The member was retained by a lawyer to perform specified audit procedures and complete a Law Society Reporting Form Trust Report for two years. The Law Society conducted a compliance audit and found numerous exceptions. The successor accountant found numerous exceptions and these were noted in the Trust Report filed for the subsequent year.
It was also determined the member did not have sufficient independence from the client and therefore lacked objectivity.
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
202.2 – Objectivity
203 – Professional competence
204.1 – Independence: Assurance and Specified Auditing Procedures Engagements
205 – False or misleading documents
206 – Compliance with professional standards
The Committee recommended the member:
- accept a reprimand;
- pay a fine of $2,000;
- pay expenses of $3,125 plus GST of $156.25;
- agree to not perform specified audit procedures and complete a Law Society Reporting Form Trust Report until he passes a future practice inspection; and
- attend in-person and successfully complete the course Audit Engagements – Review of the Standards.
The member was intoxicated and became involved in an incident involving an employee of a drinking establishment. The member was convicted of an offence under section 266 of the Criminal Code of Canada (assault). As a result, the member received a conditional discharge, was placed on probation for one year and was required to pay a victim surcharge of $100.
The Investigation Committee determined the member contravened the CPABC Code of Professional Conduct as follows,
201: Maintenance of the good reputation of the profession
213: Unlawful activity
The Committee recommended the member accept a reprimand; and provide the Director, Professional Conduct with written confirmation when probation order concludes.
The member was retained by a client to prepare a corporate income tax return to be filed with the Canada Revenue Agency. The member did not file the return on a timely basis, and did not respond to client questions and correspondence when the member should have done so.
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
The Committee recommended the member accept a reprimand.
The member operated a licensed professional practice and an unlicensed practice. The member failed to renew their professional liability insurance and operated without insurance for several months. The member did not respond to multiple enquiries from CPABC staff concerning the member’s practices and insurance. The member indicated personal medical matters prevented the effective operation of the practice and response to CPABC appropriately for a period of time.
The Investigation Committee determined the member contravened the CPABC Code of Professional Conduct as follows,
104.1&.2: Requirement to co-operate
201.1: Maintenance of the good reputation of the profession
Bylaw 1301: Professional Liability Insurance
The Committee recommended the member:
- accept a reprimand;
- pay partial expenses of $1,062.50 plus GST;
- satisfy CPABC public practice licensing requirements;
- provide confirmation of personal counselling;
- enter into an arrangement with a senior member of the profession with expertise in practice management (the Advisor”), who is acceptable to the Director, Professional Conduct, in which:
- The Advisor will conduct an overall inspection of the member’s practice management. The Advisor must periodically review and have periodic advisory discussions with the member to promote better understanding by the member of applicable professional, practice management and ethical standards. The member must meet with the Advisor at least six times.
- The member will give access to the Advisor sufficient documentation to allow the Advisor to understand the nature, extent and issues related to the member’s practice relevant to this matter.
- This arrangement will last at least one year, and will cease only upon the consent of the Director, Professional Conduct.
The member did not take adequate responsibility for all of the clients when the member’s business partner became incapacitated. As a result, for a group of clients, the member:
- failed to ensure the tax returns for the clients were filed correctly, on a timely basis or at all;
- did not provide to the clients file information on a timely basis, and
- erroneously provided to the clients records of other persons unrelated to the clients
During the investigation the member did not provide complete responses to the investigator regarding the incapacitated partner.
The Investigation Committee determined the member contravened the CPABC Code of Professional Conduct as follows:
104.1: Requirement to co-operate
201.1: Maintenance of the good reputation of the profession
206.1: Compliance with professional standards
208.1&.3: Confidentiality of information
218: Retention of documentation and working papers
303.1&.2: Provision of client information
501: Policies and procedures for compliance with professional standards
The Committee recommended the member:
- accept a reprimand;
- pay expenses of $3,781 plus GST of $189.05; and
- attend and successfully complete CPABC course PD Nexus: Public Practice Insights.
The member posted defamatory comments against another Chartered Professional Accountant on social media. During the investigation, the member declined an interview and did not provide meaningful response to the investigator’s questions.
The Investigation Committee determined the member contravened the CPABC Code of Professional Conduct as follows:
104.1&.2 Requirement to co-operate
201.1 Maintenance of the good reputation of the profession
The Committee recommended that a Statement of Complaint not be issued on condition the member accept a reprimand.
The Firm was the auditor of public companies. Pursuant to Rule 101.2 of the Code, the Firm self-reported to CPABC that on three occasions, it had not been sufficiently independent from its clients because it had not rotated the engagement partner responsible for the audits for more than seven years. As a result, its objectivity on the audits was compromised.
In a related inspection by the Canadian Public Accountability Board (“CPAB”), CPAB concluded that the Firm did not meet professional standards with respect to the sample audits that CPAB had selected for inspection. The Firm is no longer registered with CPABC in public practice.
