Section .0100 ‑ General Provisions

Link to law: http://reports.oah.state.nc.us/ncac/title 21 - occupational licensing boards and commissions/chapter 08 - certified public accountant examiners/subchapter g/subchapter g rules.html
Published: 2015

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SUBCHAPTER 8G ‑ CONTINUING PROFESSIONAL EDUCATION

(CPE)

 

 

SECTION .0100 ‑ GENERAL PROVISIONS

 

 

21 NCAC 08G .0101          COMPLIANCE WITH BOARD RULES OF

PROFESSIONAL ETHICS/CONDUCT

21 NCAC 08G .0102          DISCREDITABLE CONDUCT

21 NCAC 08G .0103          DISCIPLINE BY FEDERAL AND STATE

AGENCIES OR BOARDS

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. February 1, 1976;

Readopted Eff. September 26, 1977;

Amended Eff. September 1, 1992; October 1, 1992; May 1,

1989; July 1, 1987;

Repealed Eff. April 1, 1994.

 

 

21 NCAC 08G .0104          INELIGIBILITY

DUE TO VIOLATION OF ACCOUNTANCY ACT

21 NCAC 08G .0105          PUBLIC PRACTICE OF ACCOUNTANCY IN

CORPORATE FORM

 

History Note:        Authority G.S. 93‑8; 93‑12(9);

Eff. February 1, 1976;

Readopted Eff. September 26, 1977;

Amended Eff. August 1, 1983;

Repealed Eff. October 1, 1984.

 

 

 

21 NCAC 08G .0106          VIOLATION OF TAX LAWS

21 NCAC 08G .0107          INDEPENDENCE

21 NCAC 08G .0108          INTEGRITY AND OBJECTIVITY

21 NCAC 08G .0109          COMPETENCE

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. February 1, 1976;

Readopted Eff. September 26, 1977;

Amended Eff. May 1, 1989; September 1, 1988; April 1,

1987; October 1, 1984;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0110          INELIGIBILITY DUE TO VIOLATION OF

ACCOUNTANCY ACT

 

History Note:        Authority G.S. 93‑12(5),(9);

Eff. June 1, 1985;

Amended Eff. June 1, 1988;

Repealed Eff. May 1, 1989.

 

 

 

21 NCAC 08G .0111          PUBLIC PRACTICE OF ACCOUNTANCY IN

CORPORATE FORM

 

History Note:        Authority G.S. 93‑8; 93‑12(9);

Eff. June 1, 1985;

Repealed Eff. March 1, 1987.

 

 

 

21 NCAC 08G .0112          DISCIPLINARY ACTIONS FOR VIOLATIONS

 

History Note:        Authority G. S. 55B‑12; 93‑12(9);

Eff. September 1, 1986;

Amended Eff. March 1, 1990; May 1, 1989; July 1, 1987;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0113          REPORTING CONVICTIONS, JUDGMENTS AND

DISCIPLINARY ACTIONS

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. October 1, 1987;

Amended Eff. May 1, 1989; February 1, 1988;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0114          COOPERATION WITH BOARD INQUIRY

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. May 1, 1989;

Repealed Eff. April 1, 1994.

 

 

 

 

SECTION .0200 ‑ RESPONSIBILITIES TO CLIENTS AND

COLLEAGUES

 

 

21 NCAC 08G .0201          AUDITING STANDARDS

21 NCAC 08G .0202          ACCOUNTING PRINCIPLES

21 NCAC 08G .0203          FORECASTS

21 NCAC 08G .0204          CONFIDENTIAL CLIENT INFORMATION

21 NCAC 08G .0205          CONTINGENT FEES

 

History Note:        Authority G.S. 55B‑12; 93‑12(8c);

93‑12(9);

Eff. February 1, 1976;

Readopted Eff. September 26, 1977;

Amended Eff. September 1, 1993; April 1, 1991; May 1,

1989; June 1, 1988;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0206          ENCROACHMENT

 

History Note:        Authority G.S. 93‑8; 93‑12(9);

Eff. February 1, 1976;

Readopted Eff. September 26, 1977;

Repealed Eff. November 6, 1979.

