TITLE 24

Professions and Occupations

CHAPTER 1. BOARD OF ACCOUNTANCY


The primary objective of the Board of Accountancy, to which all other objectives and purposes are secondary, is to protect the general public (specifically those persons who are direct recipients of services regulated by this chapter) from unsafe practices, including incompetent auditing, accounting and tax services rendered by certificate and permit holders, and from occupational practices which tend to reduce competition or fix the price of services rendered. Secondary objectives of the Board include maintaining minimum standards of competency in accounting, auditing and tax services rendered by certificate and permit holders and maintaining minimum standards in the delivery of such services to the public. In meeting its objectives, the Board shall develop standards assuring professional competence, shall monitor complaints brought against practitioners regulated by the Board, adjudicate such complaints at formal hearings, promulgate rules and regulations, and impose sanctions where necessary against practitioners.

71 Del. Laws, c. 139, § 1.;

The following definitions shall apply, unless the definition is inappropriate for the context:

(1) "AICPA" means the American Institute of Certified Public Accountants.

(2) "Attest" means providing the following services:

a. Any audit or other engagement to be performed in accordance with the Statements on Auditing Standards (SAS);

b. Any review of a financial statement to be performed in accordance with the Statements on Standards for Accounting and Review Services (SSARS);

c. Any examination of prospective financial information to be performed in accordance with the Statements on Standards for Attestation Engagements (SSAE);

d. Any engagement to be performed in accordance with the standards of the PCAOB; and

e. Any examination, review, or agreed upon procedures engagement to be performed in accordance with the SSAE, other than an examination described in paragraph (2)c. of this section.

(3) "Board" means the Delaware State Board of Accountancy.

(4) "Certificate" means a certificate of "certified public accountant" issued by the Board pursuant to this chapter or the prior law of this State, or a corresponding certificate of certified public accountancy issued after examination under the law of any other state.

(5) "Certified public accountant" means the holder of a permit to practice certified public accountancy.

(6) "Certified public accounting" or "the practice of certified public accountancy" means the performance, or offer to perform, for a client or a potential client, by a person or firm holding itself out to the public as a CPA permit holder, of 1 or more kinds of services involving the use of accounting or auditing skills, including the issuance of reports or financial statements, or of 1 or more kinds of management advisory, financial advisory or consulting services, or the preparation of tax returns or the furnishing of advice on tax matters.

(7) "Client" means a person or entity that agrees with a permit holder or permit holder's employer to receive any professional service.

(8) "Compilation" means providing a service to be performed in accordance with, and as defined by, Statements on Standards for Accounting and Review Services (SSARS).

(9) "Division" means the State of Delaware Division of Professional Regulation.

(10) "Firm" means a sole proprietorship, partnership, corporation or any other entity authorized under Delaware law or a similar statute of another state.

(11) "Licensee" means an individual or firm licensed under this title or under corresponding law in another jurisdiction.

(12) "NASBA" means the National Association of State Boards of Accountancy.

(13) "Nonpublic entity" means an entity other than one whose securities trade in a public market either on a stock exchange (domestic or foreign) or in the over-the-counter market, including securities quoted only locally or regionally, or an entity that makes a filing with a regulatory agency in preparation for the sale of any of its securities in a public market.

(14) "PCAOB" means the Public Company Accounting Oversight Board.

(15) "Peer review" means a board-approved study, appraisal, or review of 1 or more aspects of the attest and compilation services rendered by an individual or firm permit holder performed by a person or persons who hold Delaware permits or are duly licensed in another jurisdiction and who are not affiliated with the individual or firm permit holder being reviewed.

(16) "Permit" or "permit to practice" means a permit issued by the Board to practice either public accountancy or certified public accountancy.

(17) "Principal place of business" means the office location designated by the licensee.

(18) "Public accountant" means the holder of a permit to practice public accountancy.

(19) "Public accounting" or "practice of public accountancy" means the performance, or offer to perform, for a client or a potential client, by a person or firm holding itself out to the public as a permit holder, of 1 or more kinds of services involving the use of accounting or auditing skills, including the issuance of reports or financial statements, or of 1 or more kinds of management advisory, financial advisory or consulting services, or the preparation of tax returns or the furnishing of advice on tax matters.

(20) "Regulation" means any rule or regulation duly adopted by the Board.

(21) "Report" when used with reference to any attest or compilation service, means an opinion, report, or other form of language that states or implies assurance as to the reliability of the attested information or compiled financial statements and that also includes or is accompanied by any statement or implication that the person or firm issuing it has special knowledge or competence in accounting or auditing. Such a statement or implication of special knowledge or competence may arise from use by the issuer of the report of names or titles indicating that the person or firm is an accountant or auditor, or from the language of the report itself. The term "report" includes any form of language which disclaims an opinion when such form of language is conventionally understood to imply any positive assurance as to the reliability of the attested information or compiled financial statements referred to and/or special competence on the part of the person or firm issuing such language; and it includes any other form of language that is conventionally understood to imply such assurance and/or such special knowledge or competence.

(22) "State" means any state of the United States, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, the Commonwealth of the Northern Mariana Islands, and Guam; except that "this State" means the State of Delaware.

(23) "Substantial equivalency" is a determination by the Board of Accountancy or its designee that the education, examination and experience requirements contained in the statutes and administrative rules of another jurisdiction are comparable to, or exceed the education, examination and experience requirements contained in the Uniform Accountancy Act or that an individual CPA's education, examination and experience qualifications are comparable to or exceed the education, examination and experience requirements contained in the Uniform Accountancy Act. In ascertaining substantial equivalency as used in this act the Board shall take into account the qualifications without regard to the sequence in which experience, education or examination requirements were attained.

(24) "Substantially related" means the nature of the criminal conduct, for which the person was convicted, has a direct bearing on the fitness or ability to perform 1 or more of the duties or responsibilities necessarily related to accountancy.

