5070. Permits to engage in the practice of public accountancy in
this state shall be issued by the board only to holders of the
certificate of certified public accountant issued under this chapter
and to those partnerships, corporations, and other persons who, upon
application approved by the board, are registered with the board
under this chapter. All applicants for registration shall furnish
satisfactory evidence that the applicant is entitled to registration
and shall pay the fee as provided in Article 8 (commencing with
Section 5130). Every partnership, corporation, and other person to
whom a permit is issued after December 31, 1962, shall, in addition
to any other fee which may be payable, pay the initial permit fee
provided in Article 8 (commencing with Section 5130).
Each partnership, corporation, and other person issued a permit by
the board to practice as a certified public accountant or as a
public accountant shall be furnished with a suitable certificate
evidencing such registration.
5070.5. (a) A permit issued under this chapter to a certified
public accountant or a public accountant expires at 12 midnight on
the last day of the month of the legal birthday of the licensee
during the second year of a two-year term if not renewed.
To renew an unexpired permit, a permitholder shall, before the
time at which the permit would otherwise expire, apply for renewal on
a form prescribed by the board, pay the renewal fee prescribed by
this chapter and give evidence satisfactory to the board that he or
she has complied with the continuing education provisions of this
chapter.
(b) A permit to practice as an accountancy partnership or an
accountancy corporation expires at 12 midnight on the last day of the
month in which the permit was initially issued during the second
year of a two-year term if not renewed. To renew an unexpired permit,
the permitholder shall, before the time at which the permit would
otherwise expire, apply for renewal on a form prescribed by the
board, pay the renewal fee prescribed by this chapter, and provide
evidence satisfactory to the board that the accountancy partnership
or accountancy corporation is in compliance with this chapter.
5070.6. Except as otherwise provided in this chapter, an expired
permit may be renewed at any time within five years after its
expiration upon the filing of an application for renewal on a form
prescribed by the board, payment of all accrued and unpaid renewal
fees and providing evidence satisfactory to the board of compliance
as required by Section 5070.5. If the permit is renewed after its
expiration, its holder, as a condition precedent to renewal, shall
also pay the delinquency fee prescribed by this chapter. Renewal
under this section shall be effective on the date on which the
application is filed, on the date on which the accrued renewal fees
are paid, or on the date on which the delinquency fee, if any, is
paid, whichever last occurs. If so renewed, the permit shall continue
in effect through the date provided in Section 5070.5 that next
occurs after the effective date of the renewal, when it shall expire
if it is not again renewed.
5070.7. (a) A permit that is not renewed within five years
following its expiration may not be renewed, restored, or reinstated
thereafter, and the certificate of the holder of the permit shall be
canceled immediately upon expiration of the five-year period, except
as provided in subdivision (e).
(b) A partnership or corporation whose certificate has been
canceled by operation of this section may obtain a new certificate
and permit only if it again meets the requirements set forth in this
chapter relating to registration and pays the registration fee and
initial permit fee.
(c) A certified public accountant whose certificate is canceled by
operation of this section may apply for and obtain a new certificate
and permit if the applicant:
(1) Is not subject to denial of a certificate and permit under
Section 480.
(2) Pays all of the fees that would be required of him or her if
he or she were then applying for the certificate and permit for the
first time.
(3) Takes and passes the examination which would be required of
him or her if he or she were then applying for the certificate for
the first time. The examination may be waived in any case in which
the applicant establishes to the satisfaction of the board that, with
due regard for the public interest, he or she is qualified to engage
in practice as a certified public accountant.
(d) The board may, by appropriate regulation, provide for the
waiver or refund of all or any part of the application fee in those
cases in which a certificate is issued without an examination under
this section.
(e) Revoked permits may not be renewed, but may be reinstated by
the board, without regard to the length of time that has elapsed
since the permit was revoked, and with conditions and restrictions as
the board shall determine.
5070.8. A permit which has been suspended is subject to expiration,
and shall be renewed as provided in this article, but such renewal
does not entitle the holder of the permit, while it remains
suspended, and until it is reinstated, to engage in the practice of
accountancy, or in any other activity or conduct in violation of the
order or judgment by which the permit was suspended.
A permit which has been revoked is subject to expiration, but it
may not be renewed. If it is reinstated after its expiration, the
holder of the permit, as a condition precedent to its reinstatement,
shall pay a reinstatement fee which shall be in an amount equal to
the renewal fee in effect on the last regular renewal date before the
date on which it is reinstated, plus the delinquency fee, if any,
accrued at the time of its revocation.
5072. (a) No persons shall engage in the practice of accountancy as
a partnership unless the partnership is registered by the board.
(b) A partnership, other than a limited partnership, may be
registered by the board to engage in the practice of public
accountancy provided it meets the following requirements:
(1) At least one general partner shall hold a valid permit to
practice as a certified public accountant, public accountant, or
accountancy corporation, or shall be an applicant for a certificate
as a certified public accountant under Sections 5087 and 5088.
(2) Each partner personally engaged within this state in the
practice of public accountancy as defined by Section 5051 shall hold
a valid permit to practice in this state or shall have applied for a
certificate as a certified public accountant under Sections 5087 and
5088.
(3) Each partner not personally engaged in the practice of public
accountancy within this state shall be a certified public accountant
in good standing of some state, except as permitted by Section 5079.
(4) Each resident manager in charge of an office of the firm in
this state shall be a licensee in good standing of this state, or
shall have applied for a certificate as a certified public accountant
under Sections 5087 and 5088.
