BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 773|
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UNFINISHED BUSINESS
Bill No: SB 773
Author: Negrete McLeod (D)
Amended: 8/15/11
Vote: 21
SENATE BUS., PROF. & ECON. DEV. COMMITTEE : 9-0, 4/25/11
AYES: Price, Emmerson, Corbett, Correa, Hernandez, Negrete
McLeod, Vargas, Walters, Wyland
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SENATE FLOOR : 38-0, 5/19/11
AYES: Alquist, Anderson, Berryhill, Blakeslee, Calderon,
Cannella, Corbett, Correa, De Le�n, Dutton, Emmerson,
Evans, Fuller, Gaines, Hancock, Harman, Huff, Kehoe, La
Malfa, Leno, Lieu, Liu, Lowenthal, Negrete McLeod,
Padilla, Pavley, Price, Rubio, Runner, Simitian,
Steinberg, Strickland, Vargas, Walters, Wolk, Wright,
Wyland, Yee
NO VOTE RECORDED: DeSaulnier, Hernandez
ASSEMBLY FLOOR : 66-10, 8/25/11 - See last page for vote
SENATE BUSINESS, PROF. & ECON. DEV. COMMITTEE : 8-0,
8/30/11 (Pursuant to Joint Rule 29.10)
AYES: Price, Emmerson, Corbett, Correa, Hernandez, Negrete
McLeod, Vargas, Wyland
NO VOTE RECORDED: Walters
SUBJECT : Accountants
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SB 773
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SOURCE : Author
DIGEST : This bill establishes requirements for ethics
courses that certified public accountants must complete to
gain licensure.
Assembly Amendments delete the portion of the bill related
to the internet broadcasting of Board of Accountancy
meetings, and add language which establish requirements for
ethics courses that certified public accountant must
complete to gain licensure.
ANALYSIS :
Existing law:
1. Licenses and regulates some 40,000 certified public
accountants (CPAs) under the Accountancy Act by the
California Board of Accountancy (CBA) within the
Department of Consumer Affairs.
2. Establishes an Advisory Committee on Accounting Ethics
Curriculum (Advisory Committee) within the CBA to
recommend to the CBA ethics study guidelines, as
specified, and authorizes the committee to determine
that a course or a portion of a course of accounting
education satisfies the ethics study requirement.
This bill:
1. Requires, after December 31, 2013, the total educational
program required for licensure as a CPA to include a
minimum of 10 units of ethics study as specified by this
bill and 20 units of accounting study consistent with
regulations to be adopted by the CBA by January 1, 2012,
pursuant to current law.
2. Specifies that CBA's Advisory Committee may determine
that a course or portion of a course satisfies this
ethics study requirement, and that nothing in this bill
shall be construed to be inconsistent with prevailing
academic practice regarding the completion of units.
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3. Deletes language that is redundant to #1 above.
4. Requires CPA license applicants to provide documentation
of completion of 10 semester units or 15 quarter units
of ethics study set forth in #1 above, to the
satisfaction of CBA and as prescribed below.
5. Requires, between January 1, 2014, and December 31,
2016, the 10 semester units or 15 quarter units of
ethics study to be completed from the following course
areas:
A. Business, government, and society; business law;
corporate governance; corporate social
responsibility; ethics; fraud; human resources
management; business leadership; legal environment of
business; management of organizations; morals;
organizational behavior; professional
responsibilities; or, auditing;
B. A maximum of three semester units or four quarter
units in: philosophy; religion; or, theology; and,
C. A maximum of one semester unit of ethics study for
completion of a course title specific to financial
statement audits.
6. Requires, on and after January 1, 2017, the ethics study
to be completed as follows:
A. A minimum of three semester units of four quarter
units in courses at an upper division level or higher
devoted to accounting ethics or accountants'
professional responsibilities, unless the course was
completed at a community college, in which case it
need not be completed at the upper division level or
higher;
B. A maximum of seven semester units or 11 quarter
units in courses listed in (A) above; and,
C. Courses as described in (B) and (C) above.
7. Specifies that qualifying courses must contain in their
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title one or more of the terms "introduction,"
"introductory," "general," "fundamentals of,"
"principles," "foundation of," or "survey of," or have
the name of the discipline as the sole name of the
course title.
8. Changes the sunset provisions for the Advisory
Committee, to remain in effect until January 1, 2014.
9. Removes a requirement that the CBA adopt Advisory
Committee ethics study recommendations via regulation,
and related language.
Background
Legislation enacted in 2009, established the Advisory
Committee to make recommendations on ethics study
guidelines to the CBA by June 1, 2012. That legislation,
SB 819 (Yee), Chapter 308, Statutes of 2009, revised the
CPA license standards to increase the amount of education
from 120 hours to 150 hours effective January 1, 2014. In
increasing the required hours, the legislation required
that the education include a minimum of 10 units of ethics
study and 20 units of accounting study, as specified. The
10 units of ethics study must meet the guidelines
established by the CBA upon the advice of the Advisory
Committee.
The Accountancy Act was further amended by AB 1005 (Block),
Chapter 379, Statutes of 2009, to increase public access
and transparency as it relates to the regulation of the
accounting profession by requiring the Internet
broadcasting of public CBA meetings, the posting of CBA
minutes and notices of formal accusations on the CBA's Web
site. In adding these requirements, the legislation
authorized the CBA to provide either an audio or a video
broadcast of the CBA meeting over the Internet. In meeting
these requirements the CBA has chosen to video broadcast
its meetings. This bill amends the law to reflect the
practice of the CBA.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
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ASSEMBLY FLOOR : 66-10, 8/25/11
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Block, Blumenfield, Bradford, Brownley, Buchanan, Butler,
Charles Calderon, Campos, Carter, Cedillo, Chesbro,
Conway, Cook, Davis, Dickinson, Eng, Feuer, Fletcher,
Fong, Fuentes, Furutani, Galgiani, Garrick, Gatto,
Gordon, Hagman, Harkey, Hayashi, Roger Hern�ndez, Hill,
Huber, Hueso, Huffman, Jeffries, Lara, Bonnie Lowenthal,
Ma, Mendoza, Mitchell, Monning, Nestande, Nielsen, Norby,
Olsen, Pan, Perea, V. Manuel P�rez, Portantino, Silva,
Skinner, Smyth, Solorio, Swanson, Torres, Valadao,
Wagner, Wieckowski, Williams, Yamada, John A. P�rez
NOES: Donnelly, Beth Gaines, Grove, Halderman, Jones,
Knight, Logue, Mansoor, Miller, Morrell
NO VOTE RECORDED: Bill Berryhill, Bonilla, Gorell, Hall
JJA:kc 8/31/11 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
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