.055(9)  and    the   rules
25   implementing such section;
26       (C) Performs such services through an individual with practice
27   privileges under RCW 18.04.350(2); and
28       (D) Can lawfully do so in the state where said individuals with
29   practice privileges have their principal place of business.
30       (b) A firm that is not subject to the requirements of subsection
31   (1)(a) of this section may perform compilation services described in
32   RCW 18.04.025(((6))) (5) and other nonattest professional services
33   while using the title "CPA" or "CPA firm" in this state without a
34   license issued under this section only if:
35       (i) The firm performs such services through an individual with
36   practice privileges under RCW 18.04.350(2); and
37       (ii) The firm can lawfully do so in the state where said
38   individuals with practice privileges have their principal place of
39   business.
                                      p. 18                         SB 5519
 1       (2) A sole proprietorship that performs or offers to perform
 2   attest or compilation services as defined in RCW 18.04.025 is
 3   required to obtain a license under subsection (1) of this section
 4   (([and])) and shall license, as a firm, every three years with the
 5   board.
 6       (a) The sole proprietor shall hold and renew a license to
 7   practice under RCW 18.04.105 and 18.04.215, or, in the case of a sole
 8   proprietorship that must obtain a license pursuant to subsection
 9   (1)(a)(iii) of this section, be a licensee of another state who meets
10   the requirements in RCW 18.04.350(2);
11       (b) Each resident individual in charge of an office located in
12   this state shall hold and renew a license to practice under RCW
13   18.04.105 and 18.04.215; and
14       (c) The licensed firm must meet requirements established by rule
15   by the board.
16       (3) A partnership that performs or offers to perform attest or
17   compilation services as defined in RCW 18.04.025 is required to
18   obtain a license under subsection (1) of this section(([,])), shall
19   license as a firm every three years with the board, and shall meet
20   the following requirements:
21       (a) At least one general partner of the partnership shall hold
22   and renew a license to practice under RCW 18.04.105 and 18.04.215,
23   or, in the case of a partnership that must obtain a license pursuant
24   to subsection (1)(a)(iii) of this section, be a licensee of another
25   state who meets the requirements in RCW 18.04.350(2);
26       (b) Each resident individual in charge of an office in this state
27   shall hold and renew a license to practice under RCW 18.04.105 and
28   18.04.215;
29       (c) At least a simple majority of the ownership of the licensed
30   firm in terms of financial interests and voting rights of all
31   partners or owners shall be held by persons who are licensees or
32   holders of a valid license issued under this chapter or by another
33   state. The principal partner of the partnership and any partner
34   having authority over issuing reports shall hold a license under this
35   chapter or issued by another state; and
36       (d) The licensed firm must meet requirements established by rule
37   by the board.
38       (4) A corporation that performs or offers to perform attest or
39   compilation services as defined in RCW 18.04.025 is required to
40   obtain a license under subsection (1) of this section(([,])), shall
                                     p. 19                         SB 5519
 1   license as a firm every three years with the board(([,])), and shall
 2   meet the following requirements:
 3       (a) At least a simple majority of the ownership of the licensed
 4   firm in terms of financial interests and voting rights of all
 5   shareholders or owners shall be held by persons who are licensees or
 6   holders of a valid license issued under this chapter or by another
 7   state and is principally employed by the corporation or actively
 8   engaged in its business. The principal officer of the corporation and
 9   any officer or director having authority over issuing reports shall
10   hold a license under this chapter or issued by another state;
11       (b) At least one shareholder of the corporation shall hold a
12   license under RCW 18.04.105 and 18.04.215, or, in the case of a
13   corporation that must obtain a license pursuant to subsection
14   (1)(a)(iii) of this section, be a licensee of another state who meets
15   the requirements in RCW 18.04.350(2);
16       (c) Each resident individual in charge of an office located in
17   this state shall hold and renew a license under RCW 18.04.105 and
18   18.04.215;
19       (d) A written agreement shall bind the corporation or its
20   shareholders to purchase any shares offered for sale by, or not under
21   the ownership or effective control of, a qualified shareholder, and
22   bind any holder not a qualified shareholder to sell the shares to the
23   corporation or its qualified shareholders. The agreement shall be
24   noted on each certificate of corporate stock. The corporation may
25   purchase any amount of its stock for this purpose, notwithstanding
26   any impairment of capital, as long as one share remains outstanding;
27       (e) The corporation shall comply with any other rules pertaining
28   to corporations practicing public accounting in this state as the
29   board may prescribe; and
30       (f) The licensed firm must meet requirements established by rule
31   by the board.
32       (5) A limited liability company that performs or offers to
33   perform attest or compilation services as defined in RCW 18.04.025 is
34   required to obtain a license under subsection (1) of this
35   section(([,])), shall license as a firm every three years with the
36   board, and shall meet the following requirements:
37       (a) At least one member of the limited liability company shall
38   hold a license under RCW 18.04.105 and 18.04.215, or, in the case of
39   a limited liability company that must obtain a license pursuant to


                                     p. 20                         SB 5519
 1   subsection (1)(a)(iii) of this section, be a licensee of another
 2   state who meets the requirements in RCW 18.04.350(2);
 3       (b) Each resident manager or member in charge of an office
 4   located in this state shall hold and renew a license under RCW
 5   18.04.105 and 18.04.215;
 6       (c) At least a simple majority of the ownership of the licensed
 7   firm in terms of financial interests and voting rights of all owners
 8   shall be held by persons who are licensees or holders of a valid
 9   license issued under this chapter or by another state. The principal
10   member or manager of the limited liability company and any member
11   having authority over issuing reports shall hold a license under this
12   chapter or issued by another state; and
13       (d) The licensed firm must meet requirements established by rule
14   by the board.
15       (6) Application for a license as a firm with an office in this
16   state shall be made upon the affidavit of the proprietor or
17   individual designated as managing partner, member, or shareholder for
18   Washington. This individual shall hold a license under RCW 18.04.215.
19       (7) In the case of a firm licensed in another state and required
20   to obtain a license under subsection (1)(a)(iii) of this section, the
21   application for the firm license shall be made upon the affidavit of
22   an individual who qualifies for practice privileges in this state
23   under RCW 18.04.350(2) who has been authorized by the applicant firm
24   to make the application. The board shall determine in each case
25   whether the applicant is eligible for a license.
26       (8) The board shall be given notification within ninety days
27   after the admission or withdrawal of a partner, shareholder, or
28   member engaged in this state in the practice of public accounting
29   from any partnership, corporation, or limited liability company so
30   licensed.
31       (9) Licensed firms that fall out of compliance with the
32   provisions of this section due to changes in firm ownership, after
33   receiving or renewing a license, shall notify the board in writing
34   within ninety days of its falling out of compliance and propose a
35   time period in which they will come back into compliance. The board
36   may grant a reasonable period of time for a firm to be in compliance
37   with the provisions of this section. Failure to bring the firm into
38   compliance within a reasonable period of time, as determined by the
39   board, may result in suspension, revocation, or imposition of
40   conditions on the firm's license.
                                     p. 21                         SB 5519
 1       (10) Fees for the license as a firm and for notification of the
 2   board of the admission or withdrawal of a partner, shareholder, or
 3   member shall be determined by the board. Fees shall be paid by the
 4   firm at the time the license application form or notice of admission
 5   or withdrawal of a partner, shareholder, or member is filed with the
 6   board.
 7       (11) Nonlicensee owners of licensed firms are:
 8       (a) Required to fully comply with the provisions of this chapter
 9   and board rules;
10       (b) Required to be an individual;
11       (c) Required to be of good character, as defined in RCW
12   18.04.105(1)(a), and an active individual participant in the licensed
13   firm or affiliated entities as these terms are defined by board rule;
14   and
15       (d) Subject to discipline by the board for violation of this
16   chapter.
17       (12) Resident nonlicensee owners of licensed firms are required
18   to meet:
19       (a) The ethics examination, registration, and fee requirements as
20   established by the board rules; and
21       (b) The ethics CPE requirements established by the board rules.
22       (13)(a) Licensed firms must notify the board within thirty days
23   after:
24       (i) Sanction, suspension, revocation, or modification of their
25   professional license or practice rights by the securities exchange
26   commission, internal revenue service, or another state board of
27   accountancy;
28       (ii) Sanction or order against the licensee or nonlicensee firm
29   owner by any federal or other state agency related to the licensee's
30   practice of public accounting or violation of ethical or technical
31   standards established by board rule; or
32       (iii) The licensed firm is notified that it has been charged with
33   a violation of law that could result in the suspension or revocation
34   of the firm's license by a federal or other state agency, as
35   identified by board rule, related to the firm's professional license,
36   practice rights, or violation of ethical or technical standards
37   established by board rule.
38       (b) The board must adopt rules to implement this subsection and
39   may also adopt rules specifying requirements for licensees to report
40   to the board sanctions or orders relating to the licensee's practice
                                     p. 22                         SB 5519
1    of public accounting or violation of ethical or technical standards
2    entered against the licensee by a nongovernmental professionally
3    related standard-setting entity.


