FINACT17F-2018.009-ACY.pdf

17F-2018.009-ACY · State Board of Accountancy · 2018-04-03

BEFORE THE ARIZONA STATE BOARD OF ACCOUNTANCY In the Matter of OAH Docket No. 17F-2018.009-ACY

Certified Public Accounting Firm Registration No. 2995-L ASBA File No. 2018.009 Issued to: MONTERA MANAGEMENT, LLC DECISION AND ORDER Respondent Firm. On March 26, 2018, this matter came before the Arizona State Board of Accountancy (“Board”) for consideration of Administrative Law Judge (“ALJ”) Tammy L. Eigenheer’s proposed Findings of Fact, Conclusions of Law and Recommended Order (“ALJ’s Decision”).1 Neither Montera Management, LLC (“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’s Certified Public Accounting Firm Registration No. 2995-L be REVOKED. IT IS FURTHER ORDERED that should Respondent Firm seek reinstatement as a CPA firm following revocation, it must meet all of the requirements for reinstatement as set forth in statute and regulation at the time application is made including, but not limited to, demonstrating to the Board’s satisfaction that she and/or her firm have satisfied all orders of restitution entered by courts. This shall be read to include all informal settlements of claims for restitution. NOTICE OF APPEAL RIGHTS Respondent Firm is hereby notified that they have 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 Respondent Firm is further notified that the filing of a motion for rehearing is required to preserve any rights of appeal to the Superior Court. DATED this 28th day of March, 2018.

ARIZONA STATE BOARD OF ACCOUNTANCY By:___________________________________ LeRoy M. Gaintner, CPA, Board President The Board voted to modify the ALJ’s recommended Order to exclude reimbursement of the Board’s fees and costs as the Board deemed the amount to be de minimis. Original of the foregoing Decision and Order (and attachment) filed this 28th day of March, 2018 with: Monica L. Petersen Executive Director Arizona State Board of Accountancy 100 N. 15th Avenue, Suite 165 Phoenix, AZ 85007 Copy of the foregoing Decision and Order (and attachment) e-filed this 28th day of March, 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 th and Certified Mail #[account number redacted] 8767 this 28 day of March, 2018, to: Richard F. Avery Partner In Charge Montera Management, LLC 1410 W. Guadalupe Rd., Ste. 121 Gilbert, AZ 85233 Copy of the foregoing Decision and Order (and attachment) emailed this 28th day of March, 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.2018.009-ACY

Certified Public Accounting Firm ADMINISTRATIVE LAW JUDGE Registration No. 2995-L DECISION Issued to: MONTERA MANAGEMENT, LLC Respondent Firm.

HEARING: January 25, 2018

APPEARANCES: Respondent Firm Montera Management, LLC did not appear

at the hearing in this matter. The Arizona State Board of Accountancy was represented

by Assistant Attorney General Scott Donald.

ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer

_____________________________________________________________________

FINDINGS OF FACT

1. The Arizona State Board of Accountancy (Board) is the state agency authorized to regulate the practice of public accounting by certified public accountants in the State of Arizona. 2. Montera Management LLC (Respondent Firm) is the holder of firm Registration No. 2995-L, issued by the Board. 3. The Board has the personal and subject matter jurisdiction over Respondent Firm pursuant to A.R.S. § 32-701 et seq. and A.A.C. R4-1-101 et seq. 4. Pursuant to A.R.S. § 32-730(A) and A.A.C. R4-1-345, every certified public accountant (CPA), public accountant, and firm is required to register once every two years with the Board and to pay a registration fee pursuant to A.R.S. § 32-729 and A.A.C. R4- 1-345. 5. On or about June 5, 2015, Respondent Firm submitted its biennial firm registration renewal form for Firm Registration No. 2995-L, listing CPA Richard F. Avery, Certificate No. 12720-E, as its Partner In Charge under A.R.S. § 32-731(C), and listing him as Respondent Firm’s only current CPA partner. 6. Mr. Avery’s individual CPA renewal registration for Certificate No. 12720-E was due at the Board’s office by April 30, 2017. When it was not received by the April 30, 2017 due date, Mr. Avery’s Certificate No. 12720-E to practice as a CPA in Arizona Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826 was automatically suspended pursuant to A.R.S. § 32-741.01(A) for failure to timely register and pay the biennial registration fee as requested by A.R.S. § 32-729, A.R.S. § 32-730(A), and A.A.C. R4-1-345. 7. On or about May 1, 2017, a Suspension Order was mailed to Mr. Avery to notify Mr. Avery that his Certificate No. 12720-E was suspended for non-registration. 8. On or about May 9, 2017, a “Notification of Failure to Meet Firm Qualifications” (Notification Letter) was mailed to Respondent Firm’s Partner in Charge, Mr. Avery. The Notification Letter notified Respondent Firm that as of May 1, 2017, CPA Certificate No. 12720-E, belonging to Mr. Avery, was suspended due to non-renewal of the certificate. The Notification Letter further notified Respondent Firm that: Pursuant to A.R.S. § 32-731(A)(1), CPA firm qualifications include the requirement that a firm have at least one partner who is a resident and a full-time practicing certified public accountant in good standing in Arizona. According to our records, MONTERA MANAGEMENT, LLC (Firm 2995-L) does not presently meet this statutory requirement to be registered and recognized as a CPA firm in Arizona. Pursuant to A.R.S. § 32-742(A), “[a]fter 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.” Therefore if RICHARD F. AVERY does not renew the individual CPA Certificate No. 12720-E by 6/8/2017, the Board may take action to REVOKE the firm’s registration.

9. Mr. Avery did not renew Certificate No. 12720-E by the June 8, 2017 deadline. 10. As Mr. Avery’s Certificate No. 12720-E is in suspended status, Respondent Firm does not have at least one partner who is a resident and a full-time practicing CPA in good standing in Arizona. 11. On or about July 10, 2017, the Board voted to proceed with a complaint against Respondent Firm. 12. On or about December 19, 2017, the Board issued a Complaint and Notice of Hearing to Respondent Firm via certified mail. 13. A hearing was held at the Office of Administrative Hearings (OAH) on January 25, 2018. The Board submitted three exhibits and presented the testimony of Christopher Rasmussen to establish the facts set forth above. 14. Respondent Firm 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 a representative of Respondent Firm additional travel time, no one appeared, personally or through an attorney, or contacted the OAH to request that the start of the hearing be further delayed. Consequently, Respondent Firm did not present any evidence to defend its certificate. CONCLUSIONS OF LAW 1. The Complaint and Notice of Public Hearing that the Board mailed to Respondent Firm at its address of record was reasonable, and Respondent Firm is deemed to have received notice of the hearing. See A.R.S. § 41-1092.04. 2. The Board has jurisdiction over Respondent Firm and the subject matter in this case. A.R.S. § 32-701 et seq. and A.A.C. R4-1-101 et seq. 3. Pursuant to A.R.S. § 41-1092.07(G)(2), the Board has the burden of proof in this matter. The standard of proof on all issues in this matter is that of a preponderance of the evidence. A.A.C. R2-19-119. 4. A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.” BLACK’S LAW DICTIONARY 1301 (9th ed. 2009). 5. The Board has the authority to revoke or suspend Respondent Firm’s firm registration and take additional disciplinary action pursuant to A.R.S. § 32-742(A).1 6. Respondent Firm’s failure to have at least one partner who was a resident and a full-time practicing certified public accountant in good standing in the state of

1 A.R.S. § 32-742(A) provides as follows: 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. Arizona constituted grounds to impose disciplinary action against Respondent Firm pursuant to A.R.S. § 32-731(A)(1).2 7. The evidence of record supports the revocation of Respondent Firm’s Firm Registration No. 2995-L pursuant to A.R.S. §§ 32-731 and 32-742. RECOMMENDED ORDER It is recommended that Respondent Firm’s Firm Registration No. 2995-L be revoked on the effective date of the Order entered in this matter. It is further recommended that Respondent shall reimburse the Board’s costs for investigating and proceeding to hearing in this matter, pursuant to A.R.S. § 32-701(10)(g). 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 shall be five (5) days from the date of the certification. Done this day, February 14, 2018

/s/ Tammy L. Eigenheer Administrative Law Judge

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

A.R.S. § 32-731 provides, in pertinent part, as follows:

A. 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.