60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 71 Del. Laws, c. 139, § 1; 74 Del. Laws, c. 262, § 1; 75 Del. Laws, c. 128, § 1; 76 Del. Laws, c. 418, § 1; 80 Del. Laws, c. 247, § 1.;

(a) There is created a State Board of Accountancy which shall administer and enforce this chapter.

(b) The Board shall consist of 9 members who are residents of this State and are appointed by the Governor, as follows:

(1) Five certified public accountants, all of whom must hold active permits to practice certified public accountancy;

(2) One public accountant who holds a valid permit to practice public accountancy;

(3) Two members from the public at large; and

(4) One public member who is employed full time in the field of post-secondary accounting education.

(c) To serve on the Board, the public members referred to in paragraph (b)(3) of this section, shall not be nor ever have been a certified public accountant or public accountant, nor a member of the immediate family of a certified public accountant or public accountant; shall not be nor ever have been employed by a person or firm which provides certified public accounting or public accounting services; shall not have a material financial interest in the providing of goods and services to any person or firm which provides accounting services; nor have been engaged in an activity directly related to accounting services. The public members shall be accessible to inquiries, comments and suggestions from the general public.

(d) Except as provided in subsection (e) of this section, each member shall serve for a term of 3 years and may succeed himself or herself for 1 additional term. Each term of office shall expire on the date specified in the appointment; however, the board member shall remain eligible to participate in board proceedings unless and until replaced by the Governor.

(e) A person who has never served on the Board may be appointed to the Board for 2 consecutive terms, but no such person shall thereafter be eligible for 2 consecutive appointments. No person who has been twice appointed to the Board or who has served on the Board for 6 years within any 9-year period shall again be appointed to the Board until an interim period of at least 3 years has expired since such person last served.

(f) Any act or vote by a person appointed in violation of this section shall be invalid. An amendment or revision of this chapter is not sufficient cause for any appointment or attempted appointment in violation of subsection (e) of this section, unless such amendment or revision amends this section to permit such an appointment.

(g) No member of the Board of Accountancy, while serving on the Board, shall be an officer (president, chairperson, president-elect, vice president, secretary or treasurer) of a professional accounting organization, including the American Institute of Certified Public Accountants (AICPA), the Delaware Society of Certified Public Accountants (DSCPA), the National Society of Public Accountants (NSPA), the Delaware Association of Public Accountants (DAPA) or any other professional accounting association.

(h) The provisions set forth for "employees" in Chapter 58 of Title 29 shall apply to members of the Board and to all agents appointed or otherwise employed by the Board.

(i) Any member who is absent without adequate reason for 3 consecutive meetings or fails to attend at least half of all regular business meetings during any calendar year shall be guilty of neglect of duty.

(j) Each member of the Board shall be compensated at an appropriate and reasonable level as determined by the Division and may be reimbursed for meeting-related travel expenses at the State's approved rate.

27 Del. Laws, c. 98, § 2; Code 1915, § 980; 32 Del. Laws, c. 48, § 2; Code 1935, § 1091; 46 Del. Laws, c. 110, § 1; 24 Del. C. 1953, § 101; 50 Del. Laws, c. 167, § 1; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 67 Del. Laws, c. 368, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 76 Del. Laws, c. 418, § 2; 80 Del. Laws, c. 247, § 1.;

(a) The Board shall hold a regularly scheduled business meeting at least once in each quarter of a calendar year and at such other times as the president may deem necessary, or at the request of a majority of Board members.

(b) The Board shall elect annually from its members a president and a secretary. Each officer shall serve for 1 year and shall not succeed himself or herself for more than 2 consecutive years.

(c) A majority of members of the Board shall constitute a quorum for the transaction of all business and no disciplinary action shall be taken without the affirmative vote of at least 5 members.

(d) Minutes of all meetings shall be recorded and copies shall be maintained by the Division. At any hearing in which evidence is presented, a record from which a verbatim transcript can be prepared shall be made. The expense of preparing any transcript shall be incurred by the person requesting it.

27 Del. Laws, c. 98, § 2; Code 1915, § 980; 32 Del. Laws, c. 48, § 2; Code 1935, § 1091; 46 Del. Laws, c. 110, § 1; 24 Del. C. 1953, § 101; 50 Del. Laws, c. 167, § 1; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1.;

(a) The Board of Accountancy shall have the authority to:

(1) Formulate rules and regulations, with appropriate notice to those affected. Each rule or regulation shall implement or clarify a specific section of this chapter. All rules and regulations shall be promulgated in accordance with the procedures specified in the Administrative Procedures Act, Chapter 101 of Title 29;

(2) Designate the application form to be used by all applicants and to process all applications;

(3) Designate an examination to be taken by persons applying for a permit, as follows:

a. The Board shall adopt the Uniform Certified Public Accountant Examination as the national examination to be taken by all applicants for licensure as certified public accountants and use the advisory grading service of the American Institute of Certified Public Accountants (AICPA), or its successor organization.

b. The Board shall adopt the examination recognized by the National Society of Public Accountants (NSPA) as the national examination to be taken by applicants for permits as public accountants and use the advisory grading service of the NSPA.

c. The Division shall have the power to review, approve and execute all contracts for examination services;

(4) Provide notice and information to applicants regarding their applications;

(5) Designate the requirements for the issuance of permits to practice consistent with the provisions of this chapter;

(6) [Repealed].