 4       Sec. 9.    RCW 18.04.215 and 2018 c 224 s 5 are each amended to
 5   read as follows:
 6       (1) Three-year licenses shall be issued by the board:
 7       (a) To persons meeting the requirements of RCW 18.04.105(1),
 8   18.04.180, or 18.04.183.
 9       (b) ((To certificate holders meeting the requirements of RCW
10   18.04.105(4).
11       (c))) To firms under RCW 18.04.195, meeting the requirements of
12   RCW 18.04.205.
13       (2) The board shall, by rule, provide for a system of
14   ((certificate and)) license renewal and reinstatement. Applicants for
15   renewal or reinstatement shall, at the time of filing their
16   applications,   list  with   the   board  all   states  and   foreign
17   jurisdictions in which they hold or have applied for certificates,
18   permits or licenses to practice.
19       (3) ((An inactive certificate is renewed every three years with
20   renewal subject to the requirements of ethics CPE and the payment of
21   fees, prescribed by the board. Failure to renew the inactive
22   certificate shall cause the inactive certificate to lapse and be
23   subject to reinstatement. The board shall adopt rules providing for
24   fees and procedures for renewal and reinstatement of inactive
25   certificates.
26       (4))) A license is issued every three years with renewal subject
27   to requirements of CPE and payment of fees, prescribed by the board.
28   Failure to renew the license shall cause the license to lapse and
29   become subject to reinstatement. Persons holding a lapsed license are
30   prohibited from using the title (("CPA" or "certified public
31   accountant.")) "CPA," "certified public accountant," "CPA-inactive,"
32   or "CPA-retired." Persons holding a lapsed license are prohibited
33   from practicing public accountancy. The board shall adopt rules
34   providing for fees and procedures for issuance, renewal, and
35   reinstatement of licenses.
36       (((5))) (4) The board shall adopt rules providing for CPE for
37   active or inactive licensees ((and certificate holders)). The rules
38   shall:


                                     p. 23                         SB 5519
 1       (a) Provide that ((a)) an active licensee shall verify to the
 2   board that he or she has completed at least an accumulation of one
 3   hundred twenty hours of CPE during the last three-year period to
 4   maintain the active license;
 5       (b) Provide that an individual with an inactive license must
 6   verify to the board that he or she has completed a board-approved
 7   ethics course for CPE during the last three-year period to maintain
 8   the inactive license;
 9       (c) Establish CPE requirements; and
10       (((c))) (d) Establish when new licensees shall verify that they
11   have completed the required CPE.
12       (((6))) (5) A certified public accountant who holds a license
13   issued by another state, and applies for a license in this state, may
14   practice in this state from the date of filing a completed
15   application with the board, until the board has acted upon the
16   application provided the application is made prior to holding out as
17   a certified public accountant in this state and no sanctions or
18   investigations, deemed by the board to be pertinent to public
19   accountancy, by other jurisdictions or agencies are in process.
20       (((7))) (6)(a) A licensee shall submit to the board satisfactory
21   proof of having completed an accumulation of one hundred twenty hours
22   of CPE recognized and approved by the board during the preceding
23   three years. Failure to furnish this evidence as required shall make
24   the license lapse and subject to reinstatement procedures, unless the
25   board determines the failure to have been due to retirement or
26   reasonable cause.
27       (b) The board in its discretion may renew a ((certificate or))
28   license despite failure to furnish evidence of compliance with
29   requirements of CPE upon condition that the applicant follow a
30   particular program of CPE. In issuing rules and individual orders
31   with   respect  to   CPE   requirements,  the   board,  among   other
32   considerations, may rely upon guidelines and pronouncements of
33   recognized educational and professional associations, may prescribe
34   course content, duration, and organization, and may take into account
35   the accessibility of CPE to licensees ((and certificate holders)) and
36   instances of individual hardship.
37       (((8))) (7) Fees for renewal or reinstatement of ((certificates
38   and)) licenses in this state shall be determined by the board under
39   this chapter. Fees shall be paid by the applicant at the time the
40   application form is filed with the board. The board, by rule, may
                                     p. 24                         SB 5519
 1   provide for proration of fees for licenses ((or certificates)) issued
 2   between normal renewal dates.
 3       (((9)))   (8)(a)    Licensees((,   certificate    holders,))   and
 4   nonlicensee owners must notify the board within thirty days after:
 5       (i) Sanction, suspension, revocation, or modification of their
 6   professional license or practice rights by the securities exchange
 7   commission, internal revenue service, or another state board of
 8   accountancy;
 9       (ii) Sanction or order against the licensee((, certificate
10   holder,)) or nonlicensee owner by any federal or other state agency
11   related to the licensee's practice of public accounting or the
12   licensee's((,   certificate   holder's,))   or   nonlicensee   owner's
13   violation of ethical or technical standards established by board
14   rule; or
15       (iii) The licensee((, certificate holder,)) or nonlicensee owner
16   is notified that he or she has been charged with a violation of law
17   that could result in the suspension or revocation of a license ((or
18   certificate)) by a federal or other state agency, as identified by
19   board rule, related to the licensee's((, certificate holder's,)) or
20   nonlicensee owner's professional license, practice rights, or
21   violation of ethical or technical standards established by board
22   rule.
23       (b) The board must adopt rules to implement this subsection and
24   may also adopt rules specifying requirements for licensees((,
25   certificate holders,)) and nonlicensee owners to report to the board
26   sanctions or orders relating to the licensee's practice of public
27   accounting   or   the   licensee's((,   certificate   holder's,))   or
28   nonlicensee owner's violation of ethical or technical standards
29   entered against the licensee((, certificate holder,)) or nonlicensee
30   owner by a nongovernmental professionally related standard-setting
31   entity.
32       (((10))) (9) A chartered professional accounting firm registered
33   in the Canadian province of British Columbia and its owners and
34   employees that provide compilation or attest services in accordance
35   with RCW 18.04.350(15) are not required to obtain a CPA firm license
36   or individual CPA licenses and will not be subject to license fees.


