Regulation of Accountants – Washington

Pursuant to Rev. Code Wash. (ARCW) § 18.04.105, license to practice public accounting shall be granted by the board to any person:

  • Who is of good character.  The board may refuse to grant a license on the ground of failure to satisfy this requirement only if there is a substantial connection between the lack of good character of the applicant and the professional and ethical responsibilities of a licensee and if the finding by the board of lack of good character is supported by a preponderance of evidence.  When an applicant is found to be unqualified for a license because of a lack of good character, the board shall furnish the applicant a statement containing the findings of the board and a notice of the applicant’s right of appeal;
  • Who has met the educational standards established by rule as the board determines to be appropriate;
  • Who has passed an examination;
  • Who has had one year of experience which is gained:
  • Through the use of accounting, issuing reports on financial statements, management advisory, financial advisory, tax, tax advisory, or consulting skills;
  • While employed in government, industry, academia, or public practice; and
  • Meeting the competency requirements in a manner as determined by the board to be appropriate and established by board rule; and
  • Who has paid appropriate fees as established by rule by the board.

The examination described in subsection (1)(c) of this section shall test the applicant’s knowledge of the subjects of accounting and auditing, and other related fields the board may specify by rule.  The time for holding the examination is fixed by the board and may be changed from time to time.  The board shall prescribe by rule the methods of applying for and taking the examination, including methods for grading examinations and determining a passing grade required of an applicant for a license.  The board shall to the extent possible see to it that the grading of the examination, and the passing grades, are uniform with those applicable to all other states.  The board may make use of all or a part of the uniform certified public accountant examination and advisory grading service of the American Institute of Certified Public Accountants and may contract with third parties to perform administrative services with respect to the examination as the board deems appropriate to assist it in performing its duties under this chapter.  The board shall establish by rule provisions for transitioning to a new examination structure or to a new media for administering the examination.

The board shall charge each applicant an examination fee for the initial examination or for reexamination.  The applicable fee shall be paid by the person at the time he or she applies for examination, reexamination, or evaluation of educational qualifications.  Persons who on June 30, 2001, held valid certificates previously issued under this chapter shall be deemed to be certificate holders, subject to the following:

  • Certificate holders may, prior to June 30, 2006, petition the board to become licensees by documenting to the board that they have gained one year of experience through the use of accounting, issuing reports on financial statements, management advisory, financial advisory, tax, tax advisory, or consulting skills, without regard to the eight-year limitation set forth in (b) of this subsection, while employed in government, industry, academia, or public practice.
  • Certificate holders who do not petition to become licensees prior to June 30, 2006, may after that date petition the board to become licensees by documenting to the board that they have one year of experience acquired within eight years prior to applying for a license through the use of accounting, issuing reports on financial statements, management advisory, financial advisory, tax, tax advisory, or consulting skills in government, industry, academia, or public practice.
  • Certificate holders who petition the board pursuant to (a) or (b) of this subsection must also meet competency requirements in a manner as determined by the board to be appropriate and established by board rule.
  • Any certificate holder petitioning the board pursuant to (a) or (b) of this subsection to become a licensee must submit to the board satisfactory proof of having completed an accumulation of one hundred twenty hours of CPE during the thirty-six months preceding the date of filing the petition.
  • Any certificate holder petitioning the board pursuant to (a) or (b) of this subsection to become a licensee must pay the appropriate fees established by rule by the board.
  • Certificate holders shall comply with the prohibition against the practice of public accounting in RCW 18.04.345.

Persons who on June 30, 2001, held valid certificates previously issued under this chapter are deemed to hold inactive certificates, subject to renewal as inactive certificates, until they have petitioned the board to become licensees and have met the requirements of subsection (4) of this section.  No individual who did not hold a valid certificate before July 1, 2001, is eligible to obtain an inactive certificate.  Persons deemed to hold inactive certificates under subsection (6) of this section shall comply with the prohibition against the practice of public accounting in subsection (8)(b) of this section and RCW 18.04.345, but are not required to display the term inactive as part of their title, as required by subsection (8)(a) of this section until renewal. Certificates renewed to any persons after June 30, 2001, are inactive certificates and the inactive certificate holders are subject to the requirements of subsection (8) of this section.  Persons holding an inactive certificate:

  • Must use or attach the term “inactive” whenever using the title CPA or certified public accountant or referring to the certificate, and print the word “inactive” immediately following the title, whenever the title is printed on a business card, letterhead, or any other document, including documents published or transmitted through electronic media, in the same font and font size as the title; and
  • Are prohibited from practicing public accounting.

