While acting as the Chief Financial Officer for a public company, the Member:
- had the appearance of a conflict of interest while being the landlord to the auditor of the public company;
- did not ensure that negative test results concerning the status of the company’s inventory were publicly disclosed in a timely manner;
- did not ensure that the financial statements of the public company accurately reflected the extent of its interest in a material asset; and
- engaged in inappropriate negotiations to assign a debt of the public company to the Member’s relative. The Committee noted that the transaction did not complete.
During the investigation it was also determined the Member’s registered firm name misrepresented its business structure and size of the practice.
The Investigation Committee determined the Member contravened the following Rules of the CPABC Code of Professional Conduct:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
203 - Professional competence
205(a) - False or misleading documents
206 - Compliance with professional standards
210 - Conflicts of interest
401 - Practice names
The Investigation Committee recommended the Member:
- accept a reprimand;
- pay a fine of $2,500;
- pay expenses of $4,806; and
- attend and successfully complete a professional development course in ethics which is satisfactory to the Director, Professional Conduct.