Activity review

              Activity Review
North Carolina State
Board of Certified Public
Accountant Examiners
1101 Oberlin Rd., Ste. 104 • PO Box 12827 • Raleigh, NC 27605 • 919-733-4222 • www.nccpaboard.gov • No. 01-2011
In This Issue
2011 Board Meetings ........................ 2
Cease and Desist Order .................... 6
Disciplinary Actions ......................... 2
Inactive Status .................................... 7
Licensing Activity ............................. 4
NC Public Campaign Fund .............. 6
Red Flag Rule ..................................... 7
Service Project .................................... 4
Although the mortgage crisis is no longer
the lead story on the nightly news, CPAs
continue to receive requests from clients,
lenders, and loan brokers for “comfort
letters” in which the CPA confirms cli-ent
information such as the client’s self-employed
status, verification of income
from self-employment, profitability of a
client’s business, and the impact on a
client’s business if money is withdrawn
to fund the down payment on a real
estate purchase.
The letter at issue is usually associ-ated
with stated-income loans, which
are mortgages that do not require bor-rowers
to document their income. Such
loans usually are sought by self-em-ployed
people and individuals with in-vestment
income or with sales jobs of
varying commissions.
Lenders, lacking documentation to
support borrower’s income claims, take
on the risk that borrower’s claims are
inadequate. To gain more comfort in
extending loans, some lenders look to
the borrower’s CPA for assurance or
comfort about certain information.
Most lenders will simply ask the
CPA to write a letter indicating that the
prospective borrower is self-employed
or is employed in a certain profession.
Others may attempt to shift the burden of
responsibility for due diligence onto the
borrower’s CPA and provide a script of
what they want the letter to say.
Such a letter provides third-party
verification of details in the application
and could transfer some of the potential
liability to the CPA in the event of default
on the loan.
There are a few issues with this type
of letter that should concern CPAs. First,
the proposed letter asks the CPA to at-test,
when the CPA has not specifically
been engaged for that purpose. The re-port
would be issued to a third party that
has not contracted with the preparer for
that specific purpose.
According to Auditing Standards
Board Statement on Standards for Attes-tation
Engagements No. 10, Attest En-gagements,
an attestation engagement is
called for if the client wants a written
report providing assurance about a spe-cific
subject.
Of course, performing an attestation
engagement is not prohibited in the case
of a lender’s comfort letter request, but
CPAs must follow the procedures re-quired
in an attestation engagement. The
client will likely not want to incur the
expense of a formal attestation engage-ment.
It is also important to know what is
not permitted under the standards.
AT Section 9101, Attest Engagements: At-test
Engagements Interpretations of Section
101, No. 2, ¶ 25 states that practitioners
should not provide any form of assur-ance
that an entity is not insolvent or
would not be rendered insolvent upon a
proposed condition, or that an entity has
the ability to pay debts as they mature.
Should You Provide “Comfort Letters” for Your Clients?
A lender may want the CPA to make
an assurance that the applicant’s with-drawal
of the funds for a down payment
or other purposes would not put a finan-cial
strain on the applicant’s self-em-ployment
business. Any representation
to that effect could be construed to be a
comment on solvency and would thus
be prohibited under the standards.
The types of services permitted in a
CPA attest report include an audit, a
review, or a compilation of the applicant’s
personal financial statements. The CPA
may also report on pro forma financial
information or perform an agreed-upon
procedures report, as long as those pro-cedures
do not provide any assurance
on matters of solvency.
The important thing to consider is
that this type of engagement requires
many procedural steps, which take time
and result in significant fees to the client.
If the CPA takes the time to explain
to the lender what is involved in present-ing
a comfort letter in light of profes-
Comfort Letters
continued on page 4
2
Disciplinary Actions
Debora B. Wentz, #15325
Newton, NC 12/20/2010
THIS CAUSE, coming before the North
Carolina State Board of CPA
Examiners (Board) at its offices at
1101 Oberlin Road, Raleigh, Wake
County, North Carolina, with a quorum
present. Pursuant to NCGS 150B-41, the
Board and Respondent stipulate the
following Findings:
1. Debora B. Wentz (hereinafter
“Respondent”) is the holder of North
Carolina certificate number 15325 as a
Certified Public Accountant.
Respondent also holds a firm
registration as an individual
practitioner firm.
