ALJDEC decisions subject to certification as final

13F-2013.077-ACY · State Board of Accountancy · 2013-04-24

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: April 12, 2013 APPEARANCES: Respondent Craig E. Clifford did not appear. The Arizona State Board of Accountancy was represented by Assistant Attorney General Seth Hargraves. ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer _____________________________________________________________________ FINDINGS OF FACT The Arizona State Board of Accountancy (the Board) issued Certified Public Accountant Certificate No. 5031-E to Craig E. Clifford (Respondent). This certificate enabled Respondent to practice as a certified public accountant (CPA or registrant) in the State of Arizona. On or about August 8, 2011, Respondent submitted to the Board his biennial registration renewal application (the 2011 registration renewal) for the period from August 31, 2011, through August 31, 2013. The address on the 2011 registration renewal was Respondent’s address of record with the Board. On the 2011 registration renewal, Respondent indicated that he had completed 141 hours of continuing professional education (CPE). Respondent signed the application, certifying that the CPE information that he reported was true, that he understood that the CPE was subject to the Board’s approval and review, and that he would retain all documentation of the claimed CPE for three years following the registration renewal. On October 25, 2012, the Board sent a letter via certified mail to Respondent, notifying him that he had been randomly selected for a CPE audit, and requesting that he submit to the Board the documentation for the CPE that he claimed on his 2011 registration renewal. The Board’s October 25, 2012 letter requested that Respondent respond in writing to the letter within thirty days pursuant to A.A.C. R4-1-455.03(F). The Board’s October 25, 2012 letter informed Respondent that A.A.C. R4-1- 453(F) required him to submit two documents to support the courses that comprised his claimed CLE hours, as follows: (1) A certificate of completion or letter of verification issued by the sponsor that verified his attendance at and completion of the course; and (2) A course outline, syllabus, or agenda issued by the sponsor of the course that identified the topics covered in the course. On or about October 29, 2012, Respondent signed the certified mail receipt to indicate that the Board’s October 25, 2012 certified letter had been received at Respondent’s address of record. Respondent did not respond to the Board’s October 25, 2012 letter within thirty days. On January 22, 2013, the CPE Advisory Committee (the Committee) reviewed Respondent’s CPE report and determined that he had not provided documentation to establish either his completion or the content of the courses claimed on the 2011 registration renewal. At the Board’s February 11, 2013 meeting, it accepted the Committee’s report and voted to proceed to hearing. On February 15, 2013, the Board issued a Complaint and Notice of Public Hearing, setting a hearing for 8:00 a.m. on April 12, 2013. The Board mailed a copy of the Complaint and Notice of Public Hearing to Respondent at his address of record. A hearing was held at the Office of Administrative Hearings (OAH) on April 12, 2013. The Board submitted five exhibits and presented the testimony Deputy Director Jim Dubé to establish the facts set forth above. Respondent did not request to appear telephonically at the duly noticed hearing and did not request that the hearing be continued. Although the start of the hearing was delayed more than twenty minutes to allow Respondent additional travel time, he did not appear, personally or through an attorney, and did not contact the OAH to request that the start of the hearing be further delayed. Consequently, Respondent did not present any evidence to defend his CPA certificate. CONCLUSIONS OF LAW The Complaint and Notice of Public Hearing that the Board mailed to Respondent at his address of record was reasonable, and Respondent is deemed to have received notice of the hearing. See A.R.S. § 41-1092.04. The Board has been created and authorized to regulate and control the profession of Certified Public Accountancy in Arizona. See A.R.S. § 32-701 et seq. This matter lies within its jurisdiction. The Board bears the burden of proof to establish Respondent’s statutory and regulatory violations by a preponderance of the evidence. See A.R.S. § 41- 1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). Under A.R.S. § 32-741(A), after notice and opportunity for hearing, the Board may revoke or suspend, or may take additional disciplinary action, as defined by A.R.S. § 32-701(6),[1] against Respondent’s CPA certificate. Under A.R.S. § 32-741(D), “[t]he board shall, after notice and a hearing, suspend the certificate of any certified public accountant or public accountant who fails to show proof, in accordance with section 32-730, subsection D, of compliance with the continuing professional education requirements established by the board.”[2] Under A.A.C. R4-1-453(F), the issue at the hearing was not whether Respondent took the courses that he reported on the CPE form that accompanied his 2011 registration renewal, but whether he had complied with the Board’s requirements for maintaining and submitting the documentation that the Board requires to support the content and his completion of the claimed CPE. The Board established that Respondent failed to maintain and/or submit the required documentation supporting the content and completion of the claimed CPE in violation of A.R.S. § 32-741(A)(9),[3] specifically, his failure to comply with A.A.C. R4-1-453(F).[4] The Board established that Respondent failed to provide documentation of the CPE that he reported on his 2011 registration renewal to the Board within thirty days after request, in violation of A.R.S. § 32-741(A)(6)[5] and A.R.S. § 32-741(A)(15).[6] Respondent’s failure to timely respond to the Board’s October 25, 2012 letter violated A.R.S. § 32-741(A)(15) and A.R.S. § 32-741(A)(9), specifically A.A.C. R4-1-455.03(F).[7] Respondent’s failure to show proof of his compliance with the CPE requirements established by the Board as set forth above provide grounds for the Board to suspend his CPA certificate under A.R.S. § 32-741(D). Respondent’s violations of the applicable statutes and regulations that are set forth above provide grounds for the Board to take disciplinary action against his CPA certificate under A.R.S. § 32-741(A). RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Board’s final order, the Board suspend Respondent Craig E. Clifford’s Certified Public Accountant Certificate No. 5031-E. It is further recommended that pursuant to A.R.S. § 32-701(6)(a), the Board require Respondent to pay an administrative penalty in the amount of $500.00. It is further recommended that pursuant to A.R.S. § 32-701(6)(f), the Board require Respondent to reimburse its costs of investigation and of proceeding to hearing in this matter. In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be five days from the date of that certification.