(7) Issue permits to practice to individuals and firms who meet the qualifications of this chapter;

(8) Require the completion of continuing education requirements for all licensees;

(9) Evaluate certified records to determine whether an applicant for a permit to practice, who has been previously licensed or certified, or who has held a certificate and/or permit in another jurisdiction, has engaged in any act or offense that would be grounds for disciplinary action under this chapter and whether there are disciplinary proceedings or unresolved complaints pending against such applicants for such acts or offenses;

(10) Refer all complaints from licensees and the public concerning accountants and the practice of public accounting or certified public accounting, or concerning practices of the Board or of the profession, or concerning the unlicensed practice of public accountancy or certified public accountancy, to the Division for investigation pursuant to § 8735 of Title 29 and assign a member of the Board to assist the Division in an advisory capacity with the investigation of the technical aspects of the complaint. Such member shall recuse himself or herself from the deliberations on the complaint;

(11) Conduct hearings and issue orders in accordance with procedures established pursuant to this chapter, the Administrative Procedures Act (Chapter 101 of Title 29) and § 8735 of Title 29. Where such provisions conflict with the provisions of this chapter, this chapter shall govern. The Board shall determine whether or not a person or firm shall be subject to a disciplinary hearing, and, if so, shall conduct such hearing in accordance with this chapter, the Administrative Procedures Act (Chapter 101 of Title 29) and § 8735 of Title 29;

(12) Where it has been determined, after a disciplinary hearing, that penalties or sanctions should be imposed, to designate and impose the appropriate sanction or penalty after time for appeal has lapsed;

(13) Bring proceedings in the courts for the enforcement of this chapter;

(14) To become a member of the National Association of State Boards of Accountancy or its successor organization and to pay such dues which that association shall establish; to send delegates to its meetings; and to assist members attending that association's meetings; and

(15) To require all applicants for permits to practice to obtain a passing grade on the Code of Ethics examination administered and graded by the American Institute of Certified Public Accountants (AICPA).

(b) The Board of Accountancy shall promulgate regulations specifically identifying those crimes which are substantially related to the practice of accountancy.

27 Del. Laws, c. 98, § 3; Code 1915, § 982; 32 Del. Laws, c. 48, §§ 2, 3; Code 1935, § 1093; 24 Del. C. 1953, § 106; 50 Del. Laws, c. 167, § 3; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 74 Del. Laws, c. 262, § 2; 76 Del. Laws, c. 418, § 3; 80 Del. Laws, c. 247, § 1.;

(a) The use of the title or designation "certified public accountant" or the abbreviation "CPA" or any other title, designation, words, letters, abbreviation, sign, card or device tending to indicate that a person is a certified public accountant shall be limited to a person who holds an active permit to practice issued by the Board pursuant to this chapter or issued under the laws of another jurisdiction. Holders of certificates only, who have never held a Delaware permit to practice, may not use the title or designation "certified public accountant" or the abbreviation "CPA" or any other title, designation, words, letters, abbreviation, sign, card or device tending to indicate that a person is a certified public accountant. Up to and including June 30, 2017, holders of certificates only who have held a Delaware permit to practice which has since lapsed may use the title or designation "certified public accountant" or the abbreviation "CPA" or any other title, designation, words, letters, abbreviation, sign, card or device tending to indicate that a person is a certified public accountant; provided that it is clearly indicated that such person is not holding himself or herself out as a practicing certified public accountant. Upon proper notification to the Board, holders of CPA permits to practice who no longer provide any type of service or advice involving the use of accounting, attest, compilation, management advisory, financial advisory, tax or consulting skills and who no longer meet the continuing education requirement under § 108 of this title must place the word "inactive" adjacent to their CPA title.

(b) The use of the title or designation "public accountant" or the abbreviation "PA" or any other title, designation, words, letters, abbreviation, sign, card or device tending to indicate that such person is a public accountant shall be limited to a person who holds a valid permit to practice public accountancy.

27 Del. Laws, c. 98, § 1; Code 1915, § 981; Code 1935, § 1092; 24 Del. C. 1953, § 103; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 75 Del. Laws, c. 128, § 2; 80 Del. Laws, c. 247, § 1.;

(a) Each person who is engaged in the practice of certified public accountancy and whose principal place of business is in this State, whether as a principal or employee of a firm, shall be required to obtain and maintain a valid permit to practice certified public accountancy. The permit to practice as a certified public accountant shall be granted to persons who meet the education, experience, lack of disqualifying conviction and examination requirements of the following subsections of this section and rules adopted thereunder and who make application therefore pursuant to § 108 of this title.

(b) The applicant has not been convicted of a crime that is substantially related to the practice of accountancy; however, after a hearing or review of documentation demonstrating that the applicant meets the specified criteria for a waiver, the Board, by an affirmative vote of a majority of the quorum, may waive this subsection, if it finds all of the following:

(1) For waiver of a felony conviction, more than 5 years have elapsed since the date of the conviction. At the time of the application the applicant may not be incarcerated, on work release, on probation, on parole or serving any part of a suspended sentence and must be in substantial compliance with all court orders pertaining to fines, restitution and community service.

(2) For waiver of a misdemeanor conviction or violation, at the time of the application the applicant may not be incarcerated, on work release, on probation, on parole or serving any part of a suspended sentence and must be in substantial compliance with all court orders pertaining to fines, restitution and community service.

(3) The applicant is capable of practicing accountancy in a competent and professional manner.

(4) The granting of the waiver will not endanger the public health, safety or welfare;

(c) The applicant has completed at least 150 semester hours of college education including a baccalaureate or higher degree conferred by an accredited college or university acceptable to the Board, the total educational program to include an accounting concentration or equivalent as determined by Board rule to be appropriate;

(d) The applicant has successfully passed the Uniform Certified Public Accountant Examination and/or such successor examinations as may be required to qualify for a permit to practice, provided that the applicant may not sit for said exams until that applicant has successfully completed at least 120 semester hours of college education including a baccalaureate or higher degree conferred by an accredited college or university acceptable to the Board, the total educational program to include an accounting concentration or equivalent as determined by Board rule to be appropriate;

(e) The applicant has successfully passed the AICPA self-study course and examination in professional ethics; and

(f) The applicant has had 1 year of experience. This experience shall include providing any type of service or advice involving the use of accounting, attest, compilation, management advisory, financial advisory, tax or consulting skills all of which was supervised by a United States certified public accountant, meeting requirements prescribed by the Board by rule. This experience would be acceptable if it was gained through employment in government, industry, academia or public practice.

