By CPABC’s Professional Conduct Team; published in CPABC in Focus
Published: July/August 2018
From CPABC’s Professional Conduct Team
Each year, CPABC receives approximately 100 complaints about member conduct. Considering the fact that CPABC now has more than 35,000 members, the chances of having a complaint lodged against you in any given year are very small. Over the course of your entire career, however, these chances increase when certain factors are involved—and this is particularly true for public practitioners.
More than half of the complaints we receive in a typical year relate to members in public practice. This isn’t surprising, because any individual who provides professional services to the public is more likely to trigger a complaint. Moreover, when the conduct of a member in industry, government, or education is called into question, there are usually other avenues for public complaints and for dispute resolution; for example, complaints about the employment or on-the-job conduct of a CPA in industry can usually be resolved through other agencies, such as the BC Human Rights Tribunal or through the individual’s employer.
A complaint can be costly for public practitioners and responding to one can distract you from other professional duties. Recognizing this, we wanted to share some guidance to help public practitioners stay onside of the CPABC Code of Professional Conduct (CPA Code). Because although each complaint is unique, there are several common themes.
Five Common Problem Areas
Currently, the most common thread among complaints is a CPA’s failure to communicate properly. This can mean:
Failing to communicate in a timely fashion when repeatedly asked to do so (whether by clients, other CPAs, or CPABC), or failing to respond to a client’s requests. Unreturned calls can quickly become a problem—one that takes far more time to resolve than simply answering the call in the first place.
Using an inappropriate tone and/or communicating inappropriate content.
Not communicating clearly or thoroughly. For example, a complaint may arise if a CPA neglects to create an engagement letter for their client or if the engagement letter they’ve created omits important aspects of the professional services to be rendered.
Not communicating or co-operating with a successor accountant can also get members into trouble. Successor accountants can, and do, contact us to complain about a predecessor accountant’s failure to co-operate and to express concerns about the quality of work previously produced.
Tensions can also arise when fees are outstanding. When a former client has not paid a CPA’s bill, the predecessor and successor may disagree about whether documents should be sent to the successor or returned to the client. We recommend that CPAs who find themselves in this situation review rules 302 and 303 of the CPA Code, along with the related guidance. We also advise practitioners to contact CPABC’s professional standards advisory team, if necessary, to discuss their situation in confidence. Our advisors can discuss the rules of the CPA Code as they relate to the return of the client’s property, the accountant’s own work, copies of statutory filings, and fee matters.
When assessed with penalties, interest, and costs, it’s not uncommon for a client to allege that their CPA failed to deliver statutory filings on time. To safeguard against such allegations, public practitioners should ensure that they have effective systems in place to follow up on outstanding questions with clients and properly track filing deadlines.
It’s also important for CPAs to limit their services to their areas of greatest strength and to avoid practising in areas of specialization in which they lack sufficient expertise. Certain types of professional services—such as specialized US tax services, for example, or trust audits required by the Law Society of British Columbia—require specialized knowledge and/or experience. It’s important for CPAs to know when they’ve crossed over to a territory in which they lack the skill set or knowledge base needed to render services to clients effectively.
Concerns about objectivity and independence
CPABC also receives complaints from CPA clients who are involved in family or marital disputes. A common mistake for members is to continue working for one of the feuding parties without clarifying which services they will be providing and to whom. In such cases, it’s not unusual for the other party to question the public practitioner’s professional objectivity.1
Improper licensing and inadequate liability insurance
Each year, CPABC receives complaints about individuals who “dabble” in public practice without the proper licensing or professional liability insurance.2
CPAs must have a public practice licence from CPABC before they perform public accounting or other regulated services for the public. The Public Practice section of the CPABC website (bccpa.ca/member-practice-regulation/public-practice) provides members with all the information needed to obtain the proper professional licensing.
The Consequences of Breaching The CPA Code
If CPABC’s Investigation Committee determines that a member has breached the CPA Code and that grounds exist for disciplinary action, it may—depending on the seriousness of the matter—recommend that the member:
Accept a reprimand;
Complete one or more professional development courses;
Pay a fine of up to $25,000 (up to $4,000 for a student3; up to $100,000 for a registered firm);
Pay the expenses of the investigation;
Take other remedial action; or
Do any combination of the above.
Furthermore, if a matter is then referred to the CPABC’s Disciplinary Committee, the Disciplinary Committee may decide to make an order of suspension or cancellation, or to impose conditions on a CPA’s continued membership.
If the Investigation Committee or the Discipline Committee establishes that a complaint made against a member has grounds, CPABC will later publish a summary of the outcome of the complaint on its website at bccpa.ca. When appropriate, complaint summaries disclose the names of the CPAs who have breached the CPA Code.
As mentioned at the beginning of this article, we receive relatively few complaints about our members’ conduct. That’s good news, indicating that most CPAs know and adhere to the rules, both in spirit and in practice. We encourage you to keep up the good work and keep complaints at bay by:
Communicating effectively and often;
Ensuring systems are set up to meet all necessary deadlines;
Practising only in areas where you have expertise and proper licensing and insurance;
Taking care when family disputes erupt among existing clients and proceeding with the utmost caution; and
Remembering to take the high road, no matter what the circumstances!
Want Additional Guidance?
CPABC’s professional standards advisors are here to help you comply with the CPA Code when you’re navigating difficult situations. All guidance is confidential, non-binding, and unofficial. Contact the advisors by email at firstname.lastname@example.org.
In complex cases, you may also want to consider obtaining independent legal counsel.
In this article, “students” refers to both candidates enrolled in the CPA Professional Education Program and students taking the CPA preparatory courses or pursuing the Advanced Certificate in Accounting and Finance.