Wyo. Code R. 061-0001-6
Accountants, Board of Certified Public
Chapter 6: Rules of Professional Conduct
Effective Date: 09/13/1996 to 12/10/1997
Rule Type: Superceded Rules & Regulations
Reference Number: 061.0001.6.09131996
Section 1. Preamble. This Code of Professional Conduct is promulgated under the authority granted by W.S. 33-3-108, which delegates to the Wyoming Board of Certified Public Accountants the power and duty to prescribe rules of professional conduct for establishing and maintaining high standards of competence and integrity in the profession of public accountancy.
(a) The Rules of Professional Conduct set out below rest upon the premises that the reliance of the public in general and of the business community in particular on sound financial reporting, and on the implication of professional competence which inheres in the authorized use of a legally restricted title relating to the practice of public accountancy, imposes on persons engaged in such practice certain obligations both to their clients and to the public. These obligations, which the Rules of Conduct are intended to enforce where necessary, include the obligation to maintain independence of thought and action, to strive continuously to improve one's professional skills, to observe where applicable generally accepted accounting principles and generally accepted auditing standards, to promote sound and informative financial reporting, to hold the affairs of clients in confidence, to uphold the standards of the public accounting profession, and to maintain high standards of personal conduct in all matters affecting one's fitness to practice public accounting.
(b) Acceptance of a permit holder to engage in the practice of public accounting, or to use titles which imply a particular competence so to engage, involves acceptance by the permit holder of such obligations, and accordingly of a duty to abide by the Rules of Conduct.
(c) The Rules of Conduct are intended to have application to all kinds of professional services performed in the practice of public accounting and to apply as well to all permit holders, whether or not engaged in the practice of public accounting, except where the wording of a Rule clearly indicates that the applicability is more limited.
(d) A permit holder who is engaged in the practice of public accounting outside the United States will not be subject to discipline by the Board for departing, with respect to such foreign practice, from any of the Rules, so long as his conduct is in accordance with standards of professional conduct applicable to the practice of public accounting in the country in which he is practicing. However, even in such a case, if a permit holder's name is associated with financial statements in such a manner as to imply that he is acting as an independent public accountant and under circumstances that would entitle the reader to assume that United States practices are followed, he will be expected to comply with Rules 202 and 203.
(e) In the interpretation and enforcement of the Rules of Conduct, the Board will give consideration, but not necessarily dispositive weight, to relevant interpretations, rulings and opinions issued by the Boards of other jurisdictions, and by appropriately authorized committees on ethics of professional organizations.
(a) Rule 101 - Independence. A permit holder shall not express an opinion on financial statements of an enterprise in such a manner as to imply that he is acting as an independent public accountant with respect thereto unless he is independent with respect to such enterprise. Independence will be considered to be impaired if, for example:
(i) During the period of his professional engagement, or at the time of expressing his opinion, the permit holder:
(A) had or was committed to acquire any direct or material indirect financial interest in the enterprise;
(B) was a trustee of any trust or executor or administrator of any estate if such trust or estate had or was committed to acquire any direct or material indirect financial interest in the enterprise;
(C) had any joint closely-held business investment with the enterprise or any officer, director or principal stockholder thereof which was material in relation to the net worth of either the permit holder or the enterprise;
(D) after January 1, 1992 obtained a loan of the type described in subsection (E)(I) of this section from an entity that, at the time of obtaining the loan, is a client requiring independence;
(E) had any loan to or from the enterprise or any officer, director or principal stockholder of the enterprise except (these exceptions are allowed only for loans that have not been renegotiated):
(I) loans of the following nature that existed as of January 1, 1992;
(a) home mortgages; or
(b) other secured loans, the collateral on which must equal or exceed the remaining balance of the loan at January 1, 1992 and at all times thereafter;
(c) loans not material to the net worth of the borrower; and
(II) loans that were obtained from a financial institution prior to its becoming a client requiring independence;
(III) loans that were obtained from a financial institution for which independence was not required and that were later sold to a client for which independence is required; or
(IV) loans that were obtained from a firm's financial institution client requiring independence, by a borrower prior to his or her becoming a member of the firm providing the services for the client; or
(V) other current secured loans such as automobile loans, passbook loans; credit cards and cash advances with an aggregate balance not paid of $5,000 or less; or similar type loans.