2. On April 3, 2007, Respondent
consented to suspension from practice
before the IRS for a period of eighteen
(18) months in settlement of allegations
by the Office of Professional
Responsibility and the IRS Office of
Chief Counsel that Respondent violated
sections of IRS Circular No. 230 in failing
to timely file personal tax returns. Said
suspension constitutes discipline by a
federal agency.
3. A review of Respondent’s records
indicates that Respondent failed to file
her federal and state personal income
tax returns for the tax year 2000 until
August 2002 (both federal and state
returns); for the tax year 2001 until
February (federal return) and January
(state return) 2003; for the tax year 2002
until October 2005 (both federal and
state returns); for the tax year 2003 until
January 2007 (both federal and state
returns); for the tax year 2004 until
February 2007 (federal return) and
December 2006 (state return); and for
the tax year 2005 until February (federal
return) and January (state return) 2007.
For some of the above-referenced tax
years in which Respondent failed to file,
taxes were due and not timely paid.
4. Respondent failed to report her
discipline by the IRS on her 2007
certificate renewal, but did report the
discipline on her 2008 certificate
renewal.
5. Respondent wishes to resolve this
matter by consent and agrees that the
Board staff and counsel may discuss
this Consent Order with the Board
ex parte, whether or not the Board
accepts this Consent Order as written.
Respondent understands and agrees
that this Consent Order is subject to
review and approval by the Board and
is not effective until approved by the
Board at a duly constituted Board
Meeting.
BASED UPON THE FOREGOING, the
Board makes the following Conclusions
of Law:
1. Respondent is subject to the provisions
of Chapter 93 of the North Carolina
General Statutes (NCGS) and Title 21,
Chapter 08 of the North Carolina
Administrative Code (NCAC),
including the Rules of Professional
Ethics and Conduct promulgated and
adopted therein by the Board.
2. Respondent’s actions as set out above
constitute violations of NCGS 93-12(9)e
and 21 NCAC 08N .0201, .0203, .0204,
.0207, and .0208(b).
BASED ON THE FOREGOING and in
lieu of further proceedings under
21 NCAC Chapter 08C, the Board and
Respondent agree to the following
Order:
1. Upon approval of this Order by the
Board, Respondent’s North Carolina
CPA certificate is hereby suspended for
eighteen (18) months effective
January 1, 2011.
2. Upon approval of this Order by the
Board, the firm registration for
Respondent’s individual practitioner
firm is hereby suspended for eighteen
(18) months effective January 1, 2011.
3. On July 1, 2012, Respondent may
apply to return her certificate to active
status by submission and approval of a
reissuance application which includes:
a. Application form,
b. Payment of the application fee,
c. Three (3) moral character affidavits,
and
d. Forty (40) hours of CPE in the twelve
(12) months preceding the application
including an eight (8) hour accountancy
law course as offered by the North
Carolina Association of CPAs in a group
study format.
4. Respondent shall reimburse the Board
for the administrative costs incurred as
a result of the investigation of this matter.
Clara Jean Pinkney, #17752
Clara Jean Pinkney, CPA, PLLC
Winston-Salem, NC 12/20/2010
THIS CAUSE, coming before the North
Carolina State Board of CPA
Examiners (Board) at its offices at
1101 Oberlin Road, Raleigh, Wake
County, North Carolina, with a quorum
present. Pursuant to NCGS 150B-41, the
Board and Respondent stipulate the
following Findings:
1. Clara Jean Pinkney (hereinafter
“Respondent Pinkney”) is the holder of
North Carolina certificate number 17752
as a Certified Public Accountant.
2. Respondent Clara J. Pinkney, CPA,
PLLC (hereinafter “Respondent Firm”),
2011 Board Meetings
February 21
March 23*
April 26
May 26
June 20
July 25
August 22
September 19
October 20
November 21
December 19
Unless otherwise noted, meetings are
held at the Board office at
1101 Oberlin Road, Raleigh, and be-gin
at 10:00 a.m.
Meetings of the Board are open to
the public except, when under State
law, some portions may be closed to
the public.
*1:00 p.m.
suspended for three (3) years; however,
said suspension shall be stayed.
2. The firm registration for Respondent
Firm, Clara J. Pinkney, CPA, PLLC, is
hereby suspended for three (3) years;
however, said suspension shall be
stayed.
3. Respondent and Respondent Firm
shall not participate in, perform, or
review any audits, reviews, and agreed-upon
procedures for any client for three
(3) years.
