FINACT17F-2017.018-ACY.pdf

17F-2017.018-ACY · State Board of Accountancy · 2018-01-22

BEFORE THE ARIZONA STATE BOARD OF ACCOUNTANCY In the Matter of Certified Public OAH Docket No. 17F-2017.018-ACY Accounting Firm Registration No. 3010-L Issued to: ASBA File No. 2017.018

REMOTE ACCOUNTING, PLC,

Respondent Firm. DECISION AND ORDER On January 16, 2018, this matter came before the Arizona State Board of Accountancy (“Board”) for consideration of Administrative Law Judge (“ALJ”) Velva Moses-Thompson’s proposed Findings of Fact, Conclusions of Law and Recommended Order (“ALJ’s Decision”).1 Neither Remote Accounting, PLC (“Respondent Firm”) nor an attorney on its behalf appeared. Assistant Attorney General Scott Donald appeared on behalf of the State. The Board received independent legal advice from Assistant Attorney General Seth Hargraves. The Board, having considered the ALJ’s Decision and the entire record in this matter, hereby issues the following Findings of Fact, Conclusions of Law and Order (“Decision and Order”). FINDINGS OF FACT The Findings of Fact as set forth in the ALJ’s Decision are adopted in their entirety and incorporated herein. CONCLUSIONS OF LAW The Conclusions of Law as set forth in the ALJ’s Decision are adopted in their entirety and incorporated herein. A true and correct copy of the ALJ’s Decision is attached and certain parts of it are incorporated here as set forth above. ORDER Based on the foregoing, the Board ORDERS that Respondent Firm Remote Accounting, PLC’s Certified Public Accounting Firm Registration No. 3010-L be REVOKED. IT IS FURTHER ORDERED that Respondent Firm Remote Accounting, PLC

shall be required to reimburse the Board $192.86 within 60 days of the effective date of this Decision and Order. This amount reflects the costs and attorney’s fees the Board incurred in prosecuting this matter.2 IT IS FURTHER ORDERED that Respondent Firm Remote Accounting, PLC shall be required to pay an administrative penalty in the amount of $1,500.00. The administrative penalty shall be paid within 60 days of the effecetive date of the Decision and Order.3 NOTICE OF APPEAL RIGHTS Respondent Firm Remote Accounting, PLC is hereby notified that it has the right to move for a rehearing or review by filing a motion with the Board’s Executive Director within 30 days after service of this Decision and Order. A.R.S. § 41-1092.09. The motion must set forth legally sufficient reasons for granting a rehearing. A.A.C. R4-1-114(C). Service of this Decision and Order is effective on the date of personal service or five days after the date of mailing. If a motion for rehearing is not filed, the Board’s Decision and Order becomes effective 30 days after it is mailed to Respondent Firm Remote Accounting, PLC. Respondent Firm Remote Accounting, PLC is further notified that the filing of a motion for rehearing is required to preserve any rights of appeal to the Superior Court. 2 The Board voted to modify the ALJ’s Decision to include reimbursement of fees and costs that the Board incurred through the last date of calculation, December 28, 2017. The Board voted to modify the ALJ’s Decision to include an administrative penalty that was calculated by the number of weeks the Respondent Firm was in violation of firm qualification requirements. DATED this 19th day of January, 2018. ARIZONA STATE BOARD OF ACCOUNTANCY By:___________________________________ LeRoy M. Gaintner, CPA, Board President Original of the foregoing Decision and Order (and attachment) th filed this 19 day of January, 2018 with: Monica L. Petersen Executive Director Arizona State Board of Accountancy th 100 N. 15 Avenue, Suite 165 Phoenix, AZ 85007 Copy of the foregoing th Decision and Order (and attachment) e-filed this 19 day of January, 2018 with: Greg Hanchett, Director Arizona Office of Administrative Hearings 1400 W. Washington, Suite 101 Phoenix, Arizona 85007 Copy of the foregoing Decision and Order (and attachment) mailed via U.S. First Class Mail and Certified Mail #[account number redacted] 7500 this 19th day of January, 2018, to: Remote Accounting, PLC Statutory Agent: Seth Jardine Partner In Charge 4400 North Scottsdale Road Ste. 9500 Scottsdale, AZ 85251 Copy of the foregoing Decision and Order (and attachment) emailed this 19th day of January, 2018 to: Scott Donald Assistant Attorney General 1275 W. Washington SGD/LES Phoenix, AZ 85007 Seth Hargraves Assistant Attorney General Independent Attorney Advisor 1275 W. Washington SGD/LES Phoenix, AZ 85007 By: ______________________________