Done this day, April 24, 2013.

/s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

Monica L. Petersen, Executive Director Arizona State Board of Accountancy ----------------------- [1] A.R.S. § 32-701(6) defines “disciplinary action” as follows: "Disciplinary action" means any other regulatory sanctions imposed by the board in combination with, or as an alternative to, revocation or suspension of a certificate or registration, including the imposition of: (a) An administrative penalty in an amount not to exceed two thousand dollars for each violation of this chapter or rules adopted pursuant to this chapter. (b) Restrictions on the scope of registrants' accounting practice, including, without limitation, restriction of audit or attest function practice, restriction of tax practice or restriction of management advisory practice. (c) Peer review and professional education requirements. (d) A decree of censure. (e) Probation requirements best adapted to protect the public welfare that may include a requirement for restitution payments to accounting services clients or to other persons suffering economic loss resulting from violations of this chapter or rules adopted pursuant to this chapter. (f) Reimbursement of the board's costs of investigations and proceedings initiated under this chapter. [2] A.R.S. § 32-741(D) also provides that “[i]f the certified public accountant or public accountant fails to reinstate the certificate within twelve months after the date of suspension, the certificate expires. The board shall not reinstate a certificate that has expired pursuant to this subsection unless the certified public accountant or public accountant complies with section 32-748 and all other requirements for reinstatement.” [3] A.R.S. § 32-741(A)(9) allows the Board to revoke or suspend a registrant’s CPA certificate for “[k]nowing violation of any . . . rule issued or adopted by the board.” [4] A.A.C. R4-1-453(F) provides “CPE Record Retention: A registrant shall maintain for three years and provide the Board upon request the following documents: course outlines, proof of attendance or participation, and written proof of completion.” [5] A.R.S. § 32-741(A)(6) allows the Board to revoke or suspend a registrant’s CPA certificate for “[v]iolation of any of the provisions of this chapter.” [6] A.R.S. § 32-741(A)(15) allows the Board to revoke or suspend a registrant’s CPA certificate for “[f]ailing to respond or furnish information in a timely manner to the board or its designated agent, if the information is legally requested by the board and is in the registrant's possession or control.” [7] A.A.C. R4-1-455.03(F) provides “Communications: When requested, certified public accountants or public accountants shall respond to communications from the Board within 30 days of the mailing of such communications by registered or certified mail.”

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