4. Respondents may request
reinstatement of the privilege to
participate in, perform, and review
audits, reviews, and agreed-upon
procedures after three (3) years, but will
be required to participate in pre-issuance
review of any audits, reviews,
and agreed-upon procedures performed
until Respondents receive a pass report
in a peer review on each level of the
aforementioned services, and in the
discretion of the Board may be required
to pass the audit section or its equivalent
of the Uniform CPA Examination.
5. Respondent Pinkney is required to
take the eight (8) hour accountancy law
course as offered by the North Carolina
Association of CPAs in a group-study
format within six (6) months of the
approval of the Consent Order by the
Board.
3
is a registered certified public accounting
limited liability company in North
Carolina. At all relevant times,
Respondent Pinkney was the sole
member of Respondent Firm, and has
been individually responsible for the
conduct of Respondent Firm.
Count 1
3. In July of 2004, the North Carolina
Office of State Treasurer, Local
Government Commission (LGC)
approved an audit contract between
Respondent Firm and the Town of
Princeville (Town) for audit services for
the year ending June 30, 2004.
4. In that Respondent Firm’s 2001 peer
review was adverse, the LGC’s audit
contract stipulated that Respondent
Firm’s audit must be pre-issuance
reviewed by a LGC-approved reviewer
prior to issuance of the audit to the
Town.
5. Despite several requests and warnings
by the Town and the LGC, Respondent
Firm and Respondent Pinkney failed to
complete the audit and submit it to the
LGC-approved reviewer as required by
the contract.
6. During the course of the audit, the
LGC determined that Respondent Firm
was no longer independent in that
Respondent Firm contracted and paid
an individual to perform bookkeeping
services for the Town, which included
balancing the accounting records. The
LGC also determined that Respondent
Firm paid the bookkeeper eighty dollars
($80.00) an hour, but billed the Town for
one hundred twenty-five dollars
($125.00) an hour for the bookkeeper’s
services.
7. In November of 2006, over two (2)
years after the original contractual due
date for the audit, the Town and the LGC
determined that the audit would be of
no value, and the Town passed a
resolution terminating Respondent Firm
as the firm engaged to perform the
Town’s June 30, 2004, audit and
requesting that Respondent Firm repay
the Town all monies paid to Respondent
Firm on the audit. Based on the Town’s
resolution and the LGC’s determination
that Respondent Firm lacked
independence, the LGC sent a letter,
dated December 20, 2006, to Respondent
Pinkney, on behalf of Respondent Firm,
notifying Respondent Firm and
Respondent Pinkney that the audit
contract approved by the LGC in July of
2004 was terminated.
8. To date, the monies paid, prior to the
audit contract termination, by the Town
to Respondent Firm and Respondent
Pinkney have not been repaid to the
Town.
Count 2
9. On January 29, 2007, Respondent
Pinkney filed for Chapter 13 Bankruptcy
and failed to report this filing on her
2007-2008 individual certificate
renewal.
10. The bankruptcy filing was later
dismissed by the Court based upon the
Bankruptcy Court’s finding that
Respondent Pinkney had failed to list a
substantial creditor and an asset of the
estate at the time the bankruptcy petition
was filed with the Court.
11. Respondents wish to resolve this
matter by consent and agree that the
Board staff and counsel may discuss
this Consent Order with the Board
ex parte, whether or not the Board
accepts this Consent Order as written.
Respondents understand and agree that
this Consent Order is subject to review
and approval by the Board and is not
effective until approved by the Board at
a duly constituted Board Meeting.
BASED UPON THE FOREGOING, the
Board makes the following Conclusions
of Law:
1. Respondents are subject to the
provisions of Chapter 93 of the North
Carolina General Statutes (NCGS) and
Title 21, Chapter 08 of the North Carolina
Administrative Code (NCAC),
including the Rules of Professional
Ethics and Conduct promulgated and
adopted therein by the Board.
2. Respondents’ actions as set out above
constitute violations of NCGS 93-12(9)e
and 21 NCAC 08N .0201, .0202(b)(3),
.0203, .0204, .0208, .0212, .0402, and
.0403.
BASED ON THE FOREGOING and in
lieu of further proceedings under
21 NCAC Chapter 08C, the Board and
Respondents agree to the following
Order:
1. The Certified Public Accountant
certificate issued to Respondent
Pinkney, Clara Jean Pinkney, is hereby
Disciplinary Actions
continued on page 5
Thomas G. Reynolds, #12484
Raleigh, NC 12/20/2010
THIS CAUSE, coming before the North
Carolina State Board of CPA Examiners
(Board) at its offices at 1101 Oberlin
Road, Raleigh, Wake County, North
Carolina, with a quorum present.
