The Member did not comply with an Order from the Director of Employment Standards of BC that required the Member to pay unpaid wages and accrued interest to a former employee, and administrative penalties to the Director of Employment Standards. The Member also did not provide the former employee with a Record of Employment as they were required to do.
The Investigation Committee determined the Member contravened the CPABC Code of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
213 - Unlawful activity
The Committee recommended that a Statement of Complaint not be issued, on condition the Member accept a reprimand. In making its recommendation, the Committee took into account the personal circumstances affecting the Member’s conduct during the events described in this matter.
The Member prepared an estate tax return for a client. The estate tax return contained errors and was not completed in a timely manner, resulting in interest and penalties assessed by the Canada Revenue Agency. The Member did not communicate with the client in a timely manner, and did not maintain adequate documentation concerning workflow and communications.
The Investigation Committee determined the Member contravened the CPABC Code of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
203 - Professional competence
205 - False or misleading documents and oral representations
206.1 - Compliance with professional standards
218 - Retention of documentation and working papers
The Committee recommended the Member:
- accept a reprimand;
- pay a fine of $2,000;
- pay expenses of $2,430 plus GST; and
- take CPABC professional development course PD Nexus: Public Practice Insights
Mr. Patel entered into a settlement agreement with the Mutual Fund Dealers Association of Canada (MFDA) for non compliance of four MFDA rules. As a result of these MFDA rule breaches, the Investigation Committee determined Mr. Patel contravened the CPABC Code of Professional Conduct as follows:
R201.1 - Maintenance of the good reputation of the profession
R205 - False or misleading documents and oral representations
The Committee recommended Mr. Patel:
- accept a reprimand; and
- pay expenses of $1,875.
In making its recommendation, the Committee took into account the sanctions that the MFDA had levied on Mr. Patel.
A company, controlled by the Member, provided a client with a mortgage on a property owned by the client. The Member:
- Contacted the previous mortgagor of the property (which was also an audit client of the Member) to discuss the client’s affairs, without the express consent of the client.
- Prepared Notice to Reader (NTR) financial statements for a company controlled by the client, but did not disclose in the NTR report that the Member’s independence was impaired as a result of their financial relationship with the client and the mortgage.
- Withheld a portion of the mortgage proceeds from the client and used those funds to pay for the Member’s accounting services, without obtaining the client’s express consent and understanding of the transaction.
The Investigation Committee determined the Member contravened the CPABC Rules of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
204.1 - Independence – Assurance and specified auditing procedures engagements
204.10 - Independence – Disclosure of impaired independence
206.1 - Compliance with professional standards
208.2 - Confidentiality
210 - Conflicts of interest
212.2 - Handling of property of others
The Committee recommended the Member:
- accept a reprimand;
- pay partial expenses of $3,856 plus GST;
- self-report to the BC Financial Services Authority (“BCFSA”) regarding activity that may require registration with the BCFSA in a manner satisfactory to the Director, Professional Conduct, and provide CPABC with a copy of the self-report; and
- take the following CPABC Professional Development courses at the next available dates:
- Ethics at our Core
- Shades of Grey: Ethics in the workplace
The Member completed a Law Society Trust Report – Accountant’s Report without a public practice license (Audit or Review).
The Investigation Committee determined the Member contravened the CPABC Rules of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
205 - False or misleading documents and oral representations
Bylaw 700 - Public Practice by CPA Members
The Committee recommended the Member:
- accept a reprimand; and
- pay expenses of $360 plus GST.
The Member completed a Law Society Trust Report – Accountant’s Report without a public practice license (audit or review).
The Investigation Committee determined the Member contravened the CPABC Rules of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
205 - False or misleading documents and oral representations
The Member also breached CPABC Bylaw 700 -- Public Practice by CPA Members.
The Committee recommended the Member:
1. accept a reprimand; and
2. pay expenses of $400 plus GST.
A self-employed CPA Candidate (student) completed personal and corporate tax returns. CPA students are not permitted to perform such work while self-employed.
