A person shall not commit any act that reflects adversely on
that person's fitness to engage in the practice of public accountancy.
A discreditable act includes but is not limited to and the board may
discipline a person for the following:
(1) fraud or deceit in obtaining a certificate as a
CPA or in obtaining registration under the Act or in obtaining a license
to practice public accounting;
(2) dishonesty, fraud or gross negligence in the practice
of public accountancy;
(3) violation of any of the provisions of Subchapter
J or §901.458 of the Act (relating to Loss of Independence) applicable
to a person certified or registered by the board;
(4) final conviction of a felony or imposition of deferred
adjudication or community supervision in connection with a criminal
prosecution of a felony under the laws of any state or the United
States;
(5) final conviction of any crime or imposition of
deferred adjudication or community supervision in connection with
a criminal prosecution, an element of which is dishonesty or fraud
under the laws of any state or the United States, a criminal prosecution
for a crime of moral turpitude, a criminal prosecution involving alcohol
abuse or controlled substances, or a criminal prosecution for a crime
involving physical harm or the threat of physical harm;
(6) a revocation, cancellation, placement on probation,
limitation on the scope of practice, or suspension by another state,
or a refusal of renewal by another state, of the authority issued
by that state to the person, or to the person's partner, member, or
shareholder, to engage in the practice of public accountancy for a
reason other than the failure to pay the appropriate authorization
fee;
(7) suspension or revocation of or any consent decree
concerning the right to practice before any state or federal regulatory
or licensing body for a cause which in the opinion of the board warrants
its action;
(8) a final finding of conduct by state or federal
courts of competent jurisdiction, agencies, boards, local governments
or commissions for violations of state or federal laws or rules or
findings of unethical conduct by licensees that engage in activities
regulated by entities including but not limited to: the Public Company
Accounting Oversight Board, Internal Revenue Service, U.S. Securities
and Exchange Commission, U.S. Department of Labor, U.S. General Accounting
Office, U.S. Housing and Urban Development, Texas State Auditor, Texas
Comptroller of Public Accounts, Texas Securities Board, Texas Department
of Insurance, and the Texas Secretary of State;
(9) knowingly participating in the preparation of a
false or misleading financial statement or tax return;
(10) fiscal dishonesty or breach of fiduciary responsibility
of any type;
(11) failure to comply with a final order of any state
or federal court;
(12) repeated failure to respond to a client's inquiry
within a reasonable time without good cause;
(13) intentionally misrepresenting facts or making
a misleading or deceitful statement to a client, the board, board
staff or any person acting on behalf of the board;
(14) giving intentional false sworn testimony or perjury
in court or in connection with discovery in a court proceeding or
in any communication to the board or any other federal or state regulatory
or licensing body;
(15) threats of bodily harm or retribution to a client;
(16) public allegations of a lack of mental capacity
of a client which cannot be supported in fact;
(17) voluntarily disclosing information communicated
to the person by an employer, past or present, or through the person's
employment in connection with accounting services rendered to the
employer, except:
(A) by permission of the employer;
(B) pursuant to the Government Code, Chapter 554 (commonly
referred to as the "Whistle Blowers Act");
(C) pursuant to:
(i) a court order signed by a judge;
(ii) a summons under the provisions of:
(I) the Internal Revenue Code of 1986 and its subsequent
amendments;
(II) the Securities Act of 1933 (15 U.S.C. §77a
et seq.) and its subsequent amendments; or
(III) the Securities Exchange Act of 1934 (15 U.S.C. §78a
et seq.) and its subsequent amendments;
(iii) a congressional or grand jury subpoena; or
(iv) applicable federal laws, federal government regulations,
including requirements of the PCAOB;
(D) in an investigation or proceeding by the board;
(E) in an ethical investigation conducted by a professional
organization of CPAs;
(F) in the course of a peer review under §901.159
of the Act (relating to Peer Review); or
(G) any information that is required to be disclosed
by the professional standards for reporting on the examination of
a financial statement.
(18) breaching the terms of an agreed consent order
entered by the board or violating any Board Order.
(19) Interpretive Comment: The board has found in §519.7
of this title (relating to Criminal Offenses that May Subject a Licensee
or Certificate Holder to Discipline or Disqualify a Person from Receiving
a License) and §525.1 of this title (relating to Applications
for the UCPAE, Issuance of the CPA Certificate, or Initial License)
that any crime of moral turpitude directly relates to the practice
of public accountancy. A crime of moral turpitude is defined in this
chapter as a crime involving grave infringement of the moral sentiment
of the community. The board has found in §519.7 of this title
that any crime involving alcohol abuse or controlled substances directly
relates to the practice of public accountancy.
(20) Interpretive comment: A conviction or final finding
of unethical conduct by a competent authority, for the purpose of
paragraph (8) of this subsection, includes any right to practice before
the authority or findings that limit the scope of the permit or license
conveyed by the authority. Conviction relates to the finding in a
criminal proceeding and final finding relates to a determination in
a non-criminal proceeding. Unethical conduct or activities are determined
by the governmental entity making the determination of a conviction
or final finding.
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| Source Note: The provisions of this §501.90 adopted to be effective June 11, 2000, 25 TexReg 5340; amended to be effective October 16, 2002, 27 TexReg 9573; amended to be effective February 4, 2004, 29 TexReg 964; amended to be effective June 7, 2006, 31 TexReg 4642; amended to be effective February 17, 2008, 33 TexReg 1097; amended to be effective August 17, 2008, 33 TexReg 6372; amended to be effective January 28, 2009, 34 TexReg 429; amended to be effective June 17, 2009, 34 TexReg 3948; amended to be effective December 7, 2011, 36 TexReg 8237; amended to be effective June 13, 2013, 38 TexReg 3608; amended to be effective October8,2014, 39 TexReg 7919; amended to be effective June 6, 2018, 43 TexReg 3592; amended to be effective June 3, 2020, 45 TexReg 3634; amended to be effective August 10, 2022, 47 TexReg 4678 |