27 Del. Laws, c. 98, § 3; Code 1915, § 982; 32 Del. Laws, c. 48, §§ 2, 3; Code 1935, § 1093; 45 Del. Laws, c. 82, § 1; 24 Del. C. 1953, § 104; 50 Del. Laws, c. 167, § 2; 55 Del. Laws, c. 193; 58 Del. Laws, c. 511, § 49; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 72 Del. Laws, c. 468, § 1; 74 Del. Laws, c. 262, § 3; 75 Del. Laws, c. 128, § 3; 75 Del. Laws, c. 436, § 1; 76 Del. Laws, c. 418, §§ 4-12; 77 Del. Laws, c. 199, § 1; 78 Del. Laws, c. 44, §§ 1, 2; 80 Del. Laws, c. 247, § 1.;

(a) The Board shall grant or renew permits to practice to persons who make application and demonstrate that:

(1) Their qualifications, including where applicable the qualifications prescribed by § 107 of this title, are in accordance with the following subsections of this section, or

(2) They are eligible under the substantial equivalency standard set out in § 109(a)(2) of this title.

(b) Permits to practice shall be initially issued, and renewed, for periods of not more than 2 years but in any event shall expire on June 30 of the odd-numbered year following issuance or renewal. Applications for such permits to practice shall be made in such form, and in the case of applications for renewal, between such dates, as the Board shall by rule specify, and the Board shall grant or deny any such application no later than 120 days after the application is filed in proper form.

(c) Reciprocal permits to practice shall be issued to applicants who have passed the Uniform CPA Examination and hold a valid CPA certificate, license or permit to practice in a substantially equivalent state or who individually are determined to be substantially equivalent.

(2) With regard to applicants that do not qualify for reciprocity under the substantial equivalency standard set out in § 109 of this title, the Board shall issue a permit to practice to a holder of a certificate, license or permit issued by another state upon a showing that:

a. The applicant passed the Uniform CPA Examination;

b. The applicant had 4 years of experience of the type described in § 107(f) of this title or meets comparable requirements prescribed by the Board by rule, after passing the examination upon which the applicant's certificate was based and within the 10 years immediately preceding the application; and

c. If the applicant's certificate, license or permit was issued more than 4 years prior to the application for issuance of an initial certificate under this section, that the applicant has fulfilled the requirements of continuing professional education that would have been applicable under subsection (d) of this section.

(d) Permits to practice shall be renewed biennially. An applicant for renewal of a permit under this section shall show that the applicant has completed no less than 80 hours of continuing professional education as determined by Board rule during the 2-year renewal period that has elapsed since the last biennial renewal date. If an applicant's initial permit to practice was issued less than 2 years prior to the renewal date, the applicant must fulfill the following continuing professional educational requirements:

(1) No continuing education requirement if initial permit was issued less than 1 year prior to the renewal date; or

(2) A prorated continuing professional education requirement as determined by Board rule if initial permit was issued 1 year or more, but less than 2 years, prior to the renewal date.

(e) For renewal of a permit to practice under this section, each licensee shall participate in a program of learning designed to maintain professional competency. Such program of learning must comply with rules adopted by the Board. The Board may by rule create an exception to this requirement for permit holders who do not perform or offer to perform 1 or more kinds of services involving the use of accounting or auditing skills, including issuance of reports on financial statements or of 1 or more kinds of management advisory, financial advisory or consulting services, or the preparation of tax returns or the furnishing of advice on tax matters, and who make application for inactive status to the Board. Licensees granted such an exception by the Board must place the word "inactive" adjacent to their CPA title on any business card, letterhead or other document or device with the exception of their CPA permit to practice, on which their CPA title appears. Holders of an inactive permit to practice certified public accountancy may apply to have their permit to practice reinstated pursuant to Board rule.

(f) Applicants for initial issuance or renewal of permits to practice under this section shall in their applications list all states in which they have applied for or hold certificates, licenses or permits and list any past denial, revocation or suspension of a certificate, license or permit, and each holder of or applicant for a permit to practice under this section shall notify the Board in writing, within 30 days after its occurrence, of any issuance, denial, revocation or suspension of a certificate, license or permit by another state.

(g) Holders of expired permits to practice as of July 1, 2016, may apply to have their permit to practice reinstated upon a showing that the applicant has completed no less than 80 hours of continuing professional education as determined by Board rule during the 2-year renewal period ending June 30, 2017. Any holder of an expired permit to practice who fails to reinstate his or her permit by June 30, 2017, shall be required to meet all of the requirements for the initial issuance of a permit to practice pursuant to this section.

80 Del. Laws, c. 247, § 1.;

(a)(1) An individual whose principal place of business is not in this State and who holds a valid license as a certified public accountant from any state which the NASBA National Qualification Appraisal Service has verified to be in substantial equivalence with the CPA licensure requirements of the AICPA/NASBA Uniform Accountancy Act shall be presumed to have qualifications substantially equivalent to this State's requirements and shall have all the privileges of permit holders of this State without the need to obtain a permit under § 108 of this title. Notwithstanding any other provision of law, an individual who offers or renders professional services, whether in person, by mail, telephone or electronic means, under this section shall be granted practice privileges in this State and no notice or other submission shall be provided by any such individual. Such an individual shall be subject to the requirements in paragraph (a)(3) of this section.

(2) An individual whose principal place of business is not in this State and who holds a valid license as a certified public accountant from any state which the NASBA National Qualification Appraisal Service has not verified to be in substantial equivalence with the CPA licensure requirements of the AICPA/NASBA Uniform Accountancy Act shall be presumed to have qualifications substantially equivalent to this State's requirements and shall have all the privileges of permit holders of this State without the need to obtain a permit under § 108 of this title if such individual obtains from the NASBA National Qualification Appraisal Service verification that such individual's CPA qualifications are substantially equivalent to the CPA licensure requirements of the AICPA/NASBA Uniform Accountancy Act. Any individual who passed the Uniform CPA Examination and holds a valid license issued by any other state prior to January 1, 2012, may be exempt from the education requirement in § 107(c) of this title for purposes of this paragraph (a)(2). Notwithstanding any other provision of law, an individual who offers or renders professional services, whether in person, by mail, telephone or electronic means, under this section shall be granted practice privileges in this State and no notice or other submission shall be provided by any such individual. Such an individual shall be subject to the requirements in paragraph (a)(3) of this section.