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 - Integrity and due care
202.2 - Objectivity
204(20) - Independence (long association of senior personnel)
206 - Compliance with professional standards
The Committee recommended that the Firm:
- accept a reprimand;
- pay a fine of $2,500; and
- pay partial expenses of $2,228 plus GST of $111.40
The Member provided incorporation services for two individuals who had decided to open a business. The Member listed each of them as directors of the business in the founding documents filed with the Corporate Registry. The individuals had a falling out, and the Member filed documents with the Corporate Registry removing one of the individuals as a director of the business, without that individual’s consent. In favouring one individual over the other, the Member did not act with integrity and did not maintain the good reputation of the profession. In addition, by providing incorporation services for the individuals, the Member appears to have engaged in the unauthorized practice of law. The Member is not licensed and insured by the Law Society of British Columbia to provide such services.
The Investigation Committee determined that the Member contravened Rules of the CPABC Code 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
213 - Unlawful activity
The Committee recommended that the Member:
- accept a reprimand;
- pay a fine of $2,000;
- pay expenses of $1,718 plus GST of $85.90;
- make a self-report to the Law Society of British Columbia concerning their conduct in this matter; and
- attend in person and successfully complete by the next available date each of the CPABC courses:
- Business Ethics, it starts with you
- Code decoded: evolving professional ethical expectations; and
- Starting a successful CPA practice.
The Firm was the auditor of the election campaigns of candidates running in provincial and federal elections, and for constituency/riding political associations. A partner of the Firm held a volunteer position with two political campaigns in which the partner exercised a function of leadership or direction. The same partner also received rental income from one of the candidates’ campaigns.
Although the partner did not have a role in the audit engagements and was not engagement partner, the Firm did not adequately consider the threats to its independence these relationships had on its objectivity. It did not document its considerations and conclusions in this regard, as required by professional standards.
The Investigation Committee determined that the Firm contravened the following:
CPABC Code of Professional Conduct
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
202.2 - Objectivity
203 - Professional competence
204.1 - Independence (Assurance and specified auditing procedures engagements)
204.2 - Independence (Compliance with Rule 204.1)
204.3 - Independence (Identification of threats and safeguards)
204.5 - Independence (Documentation)
204.20 - Independence (Audits under elections legislation)
206.1 - Compliance with professional standards
CGA Code of Ethical Principles and Rules of Conduct
EP7 - Independence
R701 - Audit, Review Engagement, Other Assurance and Specified Auditing Procedures Engagements
The Committee recommended that the Firm:
- accept a reprimand;
- pay a fine of $1,000; and
- pay expenses of $3,548 plus GST of $177.40.
The Member failed to file tax returns and other statutory filings for two clients with the Canada Revenue Agency on a timely basis. Errors were made in some of the documents which ultimately resulted in an audit by CRA. The clients were not accurately informed by the Member of the status of their returns. A subsequent refund cheque was not forwarded by the Member to the clients on a timely basis.
The Member represents that these incidents took place during a period of severe and difficult personal circumstances.
The Investigation Committee determined that the Member contravened Rules of the CPABC Code of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
206.1 - Compliance with professional standards
The Committee recommended that the Member:
- accept a reprimand;
- attend and successfully complete by the next available date the courses:
- Starting a Successful CPA Practice; and
- Time Management: the Essentials of Productivity skills.
In making its recommendation, the Committee considered the Member’s personal circumstances, and that the Member had been sanctioned in another matter for conduct occurring at substantially the same period.
A Member, while as a student and subsequently as a Member of CPABC, was associated with a family member, a non-CPA, in operating a public practice firm which was not registered with CPABC. The firm’s advertising misrepresented the firm, the Member, and the family member’s credentials, and implied that it was registered with CPABC.
The Investigation Committee determined that the Member contravened the following:
CPABC Code of Professional Conduct
101.1 - Compliance with governing legislation, bylaws, regulations and the Code
104.1 - Requirement to co-operate
201.1 - Maintenance of the good reputation of the profession
205 - False or misleading documents and oral representations
CGA Code of Ethical Principles and Rules of Conduct
R523 - Students in the Practice of Public Accounting
Bylaws of CPABC
700(2) - Public Practice by CPA Members
The Committee recommended that the Member:
- accept a reprimand;
- pay a fine of $1,000;
- pay expenses of $2,875 plus GST of $143.75; and
- agree to the publication on the publicly accessible section of CPABC’s website of a notice concerning this Determination and Recommendation for a total period of two years.
The Member failed to provide documentary support for continuing professional development (CPD) activity during 2014 to 2016. Pursuant to Bylaw 603, the Membership Committee made a report to the Investigation Committee. An investigation was subsequently authorized, and the Member failed to co-operate adequately with the investigation.