5073. (a) Application for registration of a partnership shall be
made upon a form prescribed by the board. The board shall in each
case determine whether the applicant is eligible for registration.
(b) A partnership that is so registered and that holds a valid
permit issued under this article and that has at least one general
partner who is licensed to practice using the designation "certified
public accountant" or the abbreviation "C.P.A." and one additional
licensed person may use the words "certified public accountants" or
the abbreviation"C.P.A.s" in connection with its partnership name.
(c) A partnership that is so registered and that holds a valid
permit issued under this article and that has at least one general
partner who is licensed to practice using the designation "public
accountant" or the abbreviation "P.A." and one additional licensed
person may use the words "public accountants" or the abbreviation
"P.A.s" in connection with its partnership name.
(d) Notification shall be given to the board within one month
after the admission to, or withdrawal of, a partner from any
partnership so registered.
(e) Any registration of a partnership under this section granted
in reliance upon Sections 5087 and 5088 shall terminate forthwith if
the board rejects the application under Sections 5087 and 5088 of the
general partner who signed the application for registration as a
partnership, or any partner personally engaged in the practice of
public accountancy in this state, or any resident manager of a
partnership in charge of an office in this state.
5076. (a) In order to renew its registration, a firm, as defined in
Section 5035.1, shall have a peer review report of its accounting
and auditing practice accepted by a board-recognized peer review
program no less frequently than every three years.
(b) For purposes of this article, the following definitions apply:
(1) "Peer review" means a study, appraisal, or review conducted in
accordance with professional standards of the professional work of a
firm, and may include an evaluation of other factors in accordance
with the requirements specified by the board in regulations. The peer
review report shall be issued by an individual who has a valid and
current license, certificate, or permit to practice public
accountancy from this state or another state and is unaffiliated with
the firm being reviewed.
(2) "Accounting and auditing practice" includes any services that
are performed using professional standards defined by the board in
regulations.
(c) The board shall adopt regulations as necessary to implement,
interpret, and make specific the peer review requirements in this
section, including, but not limited to, regulations specifying the
requirements for board recognition of a peer review program,
standards for administering a peer review, extensions of time for
fulfilling the peer review requirement, exclusions from the peer
review program, and document submission.
(d) The board shall adopt emergency regulations in accordance with
the Administrative Procedure Act (Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code) to establish policies, guidelines, and procedures as outlined
in subdivision (c). The adoption of the regulations shall be
considered by the Office of Administrative Law to be necessary for
the immediate preservation of the public peace, health and safety, or
general welfare. The emergency regulations shall be submitted to the
Office of Administrative Law for filing with the Secretary of State
and publication in the California Code of Regulations, and shall be
replaced in accordance with the Administrative Procedure Act.
(e) Nothing in this section shall prohibit the board from
initiating an investigation and imposing discipline against a firm or
licensee, either as the result of a complaint that alleges
violations of statutes, rules, or regulations, or from information
contained in a peer review report received by the board.
(f) A firm issued a substandard peer review report, as defined by
the board in regulation, shall submit a copy of that report to the
board. The board shall establish in regulation the time period that a
firm must submit the report to the board. This period shall not
exceed 60 days from the time the report is accepted by a
board-recognized peer review program provider to the date the report
is submitted to the board.
(g) (1) A board-recognized peer review program provider shall file
a copy with the board of all substandard peer review reports issued
to California-licensed firms. The board shall establish in regulation
the time period that a board-recognized peer review program provider
shall file the report with the board. This period shall not exceed
60 days from the time the report is accepted by a board-recognized
peer review program provider to the date the report is filed with the
board. These reports may be filed with the board electronically.
(2) Nothing in this subdivision shall require a board-recognized
peer review program provider, when administering peer reviews in
another state, to violate the laws of that state.
(h) The board shall, by January 1, 2010, define a substandard peer
review report in regulation.
(i) Any requirements imposed by a board-recognized peer review
program on a firm in conjunction with the completion of a peer review
shall be separate from, and in addition to, any action by the board
pursuant to this section.
(j) Any report of a substandard peer review submitted to the board
in conjunction with this section shall be collected for
investigatory purposes.
(k) Nothing in this section affects the discovery or admissibility
of evidence in a civil or criminal action.
(l) Nothing in this section requires any firm to become a member
of any professional organization.
(m) A peer reviewer shall not disclose information concerning
licensees or their clients obtained during a peer review, unless
specifically authorized pursuant to this section, Section 5076.1, or
regulations prescribed by the board.
(n) By January 1, 2013, the board shall provide the Legislature
and Governor with a report regarding the peer review requirements of
this section that includes, without limitation:
(1) The extent to which mandatory peer review of small firms or
sole practitioners that prepare nondisclosure compiled financial
statements on an other comprehensive basis of accounting enhances
consumer protection.
(2) The impact of peer review required by this section on small
firms and sole practitioners that prepare nondisclosure compiled
financial statements on an other comprehensive basis of accounting.
(3) The impact of peer review required by this section on small
businesses, nonprofit corporations, and other entities that utilize
small firms or sole practitioners for the purposes of nondisclosure
compiled financial statements prepared on an other comprehensive
basis of accounting.
(o) This section shall remain in effect only until January 1,
2014, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2014, deletes or extends
that date.
5076.1. (a) The board shall appoint a peer review oversight
committee of certified public accountants of this state who maintain
a license in good standing and who are authorized to practice public
accountancy to provide recommendations to the board on any matter
upon which it is authorized to act to ensure the effectiveness of
mandatory peer review.