(3) An individual licensee of another state exercising the privilege afforded under this section and the firm which employs that licensee hereby simultaneously consent, as a condition of the grant of this privilege:

a. To the personal and subject matter jurisdiction and disciplinary authority of the Board;

b. To comply with this chapter and the Board's rules;

c. That in the event the license from the state of the individual's principal place of business is no longer valid, the individual will cease offering or rendering professional services in this State individually and on behalf of a firm; and

d. To the appointment of the State Board which issued their license as their agent upon whom process may be served in any action or proceeding by this Board against the licensee.

(b) A permit holder of this State offering or rendering services or using that permit holder's CPA title in another state shall be subject to disciplinary action in this State for an act committed in another state for which the permit holder would be subject to discipline for an act committed in the other state. The Board shall be required to investigate any complaint made by the board of accountancy of another state.

(c) Practice within this State by individuals who qualify for the practice privilege under this section shall not obligate a firm that does not maintain an office in this State to obtain a firm permit under § 111 of this title.

76 Del. Laws, c. 418, § 13; 80 Del. Laws, c. 247, § 1.;

(a) Each person who intends to be or is engaged in the practice of public accountancy in this State, whether as a principal of a firm or an employee of a firm, shall be required to obtain and maintain a valid permit to practice public accountancy. The Board shall grant and/or renew permits to persons who make application and demonstrate their qualifications in accordance with this section.

(b) Permits shall be issued and renewed for periods of 2 years.

(c) An applicant for initial issuance of a permit under this section shall show that the applicant:

(1) Has not been convicted of a crime that is substantially related to the practice of accountancy; however, after a hearing or review of documentation demonstrating that the applicant meets the specified criteria for a waiver, the Board, by an affirmative vote of a majority of the quorum, may waive this paragraph (c)(1) of this section, if it finds all of the following:

a. For waiver of a felony conviction, more than 5 years have elapsed since the date of the conviction. At the time of the application the applicant may not be incarcerated, on work release, on probation, on parole or serving any part of a suspended sentence and must be in substantial compliance with all court orders pertaining to fines, restitution and community service.

b. For waiver of a misdemeanor conviction or violation, at the time of the application the applicant may not be incarcerated, on work release, on probation, on parole or serving any part of a suspended sentence and must be in substantial compliance with all court orders pertaining to fines, restitution and community service.

c. The applicant is capable of practicing accountancy in a competent and professional manner.

d. The granting of the waiver will not endanger the public health, safety or welfare;

(2) Holds, at a minimum, an associate degree, conferred by an accredited college or university, or a degree from an accredited 2-year college with a concentration in accounting, or what the Board determines to be substantially the equivalent of such concentration;

(3) Has passed either all parts of the examination recognized by the National Society of Public Accountants or both the Financial Accounting and Reporting (FAR) and Auditing and Attestation (AUD) portions of the Uniform Certified Public Accountant Examination;

(4) Has successfully passed the AICPA self-study course and examination in professional ethics; and

(5) Has not engaged in any acts or offenses that would be grounds for disciplinary action under this chapter and has no disciplinary proceedings or unresolved complaints pending against the applicant in any jurisdiction where the individual has been or currently holds a permit to practice. Each holder of or applicant for a permit under this section shall notify the Board in writing, within 30 days after its occurrence, of any issuance, denial, revocation or suspension of a permit by another state.

(d) An applicant for renewal of a permit under this section shall show that the applicant has completed no less than 80 hours of continuing professional education as determined by Board rule during the 2-year renewal period that has elapsed since the last biennial renewal date. If an applicant's initial permit to practice was issued less than 2 years prior to the renewal date, the applicant must fulfill the following continuing professional education requirements:

(1) No continuing education requirement if initial permit was issued less than 1 year prior to the renewal date; or

(2) A prorated continuing professional education requirement as determined by Board rule if initial permit was issued 1 year or more, but less than 2 years, prior to the renewal date.

(e) No new permits to practice public accountancy shall be issued after December 31, 2016. Applications for reciprocal public accountant permits to practice will be accepted from public accountants who hold an active public accountant permit in good standing in another jurisdiction and who relocate to Delaware and identify Delaware as their primary residence. The Board may, by rule, require continuing education as a condition to issuance of the reciprocal permit.

65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 76 Del. Laws, c. 418, § 15; 80 Del. Laws, c. 247, § 1.;

(a) Each firm with an office in this State and which intends to be or is engaged in the practice of certified public accountancy or the practice of public accountancy in this State shall be required to obtain and maintain a valid permit to practice. The Board shall grant or renew permits to firms that make application and demonstrate their qualifications in accordance with this section.

(b) A firm that does not have an office in this State may engage in the practice of certified public accountancy in this State through an individual practicing pursuant to the practice privilege afforded by § 109 of this title without obtaining a permit under this section or otherwise notifying the Board.

(c) Permits shall be renewed biennially.

(d) An applicant for initial issuance or renewal of a CPA firm permit to practice under this section shall be required to show that:

(1) Notwithstanding any other provision of law, a simple majority of the ownership of the firm, in terms of financial interests and voting rights, of all partners, officers, shareholders, members or managers, belongs to holders of a CPA certificate, CPA permit, or CPA license who are licensed in some state. All partners, officers, shareholders, members or managers, whose principal place of business is in this State, and who perform certified public accounting services in this State hold a valid permit to practice under § 108 of this title, or the corresponding provision of prior law. Although firms may include nonlicensee owners, the firm and its ownership must comply with applicable rules promulgated by the Board.

(2) Any certified public accounting firm as defined in this title may include nonlicensee owners provided that:

a. The firm designated a permit holder of this State who is responsible for the proper registration of the firm and identifies that individual to the Board.

b. All nonlicensee owners are active individual participants in the certified public accounting firm or affiliated entities.

c. The firm complies with such other requirements as the Board may impose by rule.