The Investigation Committee determined the Candidate contravened the CPABC Code of Professional Conduct,
Rule 201.1 - Maintenance of the good reputation of the profession
Bylaw 405 - Prohibition on Practice
The Committee recommended the Candidate:
1. accept a reprimand;
2. pay a fine of $1,200;
3. pay expenses of $1,150 plus GST; and
4. attend the CPABC Professional Development course “Ethics at Our Core.”
While as a student, the Member failed to report that they were charged with a crime, offence or delinquency on the annual legacy student CGA Ethics Declaration that they completed and signed. The Member disclosed the conviction when they applied for membership in CPABC.
The Investigation Committee determined the Member contravened the legacy CGA-BC Code of Ethical Principles and Rules of Conduct as follows,
R108 - Conduct Unbecoming
R402 - Association with Financial and Other Information
The Member asserts that the failure to disclose was unintentional and the Investigation Committee took note that the form of disclosure has changed since the Member was a student. The Committee recommended the Member:
- accept a reprimand; and
- pay expenses of $750 plus GST.
A client of the Member asked a question by email concerning a potentially complex transaction. The Member did not appropriately respond to the client’s question.
The Investigation Committee determined the Member contravened the CPABC Rule of Professional Conduct 201.1 -- Maintenance of the good reputation of the profession.
The Committee recommended that the Member accept a reprimand.
The Member was engaged by a client to complete a Labour Market Impact Assessment (LMIA) attestation letter. The Member was not readily available to the client during business hours; did not respond to the client’s communications in a timely manner; commenced but did not complete the engagement; failed to have a public practice review license which is required to perform the engagement; and advertised review engagements as a service that he provides on his website, despite not having a public practice review license.
The Investigation Committee determined the Member contravened the CPABC Rules of Professional Conduct as follows:
101.1 - Compliance with governing legislation, bylaws, regulations and the Code
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
203 - Professional competence
206 - Compliance with professional standards
217 - Advertising
218 - Retention of documentation
404 - Access to members practicing public accounting
The Member also breached CPABC Bylaw 700 -- Public Practice by CPA Members.
The Committee recommended the Member:
- accept a reprimand;
- pay expenses of $2,956 plus GST; and
- take the online virtual CPABC communications course Communicating Effectively Under Pressure.
The Firm was engaged by a client to complete a Law Society Trust Report – Accountant’s Report (Report). The Report was completed and submitted by an employee of the Firm without the engagement partner’s review and approval of the Report. The Report did not provide explanations of the exceptions that were identified.
The Investigation Committee determined the Firm contravened the CPABC Rules of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
The Committee recommended the Firm:
- accept a reprimand;
- pay a fine of $1,000; and
- pay expenses of $1,075 plus GST
The Member was the treasurer and shareholder of a private company. The Member’s firm issued Notice to Reader financial statements for the company and the Member was the engagement partner. A dispute among the company’s shareholders arose and at an Annual General Meeting of the shareholders, a motion to waive the appointment of an auditor failed to receive the required unanimous consent of the shareholders. Accordingly, under the Business Corporations Act, the company was required to have an auditor. The company’s Board of Directors failed to cause the company to appoint an auditor, but the Member remained treasurer of the company and the engagement partner for the firm’s services to the company.
The Investigation Committee determined the Member contravened the CPABC Rules of Professional Conduct as follows:
213 - Unlawful Activity
The Committee recommended that a Statement of Complaint not be issued, on condition that the Member promptly resign as the treasurer of the company or as engagement partner.
The Member was engaged to mark examinations for their employer. The Member failed to disclose that they personally knew some of the students, and selected some of the them for marking. Upon discovery, the students’ examinations were re-marked by independent markers, who confirmed the students’ examination results. The Member made written and verbal misrepresentations to their employer concerning this matter.
The Investigation Committee determined the Member contravened the CPABC Rules of Professional Conduct as follows:
201.1 – Maintenance of the good reputation of the profession
202.1 – Integrity and due care
202.2 – Objectivity
205 – False or misleading documents or oral representations
The Committee took into account the Member experienced other personal consequences as a result of this conduct. The Committee recommended the Member:
- accept a reprimand; and
- take the following CPABC professional development courses at the next available dates:
- Learning to Lead – The Essentials
- Effective and Essential Management Skills
- Conflicts of Interest Unpacked
The Member was engaged by clients to obtain a Non-Resident Certificate of Compliance from Canada Revenue Agency in order to release funds withheld on the sale of the clients’ residence. The Member did not provide accurate professional services and communications to the clients regarding the transaction, and did not document professional communications adequately.