(ii) During the period covered by the financial statements, during the period of the professional engagements, or at the time of expressing an opinion, the permit holder:
(A) was connected with the enterprise as a promoter, underwriter or voting trustee, a director or officer or in any capacity equivalent to that of a member of management or of an employee; or
(B) was a trustee for any pension or profit-sharing trust of the enterprise.
The foregoing examples are not intended to be all-inclusive.
(b) Rule 102 - Integrity and Objectivity. In the performance of any professional service, a holder shall maintain objectivity and integrity, shall be free of conflicts of interest, and shall not knowingly misrepresent facts or subordinate his judgement to others.
(c) Rule 103 - Commissions. A permit holder shall not pay a commission to obtain a client, nor accept a commission for a referral to a client of products or services of others. This rule does not prohibit payments for the purchase of all, or a material part, of an accounting practice, or retirement payments to persons formerly engaged in the practice of public accounting, or payments to the heirs or estates of such persons.
(d) Rule 104 - Contingent Fees. Solely for purposes of this rule, fees are not regarded as being contingent if fixed by courts or other public authorities; or in tax matters, if determined based on the results of judicial proceedings or the findings of governmental agencies; or fees from services performed for other non-attest clients.
(i) A permit holder shall not offer or perform professional services for a fee which is contingent upon the findings or results of such services when providing any audit, review, or compilation of a financial statement when the certified public accountant expects, or reasonably might expect, that a third party will rely on the statements and the CPA does not disclose a lack of independence. This prohibition applies during the period in which the permit holder or permit holder's firm is engaged to perform any of the services listed above and the period covered by any historical financial statements involved in any such listed services.
(ii) A permit holder shall not prepare an original or amended tax return or claim for a tax refund for a contingent fee for any client.
(e) Rule 105 - Incompatible Occupations. A permit holder shall not concurrently engage in the practice of public accounting and in any other business or occupation which impairs his independence or objectivity in rendering professional services.
(a) Rule 201 - Competence. A permit holder shall not undertake any engagement for the performance of professional services which he cannot reasonably expect to complete with due professional competence in a timely manner, including compliance, where applicable, with Rules 202, 203, and 205.
(b) Rule 202 - Auditing Standards. A permit holder shall not permit his name to be associated with financial statements in such a manner as to imply that he is acting as an independent certified public accountant with respect to such financial statements unless he has complied with applicable generally accepted auditing standards. Generally accepted auditing standards are the standards set forth in the Codification of Statements on Auditing Standards, Numbers 1 through 79; Codification of Statements on Standards for Attestation Engagements as of January 1, 1996; Standards for Audits of Government Organizations, Programs, Activities and Functions issued by the United States General Accounting Office, June 1995 Revision; and other pronouncements having similar generally recognized authority are considered to be interpretations of generally accepted auditing standards, and departures therefrom must be justified by those who do not follow them. The above referenced standards are hereby adopted by the Board.
(c) Rule 203 - Accounting Principles. A permit holder shall not express an opinion that financial statements are presented in conformity with generally accepted accounting principles if such financial statements contain any departure from such accounting principles which has a material effect on the financial statements taken as a whole, unless the permit holder can demonstrate that by reason of unusual circumstances the financial statements would otherwise have been misleading. In such a case, the permit holder's report must describe the departure, the approximate effects thereof, if practicable, and the reason why compliance with the principle would result in misleading statement. For purposes of this rule, generally accepted accounting principles are considered to be defined by pronouncements issued by: the Financial Accounting Standards Board and its predecessor entities, as published in Accounting Standards, Current Text, General Standards as of June 1, 1996 and Accounting Standards, Current Text, Industry Standards as of June 1, 1996 the Governmental Accounting Standards Board, its predecessor entities, as published in the Codification of the Governmental Accounting
Standards; and similar pronouncements issued by other entities having similar generally recognized authority. The above referenced standards are hereby adopted by the Board.
(d) Rule 205 - Other professional standards. A permit holder, in the performance of management advisory services or accounting and review services, shall conform to the professional standards applicable to such services. For purposes of this rule, such professional standards are considered to be defined by Statements on Standards for Accounting and Review Services Numbers 1 through 7 respectively, issued by the American Institute of Certified Public Accountants and by similar pronouncements by other entities having similar generally recognized authority. The above referenced standards are hereby adopted by the Board.
(e) Rule 206 - Attestation standards. A permit holder shall not permit his name to be associated with assurances on representations other than historical financial statements unless such assurances have been made in accordance with the Statements on Standards for Attestation Engagements Numbers 1-5 as of June 30, 1996. These standards are hereby adopted by the Board.