(e) An applicant for initial issuance or renewal of a PA firm permit to practice under this section shall be required to show that:

(1) Notwithstanding any other provision of law, a simple majority of the ownership of the firm, in terms of financial interests and voting rights, of all partners, officers, shareholders, members or managers, belongs to holders of permits to practice under § 110 of this title. All partners, officers, shareholders, members or managers, whose principal place of business is in this State, and who perform public accounting services in this state hold a valid permit to practice under § 110 of this title. Although firms may include nonlicensee owners, the firm and its ownership must comply with applicable rules promulgated by the Board.

(2) Any public accounting firm as defined in this title may include nonlicensee owners provided that:

a. The firm designated a permit holder of this State who is responsible for the proper registration of the firm and identifies that individual to the Board.

b. All nonlicensee owners are active individual participants in the public accounting firm or affiliated entities.

c. The firm complies with such other requirements as the Board may impose by rule.

(f) For purposes of this section, the employees of a public accounting firm with its principal office or offices outside of this State must obtain a permit for those employees who work in excess of 80 hours in this State or who work for a client or clients located in this State. However, any firm which is engaged to practice public accountancy in this State, for even 1 hour, is required to obtain a permit. Every principal of a public accounting firm who is responsible for the accounting work in this State shall obtain an individual permit to practice under § 110 of this title.

(g), (h) [Repealed.]

(i) An applicant for initial issuance or renewal of a permit to practice under this section shall be required to register each office of the firm within this State with the Board and to affirm that all attest and compilation services rendered in this State are under the charge of a person holding an active permit to practice issued under this chapter or qualifies for the practice privilege under § 109 of this title.

(j) An applicant for initial issuance or renewal of permits under this section shall in his or her application list all states in which they have applied for or hold permits as CPA firms and list any past denial, revocation or suspension of a permit by any other state, and each holder of or applicant for a permit under this section shall notify the Board in writing, within 30 days after its occurrence, of any change in the identities of partners, officers, shareholders, members or managers whose principal place of business is in this State, any change in the number or location of offices within this State, any change in the identity of the persons in charge of such offices, and any issuance, denial, revocation or suspension of a permit by any other state.

(k) An applicant for initial issuance or renewal of permits under this section shall in his or her application list all states in which they have applied for or hold permits as PA firms and list any past denial, revocation or suspension of a permit by any other state, and each holder of or applicant for a permit under this section shall notify the Board in writing, within 30 days after its occurrence, of any change in the identities of partners, officers, shareholders, members or managers whose principal place of business is in this State, any change in the number or location of offices within this State, any change in the identity of the persons in charge of such offices, and any issuance, denial, revocation or suspension of a permit by any other state.

(l) Firms which fall out of compliance with the provisions of this section due to changes in ownership or personnel, after receiving or renewing a permit, shall take corrective action to bring the firm back into compliance within 60 days. Failure to bring the firm back into compliance within 60 days will result in the suspension or revocation of the firm permit.

(m) Effective July 1, 2017, the Board shall by rule require as a condition to renewal of permits under this section, that firms that provide attest and/or compilation services be enrolled in a board-approved peer review program and comply with the applicable standards and guidance of that program, provided that any such rule:

(1) Shall be promulgated reasonably in advance of the time when it first becomes effective;

(2) Shall include reasonable provision for compliance by a firm showing that it has, within the preceding 3 years, undergone a peer review. Such compliance requirement shall first be effective for the renewal period ending June 30, 2019; and

(3) Shall require, with respect to any organization administering peer review programs, that it be subject to evaluations by the Board or its designee, to periodically assess the effectiveness of the peer review program under its charge.

65 Del. Laws, c. 167, § 1; 71 Del. Laws, c. 139, § 1; 75 Del. Laws, c. 128, § 5; 76 Del. Laws, c. 418, § 16; 80 Del. Laws, c. 247, § 1.;

While § 111(a) of this title requires firms to obtain permits to practice, and § 102(10) of this title defines "firm" to include valid partnerships and corporations, this chapter shall not be interpreted to alter professional responsibility standards. All firms and accountants practicing in firms shall continue to be bound by professional responsibility standards no less stringent than those stated in § 608 of Title 8.

71 Del. Laws, c. 139, § 1; 80 Del. Laws, c. 247, § 1.;

The Board may, by regulation, prescribe the terms and conditions for granting credit to a candidate for a permit to practice certified public accountancy or an applicant for a permit to practice public accountancy based on the candidate's or applicant's satisfactory completion of an examination in any 1 or more of the subjects of the Uniform Certified Public Accountant Examination, the examination recognized by the National Society of Public Accountants and any written examination in any other subject or subjects given by the Board or by the licensing authority in any other jurisdiction.

27 Del. Laws, c. 98, § 3; Code 1915, § 982; 32 Del. Laws, c. 48, §§ 2, 3; Code 1935, § 1093; 24 Del. C. 1953, § 105; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 80 Del. Laws, c. 247, § 1.;

27 Del. Laws, c. 98, § 4; Code 1915, § 983; Code 1935, § 1094; 45 Del. Laws, c. 82, § 2; 24 Del. C. 1953, § 107; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 71 Del. Laws, c. 139, § 1; 75 Del. Laws, c. 128, § 6;repealed by 80 Del. Laws, c. 247 § 1, eff. May 25, 2016. ;

(a) No person or firm shall perform compilation, review or audit services, as defined by the American Institute of Certified Public Accountants (AICPA), except holders of a valid permit to practice.

(b) Audit services provided by holders of permits to practice public accountancy shall be limited to services for nonpublic entities.

65 Del. Laws, c. 167, § 1; 71 Del. Laws, c. 139, § 1.;

(a) The Board or any aggrieved person may file a complaint against any individual or firm holding a permit to practice or any certificate holder. All complaints shall be received and investigated by the Division in accordance with § 8735 of Title 29, and the Division shall be responsible for issuing a final written report at the conclusion of its investigation. The Division may refer a complaint against an individual practicing under § 109 of this title to the state of licensure for handling.

(b) When it is determined that an individual or firm is engaged in the practice of certified public accountancy or public accountancy without having first obtained the appropriate permit, the Board shall apply to the Division of Professional Regulation to issue a cease and desist order.