37       Sec. 10.   RCW 18.04.215 and 2003 c 290 s 2 are each amended to
38   read as follows:
39       (1) Three-year licenses shall be issued by the board:
                                     p. 25                         SB 5519
 1       (a) To persons meeting the requirements of RCW 18.04.105(1),
 2   18.04.180, or 18.04.183.
 3       (b) ((To certificate holders meeting the requirements of RCW
 4   18.04.105(4).
 5       (c))) To firms under RCW 18.04.195, meeting the requirements of
 6   RCW 18.04.205.
 7       (2) The board shall, by rule, provide for a system of
 8   ((certificate and)) license renewal and reinstatement. Applicants for
 9   renewal or reinstatement shall, at the time of filing their
10   applications,   list  with   the   board  all   states  and   foreign
11   jurisdictions in which they hold or have applied for certificates,
12   permits or licenses to practice.
13       (3) ((An inactive certificate is renewed every three years with
14   renewal subject to the requirements of ethics CPE and the payment of
15   fees, prescribed by the board. Failure to renew the inactive
16   certificate shall cause the inactive certificate to lapse and be
17   subject to reinstatement. The board shall adopt rules providing for
18   fees and procedures for renewal and reinstatement of inactive
19   certificates.
20       (4))) A license is issued every three years with renewal subject
21   to requirements of CPE and payment of fees, prescribed by the board.
22   Failure to renew the license shall cause the license to lapse and
23   become subject to reinstatement. Persons holding a lapsed license are
24   prohibited from using the title (("CPA" or "certified public
25   accountant.")) "CPA," "certified public accountant," "CPA-inactive,"
26   or "CPA-retired." Persons holding a lapsed license are prohibited
27   from practicing public accountancy. The board shall adopt rules
28   providing for fees and procedures for issuance, renewal, and
29   reinstatement of licenses.
30       (((5))) (4) The board shall adopt rules providing for CPE for
31   active or inactive licensees and certificate holders. The rules
32   shall:
33       (a) Provide that ((a)) an active licensee shall verify to the
34   board that he or she has completed at least an accumulation of one
35   hundred twenty hours of CPE during the last three-year period to
36   maintain the active license;
37       (b) Provide that an individual with an inactive license must
38   verify to the board that he or she has completed a board-approved
39   ethics course for CPE during the last three-year period to maintain
40   the inactive license;
                                     p. 26                         SB 5519
 1       (c) Establish CPE requirements; and
 2       (((c))) (d) Establish when new licensees shall verify that they
 3   have completed the required CPE.
 4       (((6))) (5) A certified public accountant who holds a license
 5   issued by another state, and applies for a license in this state, may
 6   practice in this state from the date of filing a completed
 7   application with the board, until the board has acted upon the
 8   application provided the application is made prior to holding out as
 9   a certified public accountant in this state and no sanctions or
10   investigations, deemed by the board to be pertinent to public
11   accountancy, by other jurisdictions or agencies are in process.
12       (((7))) (6)(a) A licensee shall submit to the board satisfactory
13   proof of having completed an accumulation of one hundred twenty hours
14   of CPE recognized and approved by the board during the preceding
15   three years. Failure to furnish this evidence as required shall make
16   the license lapse and subject to reinstatement procedures, unless the
17   board determines the failure to have been due to retirement or
18   reasonable cause.
19       (b) The board in its discretion may renew a ((certificate or))
20   license despite failure to furnish evidence of compliance with
21   requirements of CPE upon condition that the applicant follow a
22   particular program of CPE. In issuing rules and individual orders
23   with   respect   to   CPE   requirements,   the  board,   among  other
24   considerations, may rely upon guidelines and pronouncements of
25   recognized educational and professional associations, may prescribe
26   course content, duration, and organization, and may take into account
27   the accessibility of CPE to licensees ((and certificate holders)) and
28   instances of individual hardship.
29       (((8))) (7) Fees for renewal or reinstatement of ((certificates
30   and)) licenses in this state shall be determined by the board under
31   this chapter. Fees shall be paid by the applicant at the time the
32   application form is filed with the board. The board, by rule, may
33   provide for proration of fees for licenses ((or certificates)) issued
34   between normal renewal dates.
35       (((9)))    (8)(a)    Licensees((,   certificate   holders,))   and
36   nonlicensee owners must notify the board within thirty days after:
37       (i) Sanction, suspension, revocation, or modification of their
38   professional license or practice rights by the securities exchange
39   commission, internal revenue service, or another state board of
40   accountancy;
                                     p. 27                         SB 5519
 1       (ii) Sanction or order against the licensee((, certificate
 2   holder,)) or nonlicensee owner by any federal or other state agency
 3   related to the licensee's practice of public accounting or the
 4   licensee's((,   certificate  holder's,))   or   nonlicensee  owner's
 5   violation of ethical or technical standards established by board
 6   rule; or
 7       (iii) The licensee((, certificate holder,)) or nonlicensee owner
 8   is notified that he or she has been charged with a violation of law
 9   that could result in the suspension or revocation of a license ((or
10   certificate)) by a federal or other state agency, as identified by
11   board rule, related to the licensee's((, certificate holder's,)) or
12   nonlicensee owner's professional license, practice rights, or
13   violation of ethical or technical standards established by board
14   rule.
15       (b) The board must adopt rules to implement this subsection and
16   may also adopt rules specifying requirements for licensees((,
17   certificate holders,)) and nonlicensee owners to report to the board
18   sanctions or orders relating to the licensee's practice of public
19   accounting   or   the   licensee's((,  certificate   holder's,))  or
20   nonlicensee owner's violation of ethical or technical standards
21   entered against the licensee((, certificate holder,)) or nonlicensee
22   owner by a nongovernmental professionally related standard-setting
23   entity.