Pursuant to NCGS 150B-41, the Board
and Respondent stipulate the following
Findings:
1. Thomas G. Reynolds (hereinafter
“Respondent”) is the holder of North
Carolina certificate number 12484 as a
Certified Public Accountant.
2. Respondent consented to a Final
Judgment issued by the United States
District Court for the District of Columbia
in a complaint filed by the Securities
and Exchange Commission (SEC).
3. As a part of said Final Judgment,
Respondent consented that he would
4
Certificates Issued
The Board has approved the following applicants for licensure as North
Carolina CPAs:
12/20/10 Seungwong “Andrew” Hong
12/20/10 Albert John Mixner, Jr.
12/20/10 Kathryn Leigh Sasser
Reinstatement
12/20/10 Michael Joseph Auth, #11609 Westford, MA
12/20/10 Lance Lester Farlow, #22350 Raleigh, NC
12/20/10 Joe Channing Minor, #3422 West Palm Beach, FL
12/20/10 Janet Sodano, #22633 Apex, NC
12/20/10 Jared Lee Spencer, #31817 Franklin, NC
12/20/10 Lou Ann Guy Vincent, #14400 Staunton, VA
Reissuance
12/20/10 Hans Timothy Blake, #32578 London, UK
12/20/10 Davin Walter Brown, #16483 Raleigh, NC
12/20/10 David Lynn Fouts, #12856 Wake Forest, NC
12/20/10 Matt Christopher Hinnant, #32535 Wilmington, NC
12/20/10 Andy Hudson, #26813 Charlotte, NC
12/20/10 Sharon Roark Thompson, #22212 Forest City, VA
Retired Status
“Retired,” when used to refer to the status of a person, describes one possessing
a North Carolina certificate of qualification who verifies to the Board that the
applicant does not receive or intend to receive in the future any earned compen-sation
for current personal services in any job whatsoever and will not return to
active status. However, retired status does not preclude volunteer services for
which the retired CPA receives no direct or indirect compensation so long as the
retired CPA does not sign any documents, related to such services, as a CPA
[21 NCAC 08A .0301(b)(33)].
12/20/10 Robert Gregory Holley #9488 Wilmington, NC
12/20/10 Gloria F. Lockerman #2301 Clinton, NC
12/20/10 Gary Walter Ritchie #9265 Shelby, NC
Licensing Activity
sional standards and the related cost to
the applicant of issuing any attestation
letter, the lender may be convinced to
withdraw its request for a comfort letter.
As an alternative, the CPA may of-fer
to send a copy (with the client’s
written authorization) of the client’s tax
forms directly to the lender with a simple
cover page stating, “Please find attached
the tax forms I prepared for Client for the
past two years.”
Sometimes the broker does not want
the tax forms in the application file be-cause
the forms do not provide enough
information or may provide informa-tion
that might cause the loan to be
rejected.
Another option is to provide the
lender with a CPA letter that basically
makes no assurances, therefore limiting
the CPA’s liability. The letter merely
says that the CPA prepared the tax forms
and that the lender should not construe
the letter to be an audited CPA represen-tation.
Although from a risk management
perspective it is preferable to avoid con-firming
any client information to a lender
or broker, a CPA, not wanting to alienate
or offend a client, may be tempted to
send off a quick letter to the lender con-firming
that the client is self-employed,
or retired, or earning a living from the
activities addressed on the tax return.
The CPA should be careful about
sending such a letter. Does the CPA
really know everything that is occur-ring
with that client? Does the client
have other activities on the side that the
CPA is not aware of and that conflict
with the information on the tax forms?
A CPA is certain about what he or she
puts on tax forms. Saying anything else
in the letter advances the tax engage-ment
to a new level.
When asked to provide a comfort
letter for a client, a CPA can best avoid
risk by sticking to the professional stan-dards
and not caving in to pressure
from a client or lender. While clients
need to have the flexibility to obtain
credit, the responsibility for underwrit-ing
the loan lies with the lender, not the
CPA.
Each year, the Board staff participates in
a community service project and this
year the Board staff collected non-per-ishable
food items for the Food Bank of
Central & Eastern North Carolina.