(b) The committee may request any information from a
board-recognized peer review program provider deemed necessary to
ensure the provider is administering peer reviews in accordance with
the standards adopted by the board in regulations. Failure of a
board-recognized peer review program provider to respond to the
committee shall result in referral by the committee of the provider
to the board for further action. Any information obtained by the
board, its representatives, or the peer review oversight committee in
conjunction with its review of peer review program providers shall
not be a public record, and shall be exempt from public disclosure,
provided, however, this information may be disclosed under any of the
following circumstances:
(1) In connection with disciplinary proceedings of the board.
(2) In connection with legal proceedings in which the board is a
party.
(3) In response to an official inquiry by a federal or state
governmental regulatory agency.
(4) In compliance with a subpoena or summons enforceable by court
order.
(5) As otherwise specifically required by law.
(c) The members of the committee shall be appointed to two-year
terms and may serve a maximum of four consecutive terms.
(d) The board may adopt, as necessary, regulations further
defining the minimum qualifications for appointment as a committee
member and additional administrative elements designed to ensure the
effectiveness of mandatory peer review.
(e) This section shall remain in effect only until January 1,
2014, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2014, deletes or extends
that date.
5078. In each office of a certified public accountant or public
accountant in this state which is not under the personal management
of such an accountant, respectively, work shall be supervised by a
certified public accountant or public accountant.
5079. (a) Notwithstanding any other provision of this chapter, any
firm lawfully engaged in the practice of public accountancy in this
state may have owners who are not licensed as certified public
accountants or public accountants if the following conditions are
met:
(1) Nonlicensee owners shall be natural persons or entities, such
as partnerships, professional corporations, or others, provided that
each ultimate beneficial owner of an equity interest in that entity
shall be a natural person materially participating in the business
conducted by the firm or an entity controlled by the firm.
(2) Nonlicensee owners shall materially participate in the
business of the firm, or an entity controlled by the firm, and their
ownership interest shall revert to the firm upon the cessation of any
material participation.
(3) Licensees shall in the aggregate, directly or beneficially,
comprise a majority of owners, except that firms with two owners may
have one owner who is a nonlicensee.
(4) Licensees shall in the aggregate, directly or beneficially,
hold more than half of the equity capital and possess majority voting
rights.
(5) Nonlicensee owners shall not hold themselves out as certified
public accountants or public accountants and each licensed firm shall
disclose actual or potential involvement of nonlicensee owners in
the services provided.
(6) There shall be a certified public accountant or public
accountant who has ultimate responsibility for each financial
statement attest and compilation service engagement.
(7) Except as permitted by the board in the exercise of its
discretion, a person may not become a nonlicensee owner or remain a
nonlicensee owner if the person has done either of the following:
(A) Been convicted of any crime, an element of which is dishonesty
or fraud, under the laws of any state, of the United States, or of
any other jurisdiction.
(B) Had a professional license or the right to practice revoked or
suspended for reasons other than nonpayment of dues or fees, or has
voluntarily surrendered a license or right to practice with
disciplinary charges or a disciplinary investigation pending, and not
reinstated by a licensing or regulatory agency of any state, or of
the United States, including, but not limited to, the Securities and
Exchange Commission or Public Company Accounting Oversight Board, or
of any other jurisdiction.
(b) (1) A nonlicensee owner of a licensed firm shall report to the
board in writing of the occurrence of any of the events set forth in
paragraph (7) of subdivision (a) within 30 days of the date the
nonlicensee owner has knowledge of the event. A conviction includes
the initial plea, verdict, or finding of guilt, pleas of no contest,
or pronouncement of sentence by a trial court even though that
conviction may not be final or sentence actually imposed until
appeals are exhausted.
(2) A California nonlicensee owner of a licensed firm shall report
to the board in writing the occurrence of any of the following
events occurring on or after January 1, 2006, within 30 days of the
date the California nonlicensee owner has knowledge of the events:
(A) Any notice of the opening or initiation of a formal
investigation of the nonlicensee owner by the Securities and Exchange
Commission or its designee, or any notice from the Securities and
Exchange Commission to a nonlicensee owner requesting a Wells
submission.
(B) Any notice of the opening or initiation of an investigation of
the nonlicensee owner by the Public Company Accounting Oversight
Board or its designee.
(C) Any notice of the opening or initiation of an investigation of
the nonlicensee owner by another professional licensing agency.
(3) The report required by paragraphs (1) and (2) shall be signed
by the nonlicensee owner and set forth the facts that constitute the
reportable event. If the reportable event involves the action of an
administrative agency or court, the report shall identify the name of
the agency or court, the title of the matter, and the date of
occurrence of the event.
(4) Notwithstanding any other provision of law, reports received
by the board pursuant to paragraph (2) shall not be disclosed to the
public pursuant to the California Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7 of Title 1 of the
Government Code) other than (A) in the course of any disciplinary
proceeding by the board after the filing of a formal accusation, (B)
in the course of any legal action to which the board is a party, (C)
in response to an official inquiry from a state or federal agency,
(D) in response to a subpoena or summons enforceable by order of a
court, or (E) when otherwise specifically required by law.
(5) Nothing in this subdivision shall impose a duty upon any
licensee or nonlicensee owner to report to the board the occurrence
of any events set forth in paragraph (7) of subdivision (a) or
paragraph (2) of this subdivision either by or against any other
nonlicensee owner.
(c) For purposes of this section, the following definitions apply:
(1) "Licensee" means a certified public accountant or public
accountant in this state or a certified public accountant in good
standing in another state.
(2) "Material participation" means an activity that is regular,
continuous, and substantial.