The Investigation Committee determined that the Member contravened Rules of the CPABC Code of Professional Conduct as follows:
101.1 - Compliance with governing legislation, bylaws, regulations and the Code
104 - Requirement to co-operate
The Committee recommended that the Member:
- accept a reprimand;
- pay a fine of $500;
- pay expenses of $1,050 plus GST of $52.50; and
- within 60 days, take whatever action the Manager, Membership Registration considers appropriate to resolve the Member’s apparent deficiency of CPD hours.
The Member failed to respond to repeated requests by CPABC staff to provide documentary support for continuing professional education activities the Member reported. Pursuant to Bylaw 603, the Membership Committee made a report to the Investigation Committee concerning the Member’s lack of co-operation. An investigation was subsequently authorized, and the Member failed to co-operate with the investigation. Subsequently the Member provided the Committee with representations that there were significant personal circumstances which affected the Member’s conduct of this matter.
The Investigation Committee determined that the Member contravened Rules of the CPABC Code of Professional Conduct as follows:
101.1 - Compliance with governing legislation, bylaws, regulations and the Code
104 - Requirement to co-operate
201.1 - Maintenance of the good reputation of the profession
The Committee recommended that the Member:
- accept a reprimand;
- pay expenses of $769 plus GST of $38.45; and
- within 60 days, provide support that is satisfactory to the Membership Registration Manager for their continuing professional development reports for 2014 to 2016.
The Member was retained by a client to prepare personal income tax returns filed with the Canada Revenue Agency. The client was a Canadian and American citizen who filed their own US returns with the United States Internal Revenue Service. The Member made errors in calculating the amount of foreign taxes paid on the Canadian tax return, and did not respond to client questions and correspondence on a timely basis after CRA also made errors in assessing the client’s return.
The Investigation Committee determined that the Member contravened Rules of the CPABC Code of Professional Conduct as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
The Committee recommended that the Member:
- accept a reprimand;
- pay expenses of $2,519 plus GST of $125.95; and
- attend and successfully completes by the next available date the CPABC course U.S. Taxation of U.S. Citizens Living Abroad, or a similar course in international taxation issues.
In response to a CPABC communication which the Member misunderstood, the Member contacted CPABC and left an abusive and profane voice mail message.
The Investigation Committee determined that the Member contravened the CPABC Code of Professional Conduct, Rule 201.1 (Maintenance of the good reputation of the profession).
The Committee recommended that the Member:
- accept a reprimand;
- pay a fine of $1,000;
- pay expenses of $926 plus GST of $46.30;
- attends and successfully completes by the next available date:
- a course in anger management acceptable to the Director, Professional Conduct; and
- the CPABC course Tools for Communicating.
The Member had responsibility for certain client records which subsequently disappeared. The Member believes they were accidentally destroyed by a person working under the Member’s supervision.
The Investigation Committee determined that the Member contravened the CPABC Code of Professional Conduct, Rule 202.1 (Integrity and due care).
The Committee recommended that the Member receive a warning that this determination will be considered if any other matters are referred to the Committee in the future.
The Member was retained by a lawyer to perform specified audit procedures and complete Law Society Reporting Form Trust Reports for the lawyer. The Member completed the Reports which were then submitted to the Law Society of British Columbia. The Law Society subsequently conducted a review of the lawyer’s trust account, and noted numerous breaches of trust accounting rules by the lawyer. The Member failed to report to the Law Society the non-compliance and exceptions to those rules.
The Investigation Committee determined that 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
202.2 - Objectivity
203 - Professional competence
204 - Independence
205 - False or misleading documents or oral representations
206 - Compliance with professional standards
The Committee recommended that the Member:
- accept a reprimand;
- pay expenses of $2,950 plus GST of $147.50; and
- attend and successfully complete by the next available date the course Law Society, Real Estate Council and Other Specified Procedures Reports.
Complaint #1:
The Member failed to cooperate with the takeover of a client by not responding to courtesy letters from the new accountant and by not providing the requested client information.
Complaint #2:
The Member failed to respond to an enquiry from the Canada Revenue Agency concerning a client’s medical expense claim. This caused the client’s claim to be denied and resulted in a reassessment of the client’s income tax payable.
The Investigation Committee determined that the Member contravened the Rules of the CPABC Code of Professional Conduct as follows:
Complaint #1:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
302.2 - Communication with predecessor
303 - Provision of client information
Complaint #2:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
The Committee recommended that the Member:
- accept a reprimand;
- pay expenses of $2,781 plus GST of $139.05; and
- attends and successfully completes by the next available date the courses:
- Business Ethics – It Starts with You; and
- Shades of Grey – Ethics in the Workforce.
The Member failed to cooperate with the takeover of a client by not responding to courtesy letters from the new accountant and by not providing the requested client information.