The 15 staff members collected and
donated approximately 325 food items
to the Food Bank. In addition, several
staff members also made monetary do-nations.
The Food Bank is a non-profit orga-nization
that provides food for people at
risk of hunger in 34 counties in central
and eastern North Carolina.
The Food Bank serves a network of
more than 800 partner agencies such as
soup kitchens, food pantries, shelters,
and programs for children and adults
through warehouses in Durham,
Greenville, New Bern, Raleigh, the
Sandhills (Southern Pines) and
Wilmington.
In fiscal year 2009-2010, the Food
Bank distributed more than 41.5 million
pounds of food and non-food essentials
through these agencies.
For more information on the Food
Bank, visit www.foodbankcenc.org.
Board Staff Participates in Service Project
Comfort Letters
continued from front page
5
Carl E. Hansen, #21586
Gibsonia, PA 12/20/2010
THIS CAUSE, coming before the Board
at its offices at 1101 Oberlin Road, Ra-leigh,
Wake County, North Carolina,
with a quorum present. Pursuant to
NCGS 150B-41, the Board and Respon-dent
stipulate the following Findings:
1. Respondent is the holder of North
Carolina certificate number 21586 as a
Certified Public Accountant.
2. Respondent informed the Board on
his 2009-2010 individual certificate
renewal (renewal) that he had obtained
forty-two (42) hours of continuing
professional education (CPE), had
completed the annual Board-approved
North Carolina ethics CPE course, and
had completed at least eight (8) hours of
non-self study CPE to meet the 2008
CPE requirement.
3. Based on Respondent’s rep-resentation,
the Board accepted his
renewal.
4. Board staff requested that Respondent
provide certificates of completion for
the CPE reported to meet his 2008 CPE
requirement.
5. Respondent provided the CPE
certificates of completion to the Board
as requested, but Respondent failed to
provide the certificate of completion
needed to document an annual Board-approved
North Carolina ethics CPE
course that Respondent claimed he
earned between January 1, 2008, and
December 31, 2008, as was reported on
his renewal. Respondent is licensed in
Pennsylvania, but did not complete an
ethics course in Pennsylvania as
Pennsylvania does not have an ethics
CPE course requirement.
6. Respondent wishes to resolve this
matter by consent and agrees that the
Board staff and counsel may discuss
this Consent Order with the Board
ex parte, whether or not the Board
accepts this Consent Order as written.
Respondent understands and agrees
that this Consent Order is subject to
review and approval by the Board and
is not effective until approved by the
Board at a duly constituted Board
Meeting.
BASED UPON THE FOREGOING, the
Board makes the following Conclusions
of Law:
1. Respondent is subject to the provisions
of Chapter 93 of the North Carolina
General Statutes (NCGS) and Title 21,
Chapter 08 of the North Carolina
Administrative Code (NCAC),
including the Rules of Professional
Ethics and Conduct promulgated and
adopted therein by the Board.
2. Respondent’s actions as set out above
constitute violations of NCGS 93-
12(8b)a, 93-12(9)c and 93-12(9)e and
21 NCAC 08J .0101(b), 08N .0202(a),
.0202(b)(3), .0202(b)(4), and .0203(b)(1).
BASED ON THE FOREGOING and in
lieu of further proceedings under
21 NCAC Chapter 08C, the Board and
Respondent agree to the following
Order:
1. Respondent’s application for renewal
is deemed insufficient and untimely
under NCGS 150-B-3(a). Hence, his
certificate is automatically forfeited
pursuant to NCGS 93-12(8b).
2. Respondent must return his certificate
to the Board with this signed Consent
Order.
3. Respondent may apply for the
reissuance of his certificate one (1) year
from the date the Board approves the
Consent Order if Respondent’s
certificate and the civil penalty required
in number five (5) of this Order have
been received by the Board.
4. Respondent may apply to return his
certificate to active status by submission
and approval of a reissuance
application which includes:
a. Application form,
b. Payment of the application fee,
c. Three (3) moral character affidavits,
and
d. Forty (40) hours of CPE in 12 months
preceding the application including an
eight (8) hour accountancy law course
as offered by the North Carolina
Association of CPAs in a group or self-study
format.
5. Respondent shall pay a one thousand
dollar ($1,000.00) civil penalty to be
remitted to the Board within six (6)
months of the date this signed Order is
accepted by the Board.