24       Sec. 11.   RCW 18.04.295 and 2004 c 159 s 4 are each amended to
25   read as follows:
26       The board shall have the power to: Revoke, suspend, or refuse to
27   issue, renew, or reinstate a license ((or certificate)); impose a
28   fine in an amount not to exceed thirty thousand dollars plus the
29   board's investigative and legal costs in bringing charges against a
30   certified public accountant, ((a certificate holder,)) a licensee, a
31   licensed firm, an applicant, a non-CPA violating the provisions of
32   RCW 18.04.345, or a nonlicensee holding an ownership interest in a
33   licensed firm; may impose full restitution to injured parties; may
34   impose conditions precedent to renewal of a ((certificate or a))
35   license; or may prohibit a nonlicensee from holding an ownership
36   interest in a licensed firm, for any of the following causes:
37       (1) Fraud or deceit in obtaining a license, or in any filings
38   with the board;


                                     p. 28                        SB 5519
 1       (2) Dishonesty, fraud, or negligence while representing oneself
 2   as a nonlicensee owner holding an ownership interest in a licensed
 3   firm((,)) or a licensee((, or a certificate holder));
 4       (3) A violation of any provision of this chapter;
 5       (4) A violation of a rule of professional conduct promulgated by
 6   the board under the authority granted by this chapter;
 7       (5) Conviction of a crime or an act constituting a crime under:
 8       (a) The laws of this state;
 9       (b) The laws of another state, and which, if committed within
10   this state, would have constituted a crime under the laws of this
11   state; or
12       (c) Federal law;
13       (6) Cancellation, revocation, suspension, or refusal to renew the
14   authority to practice as a certified public accountant by any other
15   state for any cause other than failure to pay a fee or to meet the
16   requirements of CPE in the other state;
17       (7) Suspension or revocation of the right to practice matters
18   relating to public accounting before any state or federal agency;
19       For purposes of subsections (6) and (7) of this section, a
20   certified copy of such revocation, suspension, or refusal to renew
21   shall be prima facie evidence;
22       (8) Failure to maintain compliance with the requirements for
23   issuance, renewal, or reinstatement of a ((certificate or)) license,
24   or to report changes to the board;
25       (9) Failure to cooperate with the board by:
26       (a) Failure to furnish any papers or documents requested or
27   ordered by the board;
28       (b) Failure to furnish in writing a full and complete explanation
29   covering the matter contained in the complaint filed with the board
30   or the inquiry of the board;
31       (c) Failure to respond to subpoenas issued by the board, whether
32   or not the recipient of the subpoena is the accused in the
33   proceeding;
34       (10) Failure by a nonlicensee owner of a licensed firm to comply
35   with the requirements of this chapter or board rule; and
36       (11) Failure to comply with an order of the board.


37       Sec. 12. RCW 18.04.320 and 1986 c 295 s 13 are each amended to
38   read as follows:


                                     p. 29                         SB 5519
1        In the case of the refusal, revocation, or suspension of a
2    ((certificate or a)) license by the board under the provisions of
3    this chapter, such proceedings and any appeal therefrom shall be
4    taken in accordance with the administrative procedure act, chapter
5    34.05 RCW.


 6       Sec. 13. RCW 18.04.335 and 2001 c 294 s 16 are each amended to
 7   read as follows:
 8       (1) Upon application in writing and after hearing pursuant to
 9   notice, the board may:
10       (a) Modify the suspension of, or reissue ((a certificate or)) a
11   license to, an individual whose ((certificate or)) license has been
12   revoked or suspended; or
13       (b) Modify the suspension of, or reissue a license to a firm
14   whose license has been revoked, suspended, or which the board has
15   refused to renew.
16       (2) In the case of suspension for failure to comply with a
17   support order under chapter 74.20A RCW, if the person has continued
18   to meet all other requirements for reinstatement during the
19   suspension, reissuance of a ((certificate or a)) license shall be
20   automatic upon the board's receipt of a release issued by the
21   department of social and health services stating that the individual
22   is in compliance with the order.


23       Sec. 14.   RCW 18.04.345 and 2019 c 71 s 5 are each amended to
24   read as follows:
25       (1) Except when performing services as an employee or owner of a
26   firm that performs or offers to perform attest or compilation
27   services as defined in RCW 18.04.025 in accordance with RCW
28   18.04.350(15), no individual may assume or use the designation
29   "certified public accountant-inactive" or "CPA-inactive" or any other
30   title, designation, words, letters, abbreviation, sign, card, or
31   device tending to indicate that the individual is a certified public
32   accountant-inactive or CPA-inactive unless the individual holds a
33   ((certificate)) license in an inactive status. Individuals holding
34   only ((a certificate)) an inactive license may not practice public
35   accounting.
36       (2) No individual may hold himself or herself out to the public
37   or assume or use the designation "certified public accountant" or
38   "CPA" or any other title, designation, words, letters, abbreviation,
                                     p. 30                         SB 5519
 1   sign, card, or device tending to indicate that the individual is a
 2   certified public accountant or CPA unless the individual qualifies
 3   for the privileges authorized by RCW 18.04.350(2) or holds a license
 4   under RCW 18.04.105 and 18.04.215, or is providing compilation or
 5   attest services as an employee or owner of a firm operating in
 6   accordance with RCW 18.04.350(15).
 7       (3) No firm with an office in this state may perform or offer to
 8   perform attest services as defined in RCW 18.04.025(1) or compilation
 9   services as defined in RCW 18.04.025(((6))) (5) unless the firm is
10   licensed under RCW 18.04.195 and all offices of the firm in this
11   state are maintained and registered under RCW 18.04.205. This
12   subsection does not limit the services permitted under RCW
13   18.04.350(10) by persons not required to be licensed under this
14   chapter, nor does it prohibit compilation or attest services
15   performed in accordance with RCW 18.04.350(15).
16       (4) No firm may perform the services defined in RCW 18.04.025(1)
17   in this state unless the firm is licensed under RCW 18.04.195, renews
18   the firm license as required under RCW 18.04.215, and all offices of
19   the firm in this state are maintained and registered under RCW
20   18.04.205. This subsection does not prohibit services performed in
21   accordance with RCW 18.04.350(15).
22       (5) Except when performing services as an employee or owner of a
23   firm operating in accordance with RCW 18.04.350(15), no individual,
24   partnership, limited liability company, or corporation offering
25   public accounting services to the public may hold himself, herself,
26   or itself out to the public, or assume or use along, or in connection
27   with his, hers, or its name, or any other name the title or
28   designation "certified accountant," "chartered accountant," "licensed
29   accountant," "licensed public accountant," "public accountant," or
30   any other title or designation likely to be confused with "certified
31   public accountant" or any of the abbreviations "CA," "LA," "LPA," or
32   "PA," or similar abbreviations likely to be confused with "CPA."
33       (6) No licensed firm may operate under an alias, a firm name,
34   title, or "DBA" that differs from the firm name that is registered
35   with the board.
36       (7) Except when performing services as an employee or owner of a
37   firm operating in accordance with RCW 18.04.350(15), no individual
38   with an office in this state may sign, affix, or associate his or her
39   name or any trade or assumed name used by the individual in his or
40   her business to any report prescribed by professional standards
                                     p. 31                         SB 5519
 1   unless the individual holds a license to practice under RCW 18.04.105
 2   and 18.04.215, a firm holds a license under RCW 18.04.195, and all of
 3   the individual's offices in this state are registered under RCW
 4   18.04.205.
 5       (8) No individual licensed in another state may sign, affix, or
 6   associate a firm name to any report prescribed by professional
 7   standards, or associate a firm name in conjunction with the title
 8   certified public accountant, unless the individual:
 9       (a) Qualifies for the practice privileges authorized by RCW
10   18.04.350(2);
11       (b) Is licensed under RCW 18.04.105 and 18.04.215, and all of the
12   individual's offices in this state are maintained and registered
13   under RCW 18.04.205; or
14       (c) Is performing services as an employee or owner of a firm in
15   accordance with the provisions of RCW 18.04.350(15).
16       (9) No individual, partnership, limited liability company, or
17   corporation not holding a license to practice under RCW 18.04.105 and
18   18.04.215, or firm not licensed under RCW 18.04.195 or firm not
19   registering all of the firm's offices in this state under RCW
20   18.04.205, or not qualified for the practice privileges authorized by
21   RCW 18.04.350(2), or not operating in accordance with the provisions
22   of RCW 18.04.350(15), may hold himself, herself, or itself out to the
23   public as an "auditor" with or without any other description or
24   designation by use of such word on any sign, card, letterhead, or in
25   any advertisement or directory.
26       (10) For purposes of this section, because individuals practicing
27   using   practice  privileges   under  RCW  18.04.350(2)   are  deemed
28   substantially equivalent to licensees under RCW 18.04.105 and
29   18.04.215, every word, term, or reference that includes the latter
30   shall be deemed to include the former, provided the conditions of
31   such practice privilege, as set forth in RCW 18.04.350 (4) and (5)
32   are maintained.
33       (11) Notwithstanding anything to the contrary in this section, it
34   is not a violation of this section for a firm that does not hold a
35   valid license under RCW 18.04.195 and that does not have an office in
36   this state to use the title "CPA" or "certified public accountant" as
37   part of the firm's name and to provide its professional services in
38   this state, and licensees and individuals with practice privileges
39   may provide services on behalf of such firms so long as it complies
40   with the requirements of RCW 18.04.195(1). An individual or firm
                                     p. 32                         SB 5519
1    authorized under this subsection to use practice privileges in this
2    state must comply with the requirements otherwise applicable to
3    licensees in this section.