 

 

 

21 NCAC 08G .0207          OFFERS OF EMPLOYMENT

 

History Note:        Authority G.S. 93‑8; 93‑12(9);

Eff. February 1, 1976;

Readopted Eff. September 26, 1977;

Repealed Eff. August 7, 1978.

 

 

 

21 NCAC 08G .0208          ACCOUNTING AND REVIEW SERVICES

STANDARDS

21 NCAC 08G .0209          MANAGEMENT ADVISORY SERVICES STANDARDS

21 NCAC 08G .0210          RESPONSIBILITIES IN TAX PRACTICE

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. January 1, 1983;

Amended Eff. May 1, 1989; June 1, 1988; July 1, 1987;

August 1, 1986;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0211          GOVERNMENTAL ACCOUNTING STANDARDS

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. August 1, 1986;

Amended Eff. May 1, 1989; June 1, 1988; July 1, 1987;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0212          ATTESTATION STANDARDS

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. February 1, 1987;

Amended Eff. May 1, 1989; June 1, 1988;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0213          RETENTION OF CLIENT RECORDS

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. May 1, 1989;

Repealed Eff. April 1, 1994.

 

 

 

 

SECTION .0300 ‑ OTHER RESPONSIBILITIES

 

 

21 NCAC 08G .0301          ADVERTISING OR OTHER FORMS OF

SOLICITATION

21 NCAC 08G .0302          COMMISSIONS

21 NCAC 08G .0303          INCOMPATIBLE OCCUPATIONS

21 NCAC 08G .0304          QUALIFICATION OF PARTNERS

21 NCAC 08G .0305          NAME OR STYLE OF A PRACTICE

21 NCAC 08G .0306          FIRM NAME OR STYLE OF A PRACTICE

 

History Note:        Authority G.S. 55B‑5; 93‑12(9);

Eff. February 1, 1976;

Readopted Eff. September 26, 1977;

Amended Eff. March 1, 1992; October 1, 1991; April 1,

1991; May 1, 1989;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0307          COMPLAINTS

 

History Note:        Authority G.S. 55B‑12; 93‑12(9);

Eff. February 1, 1976;

Readopted Eff. September 26, 1977;

Amended Eff. October 1, 1984; April 1, 1982; June 16,

1980;

Repealed Eff. March 1, 1987.

 

 

 

21 NCAC 08G .0308          RESERVED FOR FUTURE CODIFICATION

 

 

 

21 NCAC 08G .0309          RESERVED FOR FUTURE CODIFICATION

 

 

 

21 NCAC 08G .0310          PRACTICE THROUGH A NON‑COMPLYING

FIRM PROHIBITED

21 NCAC 08G .0311          FALSIFICATION IN CONNECTION WITH

QUALITY REVIEW PROGRAMS

21 NCAC 08G .0312          QUALITY REVIEW STANDARDS

 

History Note:        Authority G.S. 55B‑12; 93‑12(8c);

93‑12(9);

Eff. April 1, 1991;

Repealed Eff. April 1, 1994.

 

 

 

21 NCAC 08G .0313          FIRM NAME

 

History Note:        Filed as a Temporary Adoption Eff.

September 25, 1991 For a Period of 180 Days to Expire

on March 22, 1992;

Statutory Authority G.S. 55B‑5; 93‑12(9);

Temporary Adoption Expired Eff. March 22, 1992.

 

 

 

 

section .0400 - CPE REQUIREMENTS

 

21 NCAC 08G .0401          CPE REQUIREMENTS FOR CPAS

(a)  In order for a CPA to receive CPE credit for a course:

(1)           the CPA must attend or complete the course

and receive a certificate of completion as set forth in Rule .0403(c)(13) of

this Section;

(2)           the course must meet the requirements set

out in Rule .0404(a) and (c) of this Section; and

(3)           the course must increase the professional

competency of the CPA.