6. Respondent agrees that failure to
timely comply with any terms of this
agreement and consent order shall be
deemed sufficient grounds for
revocation of his license.
be permanently restrained and enjoined
from violating, directly or indirectly,
Section 30A of the Securities Exchange
Act of 1934 (Exchange Act), and
permanently restrained and enjoined
from aiding and abetting any violation
of Sections 13(b)(2)(A) and 13(b)(2)(B) of
the Exchange Act, and ordered to pay a
civil penalty in the amount of $40,000.00.
4. Respondent wishes to resolve this
matter by consent and agrees that the
Board staff and counsel may discuss
this Consent Order with the Board
ex parte, whether or not the Board accepts
this Consent Order as written.
Respondent understands and agrees
that this Consent Order is subject to
review and approval by the Board and
is not effective until approved by the
Board at a duly constituted Board
Meeting.
BASED UPON THE FOREGOING, the
Board makes the following Conclusions
of Law:
1. Respondent is subject to the provisions
of Chapter 93 of the North Carolina
General Statutes (NCGS) and Title 21,
Chapter 08 of the North Carolina
Administrative Code (NCAC), including
the Rules of Professional Ethics and
Conduct promulgated and adopted
therein by the Board.
2. Respondent’s actions as set out above
constitute violations of NCGS 93-12(9)e
and 21 NCAC 08N .0201, .0203, .0204,
and .0301 (a).
BASED ON THE FOREGOING and in
lieu of further proceedings under
21 NCAC Chapter 08C, the Board and
Respondent agree to the following
Order:
1. Respondent’s CPA certificate shall be
suspended for one (1) year; however,
said suspension shall be stayed.
2. Said suspension shall become active
should the Board be advised of any
violation by Respondent of the terms
and conditions of the Final Judgment
issued by the United States District
Court.
3. Respondent shall pay a ten thousand
dollar ($10,000.00) civil penalty to be
remitted with this signed Order.
Disciplinary Actions
continued from page 3
6
Notice of Apparent Violation and Demand to Cease and Desist
Kenneth M. McNees
Raleigh, NC
To the Above-Named Respondent:
WHEREAS, the North Carolina State
Board of Certified Public Accountant
Examiners (Board) is authorized by
NCGS 93-12(16) to enforce the
provisions of the North Carolina
Certified Public Accountant Act (Act)
through actions for injunctive relief
regarding “a single violation” of this
Chapter; and,
WHEREAS, pursuant to NCGS 93-1, “A
‘certified public accountant’ is a person
who holds a certificate as a certified
public accountant issued to him under
the provisions of this Chapter.”
WHEREAS, pursuant to NCGS 93-3, “It
shall be unlawful for any person who
has not received a certificate of
qualification or not been granted a
practice privilege under NCGS 93-10
admitting the person to practice as a
certified public accountant to assume or
use such a title, or to use any words,
letters, abbreviations, symbols or other
means of identification to indicate that
the person using same has been admitted
to practice as a certified public
accountant.”
WHEREAS, Respondent Kenneth M.
McNees (hereinafter “Respondent
McNees”) is not currently licensed as a
certified public accountant in North
Carolina or otherwise authorized by the
Board to use the CPA title in this State,
but his principal place of business is in
North Carolina; and
WHEREAS, Respondent McNees, while
working in North Carolina, identified
himself as a CPA in the course of his
employment with the Wake County
Public School System. Respondent
McNees’ use of the title “CPA” or
“Certified Public Accountant” conveys
the false impression that he is
authorized to use a title other than
‘accountant’ when, in fact, he is not
lawfully authorized to use the title
“certified public accountant” or “CPA”
in this State. Such a representation is
North Carolina Public Campaign Fund
The following information is printed as a
courtesy to the State Board of Elections.
With tax season underway, North Caro-lina
licensees are reminded of their legal
obligation to ask clients about a check-off
designation for the North Carolina
Public Campaign Fund (the Fund) on
the North Carolina personal income tax
form.
Established by NCGS 163-278.61,
and administered by the State Board of
Elections, the Fund supports a nation-ally
acclaimed program designed to im-prove
how North Carolina voters elect
judges for the North Carolina Supreme
Court and Court of Appeals.
The Fund helps voters cast a more
informed vote in these elections by pay-ing
for the creation of a non-partisan
voter guide which describes the func-tions
of the appellate court and profiles
the candidates running for those of-fices.
misleading and contrary to NCGS 93-1
and 93-3.