(d) All firms with nonlicensee owners shall certify at the time of
registration and renewal that the firm is in compliance with this
section.
(e) The board shall adopt regulations to implement, interpret, or
make specific this section.
5070. Permits to engage in the practice of public accountancy in
this state shall be issued by the board only to holders of the
certificate of certified public accountant issued under this chapter
and to those partnerships, corporations, and other persons who, upon
application approved by the board, are registered with the board
under this chapter. All applicants for registration shall furnish
satisfactory evidence that the applicant is entitled to registration
and shall pay the fee as provided in Article 8 (commencing with
Section 5130). Every partnership, corporation, and other person to
whom a permit is issued after December 31, 1962, shall, in addition
to any other fee which may be payable, pay the initial permit fee
provided in Article 8 (commencing with Section 5130).
Each partnership, corporation, and other person issued a permit by
the board to practice as a certified public accountant or as a
public accountant shall be furnished with a suitable certificate
evidencing such registration.
5070.5. (a) A permit issued under this chapter to a certified
public accountant or a public accountant expires at 12 midnight on
the last day of the month of the legal birthday of the licensee
during the second year of a two-year term if not renewed.
To renew an unexpired permit, a permitholder shall, before the
time at which the permit would otherwise expire, apply for renewal on
a form prescribed by the board, pay the renewal fee prescribed by
this chapter and give evidence satisfactory to the board that he or
she has complied with the continuing education provisions of this
chapter.
(b) A permit to practice as an accountancy partnership or an
accountancy corporation expires at 12 midnight on the last day of the
month in which the permit was initially issued during the second
year of a two-year term if not renewed. To renew an unexpired permit,
the permitholder shall, before the time at which the permit would
otherwise expire, apply for renewal on a form prescribed by the
board, pay the renewal fee prescribed by this chapter, and provide
evidence satisfactory to the board that the accountancy partnership
or accountancy corporation is in compliance with this chapter.
5070.6. Except as otherwise provided in this chapter, an expired
permit may be renewed at any time within five years after its
expiration upon the filing of an application for renewal on a form
prescribed by the board, payment of all accrued and unpaid renewal
fees and providing evidence satisfactory to the board of compliance
as required by Section 5070.5. If the permit is renewed after its
expiration, its holder, as a condition precedent to renewal, shall
also pay the delinquency fee prescribed by this chapter. Renewal
under this section shall be effective on the date on which the
application is filed, on the date on which the accrued renewal fees
are paid, or on the date on which the delinquency fee, if any, is
paid, whichever last occurs. If so renewed, the permit shall continue
in effect through the date provided in Section 5070.5 that next
occurs after the effective date of the renewal, when it shall expire
if it is not again renewed.
5070.7. (a) A permit that is not renewed within five years
following its expiration may not be renewed, restored, or reinstated
thereafter, and the certificate of the holder of the permit shall be
canceled immediately upon expiration of the five-year period, except
as provided in subdivision (e).
(b) A partnership or corporation whose certificate has been
canceled by operation of this section may obtain a new certificate
and permit only if it again meets the requirements set forth in this
chapter relating to registration and pays the registration fee and
initial permit fee.
(c) A certified public accountant whose certificate is canceled by
operation of this section may apply for and obtain a new certificate
and permit if the applicant:
(1) Is not subject to denial of a certificate and permit under
Section 480.
(2) Pays all of the fees that would be required of him or her if
he or she were then applying for the certificate and permit for the
first time.
(3) Takes and passes the examination which would be required of
him or her if he or she were then applying for the certificate for
the first time. The examination may be waived in any case in which
the applicant establishes to the satisfaction of the board that, with
due regard for the public interest, he or she is qualified to engage
in practice as a certified public accountant.
(d) The board may, by appropriate regulation, provide for the
waiver or refund of all or any part of the application fee in those
cases in which a certificate is issued without an examination under
this section.
(e) Revoked permits may not be renewed, but may be reinstated by
the board, without regard to the length of time that has elapsed
since the permit was revoked, and with conditions and restrictions as
the board shall determine.
5070.8. A permit which has been suspended is subject to expiration,
and shall be renewed as provided in this article, but such renewal
does not entitle the holder of the permit, while it remains
suspended, and until it is reinstated, to engage in the practice of
accountancy, or in any other activity or conduct in violation of the
order or judgment by which the permit was suspended.
A permit which has been revoked is subject to expiration, but it
may not be renewed. If it is reinstated after its expiration, the
holder of the permit, as a condition precedent to its reinstatement,
shall pay a reinstatement fee which shall be in an amount equal to
the renewal fee in effect on the last regular renewal date before the
date on which it is reinstated, plus the delinquency fee, if any,
accrued at the time of its revocation.
5072. (a) No persons shall engage in the practice of accountancy as
a partnership unless the partnership is registered by the board.
(b) A partnership, other than a limited partnership, may be
registered by the board to engage in the practice of public
accountancy provided it meets the following requirements:
(1) At least one general partner shall hold a valid permit to
practice as a certified public accountant, public accountant, or
accountancy corporation, or shall be an applicant for a certificate
as a certified public accountant under Sections 5087 and 5088.
(2) Each partner personally engaged within this state in the
practice of public accountancy as defined by Section 5051 shall hold
a valid permit to practice in this state or shall have applied for a
certificate as a certified public accountant under Sections 5087 and
5088.
(3) Each partner not personally engaged in the practice of public
accountancy within this state shall be a certified public accountant
in good standing of some state, except as permitted by Section 5079.