(b)  A course that increases the professional competency of

a CPA is a course in an area of accounting in which the CPA practices or is

planning to practice in the future, or in the area of professional ethics, or

an area of the profession.

(c)  Because of differences in the education and experience

of CPAs, a course may contribute to the professional competence of one CPA but

not another. Each CPA must therefore exercise judgment in selecting courses for

which CPE credit is claimed and choose only those that contribute to that CPA's

professional competence.

(d)  Active CPAs must complete 40 CPE hours, computed in

accordance with Rule .0409 of this Section by December 31 of each year, except

as follows:

(1)           CPAs having certificate applications

approved by the Board in April-June must complete 30 CPE hours during the same

calendar year;

(2)           CPAs having certificate applications

approved by the Board in July-September must complete 20 CPE hours during the

same calendar year; or

(3)           CPAs having certificate applications

approved by the Board in October-December must complete 10 CPE hours during the

same calendar year.

(e)   There are no CPE requirements for inactive CPAs.

(f)  Any CPE hours completed during the calendar year in

which the certificate is approved may be used for that year's requirement even

if the hours were completed before the certificate was granted. When a CPA has

completed more than the required number of hours of CPE in any one calendar

year, the extra hours, not in excess of 20 hours, may be carried forward and

treated as hours earned in the following year.  Ethics CPE hours may not be

included in any carry forward hours.  A CPA may not claim CPE credit for

courses taken in any year prior to the year of certification.

(g)  Any CPE hours used to satisfy the requirements for

change of status as set forth in 21 NCAC 08J .0105, for reissuance as set forth

in 21 NCAC 08J .0106, or for application for a new certificate as set forth in

21 NCAC 08I .0104 may be used to satisfy the annual CPE requirement set forth

in Paragraph (d) of this Rule.

(h)  It is the CPA's responsibility to maintain records

substantiating the CPE credits claimed for the current year and for each of the

four calendar years prior to the current year.

(i)  A non-resident licensee may satisfy the annual CPE

requirements including 21 NCAC 08G .0401 in the jurisdiction in which he or she

is licensed and currently works or resides. If there is no annual CPE

requirement in the jurisdiction in which he or she is licensed and currently

works or resides, he or she must comply with Paragraph (d) of this Rule.

 

History Note:        Authority G.S. 93-12(3); 93‑12(8b);



Eff. May 1, 1981;

Amended Eff. January 1, 2014; January 1, 2007; January 1,

2004; August 1, 1995; April 1, 1994; May 1, 1989; September 1, 1988.

 

21 NCAC 08G .0402          DEFINITIONS

 

History Note:        Authority G.S. 93‑12(8b);

Eff. May 1, 1981;

Amended Eff. January 1, 1989; October 1, 1984;

Repealed Eff. May 1, 1989.

 

 

 

21 NCAC 08G .0403          QUALIFICATION OF CPE SPONSORS

(a)  The Board shall not register either sponsors of CPE

courses or CPE courses.

(b)  Sponsors of continuing education programs that are

listed in good standing on the NASBA National Registry of CPE Sponsors shall be

considered by the Board as compliant with the CPE requirements of Paragraph (c)

of this Rule.

(c) CPE providers not in good standing on the NASBA National

Registry of CPE Sponsors shall meet the following requirements:  

(1)           have an individual who did not prepare the

course review each course to be sure it meets the standards for CPE;

(2)           state the following in every brochure or

other publication or announcement concerning a course:

(A)          the general content of the course and the specific

knowledge or skill taught in the course;

(B)          any prerequisites for the course and any advance

preparation required for the course and if none, that shall be stated;

(C)          the level of the course, such as basic,

intermediate, or advanced;

(D)          the teaching methods to be used in the course;

(E)           the amount of sponsor recommended CPE credit a CPA

who takes the course may claim; and

(F)           the date the course is offered, if the course is

offered only on a certain date, and, if applicable, the location;