THEREFORE, Respondent McNees is
hereby notified and the North Carolina
State Board of Certified Public
Accountant Examiners demands that
he immediately cease and desist from
offering or using in any manner the title
“CPA” or “Certified Public Accountant”
in North Carolina unless and until
Respondent McNees has been licensed
as a CPA by the North Carolina State
Board of Certified Public Accountant
Examiners.
BY:
Robert N. Brooks, Executive Director
North Carolina State Board of Certified
Public Accountant Examiners
11/01/2010
In lieu of civil proceedings authorized by
NCGS 93-12(16), the Board will accept
Respondent’s consent to this Demand.
CONSENTED TO BY:
Kenneth M. McNees
11/19/2010
The Fund also helps protect the
impartiality of the courts by providing
financial aid to candidates who accept
restrictions on their spending and fund-raising,
including limits on donations
from lawyers and special-interest
groups.
Pursuant to NCGS 105-159.2, “a
taxpayer must be given the opportunity
to indicate an agreement to that
allocation...after being presented with
the information required.”
To participate in the Fund, filers of
North Carolina personal income tax re-turns
may designate $3.00 to the Fund
by checking a box on their
personalincome tax returns. Taxpayers
must be made aware that designating
$3.00 to the Fund does not increase the
taxpayer’s tax due and does not reduce
any refund due the taxpayer.
A paid tax preparer of an
individual’s personal income tax re-turn
may not mark an agreement or
objection to the allocation without the
taxpayer’s consent.
To help licensees explain the Fund
to clients, the State Board of Elections
web site, www.sboe.state.nc.us has fact
sheets and small dollar-size flyers
(“buck slips”) available for printing.
More information on the Fund is
available from the non-partisan Democ-racy
North Carolina web site,
www.democracy-nc.org.
Additional information is also avail-able
by calling the State Board of Elec-tions
Campaign Finance Division at
(919) 733-7173.
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twitter.com/NCCPABoard
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facebook.com/NCCPABoard
7
10/26/10 Pamela Manning Myers, #19875 Thomasville, NC
10/28/10 Tony Bradford Cheers, #18774 Supply, NC
11/01/10 Robert Halley Bazemore, Jr., #17298 Raleigh, NC
11/01/10 Douglas A.Fullerton, #32145 Kernersville, NC
11/03/10 John William Graeter, #16199 Hot Springs, NC
11/08/10 Rebecca Thrower, Barnett, #25065 Florence, SC
11/08/10 Paul Douglas Bullard, #14661 Sanford, NC
11/09/10 Sarah Casey Howell, #15817 North Wilkesboro, NC
11/10/10 Heather Ann Edson, #27481 Charlotte, NC
11/10/10 Clarence Randall McGlothlin, #2927 Mooresville, NC
11/10/10 Janine Urbanek, #31196 Seattle, WA
11/15/10 Sue Flowers Bell, #13920 Cary, NC
11/17/10 Michael Joseph Boyle, #15331 Asheboro, NC
11/19/10 Camilla Smith Buie, #14029 Charlotte, NC
11/24/10 Steven Dean Johnson, #31347 Salisbury, NC
11/29/10 Bonnie Ann Hunt, #23188 Fayetteville, NC
11/30/10 Louis Lindsey Crawley, #9514 Raleigh, NC
12/01/10 Michael Eugene Powers, #6623 Taylorsville, NC
12/01/10 John Michael Pownall, #16653 Charlotte, NC
12/06/10 Ray Eugene Barnhardt, #3602 Newton, NC
12/06/10 Edward Evan Bass, #4198 Chapin, SC
12/10/10 Amy Lee Boswell, #33569 Charlotte, NC
12/10/10 Nancy Hunt Brumbaugh, #12142 Surprise, AZ
12/10/10 Garmon G. Dale, Jr., #27921 Grand Prairie, TX
12/15/10 J. Robert Capps, #18290 Huntersville, NC
12/15/10 David Camden Frazier, #15410 Sunset Beach, NC
12/15/10 Dyanne Morrell Frazier, #17327 Cornelius, NC
12/15/10 Alice Gwyn Heusel, #15668 Tacoma, WA
12/15/10 Jamie O. Jonas, #24629 Charlotte, NC
12/15/10 James Roy King, #7758 Sumter, SC
12/15/10 Ronald Ray Moats, #27855 South Daytona, FL
12/17/10 James William Bass, Jr., #12581 Nashville, NC
12/17/10 Margaret A. Stadtler, #33475 Hendersonville, NC
12/20/10 Rebecca Heineck Ferrara, #33084 Fort Mill, SC
12/20/10 Muffin Padgett Gerler, #22045 Raleigh, NC
12/20/10 Amy Nobs Lamar, #32591 Fort Walton Beach, FL
12/23/10 Gerene Sue Bovermann, #34431 Frisco, TX
12/23/10 Edward Paul Byron, #34092 Charlotte, NC
12/23/10 Craig Alan Emrick, #25681 New York, NY
12/23/10 Timothy John Parker, #31603 Keene, NH
Inactive Status
“Inactive,” when used to refer to the status of a person, describes one who has
requested inactive status and been approved by the Board and who does not use
the title “certified public accountant” nor does he or she allow anyone to refer
to him or her as a “certified public accountant,” and neither he nor she nor
anyone else refers to him or her in any representation as described in 21 NCAC
08A .0308(b) [21 NCAC 08A .0301(b)(21)].