The Investigation Committee determined that the Member contravened the CPABC Code of Professional Conduct Rules as follows:
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
302.2 - Communication with predecessor
303 - Provision of client information
The Committee recommended that the Member:
- accept a reprimand;
- pay a fine of $3,000;
- pay expenses of $1,437 plus GST of $71.85; and
- attend and successfully complete, by the next available date, the CPABC course Balancing your Wheels, or a similar one-day course in time and personal self-management.
In making its recommendation, the Committee considered that the Member had been disciplined by the Institute of Chartered Accountants of BC for similar misconduct.
The Member performed public accounting services without a public practice licence. During this time, the Member did not maintain professional liability insurance. After receiving contact from CPABC, the Member obtained a public practice license and professional liability insurance. The Member represented to the Committee that the Member had been unaware of the regulatory requirement for a practice license.
The Investigation Committee determined that the Member contravened the following:
CPABC Code of Professional Conduct
101.1 - Compliance with governing legislation, bylaws, regulations and the Code
206.1 - Compliance with professional standards
CPABC Bylaws
700 - Public Practice by CPA Members
1301 - Professional Liability Insurance
CGA-BC Code of Ethical Principles and Rules of Conduct
R517 - Registration
R519 - Professional Liability Insurance
The Committee recommended that the Member:
- accepts a reprimand;
- pays expenses of $500 plus GST of $25; and
- complies with the requirements of any CPABC practice reviews that they may receive in the future.
The Member signed documents purporting to be the employer of another person (now a former Member) for the purposes of that person’s public practice license application with CPABC. The documents purported to verify the other person’s practical experience at two public practice firms in 2015 and 2017. In fact, the Member never worked at either firm. The Member signed a third document for the other person purporting to be the other person’s employer when in fact, they had been the other person’s colleague at a different company.
The Member asserts that they signed some of the documents when they were substantially blank, and does not recall the circumstances of the other documents. The other person used all the documents in an attempt to mislead CPABC concerning the extent of the other person’s practical experience and qualifications to obtain a public practice license from CPABC.
The Investigation Committee determined that the Member contravened the following CPABC Rules of Professional Conduct:
103 - False or misleading applications
104.1 - Requirement to co-operate
201.1 - Maintenance of the good reputation of the profession
202.1 - Integrity and due care
205 - False or misleading documents
The Committee recommended that the Member:
- accept a reprimand;
- pay a fine of $5,000;
- pay expenses of $2,908 plus GST of $145.40;
- acknowledge that by signing this Determination and Recommendation that they are responsible for their conduct;
- acknowledge that if they ever apply for a public practice license, their role in this matter will be considered when considering their suitability for such licensing; and
- attend and successfully complete by the next available date the courses:
- Business Ethics – It starts with you; and
- Shades of Grey – Ethics in the workforce.
The member was the lead partner for several audits of the annual financial statements of two public companies. The Investigation Committee has determined that grounds exist for an allegation that the member contravened Rules of Professional Conduct of the Institute of Chartered Accountants of British Columbia 201.1, 202.1, 203 and 206.1. While it is the Committee’s view that a Statement of Complaint would allege that there were certain deficiencies with generally accepted auditing standards in the work performed, it is the Committee’s recommendation that a Statement of Complaint not be issued on condition that the member:
- accept a reprimand;
- pay a fine of $15,000;
- pay costs of the investigation of $71,172 plus GST of $3,558.60; and
- agree to the publication on the publicly accessible section of CPABC’s website of a notice concerning this Determination and Recommendation for a total period of two years.
The member prepared T1 income tax returns for clients. The member:
- caused the tax returns of the clients to be filed late, which consequently incurred late penalties from the Canada Revenue Agency;
- did not communicate with the clients on a timely basis;
- provided inappropriate tax advice to the clients;
- did not make a financial settlement with his clients, as he had agreed to do; and
- operated a practice under a name that was misleading, because the member is a sole practitioner.
The Investigation Committee determined that the member contravened the following CPABC Rules 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
- 401(a) - Practice names
The Committee recommended that the member:
- accept a reprimand;
- pay a fine of $8,000;
- pay expenses of $3,032 plus GST of $151.60;
- agree to the publication of this Determination and Recommendation in the Whistler Question and on the CPABC website;
- personally attend and successfully complete by the next available date the in-person version of the course Income Tax Planning Refresher for Personal Tax; and
- at his expense, enters into an arrangement with a senior member of the profession (the “Mentor”) who is acceptable to CPABC’s Director of Professional Conduct, in which the Mentor will have periodic mentoring discussions with the member to promote better understanding by the member of applicable professional and ethical standards. This arrangement will last for no less than two years, and must involve at least eight meetings with the Mentor which must be held before December 31, 2019.At the outset of the arrangement, the member must provide the Mentor with a copy of this Determination and Recommendation, and written notification to the CPABC’s Director of Ethics that he has done so.