(3)           ensure that the instructors or presenters

of the course are qualified to teach the subject matter of the course and to

apply the instructional techniques used in the course;

(4)           evaluate the performance of an instructor

or presenter of a course to determine whether the instructor or presenter is

suited to serve as an instructor or presenter in the future as follows:

(A)          before the course's conclusion, provide for the

attendees an opportunity to evaluate the quality of the course by

questionnaires, oral feedback, or other means, in order to determine whether

the course's objectives have been met, its prerequisites were necessary or

desirable, the facilities used were satisfactory, and the course content was

appropriate for the level of the course; and

(B)          systematically review the evaluation process to

ensure its effectiveness;

(5)           encourage participation in a course only by

those who have the education and experience for the level of the course;

(6)           distribute course materials to

participants;

(7)           use physical facilities for conducting the

course that are consistent with the instructional techniques used;

(8)           accurately assign the number of CPE credits

each participant may be eligible to receive by either:

(A)          monitoring attendance at a group course; or

(B)          testing in order to determine if the participant has

learned the material presented;

(9)           inform instructors and presenters of the

results of the evaluation of their performance;

(10)         retain for five years from the date of the

course presentation or completion:

(A)          a record of participants completing course credit

requirements;

(B)          an outline of the course (or equivalent);

(C)          the date and location of presentation;

(D)          the participant evaluations or summaries of

evaluations;

(E)           the documentation of the instructor's

qualifications; and

(F)           the number of contact hours recommended for each

participant;

(11)         have a visible, continuous, and identifiable

contact person who is charged with the administration of the sponsor's CPE

programs and has the responsibility and is accountable for assuring and

demonstrating compliance with this Rule by the sponsor or by any other

organization working with the sponsor for the development, distribution or

presentation of CPE courses;

(12)         develop and promulgate policies and

procedures for the management of grievances including tuition and fee refunds;

and

(13)         provide persons completing course

requirements with written proof of completion indicating the participant's

name, the name of the course, the date the course was held or completed, the

sponsor's name and address, and the number of CPE hours calculated and

recommended in accordance with 21 NCAC 08G .0409.

(d)  Failure of a National Registry of CPE Sponsor to comply

with the terms of this Rule shall be grounds for the Board to disqualify the

sponsor as a CPE sponsor with this Board and to notify NASBA and the public of

this action.

 

History Note:        Authority G.S. 93-12(3); 93‑12(8b);



Eff. May 1, 1981;

Amended Eff. January 1, 2014; January 1, 2007; January 1,

2004; March 1, 1990; May 1, 1989; August 1, 1988; February 1, 1983.

 

21 NCAC 08G .0404          REQUIREMENTS FOR CPE CREDIT

(a)  A CPA shall not be granted CPE credit for a course

unless the course:

(1)           is in one of the seven fields of study

recognized by the Board and set forth in Paragraph (b) of this Rule;

(2)           is developed by an individual who has

education and work experience in the subject matter of the course; and

(3)           uses instructional techniques and materials

that are current and accurate.

(b)  The seven fields of study recognized by the Board are:

(1)           Accounting and Auditing

(A)          Accountancy

(B)          Accounting – Governmental

(C)          Auditing

(D)          Auditing – Governmental

(2)           Consulting Services

(A)          Administrative Practice

(B)          Social Environment of Business

(3)           Ethics

(A)          Behavioral Ethics

(B)          Regulatory Ethics

(4)           Management

(A)          Business Law

(B)          Business Management and Organization

(C)          Finance

(D)          Management Advisory Services

(E)           Marketing

(5)           Personal Development

(A)          Communications

(B)          Personal Development

(C)          Personnel/HR

(6)           Special Knowledge and Applications

(A)          Computer Science

(B)          Economics

(C)          Mathematics

(D)          Production

(E)           Specialized Knowledge and Applications

(F)           Statistics

(7)           Tax

(c)  The following may qualify as acceptable types of

continuing education programs, provided the programs comply with the

requirements set forth in Paragraph (a) of this Rule:

(1)           professional development programs of

national and state accounting organizations;

(2)           technical sessions at meetings of national

and state accounting organizations and their chapters;

(3)           courses taken at regionally accredited

colleges and universities;

(4)           educational programs that are designed and

intended for continuing professional education activity conducted within an

association of accounting firms; and

(5)           correspondence courses that are designed

and intended for continuing professional education activity.