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the matter of: No. 17F-2017.018-ACY Certified Public Accounting Firm Registration No. 3010-L Issued to: REMOTE ACCOUNTING, PLC, ADMINISTRATIVE LAW JUDGE DECISION Respondent Firm.

HEARING: November 9, 2017 APPEARANCES: Assistant Attorney General Scott Donald appeared on behalf of the Arizona Board of Accountancy. No one appeared on behalf of Respondent Remote Accounting, PLC. ADMINISTRATIVE LAW JUDGE: Velva Moses-Thompson _____________________________________________________________________ FINDINGS OF FACT 1. On October 4, 2017, the Arizona Board of Accountancy (“Board”) issued a NOTICE OF HEARING setting the above-captioned matter for hearing at 9:00 a.m. on November 9, 2017, at the Office of Administrative Hearings in Phoenix, Arizona. 2. The NOTICE OF HEARING provides that the issue for hearing is “whether good cause exists to revoke, suspend or take any other disciplinary action against Firm Registration No. 3010-L issued to Remote Accounting, PLC. 3. No representative for Respondent Remote Accounting, PLC (“Remote Accounting”) appeared at the scheduled time and the matter was convened in its absence at about 9:20 a.m. 4. On or about July 31, 2015, Remote Accounting filed a biennial firm registration renewal form for Firm Registration No. 3010-L. Remote Accounting listed certified public accountant Seth Jardine (“Mr. Jardine”) as its Partner In Charge under ARIZ. REV. STAT. section 32-731(C) on the renewal form. See Exhibit 3. Remote

Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826 Accounting also listed Mr. Jardine as its only current certified public accountant partner. See id. 5. Mr. Jardine is Remote Accounting’s statutory agent and sole manager. See Exhibit 5. 6. On June 1, 2016, the Board suspended Mr. Jardine’s certificate for failure to timely register. 7. On or about June 3, 2016, the Board issued a “Notification of Failure to Meet Firm Qualifications” to Mr. Jardine to notify Remote Accounting of the suspension. 8. On or about July 11, 2016, the Board voted to offer Remote Accounting a Consent Agreement for revocation due to Remote Accounting’s failure to meet the firm qualification requirements of ARIZ. REV. STAT. sections 32-731(A)(1) and 742(A), due to Mr. Jardine’s suspension. 9. On or about August 10, 2016, the Board issued a Consent Agreement for revocation to Remote Accounting requesting that it respond by September 9, 2016. 10. On or about August 15, 2016, the Board received back the return receipt signed by “V.Kopp”. 11. On or about September 9, 2016, the Board vacated Mr. Jardine’s suspension because he submitted his renewal. 12. On or about November 7, 2016, the Board voted to offer Remote Accounting a Consent Agreement for an administrative penalty for the period of time during which Remote Accounting failed to meet firm qualification requirements. 13. On November 18, 2016, the Board mailed Remote Accounting a notice regarding the offered Consent Agreement. See Exhibit 1. The November 18, 2016 notice provides, in relevant part, as follows: 1 A written response to this offer indicting your firm’s written consent or dissent to the Order is required and you are hereby requested to respond within thirty (30) days from the date of this letter. Please be advised that the failure to timely respond may be considered a violation of A.R.S. § 32-741(A)(15) and A.A.C. R4-1-455.03(F), and grounds for disciplinary action against your firm’s registration and/or your certificate pursuant to

See id. A.R.S. §§ 32-741(A)(9), (15) and – 742(B).