 4       Sec. 15.   RCW 18.04.345 and 2019 c 71 s 6 are each amended to
 5   read as follows:
 6       (1) No individual may assume or use the designation "certified
 7   public accountant-inactive" or "CPA-inactive" or any other title,
 8   designation, words, letters, abbreviation, sign, card, or device
 9   tending to indicate that the individual is a certified public
10   accountant-inactive or CPA-inactive unless the individual holds a
11   ((certificate)) license in an inactive status. Individuals holding
12   only ((a certificate)) an inactive license may not practice public
13   accounting.
14       (2) No individual may hold himself or herself out to the public
15   or assume or use the designation "certified public accountant" or
16   "CPA" or any other title, designation, words, letters, abbreviation,
17   sign, card, or device tending to indicate that the individual is a
18   certified public accountant or CPA unless the individual qualifies
19   for the privileges authorized by RCW 18.04.350(2) or holds a license
20   under RCW 18.04.105 and 18.04.215.
21       (3) No firm with an office in this state may perform or offer to
22   perform attest services as defined in RCW 18.04.025(1) or compilation
23   services as defined in RCW 18.04.025(((6))) (5) unless the firm is
24   licensed under RCW 18.04.195 and all offices of the firm in this
25   state are maintained and registered under RCW 18.04.205. This
26   subsection does not limit the services permitted under RCW
27   18.04.350(10) by persons not required to be licensed under this
28   chapter.
29       (4) No firm may perform the services defined in RCW 18.04.025(1)
30   in this state unless the firm is licensed under RCW 18.04.195, renews
31   the firm license as required under RCW 18.04.215, and all offices of
32   the firm in this state are maintained and registered under RCW
33   18.04.205.
34       (5) No individual, partnership, limited liability company, or
35   corporation offering public accounting services to the public may
36   hold himself, herself, or itself out to the public, or assume or use
37   along, or in connection with his, hers, or its name, or any other
38   name the title or designation "certified accountant," "chartered
39   accountant," "licensed accountant," "licensed public accountant,"
                                     p. 33                         SB 5519
 1   "public accountant," or any other title or designation likely to be
 2   confused   with  "certified   public  accountant"  or   any   of  the
 3   abbreviations "CA," "LA," "LPA," or "PA," or similar abbreviations
 4   likely to be confused with "CPA."
 5       (6) No licensed firm may operate under an alias, a firm name,
 6   title, or "DBA" that differs from the firm name that is registered
 7   with the board.
 8       (7) No individual with an office in this state may sign, affix,
 9   or associate his or her name or any trade or assumed name used by the
10   individual in his or her business to any report prescribed by
11   professional standards unless the individual holds a license to
12   practice under RCW 18.04.105 and 18.04.215, a firm holds a license
13   under RCW 18.04.195, and all of the individual's offices in this
14   state are registered under RCW 18.04.205.
15       (8) No individual licensed in another state may sign, affix, or
16   associate a firm name to any report prescribed by professional
17   standards, or associate a firm name in conjunction with the title
18   certified public accountant, unless the individual:
19       (a) Qualifies for the practice privileges authorized by RCW
20   18.04.350(2); or
21       (b) Is licensed under RCW 18.04.105 and 18.04.215, and all of the
22   individual's offices in this state are maintained and registered
23   under RCW 18.04.205.
24       (9) No individual, partnership, limited liability company, or
25   corporation not holding a license to practice under RCW 18.04.105 and
26   18.04.215, or firm not licensed under RCW 18.04.195 or firm not
27   registering all of the firm's offices in this state under RCW
28   18.04.205, or not qualified for the practice privileges authorized by
29   RCW 18.04.350(2), may hold himself, herself, or itself out to the
30   public as an "auditor" with or without any other description or
31   designation by use of such word on any sign, card, letterhead, or in
32   any advertisement or directory.
33       (10) For purposes of this section, because individuals practicing
34   using   practice  privileges   under  RCW   18.04.350(2)  are  deemed
35   substantially equivalent to licensees under RCW 18.04.105 and
36   18.04.215, every word, term, or reference that includes the latter
37   shall be deemed to include the former, provided the conditions of
38   such practice privilege, as set forth in RCW 18.04.350 (4) and (5)
39   are maintained.


                                     p. 34                         SB 5519
 1       (11) Notwithstanding anything to the contrary in this section, it
 2   is not a violation of this section for a firm that does not hold a
 3   valid license under RCW 18.04.195 and that does not have an office in
 4   this state to use the title "CPA" or "certified public accountant" as
 5   part of the firm's name and to provide its professional services in
 6   this state, and licensees and individuals with practice privileges
 7   may provide services on behalf of such firms so long as it complies
 8   with the requirements of RCW 18.04.195(1). An individual or firm
 9   authorized under this subsection to use practice privileges in this
10   state must comply with the requirements otherwise applicable to
11   licensees in this section.