(d)  CPE credit may be granted for teaching a CPE course or

authoring a publication as long as the preparation to teach or write increased

the CPA's professional competency and was in one of the seven fields of study

recognized by the Board and set forth in Paragraph (b) of this Rule.

(e)  CPE credit shall not be granted for a self-study course

if the material that the CPA must study to take the examination is not designed

for CPE purposes. This includes periodicals, guides, magazines, subscription

services, books, reference manuals and supplements which contain an examination

to test the comprehension of the material read.

(f)  A CPA may claim credit for a course offered by a

non–registered sponsor provided that the course meets the requirements of 21

NCAC 08G .0403(c), 21 NCAC 08G .0404, and 21 NCAC 08G .0409. The CPA shall

maintain documentation proving that the course met these standards.

 

History Note:        Authority G.S. 93‑12(8b);

Eff. May 1, 1981;

Amended Eff. January 1, 2007; January 1, 2004; August 1,

1998; February 1, 1996; March 1, 1990; May 1, 1989; August 1, 1988; February 1,

1983.

 

21 NCAC 08G .0405          ADMINISTRATION OF REQUIREMENT

Forms for reporting CPE hours will be furnished by the

Board.  The Board may audit on a test basis information submitted by licensees

who may apply for a renewal license.

 

History Note:        Authority G.S. 93-12(8b);

Eff. May 1, 1981;

Amended Eff. October 1, 1984; January 1, 1982;

Pursuant to G.S. 150B-21.3A, rule is necessary without

substantive public interest Eff. October 28, 2014.

 

21 NCAC 08G .0406          COMPLIANCE WITH CPE REQUIREMENTS

(a)  All active CPAs shall file with the Board a completed

CPE reporting form by the July 1 renewal date of each year.

(b)  If a CPA fails to complete the CPE requirements prior

to the end of the previous calendar year but the CPA has completed them by June

30, the Board may:

(1)           issue a letter of warning for the first

such failure within a five calendar year period; and

(2)           deny the renewal of the CPA's certificate

for a period of not less than 30 days and until the CPA meets the reinstatement

requirements set forth in 21 NCAC 08J .0106 for the second such failure within

a five calendar year period.

 

History Note:        Authority G.S. 93‑12(8b); 93‑12(9)(e);

Eff. May 1, 1981;

Amended Eff. January 1, 2007; January 1, 2004; April 1,

1994; March 1, 1990; May 1, 1989; October 1, 1988.

 

21 NCAC 08G .0407          EXEMPTION AND SUBSEQUENT REINSTATEMENT

 

History Note:        Authority G.S. 93‑12(8b);

Eff. May 1, 1981;

Amended Eff. September 1, 1988; April 1, 1987; October 1,

1984; August 1, 1984;

Repealed Eff. May 1, 1989.

 

 

 

21 NCAC 08G .0408          REQUIRED COURSES ON ACCOUNTANCY LAWS

AND RULES

 

History Note:        Authority G.S. 93‑12(8b);

Eff. April 1, 1987;

Repealed Eff. April 1, 1988.