14. Remote Accounting failed to respond to the offered Consent Agreement within 30 days from November 18, 2016. CONCLUSIONS OF LAW 1. The Board has personal and subject matter jurisdiction over Respondent pursuant to ARIZ. REV. STAT section 32-701 et seq. and A.A.C. R4-1-101 et seq. 2. The Board has the authority to discipline Respondent pursuant to ARIZ. REV. STAT. section 32-742. 3. Pursuant to ARIZ. REV. STAT. section 41-1092.07(G)(2), the Board has the burden of proof in this matter. The standard of proof is by a preponderance of the evidence. A.A.C. R2-19-119(A). 4. ARIZ. REV. STAT. section 32-741(A) provides: After notice and an opportunity for a hearing, the board may revoke or suspend any certificate granted under this chapter and may take disciplinary action concerning the holder of any certificate for any of the following causes: * * * * 9. the violation of any decision, order or rule issued or adopted by the board. * * * * 5. A.A.C. R4-1-455.03(F) provides,

Communications: When requested, a certified public accountant or public accountant shall respond to communications from the Board within 30 days after the communication is mailed by registered or certified mail.

6. ARIZ. REV. STAT. section 32-742(A) provides: After notice and an opportunity for a hearing, the board shall revoke a firm's registration to practice public accounting if at any time it does not have all the qualifications prescribed by this chapter.

7. ARIZ. REV. STAT. section 32-742(B) provides:

After notice and an opportunity for a hearing, the board may revoke or suspend a firm's registration to practice public accounting or may take disciplinary action concerning the registrant for any of the causes enumerated in section 32-741, subsection A or for any of the following additional causes: * * * * 2. The cancellation, revocation, suspension or refusal to renew the authority of the firm or any Arizona partner, shareholder, member, manager, officer, director, agent or employee to practice public accounting in any jurisdiction for any cause other than failure to pay a registration fee in the jurisdiction. * * * * 8. ARIZ. REV. STAT. section 32-731(A) provides:

Except as provided in section 32-725, subsection G, once every two years a partnership engaged in this state in the practice of accounting by certified public accountants or public accountants shall pay the registration fee pursuant to section 32-729 and register with the board as a partnership of certified public accountants and shall meet the following requirements:

1. At least one partner shall be a resident and a full-time practicing certified public accountant in good standing in this state. * * * *

2. At least fifty-one percent of the ownership of the partnership, in terms of direct and indirect financial interests and voting rights, must belong to holders in good standing of certificates or licenses to practice accounting as certified public accountants or public accountants in any jurisdiction. Only certified public accountants or public accountants whose qualifications are considered to be substantially equivalent, as provided by section 32-721, subsections C and D, may be considered as meeting the requirement prescribed by this paragraph.

* * * * 9. The Board established by a preponderance of the evidence that Remote Accounting failed to respond to the Board’s November 18, 2016 letter regarding an offer of Consent Agreement within 30 days after the date of the letter, which is a violation of A.A.C. R4-1-455.03(F). 10. Because Remote Accounting violated A.A.C. R4-1-455.03(F), the Board has authority to revoke its registration to practice public accounting under ARIZ. REV. STAT. section 32-741(A)(9). 11. The Board established by a preponderance of the evidence that Remote Accounting violated ARIZ. REV. STAT.32-731(A)(1) and (2). Therefore, the Board has authority to revoke its registration to practice public accounting under ARIZ. REV. STAT. section 32-742(A). 12. Considering the facts and circumstances of this matter, it is recommended that Remote Accounting’s certificate No. 3010-L be revoked. RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the Board’s final order, the Board revoke Certified Public Accounting Firm Registration No. 3010-L issued to REMOTE ACCOUNTING, PLC. 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, November 29, 2017.

/s/ Velva Moses-Thompson Administrative Law Judge

Transmitted electronically to: Monica L. Petersen, Executive Director Arizona State Board of Accountancy