12       Sec. 16.   RCW 18.04.350 and 2018 c 224 s 2 are each amended to
13   read as follows:
14       (1) Nothing in this chapter prohibits any individual not holding
15   a license and not qualified for the practice privileges authorized by
16   subsection (2) of this section from serving as an employee of a firm
17   licensed under RCW 18.04.195 and 18.04.215. However, the employee
18   shall not issue any report as defined in this chapter, on the
19   information of any other persons, firms, or governmental units over
20   his or her name.
21       (2) An individual whose principal place of business is not in
22   this state shall be presumed to have qualifications substantially
23   equivalent to this state's requirements and shall have all the
24   privileges of licensees of this state without the need to obtain a
25   license under RCW 18.04.105 if the individual:
26       (a) Holds a valid license as a certified public accountant from
27   any state that requires, as a condition of licensure, that an
28   individual:
29       (i) Have at least one hundred fifty semester hours of college or
30   university education including a baccalaureate or higher degree
31   conferred by a college or university;
32       (ii) Achieve a passing grade on the uniform certified public
33   accountant examination; and
34       (iii) Possess at least one year of experience including service
35   or advice involving the use of accounting, attest, compilation,
36   management advisory, financial advisory, tax, or consulting skills,
37   all of which was verified by a licensee; or
38       (b) Holds a valid license as a certified public accountant from
39   any state that does not meet the requirements of (a) of this
                                     p. 35                         SB 5519
 1   subsection, but such individual's qualifications are substantially
 2   equivalent to those requirements. Any individual who passed the
 3   uniform certified public accountant examination and holds a valid
 4   license issued by any other state prior to January 1, 2012, may be
 5   exempt from the education requirements in (a)(i) of this subsection
 6   for purposes of this section.
 7       (3) Notwithstanding any other provision of law, an individual who
 8   qualifies for the practice privilege under subsection (2) of this
 9   section may offer or render professional services, whether in person
10   or by mail, telephone, or electronic means, and no notice, fee, or
11   other submission shall be provided by any such individual. Such an
12   individual shall be subject to the requirements of subsection (4) of
13   this section.
14       (4) Any individual licensee of another state exercising the
15   privilege afforded under subsection (2) of this section and the firm
16   that employs that licensee simultaneously consent, as a condition of
17   exercising this privilege:
18       (a) To the personal and subject matter jurisdiction and
19   disciplinary authority of the board;
20       (b) To comply with this chapter and the board's rules;
21       (c) That in the event the license from the state of the
22   individual's principal place of business is no longer valid, the
23   individual will cease offering or rendering professional services in
24   this state individually and on behalf of a firm; and
25       (d) To the appointment of the state board which issued the
26   certificate or license as their agent upon whom process may be served
27   in any action or proceeding by this state's board against the
28   certificate holder or licensee.
29       (5) An individual who qualifies for practice privileges under
30   subsection (2) of this section who performs any attest service
31   described in RCW 18.04.025(1) may only do so through a firm which has
32   obtained a license under RCW 18.04.195 and 18.04.215 or which meets
33   the   requirements  for   an  exception   from   the  firm   licensure
34   requirements under RCW 18.04.195(1) (a)(((iii))) (ii) or (b).
35       (6) A licensee of this state offering or rendering services or
36   using their CPA title in another state shall be subject to
37   disciplinary action in this state for an act committed in another
38   state for which the licensee would be subject to discipline for an
39   act committed in the other state. Notwithstanding RCW 18.04.295 and
40   this section, the board shall cooperate with and investigate any
                                     p. 36                         SB 5519
 1   complaint made by the board of accountancy of another state or
 2   jurisdiction.
 3       (7) Nothing in this chapter prohibits a licensee, a licensed
 4   firm, any of their employees, or persons qualifying for practice
 5   privileges by this section from disclosing any data in confidence to
 6   other certified public accountants, quality assurance or peer review
 7   teams, partnerships, limited liability companies, or corporations of
 8   certified public accountants or to the board or any of its employees
 9   engaged in conducting quality assurance or peer reviews, or any one
10   of their employees in connection with quality or peer reviews of that
11   accountant's accounting and auditing practice conducted under the
12   auspices of recognized professional associations.
13       (8) Nothing in this chapter prohibits a licensee, a licensed
14   firm, any of their employees, or persons qualifying for practice
15   privileges by this section from disclosing any data in confidence to
16   any employee, representative, officer, or committee member of a
17   recognized professional association, or to the board, or any of its
18   employees   or   committees   in  connection   with  a   professional
19   investigation held under the auspices of recognized professional
20   associations or the board.
21       (9) Nothing in this chapter prohibits any officer, employee,
22   partner, or principal of any organization:
23       (a) From affixing his or her signature to any statement or report
24   in reference to the affairs of the organization with any wording
25   designating the position, title, or office which he or she holds in
26   the organization; or
27       (b) From describing himself or herself by the position, title, or
28   office he or she holds in such organization.
29       (10) Nothing in this chapter prohibits any person or firm
30   composed of persons not holding a license under this chapter from
31   offering or rendering to the public bookkeeping, accounting, tax
32   services, the devising and installing of financial information
33   systems, management advisory, or consulting services, the preparation
34   of tax returns, or the furnishing of advice on tax matters, or
35   similar services, provided that persons, partnerships, limited
36   liability companies, or corporations not holding a license who offer
37   or render these services do not designate any written statement as a
38   report as defined in RCW 18.04.025(((21))) (20) or use any language
39   in any statement relating to the financial affairs of a person or


                                     p. 37                         SB 5519
 1   entity which is conventionally used by licensees in reports or any
 2   attest service as defined in this chapter.
 3       (11) Nothing in this chapter prohibits any person or firm
 4   composed of persons not holding a license under this chapter from
 5   offering or rendering to the public the preparation of financial
 6   statements, or written statements describing how such financial
 7   statements were prepared, provided that persons, partnerships,
 8   limited liability companies, or corporations not holding a license
 9   who offer or render these services do not designate any written
10   statement as a report as defined in RCW 18.04.025(((21))) (20), do
11   not issue any written statement that purports to express or disclaim
12   an opinion on financial statements that have been audited, and do not
13   issue any written statement that expresses assurance on financial
14   statements that have been reviewed. The board may prescribe, by rule,
15   language for the written statement describing how such financial
16   statements were prepared for use by persons not holding a license
17   under this chapter.
18       (12) Nothing in this chapter prohibits any act of or the use of
19   any words by a public official or a public employee in the
20   performance of his or her duties.
21       (13) Nothing contained in this chapter prohibits any person who
22   holds only a valid ((certificate)) license in an inactive status from
23   assuming or using the designation "certified public accountant-
24   inactive" or "CPA-inactive" or any other title, designation, words,
25   letters, sign, card, or device tending to indicate the person is ((a
26   certificate holder)) in an inactive status, provided, that such
27   person does not perform or offer to perform for the public one or
28   more kinds of services involving the use of accounting or auditing
29   skills, including issuance of reports or of one or more kinds of
30   management advisory, financial advisory, consulting services, the
31   preparation of tax returns, or the furnishing of advice on tax
32   matters.
33       (14) Nothing in this chapter prohibits the use of the title
34   "accountant" by any person regardless of whether the person ((has
35   been granted a certificate or)) holds a license under this chapter.
36   Nothing in this chapter prohibits the use of the title "enrolled
37   agent" or the designation "EA" by any person regardless of whether
38   the person ((has been granted a certificate or)) holds a license
39   under this chapter if the person is properly authorized at the time
40   of use to use the title or designation by the United States
                                     p. 38                         SB 5519
 1   department of the treasury. The board shall by rule allow the use of
 2   other titles by any person regardless of whether the person ((has
 3   been granted a certificate or)) holds a license under this chapter if
 4   the person using the titles or designations is authorized at the time
 5   of use by a nationally recognized entity sanctioning the use of board
 6   authorized titles.
 7       (15) Nothing in this chapter prohibits any firm holding a license
 8   or registration as a chartered professional accounting firm in the
 9   Canadian province of British Columbia from performing any of the
10   following services: (a) An attest or compilation engagement of a
11   business   entity  operating   in  Washington   state  that   is  the
12   consolidated, subsidiary, or component entity of another entity that
13   is operating in Canada who acts as the issuer of the report; or (b) a
14   stand-alone attest or compilation engagement of a wholly or majority-
15   owned subsidiary and/or component of an entity that is operating in
16   Canada.