(4) Each resident manager in charge of an office of the firm in
this state shall be a licensee in good standing of this state, or
shall have applied for a certificate as a certified public accountant
under Sections 5087 and 5088.
5073. (a) Application for registration of a partnership shall be
made upon a form prescribed by the board. The board shall in each
case determine whether the applicant is eligible for registration.
(b) A partnership that is so registered and that holds a valid
permit issued under this article and that has at least one general
partner who is licensed to practice using the designation "certified
public accountant" or the abbreviation "C.P.A." and one additional
licensed person may use the words "certified public accountants" or
the abbreviation"C.P.A.s" in connection with its partnership name.
(c) A partnership that is so registered and that holds a valid
permit issued under this article and that has at least one general
partner who is licensed to practice using the designation "public
accountant" or the abbreviation "P.A." and one additional licensed
person may use the words "public accountants" or the abbreviation
"P.A.s" in connection with its partnership name.
(d) Notification shall be given to the board within one month
after the admission to, or withdrawal of, a partner from any
partnership so registered.
(e) Any registration of a partnership under this section granted
in reliance upon Sections 5087 and 5088 shall terminate forthwith if
the board rejects the application under Sections 5087 and 5088 of the
general partner who signed the application for registration as a
partnership, or any partner personally engaged in the practice of
public accountancy in this state, or any resident manager of a
partnership in charge of an office in this state.
5076. (a) In order to renew its registration, a firm, as defined in
Section 5035.1, shall have a peer review report of its accounting
and auditing practice accepted by a board-recognized peer review
program no less frequently than every three years.
(b) For purposes of this article, the following definitions apply:
(1) "Peer review" means a study, appraisal, or review conducted in
accordance with professional standards of the professional work of a
firm, and may include an evaluation of other factors in accordance
with the requirements specified by the board in regulations. The peer
review report shall be issued by an individual who has a valid and
current license, certificate, or permit to practice public
accountancy from this state or another state and is unaffiliated with
the firm being reviewed.
(2) "Accounting and auditing practice" includes any services that
are performed using professional standards defined by the board in
regulations.
(c) The board shall adopt regulations as necessary to implement,
interpret, and make specific the peer review requirements in this
section, including, but not limited to, regulations specifying the
requirements for board recognition of a peer review program,
standards for administering a peer review, extensions of time for
fulfilling the peer review requirement, exclusions from the peer
review program, and document submission.
(d) The board shall adopt emergency regulations in accordance with
the Administrative Procedure Act (Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code) to establish policies, guidelines, and procedures as outlined
in subdivision (c). The adoption of the regulations shall be
considered by the Office of Administrative Law to be necessary for
the immediate preservation of the public peace, health and safety, or
general welfare. The emergency regulations shall be submitted to the
Office of Administrative Law for filing with the Secretary of State
and publication in the California Code of Regulations, and shall be
replaced in accordance with the Administrative Procedure Act.
(e) Nothing in this section shall prohibit the board from
initiating an investigation and imposing discipline against a firm or
licensee, either as the result of a complaint that alleges
violations of statutes, rules, or regulations, or from information
contained in a peer review report received by the board.
(f) A firm issued a substandard peer review report, as defined by
the board in regulation, shall submit a copy of that report to the
board. The board shall establish in regulation the time period that a
firm must submit the report to the board. This period shall not
exceed 60 days from the time the report is accepted by a
board-recognized peer review program provider to the date the report
is submitted to the board.
(g) (1) A board-recognized peer review program provider shall file
a copy with the board of all substandard peer review reports issued
to California-licensed firms. The board shall establish in regulation
the time period that a board-recognized peer review program provider
shall file the report with the board. This period shall not exceed
60 days from the time the report is accepted by a board-recognized
peer review program provider to the date the report is filed with the
board. These reports may be filed with the board electronically.
(2) Nothing in this subdivision shall require a board-recognized
peer review program provider, when administering peer reviews in
another state, to violate the laws of that state.
(h) The board shall, by January 1, 2010, define a substandard peer
review report in regulation.
(i) Any requirements imposed by a board-recognized peer review
program on a firm in conjunction with the completion of a peer review
shall be separate from, and in addition to, any action by the board
pursuant to this section.
(j) Any report of a substandard peer review submitted to the board
in conjunction with this section shall be collected for
investigatory purposes.
(k) Nothing in this section affects the discovery or admissibility
of evidence in a civil or criminal action.
(l) Nothing in this section requires any firm to become a member
of any professional organization.
(m) A peer reviewer shall not disclose information concerning
licensees or their clients obtained during a peer review, unless
specifically authorized pursuant to this section, Section 5076.1, or
regulations prescribed by the board.
(n) By January 1, 2013, the board shall provide the Legislature
and Governor with a report regarding the peer review requirements of
this section that includes, without limitation:
(1) The extent to which mandatory peer review of small firms or
sole practitioners that prepare nondisclosure compiled financial
statements on an other comprehensive basis of accounting enhances
consumer protection.
(2) The impact of peer review required by this section on small
firms and sole practitioners that prepare nondisclosure compiled
financial statements on an other comprehensive basis of accounting.
(3) The impact of peer review required by this section on small
businesses, nonprofit corporations, and other entities that utilize
small firms or sole practitioners for the purposes of nondisclosure
compiled financial statements prepared on an other comprehensive
basis of accounting.
(o) This section shall remain in effect only until January 1,
2014, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2014, deletes or extends
that date.