Rev. Code Wash. (ARCW) § 18.04.195 provides that the board shall grant or renew licenses to practice as a CPA firm to applicants that demonstrate their qualifications therefore in accordance with this section.  The following must hold a license issued under this section:

  • Any firm with an office in this state performing attest services as defined in RCW 18.04.025(1) or compilations as defined in RCW 18.04.025(6);
  • Any firm with an office in this state that uses the title “CPA” or “CPA firm”; or
  • Any firm that does not have an office in this state but performs attest services described in RCW 18.04.025(1)(a), (c), or (d) for a client having its home office in this state.

The board must adopt rules to implement this subsection and may also adopt rules specifying requirements for licensees to report to the board sanctions or orders relating to the licensee’s practice of public accounting or violation of ethical or technical standards entered against the licensee by a nongovernmental professionally related standard-setting entity.

Rev. Code Wash. (ARCW) § 18.04.215 provides that three-year licenses shall be issued by the board:

  • To persons meeting the requirements of RCW 18.04.105(1), 18.04.180, or 18.04.183.
  • To certificate holders meeting the requirements of RCW 18.04.105(4).
  • To firms under RCW 18.04.195, meeting the requirements of RCW 18.04.205.

The board shall, by rule, provide for a system of certificate and license renewal and reinstatement.  Applicants for renewal or reinstatement shall, at the time of filing their applications, list with the board all states and foreign jurisdictions in which they hold or have applied for certificates, permits or licenses to practice.  An inactive certificate is renewed every three years with renewal subject to the requirements of ethics CPE and the payment of fees, prescribed by the board. Failure to renew the inactive certificate shall cause the inactive certificate to lapse and be subject to reinstatement.  The board shall adopt rules providing for fees and procedures for renewal and reinstatement of inactive certificates.

A license is issued every three years with renewal subject to requirements of CPE and payment of fees, prescribed by the board.  Failure to renew the license shall cause the license to lapse and become subject to reinstatement.  Persons holding a lapsed license are prohibited from using the title “CPA” or “certified public accountant.”  Persons holding a lapsed license are prohibited from practicing public accountancy.  The board shall adopt rules providing for fees and procedures for issuance, renewal, and reinstatement of licenses.  The board shall adopt rules providing for CPE for licensees and certificate holders.  The rules shall:

  • Provide that a licensee shall verify to the board that s/he has completed at least an accumulation of one hundred twenty hours of CPE during the last three-year period to maintain the license;
  • Establish CPE requirements; and
  • Establish when new licensees shall verify that they have completed the required CPE.

A certified public accountant who holds a license issued by another state, and applies for a license in this state, may practice in this state from the date of filing a completed application with the board, until the board has acted upon the application provided the application is made prior to holding out as a certified public accountant in this state and no sanctions or investigations, deemed by the board to be pertinent to public accountancy, by other jurisdictions or agencies are in process.

A licensee shall submit to the board satisfactory proof of having completed an accumulation of one hundred twenty hours of CPE recognized and approved by the board during the preceding three years.  Failure to furnish this evidence as required shall make the license lapse and subject to reinstatement procedures, unless the board determines the failure to have been due to retirement or reasonable cause.  The board in its discretion may renew a certificate or license despite failure to furnish evidence of compliance with requirements of CPE upon condition that the applicant follow a particular program of CPE.  In issuing rules and individual orders with respect to CPE requirements, the board, among other considerations, may rely upon guidelines and pronouncements of recognized educational and professional associations, may prescribe course content, duration, and organization, and may take into account the accessibility of CPE to licensees and certificate holders and instances of individual hardship.

Pursuant to Rev. Code Wash. (ARCW) § 18.04.295, the board shall have the power to: Revoke, suspend, or refuse to issue, renew, or reinstate a license or certificate; impose a fine in an amount not to exceed thirty thousand dollars plus the board’s investigative and legal costs in bringing charges against a certified public accountant, a certificate holder, a licensee, a licensed firm, an applicant, a non-CPA violating the provisions of RCW 18.04.345, or a nonlicensee holding an ownership interest in a licensed firm; may impose full restitution to injured parties; may impose conditions precedent to renewal of a certificate or a license; or may prohibit a nonlicensee from holding an ownership interest in a licensed firm, for any of the following causes:

  • Fraud or deceit in obtaining a license, or in any filings with the board;
  • Dishonesty, fraud, or negligence while representing oneself as a nonlicensee owner holding an ownership interest in a licensed firm, a licensee, or a certificate holder;
  • A violation of any provision of this chapter;
  • A violation of a rule of professional conduct promulgated by the board under the authority granted by this chapter;
  • Conviction of a crime or an act constituting a crime under:The laws of this state;The laws of another state, and which, if committed within this state, would have constituted a crime under the laws of this state; o Federal law;
  • Cancellation, revocation, suspension, or refusal to renew the authority to practice as a certified public accountant by any other state for any cause other than failure to pay a fee or to meet the requirements of CPE in the other state;
  • Suspension or revocation of the right to practice matters relating to public accounting before any state or federal agency;
  • Failure to maintain compliance with the requirements for issuance, renewal, or reinstatement of a certificate or license, or to report changes to the board;
  • Failure to cooperate with the board by failure to furnish any papers or documents requested or ordered by the board; Failure to furnish in writing a full and complete explanation covering the matter contained in the complaint filed with the board or the inquiry of the board; Failure to respond to subpoenas issued by the board, whether or not the recipient of the subpoena is the accused in the proceeding; Failure by a nonlicensee owner of a licensed firm to comply with the requirements of this chapter or board rule; and Failure to comply with an order of the board.

Pursuant to Rev. Code Wash. (ARCW) § 18.04.335, upon application in writing and after hearing pursuant to notice, the board may:

  • Modify the suspension of, or reissue a certificate or a license to, an individual whose certificate or license has been revoked or suspended; or
  • Modify the suspension of, or reissue a license to a firm whose license has been revoked, suspended, or which the board has refused to renew.

In the case of suspension for failure to comply with a support order under chapter 74.20A RCW, if the person has continued to meet all other requirements for reinstatement during the suspension, reissuance of a certificate or a license shall be automatic upon the board’s receipt of a release issued by the department of social and health services stating that the individual is in compliance with the order.

Rev. Code Wash. (ARCW) § 18.04.345 provides that no individual may assume or use the designation “certified public accountant-inactive” or “CPA-inactive” or any other title, designation, words, letters, abbreviation, sign, card, or device tending to indicate that the individual is a certified public accountant-inactive or CPA-inactive unless the individual holds a certificate.  Individuals holding only a certificate may not practice public accounting.  No individual may hold himself or herself out to the public or assume or use the designation “certified public accountant” or “CPA” or any other title, designation, words, letters, abbreviation, sign, card, or device tending to indicate that the individual is a certified public accountant or CPA unless the individual qualifies for the privileges authorized by RCW 18.04.350(2) or holds a license under RCW 18.04.105 and 18.04.215.

No firm with an office in this state may perform or offer to perform attest services as defined in RCW 18.04.025(1) or compilation services as defined in RCW 18.04.025(6) or assume or use the designation “certified public accountant” or “CPA” or any other title, designation, words, letters, abbreviation, sign, card, or device tending to indicate that the firm is composed of certified public accountants or CPAs, unless the firm is licensed under RCW 18.04.195 and all offices of the firm in this state are maintained and registered under RCW 18.04.205.  This subsection does not limit the services permitted under RCW 18.04.350(10) by persons not required to be licensed under this chapter.  No firm may perform the services defined in RCW 18.04.025(1) (a), (c), or (d) for a client with its home office in this state unless the firm is licensed under RCW 18.04.195, renews the firm license as required under RCW 18.04.215, and all offices of the firm in this state are maintained and registered under RCW 18.04.205.

No individual, partnership, limited liability company, or corporation offering public accounting services to the public may hold himself, herself, or itself out to the public, or assume or use along, or in connection with his, hers, or its name, or any other name the title or designation “certified accountant,” “chartered accountant,” “licensed accountant,” “licensed public accountant,” “public accountant,” or any other title or designation likely to be confused with “certified public accountant” or any of the abbreviations “CA,” “LA,” “LPA,” or “PA,” or similar abbreviations likely to be confused with “CPA.”  No licensed firm may operate under an alias, a firm name, title, or “DBA” that differs from the firm name that is registered with the board.  No individual with an office in this state may sign, affix, or associate his or her name or any trade or assumed name used by the individual in his or her business to any report prescribed by professional standards unless the individual holds a license to practice under RCW 18.04.105 and 18.04.215, a firm holds a license under RCW 18.04.195, and all of the individual’s offices in this state are registered under RCW 18.04.205.  No individual licensed in another state may sign, affix, or associate a firm name to any report prescribed by professional standards, or associate a firm name in conjunction with the title certified public accountant, unless the individual qualifies for the practice privileges authorized by RCW 18.04.350(2); or is licensed under RCW 18.04.105 and 18.04.215, and all of the individual’s offices in this state are maintained and registered under RCW 18.04.205.