17       Sec. 17.   RCW 18.04.350 and 2016 c 127 s 7 are each amended to
18   read as follows:
19       (1) Nothing in this chapter prohibits any individual not holding
20   a license and not qualified for the practice privileges authorized by
21   subsection (2) of this section from serving as an employee of a firm
22   licensed under RCW 18.04.195 and 18.04.215. However, the employee
23   shall not issue any report as defined in this chapter, on the
24   information of any other persons, firms, or governmental units over
25   his or her name.
26       (2) An individual whose principal place of business is not in
27   this state shall be presumed to have qualifications substantially
28   equivalent to this state's requirements and shall have all the
29   privileges of licensees of this state without the need to obtain a
30   license under RCW 18.04.105 if the individual:
31       (a) Holds a valid license as a certified public accountant from
32   any state that requires, as a condition of licensure, that an
33   individual:
34       (i) Have at least one hundred fifty semester hours of college or
35   university education including a baccalaureate or higher degree
36   conferred by a college or university;
37       (ii) Achieve a passing grade on the uniform certified public
38   accountant examination; and


                                     p. 39                         SB 5519
 1       (iii) Possess at least one year of experience including service
 2   or advice involving the use of accounting, attest, compilation,
 3   management advisory, financial advisory, tax, or consulting skills,
 4   all of which was verified by a licensee; or
 5       (b) Holds a valid license as a certified public accountant from
 6   any state that does not meet the requirements of (a) of this
 7   subsection, but such individual's qualifications are substantially
 8   equivalent to those requirements. Any individual who passed the
 9   uniform certified public accountant examination and holds a valid
10   license issued by any other state prior to January 1, 2012, may be
11   exempt from the education requirements in (a)(i) of this subsection
12   for purposes of this section.
13       (3) Notwithstanding any other provision of law, an individual who
14   qualifies for the practice privilege under subsection (2) of this
15   section may offer or render professional services, whether in person
16   or by mail, telephone, or electronic means, and no notice, fee, or
17   other submission shall be provided by any such individual. Such an
18   individual shall be subject to the requirements of subsection (4) of
19   this section.
20       (4) Any individual licensee of another state exercising the
21   privilege afforded under subsection (2) of this section and the firm
22   that employs that licensee simultaneously consent, as a condition of
23   exercising this privilege:
24       (a) To the personal and subject matter jurisdiction and
25   disciplinary authority of the board;
26       (b) To comply with this chapter and the board's rules;
27       (c) That in the event the license from the state of the
28   individual's principal place of business is no longer valid, the
29   individual will cease offering or rendering professional services in
30   this state individually and on behalf of a firm; and
31       (d) To the appointment of the state board which issued the
32   certificate or license as their agent upon whom process may be served
33   in any action or proceeding by this state's board against the
34   certificate holder or licensee.
35       (5) An individual who qualifies for practice privileges under
36   subsection (2) of this section who performs any attest service
37   described in RCW 18.04.025(1) may only do so through a firm which has
38   obtained a license under RCW 18.04.195 and 18.04.215 or which meets
39   the   requirements  for   an  exception   from   the  firm   licensure
40   requirements under RCW 18.04.195(1) (a)(((iii))) (ii) or (b).
                                     p. 40                         SB 5519
 1       (6) A licensee of this state offering or rendering services or
 2   using their CPA title in another state shall be subject to
 3   disciplinary action in this state for an act committed in another
 4   state for which the licensee would be subject to discipline for an
 5   act committed in the other state. Notwithstanding RCW 18.04.295 and
 6   this section, the board shall cooperate with and investigate any
 7   complaint made by the board of accountancy of another state or
 8   jurisdiction.
 9       (7) Nothing in this chapter prohibits a licensee, a licensed
10   firm, any of their employees, or persons qualifying for practice
11   privileges by this section from disclosing any data in confidence to
12   other certified public accountants, quality assurance or peer review
13   teams, partnerships, limited liability companies, or corporations of
14   certified public accountants or to the board or any of its employees
15   engaged in conducting quality assurance or peer reviews, or any one
16   of their employees in connection with quality or peer reviews of that
17   accountant's accounting and auditing practice conducted under the
18   auspices of recognized professional associations.
19       (8) Nothing in this chapter prohibits a licensee, a licensed
20   firm, any of their employees, or persons qualifying for practice
21   privileges by this section from disclosing any data in confidence to
22   any employee, representative, officer, or committee member of a
23   recognized professional association, or to the board, or any of its
24   employees   or   committees   in  connection   with  a   professional
25   investigation held under the auspices of recognized professional
26   associations or the board.
27       (9) Nothing in this chapter prohibits any officer, employee,
28   partner, or principal of any organization:
29       (a) From affixing his or her signature to any statement or report
30   in reference to the affairs of the organization with any wording
31   designating the position, title, or office which he or she holds in
32   the organization; or
33       (b) From describing himself or herself by the position, title, or
34   office he or she holds in such organization.
35       (10) Nothing in this chapter prohibits any person or firm
36   composed of persons not holding a license under this chapter from
37   offering or rendering to the public bookkeeping, accounting, tax
38   services, the devising and installing of financial information
39   systems, management advisory, or consulting services, the preparation
40   of tax returns, or the furnishing of advice on tax matters, or
                                     p. 41                         SB 5519
 1   similar services, provided that persons, partnerships, limited
 2   liability companies, or corporations not holding a license who offer
 3   or render these services do not designate any written statement as a
 4   report as defined in RCW 18.04.025(((21))) (20) or use any language
 5   in any statement relating to the financial affairs of a person or
 6   entity which is conventionally used by licensees in reports or any
 7   attest service as defined in this chapter.
 8       (11) Nothing in this chapter prohibits any person or firm
 9   composed of persons not holding a license under this chapter from
10   offering or rendering to the public the preparation of financial
11   statements, or written statements describing how such financial
12   statements were prepared, provided that persons, partnerships,
13   limited liability companies, or corporations not holding a license
14   who offer or render these services do not designate any written
15   statement as a report as defined in RCW 18.04.025(((21))) (20), do
16   not issue any written statement that purports to express or disclaim
17   an opinion on financial statements that have been audited, and do not
18   issue any written statement that expresses assurance on financial
19   statements that have been reviewed. The board may prescribe, by rule,
20   language for the written statement describing how such financial
21   statements were prepared for use by persons not holding a license
22   under this chapter.
23       (12) Nothing in this chapter prohibits any act of or the use of
24   any words by a public official or a public employee in the
25   performance of his or her duties.
26       (13) Nothing contained in this chapter prohibits any person who
27   holds only a valid ((certificate)) license in an inactive status from
28   assuming or using the designation "certified public accountant-
29   inactive" or "CPA-inactive" or any other title, designation, words,
30   letters, sign, card, or device tending to indicate the person is ((a
31   certificate holder)) in an inactive status, provided, that such
32   person does not perform or offer to perform for the public one or
33   more kinds of services involving the use of accounting or auditing
34   skills, including issuance of reports or of one or more kinds of
35   management advisory, financial advisory, consulting services, the
36   preparation of tax returns, or the furnishing of advice on tax
37   matters.
38       (14) Nothing in this chapter prohibits the use of the title
39   "accountant" by any person regardless of whether the person ((has
40   been granted a certificate or)) holds a license under this chapter.
                                     p. 42                         SB 5519
 1   Nothing in this chapter prohibits the use of the title "enrolled
 2   agent" or the designation "EA" by any person regardless of whether
 3   the person ((has been granted a certificate or)) holds a license
 4   under this chapter if the person is properly authorized at the time
 5   of use to use the title or designation by the United States
 6   department of the treasury. The board shall by rule allow the use of
 7   other titles by any person regardless of whether the person ((has
 8   been granted a certificate or)) holds a license under this chapter if
 9   the person using the titles or designations is authorized at the time
10   of use by a nationally recognized entity sanctioning the use of board
11   authorized titles.