The Investigation Committee determined the Member contravened the CPABC Rules of Professional Conduct as follows:
201.1 – Maintenance of the good reputation of the profession
202.1 – Integrity and due care
205 – False or misleading documents and oral representations
218 – Retention of documentation and working papers
The Committee recommended the Member:
- accept a reprimand;
- pay expenses of $2,740 plus GST; and
- at the next available dates, attend CPABC Professional Development courses acceptable to the Director, Professional Conduct, regarding:
- Real estate taxation; and
- effective communication.
The Firm was engaged to prepare personal income tax returns for a client. The Firm did not properly document and communicate decisions related to the client’s business income and expenses on their personal income tax returns for two years.
The Investigation Committee determined the Firm contravened the CPABC Rules of Professional Conduct as follows:
202.1 – Integrity and Due Care
The Committee recommended the Firm:
- accept a reprimand;
- pay expenses of $2,990 plus GST of $149.50; and
- ensure that a partner takes the following CPABC Professional Development online course by December 31, 2020: Archived Broadcast PD Nexus: Public Practice Insights
The Firm was engaged to prepare financial statements and income tax returns for a client’s companies and personal income tax returns for the client and spouse. The Firm did not provide competent professional services and effective advice to the client regarding the transfer of assets from a proprietorship to a corporation. The work was completed by a partner of the firm who was not a Chartered Accountant.
The Investigation Committee determined the Firm contravened the legacy ICABC Rules of Professional Conduct as follows:
201.1 – Maintenance of Reputation of the Profession
202.1 – Integrity and Due Care
203 – Professional Competence
408 – Association of Member with Non-Member in Public Practice
The Committee recommended the Firm:
- Accept a reprimand;
- Pay a fine of $1000; and
- Pay expenses of $2936 plus GST.
The Member did not appropriately assist a client regarding a Canada Revenue Agency (CRA) limited review of the client’s 2017 and 2016 corporate tax returns. The Member did not respond to the client’s request for assistance on a timely basis, and did not provide the client with copies of requested documentation. When the client subsequently decided to change accountants, the Member did not provide the client and the new accountant with sufficient information.
The Investigation Committee determined the Member contravened the CPABC Code of Professional Conduct as follows:
201.1 – Maintenance of the good reputation of the profession
202.1 – Integrity and due care
303.1 – Provision of client information
The Committee recommended the Member:
- Accept a reprimand;
- Pay a fine of $1000;
- Pay expenses of $1390 plus GST; and
- Attend the professional development course Public Practice Insights.
The Firm prepared corporate income tax records for a client. The engagement letters did not clearly outline all of the services to be performed and the services were not formally agreed to by the client and the Firm. The client believed the Firm would complete GST and PST returns, which the Firm did not do, causing the client to be seriously delinquent in their compliance with the relevant taxation authorities. The Firm also did not retain documentation of its discussions with the client regarding the scope of services to be provided.
The Investigation Committee determined the Firm contravened the CPABC Code of Professional Conduct as follows:
201.1 – Maintenance of the good reputation of the profession
202.1 – Due care
206.1 – Compliance with professional standards
218 – Retention of documentation and working papers
The Committee recommended the Firm:
- Accept a reprimand;
- Pay a fine of $1000; and
- Pay partial expenses of $4000.
The Member provided financial information for a family court proceeding on behalf of a client. The financial information was hastily prepared, incomplete and inaccurate.
The Investigation Committee determined the Member contravened the CPABC Code of Professional Conduct as follows:
201.1 – Maintenance of the good reputation of the profession
202.1 – Due care
206.1 – Compliance with professional standards
The Committee recommended the Member:
- Accept a reprimand;
- Pay a fine of $1000; and
- Pay expenses of $2000 plus GST.