5076.1. (a) The board shall appoint a peer review oversight
committee of certified public accountants of this state who maintain
a license in good standing and who are authorized to practice public
accountancy to provide recommendations to the board on any matter
upon which it is authorized to act to ensure the effectiveness of
mandatory peer review.
(b) The committee may request any information from a
board-recognized peer review program provider deemed necessary to
ensure the provider is administering peer reviews in accordance with
the standards adopted by the board in regulations. Failure of a
board-recognized peer review program provider to respond to the
committee shall result in referral by the committee of the provider
to the board for further action. Any information obtained by the
board, its representatives, or the peer review oversight committee in
conjunction with its review of peer review program providers shall
not be a public record, and shall be exempt from public disclosure,
provided, however, this information may be disclosed under any of the
following circumstances:
(1) In connection with disciplinary proceedings of the board.
(2) In connection with legal proceedings in which the board is a
party.
(3) In response to an official inquiry by a federal or state
governmental regulatory agency.
(4) In compliance with a subpoena or summons enforceable by court
order.
(5) As otherwise specifically required by law.
(c) The members of the committee shall be appointed to two-year
terms and may serve a maximum of four consecutive terms.
(d) The board may adopt, as necessary, regulations further
defining the minimum qualifications for appointment as a committee
member and additional administrative elements designed to ensure the
effectiveness of mandatory peer review.
(e) This section shall remain in effect only until January 1,
2014, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2014, deletes or extends
that date.
5078. In each office of a certified public accountant or public
accountant in this state which is not under the personal management
of such an accountant, respectively, work shall be supervised by a
certified public accountant or public accountant.
5079. (a) Notwithstanding any other provision of this chapter, any
firm lawfully engaged in the practice of public accountancy in this
state may have owners who are not licensed as certified public
accountants or public accountants if the following conditions are
met:
(1) Nonlicensee owners shall be natural persons or entities, such
as partnerships, professional corporations, or others, provided that
each ultimate beneficial owner of an equity interest in that entity
shall be a natural person materially participating in the business
conducted by the firm or an entity controlled by the firm.
(2) Nonlicensee owners shall materially participate in the
business of the firm, or an entity controlled by the firm, and their
ownership interest shall revert to the firm upon the cessation of any
material participation.
(3) Licensees shall in the aggregate, directly or beneficially,
comprise a majority of owners, except that firms with two owners may
have one owner who is a nonlicensee.
(4) Licensees shall in the aggregate, directly or beneficially,
hold more than half of the equity capital and possess majority voting
rights.
(5) Nonlicensee owners shall not hold themselves out as certified
public accountants or public accountants and each licensed firm shall
disclose actual or potential involvement of nonlicensee owners in
the services provided.
(6) There shall be a certified public accountant or public
accountant who has ultimate responsibility for each financial
statement attest and compilation service engagement.
(7) Except as permitted by the board in the exercise of its
discretion, a person may not become a nonlicensee owner or remain a
nonlicensee owner if the person has done either of the following:
(A) Been convicted of any crime, an element of which is dishonesty
or fraud, under the laws of any state, of the United States, or of
any other jurisdiction.
(B) Had a professional license or the right to practice revoked or
suspended for reasons other than nonpayment of dues or fees, or has
voluntarily surrendered a license or right to practice with
disciplinary charges or a disciplinary investigation pending, and not
reinstated by a licensing or regulatory agency of any state, or of
the United States, including, but not limited to, the Securities and
Exchange Commission or Public Company Accounting Oversight Board, or
of any other jurisdiction.
(b) (1) A nonlicensee owner of a licensed firm shall report to the
board in writing of the occurrence of any of the events set forth in
paragraph (7) of subdivision (a) within 30 days of the date the
nonlicensee owner has knowledge of the event. A conviction includes
the initial plea, verdict, or finding of guilt, pleas of no contest,
or pronouncement of sentence by a trial court even though that
conviction may not be final or sentence actually imposed until
appeals are exhausted.
(2) A California nonlicensee owner of a licensed firm shall report
to the board in writing the occurrence of any of the following
events occurring on or after January 1, 2006, within 30 days of the
date the California nonlicensee owner has knowledge of the events:
(A) Any notice of the opening or initiation of a formal
investigation of the nonlicensee owner by the Securities and Exchange
Commission or its designee, or any notice from the Securities and
Exchange Commission to a nonlicensee owner requesting a Wells
submission.
(B) Any notice of the opening or initiation of an investigation of
the nonlicensee owner by the Public Company Accounting Oversight
Board or its designee.
(C) Any notice of the opening or initiation of an investigation of
the nonlicensee owner by another professional licensing agency.
(3) The report required by paragraphs (1) and (2) shall be signed
by the nonlicensee owner and set forth the facts that constitute the
reportable event. If the reportable event involves the action of an
administrative agency or court, the report shall identify the name of
the agency or court, the title of the matter, and the date of
occurrence of the event.
(4) Notwithstanding any other provision of law, reports received
by the board pursuant to paragraph (2) shall not be disclosed to the
public pursuant to the California Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7 of Title 1 of the
Government Code) other than (A) in the course of any disciplinary
proceeding by the board after the filing of a formal accusation, (B)
in the course of any legal action to which the board is a party, (C)
in response to an official inquiry from a state or federal agency,
(D) in response to a subpoena or summons enforceable by order of a
court, or (E) when otherwise specifically required by law.
(5) Nothing in this subdivision shall impose a duty upon any
licensee or nonlicensee owner to report to the board the occurrence
of any events set forth in paragraph (7) of subdivision (a) or
paragraph (2) of this subdivision either by or against any other
nonlicensee owner.