12       Sec. 18.   RCW 18.04.370 and 2004 c 159 s 5 are each amended to
13   read as follows:
14       (1) Any person who violates any provision of this chapter shall
15   be guilty of a crime, as follows:
16       (a) Any person who violates any provision of this chapter is
17   guilty of a misdemeanor, and upon conviction thereof, shall be
18   subject to a fine of not more than thirty thousand dollars, or to
19   imprisonment for not more than six months, or to both such fine and
20   imprisonment.
21       (b) Notwithstanding (a) of this subsection, any person who uses a
22   professional title intended to deceive the public, in violation of
23   RCW 18.04.345, having previously entered into a stipulated agreement
24   and order of assurance with the board, is guilty of a class C felony,
25   and upon conviction thereof, is subject to a fine of not more than
26   thirty thousand dollars, or to imprisonment for not more than two
27   years, or to both such fine and imprisonment.
28       (c) Notwithstanding (a) of this subsection, any person whose
29   license ((or certificate)) was suspended or revoked by the board and
30   who uses the CPA professional title intending to deceive the public,
31   in violation of RCW 18.04.345, having previously entered into a
32   stipulated agreement and order of assurance with the board, is guilty
33   of a class C felony, and upon conviction thereof, is subject to a
34   fine of not more than thirty thousand dollars, or to imprisonment for
35   not more than two years, or to both fine and imprisonment.
36       (2) With the exception of first time violations of RCW 18.04.345,
37   subject to subsection (3) of this section whenever the board has
38   reason to believe that any person is violating the provisions of this
39   chapter it shall certify the facts to the prosecuting attorney of the
                                     p. 43                         SB 5519
 1   county in which such person resides or may be apprehended and the
 2   prosecuting attorney shall cause appropriate proceedings to be
 3   brought against such person.
 4       (3) The board may elect to enter into a stipulated agreement and
 5   orders of assurance with persons in violation of RCW 18.04.345 who
 6   have not previously been found to have violated the provisions of
 7   this chapter. The board may order full restitution to injured parties
 8   as a condition of a stipulated agreement and order of assurance.
 9       (4) Nothing herein contained shall be held to in any way affect
10   the power of the courts to grant injunctive or other relief as above
11   provided.

12       Sec. 19. RCW 18.04.405 and 2001 c 294 s 22 are each amended to
13   read as follows:
14       (1) A licensee((, certificate holder,)) or licensed firm, or any
15   of their employees shall not disclose any confidential information
16   obtained in the course of a professional transaction except with the
17   consent of the client or former client or as disclosure may be
18   required by law, legal process, the standards of the profession, or
19   as disclosure of confidential information is permitted by RCW
20   18.04.350 (((3))) (7) and (((4))) (8), 18.04.295(((8))) (9),
21   18.04.390, and this section in connection with quality assurance, or
22   peer reviews, investigations, and any proceeding under chapter 34.05
23   RCW.
24        (2) This section shall not be construed as limiting the authority
25   of this state or of the United States or an agency of this state, the
26   board, or of the United States to subpoena and use such confidential
27   information obtained by a licensee, or any of their employees in the
28   course of a professional transaction in connection with any
29   investigation, public hearing, or other proceeding, nor shall this
30   section be construed as prohibiting a licensee or certified public
31   accountant whose professional competence has been challenged in a
32   court of law or before an administrative agency from disclosing
33   confidential information as a part of a defense to the court action
34   or administrative proceeding.
35        (3) The proceedings, records, and work papers of a review
36   committee shall be privileged and shall not be subject to discovery,
37   subpoena, or other means of legal process or introduction into
38   evidence in any civil action, arbitration, administrative proceeding,
39   or board proceeding and no member of the review committee or person
                                     p. 44                         SB 5519
 1   who was involved in the peer review process shall be permitted or
 2   required to testify in any such civil action, arbitration,
 3   administrative proceeding, or board proceeding as to any matter
 4   produced, presented, disclosed, or discussed during or in connection
 5   with the peer review process, or as to any findings, recommendations,
 6   evaluations, opinions, or other actions of such committees, or any
 7   members thereof. Information, documents, or records that are publicly
 8   available are not to be construed as immune from discovery or use in
 9   any civil action, arbitration, administrative proceeding, or board
10   proceeding merely because they were presented or considered in
11   connection with the quality assurance or peer review process.

12       Sec. 20. RCW 18.04.430 and 1997 c 58 s 811 are each amended to
13   read as follows:
14       The board shall immediately suspend the ((certificate or))
15   license of a person who has been certified pursuant to RCW 74.20A.320
16   by the department of social and health services as a person who is
17   not in compliance with a support order or a residential or visitation
18   order. If the person has continued to meet all other requirements for
19   reinstatement during the suspension, reissuance of the license or
20   certificate shall be automatic upon the board's receipt of a release
21   issued by the department of social and health services stating that
22   the licensee is in compliance with the order.


23       NEW SECTION.   Sec. 21.   Sections 7, 9, 14, and 16 of this act
24   expire June 30, 2023.


25       NEW SECTION.   Sec. 22.   Sections 8, 10, 15, and 17 of this act
26   take effect June 30, 2023.

                                   --- END ---




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