The Member incorrectly prepared and filed a US tax return and the Canadian T1 tax return for a client which resulted in both tax returns being reassessed by the respective authorities. The Member was not registered with the United States Internal Revenue Service (IRS) to prepare and file US tax returns, and was not trained to prepare them. The Member treated the client in a rude and unprofessional manner when discussing the errors within the tax returns.
The Investigation Committee determined the Member contravened the CPABC Code of Professional Conduct as follows:
201. – Maintenance of the good reputation of the profession
202.1 – Integrity and due care
203 – Professional competence
205 – False or misleading documents and oral representations
The Committee recommended the Member:
-
Accept a reprimand;
-
Pay expenses of $2,369 plus GST;
-
Pay a fine of $2,000, less any amount the Member refunds the client;
-
Register with the IRS should the Member continue to prepare or file US tax returns; and
-
Attend the following courses:
-
PD Nexus: Public Practice Insights; and
-
US Personal Tax – Fundamentals and US Tax – Personal Investment in Real Estate (if the Member continues to prepare or file US Tax returns).
-
The Member used disparaging and unprofessional language in email communications that the Member sent to a client regarding a dispute.
The Investigation Committee determined the Member contravened Rule 201.1 (Maintenance of the good reputation of the profession) of the CPABC Code of Professional Conduct.
The Committee recommended the Member:
-
Accept a reprimand; and
-
Pay a fine of $500.
The Member completed a Law Society Trust Report – Accountant’s Report (Report) for a lawyer. The Report required that all exceptions should be noted within the Report. The Member did not identify some exceptions and did not report any exceptions within the Report.
The Investigation Committee determined the Member contravened the CPABC Code of Professional Conduct as follows:
201. – Maintenance of the good reputation of the profession
202.1 – Integrity and due care
203 – Professional competence
205(a) – False or misleading documents and oral representations
The Committee recommended the Member:
-
Accept a reprimand; and
-
Pay expenses of $2,065 plus GST.
The Member, while working in industry, stored and accessed numerous personal files on the work computer of their employer, which contained information about the Member’s personal accounting clients. The personal and confidential information of the Member’s clients were accessed by their employer after the Member was terminated by the employer.
During the investigation, the Member provided a resume which misstated the Member’s work history and provided misleading information. The Member failed to maintain the reputation of the profession co-mingling their work and personal files and was not candid with the investigator or the Committee during the investigation.
The Investigation Committee determined the Member contravened the CPABC and CGA-BC Codes of Professional Conduct as follows:
CPABC Code of Professional Conduct
104.1 – Requirement to co-operate
201.1 – Maintenance of the good reputation of the profession
202. – Integrity and due care
205 (b) – False or misleading documents and oral statements
CGA Code of Professional Conduct
2nd Ethical Principle - Trust and Duties
6th Ethical Principle - Responsibilities to the Profession
The Committee recommended the Member:
-
Accept a reprimand
-
Pay expenses of $4,273 plus GST; and
-
Attend the seminar Shades of Grey: Ethics in the Work Place.
A Member prepared Notice to Reader financial statements and corporate tax returns for a client from 2014-2018 without obtaining a public practice license from CPABC. The 2018 financial statements and corporate tax returns contained errors. During 2017 and 2018, the Member changed the share structure of two companies owned by the client without their consent. In addition, the Member erroneously issued a T5 information slip to a non-shareholder during 2018. The Member also maintained a website that advertises accounting services to the public.
The Investigation Committee determined the Member contravened the CPABC Code of Professional Conduct as follows:
CPABC Code of Professional Conduct
- 101.1(a) Compliance with governing legislation, bylaws, regulations and the Code
- 201.1 Maintenance of the good reputation of the profession
- 202.1 Integrity and due care
- 205 False or misleading documents and oral representations
CPABC Bylaws
- 700 (2) Public Practice by CPA members
The Committee recommended the Member:
- accept a reprimand;
- pay expenses of $2,363 plus GST;
- pay a fine of $4,500;
- comply with CPABC public practice licensing requirements, if they continue to offer or provide public accounting services or other regulated services to the public;
- attend in-person 8 hours of CPABC professional development ethics seminars at the next available dates; and
- agree to the publication of this Determination and Recommendation in the Vancouver Sun and on the CPABC website.