CPAs Exempt from Red
Flags Rule
On December 18, 2010, President Obama
signed legislation into law exempting
accountants from the Federal Trade
Commission’s Red Flags Rule requiring
businesses to implement a written
identity theft protection program.
The Red Flags Rule calls for
“creditors” to establish a program to
protect customers, clients and patients
from identity theft.
The law took effect December 31,
2010, after numerous postponements
as various industries protested their
inclusion under the rule.
The “Red Flag Program
Clarification Act of 2010,” changes the
definition of a creditor and exempts
businesses that “advance funds on
behalf of a person for expenses
incidental to a service provided.”
The law also states that the rule
should only apply to businesses that
obtain or use consumer reports, directly
or indirectly, in connection with credit
transactions; furnish information to
consumer reporting agencies in
connection with a credit transaction;
and advance funds to or on behalf of a
person based on an obligation to repay
the funds or repayable from specific
pledged property.
The new law also gives the Federal
Trade Commission (FTC) the authority
to promulgate regulations applying the
rule to businesses whose accounts the
FTC decides should be “subject to a
reasonably foreseeable risk of identity
theft.”
However, the congressional record
contains many instances of lawmakers
specifically calling on Congress to
exempt accounting practices.
Firm Renewal & Peer
Review Compliance
Due January 31
January 31, 2011, is the final dead-line
for firm renewal and peer re-view
compliance. For more infor-mation,
visit www.nccpaboard.gov.
Certificate No. Send Mail to Home Business
New Home Address
City State Zip
CPA Firm/Business Name
New Bus. Address
City State Zip
Telephone: Bus. ( ) Home ( )
Bus. Fax ( ) E-mail Address
Certificate Holder
Last Name Jr./III First Middle
North Carolina State Board of
Certified Public Accountant Examiners
PO Box 12827
Raleigh NC 27605-2827
PRSRT STD
US Postage PAID
Greensboro, NC
Permit No. 393
23,000 copies of this document were printed for this agency at a cost of $3,196.00 or approximately $.138 per copy in January 2011
Notice of Address Change
Signature Date
Mail: PO Box 12827
Raleigh, NC 27605-2827
Fax : 919-733-4209
State Board of
CPA Examiners
Board Members
Michael C. Jordan, CPA
President, Goldsboro
Jose R. Rodriguez, CPA
Vice President, Winston-Salem
Maria M. Lynch, Esq.
Secretary-Treasurer, Raleigh
Barton W. Baldwin, CPA
Member, Mount Olive
Wm. Hunter Cook, CPA
Member, Charlotte
Bucky Glover, CPA
Member, Monroe
Jordan C. Harris, Jr.
Member, Statesville
Staff
Executive Director
Robert N. Brooks
Deputy Director
J. Michael Barham, CPA
Legal Counsel
Noel L. Allen, Esq.
Administrative Services
Felecia F. Ashe
Vanessia L. Willett
Communications
Lisa R. Hearne, Manager
Examinations
Phyllis W. Elliott
Licensing
Buck Winslow, Manager
Alice G. Steckenrider
Cammie Emery
Professional Standards
Frank Trainor, Esq., Staff Attorney
Ann J. Hinkle, Manager
Mary Beth Britt
Paulette Martin
Pursuant to 21 NCAC 08J .0107, all certificate holders and CPA firms must notify the Board in
writing within 30 days of any change in address or business location.