(c) For purposes of this section, the following definitions apply:
(1) "Licensee" means a certified public accountant or public
accountant in this state or a certified public accountant in good
standing in another state.
(2) "Material participation" means an activity that is regular,
continuous, and substantial.
(d) All firms with nonlicensee owners shall certify at the time of
registration and renewal that the firm is in compliance with this
section.
(e) The board shall adopt regulations to implement, interpret, or
make specific this section.
5070. Permits to engage in the practice of public accountancy in
this state shall be issued by the board only to holders of the
certificate of certified public accountant issued under this chapter
and to those partnerships, corporations, and other persons who, upon
application approved by the board, are registered with the board
under this chapter. All applicants for registration shall furnish
satisfactory evidence that the applicant is entitled to registration
and shall pay the fee as provided in Article 8 (commencing with
Section 5130). Every partnership, corporation, and other person to
whom a permit is issued after December 31, 1962, shall, in addition
to any other fee which may be payable, pay the initial permit fee
provided in Article 8 (commencing with Section 5130).
Each partnership, corporation, and other person issued a permit by
the board to practice as a certified public accountant or as a
public accountant shall be furnished with a suitable certificate
evidencing such registration.
5070.5. (a) A permit issued under this chapter to a certified
public accountant or a public accountant expires at 12 midnight on
the last day of the month of the legal birthday of the licensee
during the second year of a two-year term if not renewed.
To renew an unexpired permit, a permitholder shall, before the
time at which the permit would otherwise expire, apply for renewal on
a form prescribed by the board, pay the renewal fee prescribed by
this chapter and give evidence satisfactory to the board that he or
she has complied with the continuing education provisions of this
chapter.
(b) A permit to practice as an accountancy partnership or an
accountancy corporation expires at 12 midnight on the last day of the
month in which the permit was initially issued during the second
year of a two-year term if not renewed. To renew an unexpired permit,
the permitholder shall, before the time at which the permit would
otherwise expire, apply for renewal on a form prescribed by the
board, pay the renewal fee prescribed by this chapter, and provide
evidence satisfactory to the board that the accountancy partnership
or accountancy corporation is in compliance with this chapter.
5070.6. Except as otherwise provided in this chapter, an expired
permit may be renewed at any time within five years after its
expiration upon the filing of an application for renewal on a form
prescribed by the board, payment of all accrued and unpaid renewal
fees and providing evidence satisfactory to the board of compliance
as required by Section 5070.5. If the permit is renewed after its
expiration, its holder, as a condition precedent to renewal, shall
also pay the delinquency fee prescribed by this chapter. Renewal
under this section shall be effective on the date on which the
application is filed, on the date on which the accrued renewal fees
are paid, or on the date on which the delinquency fee, if any, is
paid, whichever last occurs. If so renewed, the permit shall continue
in effect through the date provided in Section 5070.5 that next
occurs after the effective date of the renewal, when it shall expire
if it is not again renewed.
5070.7. (a) A permit that is not renewed within five years
following its expiration may not be renewed, restored, or reinstated
thereafter, and the certificate of the holder of the permit shall be
canceled immediately upon expiration of the five-year period, except
as provided in subdivision (e).
(b) A partnership or corporation whose certificate has been
canceled by operation of this section may obtain a new certificate
and permit only if it again meets the requirements set forth in this
chapter relating to registration and pays the registration fee and
initial permit fee.
(c) A certified public accountant whose certificate is canceled by
operation of this section may apply for and obtain a new certificate
and permit if the applicant:
(1) Is not subject to denial of a certificate and permit under
Section 480.
(2) Pays all of the fees that would be required of him or her if
he or she were then applying for the certificate and permit for the
first time.
(3) Takes and passes the examination which would be required of
him or her if he or she were then applying for the certificate for
the first time. The examination may be waived in any case in which
the applicant establishes to the satisfaction of the board that, with
due regard for the public interest, he or she is qualified to engage
in practice as a certified public accountant.
(d) The board may, by appropriate regulation, provide for the
waiver or refund of all or any part of the application fee in those
cases in which a certificate is issued without an examination under
this section.
(e) Revoked permits may not be renewed, but may be reinstated by
the board, without regard to the length of time that has elapsed
since the permit was revoked, and with conditions and restrictions as
the board shall determine.
5070.8. A permit which has been suspended is subject to expiration,
and shall be renewed as provided in this article, but such renewal
does not entitle the holder of the permit, while it remains
suspended, and until it is reinstated, to engage in the practice of
accountancy, or in any other activity or conduct in violation of the
order or judgment by which the permit was suspended.
A permit which has been revoked is subject to expiration, but it
may not be renewed. If it is reinstated after its expiration, the
holder of the permit, as a condition precedent to its reinstatement,
shall pay a reinstatement fee which shall be in an amount equal to
the renewal fee in effect on the last regular renewal date before the
date on which it is reinstated, plus the delinquency fee, if any,
accrued at the time of its revocation.
5072. (a) No persons shall engage in the practice of accountancy as
a partnership unless the partnership is registered by the board.
(b) A partnership, other than a limited partnership, may be
registered by the board to engage in the practice of public
accountancy provided it meets the following requirements:
(1) At least one general partner shall hold a valid permit to
practice as a certified public accountant, public accountant, or
accountancy corporation, or shall be an applicant for a certificate
as a certified public accountant under Sections 5087 and 5088.
(2) Each partner personally engaged within this state in the
practice of public accountancy as defined by Section 5051 shall hold
a valid permit to practice in this state or shall have applied for a
certificate as a certified public accountant under Sections 5087 and
5088.
