S T A T E O F N E W Y O R K
________________________________________________________________________
7841
2013-2014 Regular Sessions
I N A S S E M B L Y
June 6, 2013
___________
Introduced by M. of A. WRIGHT -- read once and referred to the Committee
on Higher Education
AN ACT to amend the education law, in relation to certified public
accountants
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivision 2 of section 7408 of the education law, as
amended by chapter 651 of the laws of 2008, is amended to read as
follows:
2. A. No firm shall use the words "certified public accountant" or
"certified public accountants" or the letters "CPA" or "CPAs" in
connection with its name unless the sole proprietor of such firm or each
partner of a partnership or limited liability partnership, member of a
limited liability company or shareholder of a professional service
corporation engaged within the United States in the practice of public
accountancy is in good standing as a certified public accountant of one
or more of the states of the United States. NOTWITHSTANDING ANY OTHER
PROVISIONS OF LAW TO THE CONTRARY, AN APPLICANT FOR INITIAL ISSUANCE OR
RENEWAL OF A FIRM PERMIT TO PRACTICE UNDER THIS SECTION SHALL BE
REQUIRED TO SHOW (1) THAT A SIMPLE MAJORITY OF THE OWNERSHIP OF THE
FIRM, IN TERMS OF FINANCIAL INTERESTS AND VOTING RIGHTS HELD BY THE
FIRM'S OWNERS, BELONGS TO INDIVIDUALS LICENSED TO PRACTICE PUBLIC
ACCOUNTANCY IN SOME STATE, AND (2) THAT ALL PARTNERS OF A PARTNERSHIP OR
LIMITED LIABILITY PARTNERSHIP, OR MEMBERS OF A LIMITED LIABILITY COMPA-
NY, OR SHAREHOLDERS OF A PROFESSIONAL SERVICE CORPORATION WHOSE PRINCI-
PAL PLACE OF BUSINESS IS IN THIS STATE, AND WHO ARE ENGAGED IN THE PRAC-
TICE OF PUBLIC ACCOUNTANCY IN THIS STATE, HOLD A VALID LICENSE ISSUED
UNDER SECTION SEVENTY-FOUR HUNDRED FOUR OF THIS ARTICLE OR ARE PUBLIC
ACCOUNTANTS LICENSED UNDER SECTION SEVENTY-FOUR HUNDRED FIVE OF THIS
ARTICLE. ALTHOUGH FIRMS MAY INCLUDE NON-LICENSEE OWNERS, THE FIRM AND
ITS OWNERS MUST COMPLY WITH RULES PROMULGATED BY THE BOARD. NOTWITH-
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10267-01-3
A. 7841 2
STANDING THE FOREGOING, A FIRM REGISTERED UNDER THIS SECTION MAY NOT
HAVE NON-LICENSEE OWNERS IF THE FIRM'S NAME INCLUDES THE WORDS "CERTI-
FIED PUBLIC ACCOUNTANT," OR "CERTIFIED PUBLIC ACCOUNTANTS," OR THE
ABBREVIATIONS "CPA" OR "CPAS."
B. EACH NON-LICENSEE OWNER OF A FIRM THAT IS REGISTERED UNDER THIS
SECTION SHALL BE (1) A NATURAL PERSON WHO ACTIVELY PARTICIPATES IN THE
BUSINESS OF THE FIRM OR ITS AFFILIATED ENTITIES, OR (2) AN ENTITY,
INCLUDING, BUT NOT LIMITED TO, A PARTNERSHIP OR PROFESSIONAL CORPO-
RATION, PROVIDED EACH BENEFICIAL OWNER OF AN EQUITY INTEREST IN SUCH
ENTITY IS A NATURAL PERSON WHO ACTIVELY PARTICIPATES IN THE BUSINESS
CONDUCTED BY THE FIRM OR ITS AFFILIATED ENTITIES. FOR PURPOSES OF THIS
SUBDIVISION, "ACTIVELY PARTICIPATE" MEANS TO PROVIDE SERVICES TO CLIENTS
OR TO OTHERWISE INDIVIDUALLY TAKE PART IN THE DAY-TO-DAY BUSINESS OR
MANAGEMENT OF THE FIRM.
S 2. This act shall take effect immediately.