Embarking on a career as a licensed public accountant or certified public accountant (CPA) in New York demands significant sacrifice. New York CPAs have achieved licensure through an involving process consisting of extensive education, challenging examinations, and completing thousands of hours of work under the supervision of a licensed accountant. After such considerable dedication to entering the profession, it's disheartening to think that an allegation of misconduct could put everything at risk.
The New York State Office of the Professions (OP) is tasked with investigating any complaints lodged against licensed professionals, regardless of the basis of these complaints. Should an investigation find the complaints warranted, it could lead to disciplinary actions, potentially resulting in the suspension or revocation of your license.
While you may feel hopeless in these situations, help is available! Contact the Lento Law Firm's nationwide Professional License Defense Team today by calling 888-535-3686 or by utilizing our online contact form.
New York CPAs
New York CPAs play a crucial role in the State's complex regulatory environment. Unlike some other metropolitan areas in the county, financial reporting in New York leaves no room for error; investor confidence and market stability depend on it. Given the state's diverse business environment and complex tax regulations, CPAS must exist within a competitive environment where their reliability and professional reputation are paramount.
Given the state's dynamic financial landscape, New York CPAs also offer strategic advice on mergers and acquisitions, financial restructuring, and other corporate finance activities. New York CPAs are also at the forefront of innovation and technological advancement within the state, ranging from social medical companies to start-ups, blockchain, and AI.
Never short on essential duties, New York CPAs are renowned for their success and trustworthiness in the world's biggest financial market.
Public Accountancy Practice Expectations
In New York, licensed CPAs are engaged in the practice of public accountancy when they provide services outlined in the scope of practice provisions of section 70.1 of the Commissioner's Regulations. Under these regulations, this practice is defined broadly to include the following services:
- Attest and Compilation Services: CPAs offer or perform services involving the attestation and compilation of financial information, which encompasses a range of activities focused on the accuracy and presentation of financial data.
- Professional Services Related to Accounting: CPAs must be able to offer or perform services related to accounting concepts, the recording and presentation of financial information, and the certification of financial data.
- Additional Accounting-related Services: Beyond attest and compilation services, CPAs may offer or perform services in accounting, management advisory, financial advisory, and tax matters.
Other additional services that CPAs in New York must be able to provide competently include:
- Prepare and analyze financial statements and transactions.
- Application of generally accepted accounting principles.
- Evaluation of internal controls, corporate governance, and potential ethical violations.
- Detection and deterrence of fraud, including familiarity with laws related to fraud and confidentiality.
- Application of tax law, covering federal, state, and local income taxes for individuals and businesses, as well as gift, estate, payroll, sales, and use taxes.
- Accounting principles for government and not-for-profit organizations, focusing on financial reporting differences and statement preparation.
- Management accounting concepts aimed at supporting decision-making and improving profitability.
- Finance concepts, analyzing business financing decisions, investment opportunities, and the time value of money.
Departures from these standards, whether intentional or not, can trigger misconduct allegations and disciplinary proceedings.
New York CPA Licensure Requirements
To become a Certified Public Accountant (CPA) in New York, applicants must meet all requirements as outlined in Title 8, Article 149, Section 7404 of New York's Education Law and Part 70 of the Commissioner's Regulations, some of which include:
- Be at least 21 years of age.
- Hold a college degree in accounting from an accredited university.
- Accumulate 150 semester hours of academic credit from an accredited institution, covering essential courses like financial accounting, cost or management accounting, taxation, audit and attestation, and 36 semester hours of general business electives.
- Complete at least one year of full-time supervised accounting experience.
- Successfully pass the Uniform CPA Examination, consisting of four sections: accounting theory, accounting practice, auditing, and taxes.
- Submit the applicable licensure fee, complete the CPA licensure application, and pass all required background examinations.
After becoming licensed, New York CPAs must continue to meet continuing education requirements and pay annual licensing fees. Failure to do either one of these can trigger disciplinary hearings and result in license consequences, as well as other fines, fees, and penalties.
What Misconduct Allegations Can Threaten My CPA License?
Public accountants and CPAs are entrusted with the critical task of managing personal and corporate finances. Both responsibilities necessitate a high level of public confidence in their integrity and capabilities. Consequently, the profession is tightly regulated, and practitioners and New York CPAs are expected to meet stringent standards of professional excellence.
Disciplinary actions launched by the State Board of Accountancy often stem from breaches of these standards or any actions that undermine public trust in the profession. Section 29.10 of the state's Rules of the Board of Regents addresses various breaches that can result in disciplinary conduct, summarized below as follows:
Financial Statement Integrity
Accountants must ensure full disclosure in financial statements, including revealing material facts not disclosed in the documents, reporting material misstatements, and obtaining sufficient information to support their opinions. New York CPAs may face disciplinary proceedings for any deviations from generally accepted accounting principles or auditing procedures.
Advertising and Solicitation
All advertising and promotional materials must be truthful and not misleading. Disciplinary actions can be triggered when a CPA makes exaggerated claims about services, expertise, or results that cannot be substantiated.
If advertising includes information about fees, such as a free consultation or a discount on services, these offers must be honored as stated and must clearly disclose any relevant conditions. Furthermore, advertisements should not imply that the service quality will be compromised by lower fees or faster service times. Direct solicitation of clients, including cold calls, emails, or visits, must also be conducted professionally.
