1. (a) A certificate or registration holder engaged in the client practice of public accountancy must practice through an entity meeting the ownership requirements of the Act and registered with the board pursuant to the Act, §901.351, if:

   1. (1) the certificate or registration holder engages in the client practice of public accountancy in an entity that is eligible for registration and is required to register under the Act, §901.351 and §901.354; or
   2. (2) the services offered or performed include the performance of attest or compilation services, or issuance of reports on financial statements, including historical or prospective financial statements or any element thereof.
2. (b) A certificate or registration holder engaged in the client practice of public accountancy who is not required to practice through an entity registered with the board pursuant to subsection (a) of this section must, in each advertisement or written statement by the certificate or registration holder and/or by his employer or principal, in which reference is made to the certificate or registration holder's CPA designation or his or her association with the employer or principal as such, include an asterisk by the name of the employer or principal, which asterisk shall refer to a notation included within conspicuous proximity and with reasonable prominence that says "Not qualified to register with the Texas State Board of Public Accountancy to practice public accountancy in Texas." The notation must be printed in type not less bold than that contained in the body of the advertisement or written statement. If the advertisement is in audio format only, the foregoing notation shall be clearly declared at the conclusion of each such presentation.

3. (c) The requirements of this section do not apply with regard to a certificate or registration holder performing services:

   1. (1) as a licensed attorney at law of this state while in the practice of law or as an employee of a licensed attorney when acting within the scope of the attorney's practice of law; or
   2. (2) as an employee, officer, or director of a federally-insured depository institution, when lawfully acting within the scope of the legally permitted activities of the institution's trust department.
4. (d) On the third determination by the board that a certificate holder has practiced without a license or through an unregistered entity in violation of subsection (c) of this section, the individual's certificate shall be subject to revocation and may not be reinstated for at least 12 months from the date of the revocation.

Source Note:The provisions of this §501.81 adopted to be effective June 11, 2000, 25 TexReg 5339.