(c) Any complaints involving allegations of unprofessional conduct or incompetence shall be investigated by the Division of Professional Regulation.

71 Del. Laws, c. 139, § 1; 76 Del. Laws, c. 418, § 17; 80 Del. Laws, c. 247, § 1.;

An individual holding a certificate and any individual or firm holding a permit to practice shall be subject to those disciplinary actions set forth in § 118 of this title if, after a hearing, the Board finds that the individual or firm:

(1) Has employed or knowingly cooperated in fraud or material deception in order to acquire or renew a certificate or permit to practice or be otherwise authorized to practice accountancy; or impersonated another person holding a certificate or permit to practice; or allowed another person to use the individual's certificate or permit to practice; or aided or abetted a person not holding a certificate or permit to practice to represent himself or herself as holding a certificate or permit to practice;

(2) Has engaged in an act of fraud or gross negligence in the practice of accounting or engaged in dishonorable, unethical or unprofessional conduct intended to or likely to deceive, defraud or harm the public;

(3) Has been found guilty of or has entered a plea of guilty or nolo contendere to a crime that is substantially related to the practice of accountancy;

(4) Has been subject to disciplinary sanction or censured or has had the individual's certificate or permit to practice revoked or suspended in any other state for any cause other than failure to pay an annual registration fee;

(5) Has been subject to disciplinary sanction or censured or has had the individual's right to practice revoked before any state or federal agency; or

(6) Has violated a lawful provision of this chapter or any lawful regulation or rule of professional conduct established thereunder.

27 Del. Laws, c. 98, § 5; Code 1915, § 984; Code 1935, § 1095; 24 Del. C. 1953, § 108; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 74 Del. Laws, c. 262, § 4; 76 Del. Laws, c. 418, § 18; 80 Del. Laws, c. 247, § 1.;

(a) The Board may impose any of the following sanctions or take any of the following actions, singly or in combination, when it finds that 1 or more of the conditions or violations set forth in § 117 of this title applies to a certificate or permit holder or to an individual or firm with practice privileges under § 109 of this title:

(1) Issue a letter of reprimand;

(2) Censure the certificate or permit holder or individual or firm with practice privileges under § 109 of this title;

(3) Suspend the certificate or permit to practice or the practice privilege of the individual or firm;

(4) Place the certificate or permit holder or the practice privilege holder on probationary status and require him or her to:

a. Report regularly to the Board upon the matters which are the basis of the probation;

b. Limit all practice and professional activities to those areas prescribed by the Board; and/or

c. Continue or renew his or her professional education until the required degree of skill has been attained in the areas which are the basis of the probation;

(5) Revoke the certificate or permit to practice or practice privilege of an individual or firm;

(6) Impose a fine of up to $10,000 for each offense, at the discretion of the Board; and/or

(7) Require the certificate or permit holder or practice privilege holder or firm to reimburse the Division for the cost of the investigation, including but not limited to, legal assistance, public hearings, materials, human resources, contractual assistance and appropriate salary and overtime pay for all state employees involved notwithstanding merit system laws or regulations to the contrary.

(b) The Board may refuse or reject an applicant for a permit to practice if, after a hearing, the Board finds that an applicant has misstated or misrepresented a material fact in connection with the applicant's application; has violated any section of the AICPA Code of Professional Conduct; or practiced public accountancy or certified public accountancy without being registered in accordance with this chapter.

(c) The Board may withdraw or reduce conditions of probation when it finds that the deficiencies which required such actions have been remedied.

(d) Upon an application (or petition), in writing, and after notice and a hearing, the Board may issue a new permit to practice or a practice privilege to a person or firm whose certificate or permit or practice privilege has been revoked or suspended or modify the terms of any suspension.

(e) In the event of a formal or informal complaint concerning the activity of a certificate or permit holder that presents a clear and immediate danger to the public health, safety or welfare, the Board may temporarily suspend the person's certificate or permit, pending a hearing, upon the written order of the Secretary of State or the Secretary's designee, with the concurrence of the Board chair or the Board chair's designee. An order temporarily suspending a certificate or permit may not be issued unless the person or the person's attorney received at least 24 hours' written or oral notice before the temporary suspension so that the person or the person's attorney may file a written response to the proposed suspension. The decision as to whether to issue the temporary order of suspension will be decided on the written submissions. An order of temporary suspension pending a hearing may remain in effect for no longer than 60 days from the date of the issuance of the order unless the temporarily suspended person requests a continuance of the hearing date. If the temporarily suspended person requests a continuance, the order of temporary suspension remains in effect until the hearing is convened and a decision is rendered by the Board. A person whose certificate or permit has been temporarily suspended pursuant to this section may request an expedited hearing. The Board shall schedule the hearing on an expedited basis, provided that the Board receives the request within 5 calendar days from the date on which the person received notification of the decision to temporarily suspend the person's certificate or permit.

60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 76 Del. Laws, c. 418, §§ 19, 20; 79 Del. Laws, c. 213, § 2; 80 Del. Laws, c. 247, § 1.;

(a) If a complaint is filed with the Board pursuant to § 8735 of Title 29, alleging violation of § 117 of this title, the Board shall set a time and place to conduct a hearing on the complaint. Notice of the hearing shall be given and the hearing conducted in accordance with this chapter, § 8735 of Title 29 and the Administrative Procedures Act, Chapter 101 of Title 29.

(b) Upon reaching its conclusion of law and determining an appropriate sanction, if any, the Board shall issue a written decision and order in accordance with § 10128 of Title 29. The order must restate the factual findings, but need not summarize the evidence presented. The decision and order may be issued over the signature of only the President or other officer of the Board. The decision and order must be sent by certified mail, return receipt requested, to the subject of the complaint.

(c) [Repealed.]