(a) Rule 301 - Confidential Client Information. A permit holder shall not without the consent of his client disclose any confidential information pertaining to this client obtained in the course of performing professional services.
(i) This rule does not:
(A) relieve a permit holder of any obligation under Rules 202 and 203;
(B) affect in any way a permit holder's obligation to comply with a validly issued subpoena or summons enforceable by order of a court;
(C) prohibit disclosures in the course of a quality review of a permit holder's professional services; or
(D) Preclude a permit holder from responding to any inquiry made by the Board or any investigative or disciplinary body established by law or formally recognized by the Board.
(ii) Members of the Board and professional practice reviewers shall not disclose any confidential client information which comes to their attention from permit holders in disciplinary proceedings or otherwise in carrying out their responsibilities, except that they may furnish such information to an investigative or disciplinary body of the kind referred to above.
(b) Rule 302 - Records. A permit holder shall furnish to his client or former client, upon request made within a reasonable time after original issuance of the document in question; a permit holder is entitled to reasonable reimbursement:
(i) a copy of a tax return of the client;
(ii) a copy of any report, or other document, issued by the permit holder to or for such a client;
(iii) any accounting or other records belonging to, or obtained from or on behalf of, the client which the permit holder removed from the client's premises or received for the client's account, but the permit holder may make and retain copies of such documents when they form the basis for work done by him; and
(iv) a copy of the permit holder's working papers, to the extent that such working papers include records which would ordinarily constitute part of the client's books and records and are not otherwise available to the client.
(a) Rule 401 - Discreditable Acts. A holder shall not commit any act that reflects adversely on his fitness to engage in the practice of public accounting.
(b) Rule 402 - Acting Through Others. A permit holder shall not permit others to carry out on his behalf, either with or without compensation, acts which, if carried out by the permit holder, would place him in violation of the Rules of Conduct.
(c) Rule 403 - Advertising. A permit holder shall not use or participate in the use of any form of public communication having reference to his professional services which contains a false, fraudulent, misleading, deceptive or unfair statement or claim. A false, fraudulent, misleading, deceptive or unfair statement or claim includes, but is not limited to, a statement or claim which:
(i) contains a misrepresentation of fact;
(ii) is likely to mislead or deceive because if fails to make full disclosure of relevant facts;
(iii) contains any testimonial, laudatory, or other statement or implication that the permit holder's professional services are of exceptional quality, which are not supported by verifiable acts;
(iv) is intended or likely to create false or unjustified expectations of favorable results;
(v) implies educational or professional attainments, formal recognition as a specialist, or licensing recognition which cannot be verified;
(vi) represents that professional services can or will be competently performed for a stated fee when this is not the case, or makes representation with respect to fees for professional services that do not disclose all variables that may reasonably be expected to affect the fees that will in fact be charged; or
(vii) contains other representations or implications that in reasonable probability will cause an ordinarily prudent person to misunderstand or be deceived.
(d) Rule 405 - Form of Practice.
(i) A permit holder may practice public accounting in a proprietorship, a partnership, a corporation, or a limited liability company organized to comply with W.S. 33-3-118, 33-3-119, 33-3-120, or 17-15-103 and the Rules and Regulations.
(e) Rule 406 - Firm Names.
(i) A permit holder shall not practice public accounting under a firm name which is misleading in any way, as to the legal form of the firm, or as to the persons who are partners, members, officers or shareholders of the firm, or as to any matter with respect to which public communications are restricted by Rule 403. However, names of one (1) or more past partners, shareholders, or members may be included in the firm name of a partnership, corporation, or limited liability company or its successor, and a partner, shareholder, or member surviving the death or withdrawal of all other partners, shareholders, or members may continue to practice under a partnership, corporate, or limited liability company name for up to two (2) years after becoming a sole practitioner or sole shareholder.
(ii) Use of the terms 'and Company', 'and Co.', 'and Associates' or any other similar term is prohibited unless there is more than one certified public accountant who holds ownership interest in the firm.
(iii) A firm may not designate itself as 'Certified Public Accountants' unless all partners, shareholders, or members are licensed to practice as such and that firm is registered as such.
(iv) No misleading name may be adopted or used for any corporation, partnership, limited liability company, or proprietorship.
(f) Rule 407 - Communications. A permit holder shall, when requested, respond in writing to communications from the Board within thirty (30) days of the mailing of such communications by registered or certified mail.