Unauthorized Practice
Only a firm's individuals, partners, or authorized employees may engage in public accountancy under the designated title “CPA” with a valid state-issued license.
Commission-Based Referrals and Contingency Fees
Direct or indirect acceptance of commissions for referring products or services under certain conditions is considered unprofessional conduct, and specific disclosures are required if a commission is accepted.
Offering or rendering professional services under contingency fee arrangements is restricted, especially in audit or review services or where independence is required.
Work Paper Management
New York CPAs must abide by explicit documentation and retention requirements for work papers, including ensuring access to them for review and compliance with legal standards.
Work papers must contain sufficient detail to clearly understand the procedures performed, the information obtained, and the conclusions reached. Accountants are required to establish a formal written policy for the retention of work papers and ensure that they are stored in a manner that ensures they are accessible for review, audit, or regulatory purposes throughout the retention period.
Criminal Convictions
A criminal record, particularly for fraud-related offenses, can significantly impact your ability to obtain or retain your New York CPA license.
Gross Negligence, Dishonestly, or Fraud
New York CPAs can face disciplinary consequences for various unethical behaviors such as submitting false tax returns, neglecting to file necessary documents, mishandling confidential information, inaccuracies in financial statements, or manipulating financial data.
Breach of Confidentiality
Given their access to sensitive financial data, New York CPAs are bound by strict professional standards and legal requirements to protect the confidentiality of the information they handle. Although there are exceptions to client confidentiality standards, the general rule is that accountants are prohibited from sharing any personally identifiable information, financial data, or other sensitive client details with third parties without the client's consent.
In addition to state disciplinary investigations, Breaches of confidentiality can have profound legal implications for accountants, including civil liability for damages caused by unauthorized disclosures.
The Disciplinary Process
New York has made it easier for the public to lodge complaints against licensed professionals, including accountants, within the state. Complaints can originate from various sources, such as clients, coworkers, and colleagues, and are handled through a structured disciplinary process by the Office of the Professions (OP). The process unfolds in several key stages:
Investigation
Upon receiving a complaint, the OP initiates an investigation to gather evidence. This phase typically involves interviewing the complainant and potential witnesses, issuing subpoenas for documents, and other methods of inquiry. The OP might dismiss the complaint if the investigation finds no evidence of misconduct. Conversely, if evidence is found, the case is escalated to the New York State Department of Education's Board of Regents for deeper scrutiny.
Consent Order
Should the Board gather sufficient evidence to charge you formally, they might offer the chance to sign a consent order. This agreement involves acknowledging the misconduct and consenting to certain disciplinary measures proposed by the Board, such as license forfeiture or probation. This option, which can sometimes include terms for license reinstatement, might be advisable depending on the strength of the evidence against you.
Adjudication and Resolution
In the absence of a consent order agreement, the case advances to a formal hearing before the Board of Regents. Here, you're given the opportunity to argue against the revocation of your license. These hearings operate like mini-trials and consist of witness testimony, arguments of law and fact, evidence submission, and cross-examination techniques.
Following your defense, the Board issues a verdict on the disciplinary action, which can range from a formal reprimand to the revocation of your license as a public accountant.
In the event that a professional is not happy with the results, they can pursue an appeal.
The Consequences of Losing Your New York CPA License
For most CPAs, their license is synonymous with their source of income, and losing their license can abruptly cease their current work engagements, particularly for those in private practice or positions mandating a CPA qualification.
Losing your New York CPA license can also threaten your professional standing and reputation. This is especially true given New York's practice of publicizing disciplinary records, which are easily uncoverable with a simple internet search.
Losing your New York CPA license can also come with profound psychological distress, including feelings of shame, guilt, and perceived failure. This loss can significantly impact your self-worth and professional identity, leading to mental health challenges.
Finally, financial uncertainties may strain familial relationships, with domestic tensions arising from concerns over finances, job prospects, and lifestyle adjustments. The emotional toll extends to partners and children, as well as witnessing a family member endure such hardship.
New York CPA License Defense Attorney
The Lento Law Firm's Professional License Defense Team recognizes the considerable time and energy you've committed to your professional journey. We understand the high stakes and are ready to support you without hesitation.
Our Team members have a wealth of experience representing clients nationwide, especially within the state of New York. Some of the areas we serve in New York include:
- Albany-Schenectady-Troy: Albany, Rensselaer, Saratoga, Schenectady, and Schoharie counties
- Binghamton: Broome and Tioga counties
- Buffalo-Niagara Falls: Erie and Niagara counties
- Elmira: Chemung County
- Glens Falls: Warren and Washington counties
- Ithaca: Tompkins County
- Kingston: Ulster County
- New York City labor market area: Bronx, Kings, New York, Queens, and Richmond counties
- Orange-Rockland-Westchester labor market area: Orange, Rockland, and Westchester counties
- Rochester: Livingston, Monroe, Ontario, Orleans, Wayne, and Yates counties
- Syracuse: Madison, Onondaga and Oswego counties
- Utica-Rome: Herkimer and Oneida counties
- Watertown-Fort Drum: Jefferson County
Contact a member of our Professional License Defense Team today for more details on how we can help you safeguard your New York CPA license by calling 888-535-3686 or filling out our online contact form.