60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 71 Del. Laws, c. 139, § 1; 80 Del. Laws, c. 247, § 1.;

(a) All statements, records, schedules, working papers and memoranda made by a permit holder or a partner, shareholder, officer, director or employee of a permit holder, incident to or in the course of rendering services to a client, except the reports submitted by the permit holder to the client, and except for records that are part of the client's records, shall be and remain the property of the permit holder in the absence of an express agreement between the permit holder and the client to the contrary. No such statement, record, schedule, working paper or memorandum shall be sold, transferred or bequeathed without the consent of the client or the client's personal representative or assignee, to anyone other than 1 or more surviving partners or stockholders or new partners or stockholders of the permit holder or any combined or merged firm or successor in interest to the permit holder. Nothing in this section should be construed as prohibiting any temporary transfer of working papers or other material necessary in the course of carrying out quality reviews.

(b) A permit holder shall furnish to permit holder's client or former client, upon request and reasonable notice:

(1) A copy of the permit holder's working papers, to the extent that such working papers include records that would ordinarily constitute part of the client's records and are not otherwise available to the client; or

(2) Any accounting or other records belonging to or obtained from or on behalf of the client that the permit holder removed from the client's premises or received for the client's account; the permit holder may make and retain copies of such documents of the client when they form the basis for work done by the permit holder.

(c) Nothing herein shall require a permit holder to keep any working paper beyond the period prescribed in any other applicable statute.

24 Del. C. 1953, § 110; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1.;

(a) Where the Board has determined, upon notice and hearing pursuant to Chapter 101 of Title 29, that a person is engaged in the practice of certified public accountancy or public accountancy, or is representing himself or herself to the public as the recipient of a certificate or permit, or is holding himself or herself out as being authorized to practice certified public accountancy or public accountancy, without having lawfully obtained a certificate or permit, or without having a practice privilege under § 109 of this title, or otherwise wrongfully uses such title or any similar title to practice certified public accountancy or public accountancy, or continues to practice certified public accountancy or public accountancy after the revocation or suspension of a practice privilege in this State or after the revocation, suspension or expiration of a certificate or permit from this State or another state, the Board may apply to the Division of Professional Regulation to issue a cease and desist order.

(b) Where the Board has determined, upon notice and hearing pursuant to Chapter 101 of Title 29, that a firm is improperly holding itself out as being authorized to practice certified public accountancy or public accountancy, the Board may apply to the Division of Professional Regulation to issue a cease and desist order.

(c) [Repealed.]

(d) Any person or entity who violates any provisions of this chapter or any rules or regulations promulgated hereunder, shall be liable for a civil penalty as set forth in § 118(a)(6) of this title. Where a partnership or corporation engages in the practice of certified public accountancy or public accountancy in violation of this chapter, or any rules or regulations promulgated hereunder, every partner of such partnership and every officer, director, shareholder or principal of such corporation, shall be deemed to have committed the violation in question. Nothing in this section shall be construed to prevent prosecution under, or be inconsistent with, Chapter 5 of Title 11.

27 Del. Laws, c. 98, § 7; Code 1915, § 986; Code 1935, § 1097; 24 Del. C. 1953, § 114; 55 Del. Laws, c. 193; 60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 70 Del. Laws, c. 186, § 1; 71 Del. Laws, c. 139, § 1; 76 Del. Laws, c. 418, § 21; 80 Del. Laws, c. 247, § 1.;

(a) Any person legally authorized to practice as a certified public accountant in this State as of July 1, 1985, shall thereafter possess the same rights and privileges as persons to whom permits to practice certified public accountancy shall be issued pursuant to this chapter, subject, however, to the power of the Board, as provided in this chapter, to suspend or revoke the certificate and/or permit to practice of such person or censure or reprimand such person for any of the causes set forth in this chapter.

(b) Any person who holds a valid certificate issued under this chapter and regulations of the Board in effect on or before June 30, 1985, shall be deemed to have sufficient education and experience to satisfy the experience requirement of § 107(c) of this title.

(c) Any firm holding a valid permit to practice as of December 31, 2015, that would otherwise not quality for renewal solely based on § 111(d) of this title shall nevertheless be eligible for renewal.

(d) [Repealed.]

60 Del. Laws, c. 198, § 1; 65 Del. Laws, c. 167, § 1; 71 Del. Laws, c. 139, § 1; 75 Del. Laws, c. 128, §§ 7, 10; 80 Del. Laws, c. 247, § 1.;

Any person legally authorized to practice as a public accountant in this State as of June 30, 1985, or who had a permit to practice public accountancy on that date shall thereafter possess the same rights and privileges as persons to whom permits to practice public accountancy shall be issued pursuant to § 110 of this title, subject, however, to the power of the Board, as provided in this chapter, to suspend or revoke the permit of such person or censure or reprimand such person for any of the causes set forth in this chapter.

65 Del. Laws, c. 167, § 1; 66 Del. Laws, c. 132; 71 Del. Laws, c. 139, § 1.;

In the event that a permit holder fails to timely renew a permit, such permit can be reinstated within a period of 1 year from the lapse of the permit to practice, at the discretion of the Board, upon payment of the regular renewal fee plus an additional late renewal processing fee established by the Division of Professional Regulation, and upon the permit holder furnishing proof of compliance with all other permit requirements established by the Board, including proof that the permit holder has met the continuing education requirements established by the Board.

(a) Notwithstanding any provision to the contrary contained herein, an individual who is not a licensee of the Board shall not be prohibited the use of the following titles: the unadorned word "Accountant"; "Enrolled Agent" or initials "E.A."; "Accredited business Advisor" or the initials "A.B.A."; "Accredited Tax Preparer" or the initials "A.T.P."; "Accredited Tax Advisor" or the initials "A.T.A."

(b) Notwithstanding any provision to the contrary contained herein, an individual who is not a licensee of the Board shall not be prohibited the use of the following language in connection with financial statements:

"I (we) have prepared the accompanying (financial statements) of (name of entity) as of (time period) for the (period) then ended. This presentation is limited to preparing in the form of financial statements information that is the representation of management (owners).

"I (we) have not audited or reviewed the accompanying financial statements and accordingly do not express an opinion or any other form of assurance on them."

76 Del. Laws, c. 418, § 23.;