No individual, partnership, limited liability company, or corporation not holding a license to practice under RCW 18.04.105 and 18.04.215, or firm not licensed under RCW 18.04.195 or firm not registering all of the firm’s offices in this state under RCW 18.04.205, or not qualified for the practice privileges authorized by RCW 18.04.350(2), may hold himself, herself, or itself out to the public as an “auditor” with or without any other description or designation by use of such word on any sign, card, letterhead, or in any advertisement or directory.  For purposes of this section, because individuals practicing using practice privileges under RCW 18.04.350(2) are deemed substantially equivalent to licensees under RCW 18.04.105 and 18.04.215, every word, term, or reference that includes the latter shall be deemed to include the former, provided the conditions of such practice privilege, as set forth in RCW 18.04.350 (4) and (5) are maintained.  Notwithstanding anything to the contrary in this section, it is not a violation of this section for a firm that does not hold a valid license under RCW 18.04.195 and that does not have an office in this state to provide its professional services in this state so long as it complies with the requirements of RCW 18.04.195(1)(b).

Rev. Code Wash. (ARCW) § 18.04.370 provides that any person who violates any provision of this chapter shall be guilty of a crime, as follows:

  • Any person who violates any provision of this chapter is guilty of a misdemeanor, and upon conviction thereof, shall be subject to a fine of not more than thirty thousand dollars, or to imprisonment for not more than six months, or to both such fine and imprisonment.
  • Notwithstanding (a) of this subsection, any person who uses a professional title intended to deceive the public, in violation of RCW 18.04.345, having previously entered into a stipulated agreement and order of assurance with the board, is guilty of a class C felony, and upon conviction thereof, is subject to a fine of not more than thirty thousand dollars, or to imprisonment for not more than two years, or to both such fine and imprisonment.
  • Notwithstanding (a) of this subsection, any person whose license or certificate was suspended or revoked by the board and who uses the CPA professional title intending to deceive the public, in violation of RCW 18.04.345, having previously entered into a stipulated agreement and order of assurance with the board, is guilty of a class C felony, and upon conviction thereof, is subject to a fine of not more than thirty thousand dollars, or to imprisonment for not more than two years, or to both fine and imprisonment.

With the exception of first time violations of RCW 18.04.345, subject to subsection (3) of this section whenever the board has reason to believe that any person is violating the provisions of this chapter it shall certify the facts to the prosecuting attorney of the county in which such person resides or may be apprehended and the prosecuting attorney shall cause appropriate proceedings to be brought against such person.  The board may elect to enter into a stipulated agreement and orders of assurance with persons in violation of RCW 18.04.345 who have not previously been found to have violated the provisions of this chapter.  The board may order full restitution to injured parties as a condition of a stipulated agreement and order of assurance.

Pursuant to Rev. Code Wash. (ARCW) § 18.04.420, the board shall suspend the license or certificate of any person who has been certified by a lending agency and reported to the board for nonpayment or default on a federally or state-guaranteed educational loan or service-conditional scholarship.  Prior to the suspension, the agency must provide the person an opportunity for a brief adjudicative proceeding under RCW 34.05.485 through 34.05.494 and issue a finding of nonpayment or default on a federally or state-guaranteed educational loan or service-conditional scholarship.  The person’s license or certificate shall not be reissued until the person provides the board a written release issued by the lending agency stating that the person is making payments on the loan in accordance with a repayment agreement approved by the lending agency.  If the person has continued to meet all other requirements for licensure or certification during the suspension, reinstatement shall be automatic upon receipt of the notice and payment of any reinstatement fee the board may impose.

Rev. Code Wash. (ARCW) § 18.04.430 provides that the board shall immediately suspend the certificate or license of a person who has been certified pursuant to RCW 74.20A.320 by the department of social and health services as a person who is not in compliance with a support order or a residential or visitation order.  If the person has continued to meet all other requirements for reinstatement during the suspension, reissuance of the license or certificate shall be automatic upon the board’s receipt of a release issued by the department of social and health services stating that the licensee is in compliance with the order.


Inside Regulation of Accountants – Washington