 

 

 

21 NCAC 08G .0409          COMPUTATION OF CPE CREDITS

(a)  Group Courses: Non-College. CPE credit for a group

course that is not part of a college curriculum shall be given based on contact

hours. A contact hour shall be 50 minutes of instruction and one-half contact

hour shall be equal to 25 minutes of instruction.  For example, a group course

lasting 100 minutes shall be two contact hours equaling two CPE credits. A

group course lasting 75 minutes shall be one and one-half contact hours

equaling one and one-half CPE credits. A group course lasting 25 minutes shall

be one-half contact hour and equal to one-half CPE credit.  When individual

segments of a group course are less than 50 minutes, the sum of the individual

segments shall be added to determine the number of contact hours. For example,

five 30-minute presentations shall be 150 minutes, which shall be three contact

hours and three CPE credits. No credit shall be allowed for a segment unless

the participant completes the entire segment.  Internet based programs shall

employ a monitoring mechanism to verify that participants are participating

during the duration of the course.  No credit shall be allowed for a group

course having fewer than 25 minutes of course instruction.

(b)  Completing a College Course. CPE credit for completing

a college course in the college curriculum shall be granted based on the number

of credit hours the college gives the CPA for completing the course. One

semester hour of college credit shall be 15 CPE credits; one quarter hour of

college credit shall be 10 CPE credits; and one continuing education unit shall

be 10 CPE credits. No CPE credit shall be given to a CPA who audits a college

course.

(c)  Self Study. CPE credit for a self-study course shall be

given based on the average number of contact hours needed to complete the

course. The average completion time shall be allowed for CPE credit. A sponsor shall

determine on the basis of pre-tests or NASBA word count formula the average

number of contact hours of course material it takes to complete a course.  A

contact hour shall be 50 minutes and one-half contact hour shall be 25 minutes

of course material.  No self-study course may contain less than 25 minutes of

course material.

(d)  Instructing a CPE Course. CPE credit for teaching or

presenting a CPE course for CPAs shall be given based on the number of contact

hours spent in preparing and presenting the course. No more than 50 percent of

the CPE credits required for a year shall be credits for preparing for and

presenting CPE courses. CPE credit for preparing or presenting a course shall

be allowed only once a year for a course presented more than once in the same

year by the same CPA.

(e)  Authoring a Publication. CPE credit for published

articles and books shall be given based on the number of contact hours the CPA

spent writing the article or book. No more than 25 percent of a CPA's required

CPE credits for a year shall be credits for published articles or books. An

article written for a CPA's client or business newsletter shall not receive CPE

credit.

(f)  Instructing a Graduate Level College Course. CPE credit

for instructing a graduate level college course shall be given based on the

number of credit hours the college gives a student for completing the course,

using the calculation set forth in Paragraph (b) of this Rule. Credit shall not

be given for instructing a course in which there is credit given towards an

undergraduate degree.

(g)  No more than 50 percent of the CPE credits required for

a year shall be credits claimed under Paragraph (d) and (f) of this Rule.

 

History Note:        Authority G.S. 93‑12(8b);

Eff. May 1, 1989;

Amended Eff. July 1, 2015; January 1, 2014; February 1,

2012; January 1, 2007; January 1, 2004; February 1, 1996; April 1, 1994; March

1, 1990.

 

21 NCAC 08G .0410          PROFESSIONAL ETHICS AND CONDUCT CPE

(a)  As part of the annual CPE requirement, all active CPAs

shall complete CPE on professional ethics and conduct.  They shall complete two

contact hours in either a group study format or in a self-study format of a

course on regulatory or behavioral professional ethics and conduct.  This CPE

shall be offered by a CPE sponsor registered with NASBA pursuant to Rule .0403(b)

of this Section.

(b)  A non-resident licensee whose primary office is in

North Carolina must comply with Paragraph (a) of this Rule.  All other

non-resident licensees may satisfy Paragraph (a) of this Rule by completing the

ethics requirements in the jurisdiction in which he or she is licensed as a CPA

and works or resides.  If there is no ethics CPE requirement in the

jurisdiction where he or she is licensed and currently works or resides, he or

she must comply with Paragraph (a) of this Rule.

 

History Note:        Authority G.S. 93-12(3); 93-12(8b);

93-12(9);

Eff. January 1, 2005;

Amended Eff. January 1, 2014; February 1, 2012; January

1, 2007; January 1, 2006.