(3) Each partner not personally engaged in the practice of public
accountancy within this state shall be a certified public accountant
in good standing of some state, except as permitted by Section 5079.
(4) Each resident manager in charge of an office of the firm in
this state shall be a licensee in good standing of this state, or
shall have applied for a certificate as a certified public accountant
under Sections 5087 and 5088.
5073. (a) Application for registration of a partnership shall be
made upon a form prescribed by the board. The board shall in each
case determine whether the applicant is eligible for registration.
(b) A partnership that is so registered and that holds a valid
permit issued under this article and that has at least one general
partner who is licensed to practice using the designation "certified
public accountant" or the abbreviation "C.P.A." and one additional
licensed person may use the words "certified public accountants" or
the abbreviation"C.P.A.s" in connection with its partnership name.
(c) A partnership that is so registered and that holds a valid
permit issued under this article and that has at least one general
partner who is licensed to practice using the designation "public
accountant" or the abbreviation "P.A." and one additional licensed
person may use the words "public accountants" or the abbreviation
"P.A.s" in connection with its partnership name.
(d) Notification shall be given to the board within one month
after the admission to, or withdrawal of, a partner from any
partnership so registered.
(e) Any registration of a partnership under this section granted
in reliance upon Sections 5087 and 5088 shall terminate forthwith if
the board rejects the application under Sections 5087 and 5088 of the
general partner who signed the application for registration as a
partnership, or any partner personally engaged in the practice of
public accountancy in this state, or any resident manager of a
partnership in charge of an office in this state.
5076. (a) In order to renew its registration, a firm, as defined in
Section 5035.1, shall have a peer review report of its accounting
and auditing practice accepted by a board-recognized peer review
program no less frequently than every three years.
(b) For purposes of this article, the following definitions apply:
(1) "Peer review" means a study, appraisal, or review conducted in
accordance with professional standards of the professional work of a
firm, and may include an evaluation of other factors in accordance
with the requirements specified by the board in regulations. The peer
review report shall be issued by an individual who has a valid and
current license, certificate, or permit to practice public
accountancy from this state or another state and is unaffiliated with
the firm being reviewed.
(2) "Accounting and auditing practice" includes any services that
are performed using professional standards defined by the board in
regulations.
(c) The board shall adopt regulations as necessary to implement,
interpret, and make specific the peer review requirements in this
section, including, but not limited to, regulations specifying the
requirements for board recognition of a peer review program,
standards for administering a peer review, extensions of time for
fulfilling the peer review requirement, exclusions from the peer
review program, and document submission.
(d) The board shall adopt emergency regulations in accordance with
the Administrative Procedure Act (Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code) to establish policies, guidelines, and procedures as outlined
in subdivision (c). The adoption of the regulations shall be
considered by the Office of Administrative Law to be necessary for
the immediate preservation of the public peace, health and safety, or
general welfare. The emergency regulations shall be submitted to the
Office of Administrative Law for filing with the Secretary of State
and publication in the California Code of Regulations, and shall be
replaced in accordance with the Administrative Procedure Act.
(e) Nothing in this section shall prohibit the board from
initiating an investigation and imposing discipline against a firm or
licensee, either as the result of a complaint that alleges
violations of statutes, rules, or regulations, or from information
contained in a peer review report received by the board.
(f) A firm issued a substandard peer review report, as defined by
the board in regulation, shall submit a copy of that report to the
board. The board shall establish in regulation the time period that a
firm must submit the report to the board. This period shall not
exceed 60 days from the time the report is accepted by a
board-recognized peer review program provider to the date the report
is submitted to the board.
(g) (1) A board-recognized peer review program provider shall file
a copy with the board of all substandard peer review reports issued
to California-licensed firms. The board shall establish in regulation
the time period that a board-recognized peer review program provider
shall file the report with the board. This period shall not exceed
60 days from the time the report is accepted by a board-recognized
peer review program provider to the date the report is filed with the
board. These reports may be filed with the board electronically.
(2) Nothing in this subdivision shall require a board-recognized
peer review program provider, when administering peer reviews in
another state, to violate the laws of that state.
(h) The board shall, by January 1, 2010, define a substandard peer
review report in regulation.
(i) Any requirements imposed by a board-recognized peer review
program on a firm in conjunction with the completion of a peer review
shall be separate from, and in addition to, any action by the board
pursuant to this section.
(j) Any report of a substandard peer review submitted to the board
in conjunction with this section shall be collected for
investigatory purposes.
(k) Nothing in this section affects the discovery or admissibility
of evidence in a civil or criminal action.
(l) Nothing in this section requires any firm to become a member
of any professional organization.
(m) A peer reviewer shall not disclose information concerning
licensees or their clients obtained during a peer review, unless
specifically authorized pursuant to this section, Section 5076.1, or
regulations prescribed by the board.
(n) By January 1, 2013, the board shall provide the Legislature
and Governor with a report regarding the peer review requirements of
this section that includes, without limitation:
(1) The extent to which mandatory peer review of small firms or
sole practitioners that prepare nondisclosure compiled financial
statements on an other comprehensive basis of accounting enhances
consumer protection.
(2) The impact of peer review required by this section on small
firms and sole practitioners that prepare nondisclosure compiled
financial statements on an other comprehensive basis of accounting.
(3) The impact of peer review required by this section on small
businesses, nonprofit corporations, and other entities that utilize
small firms or sole practitioners for the purposes of nondisclosure
compiled financial statements prepared on an other comprehensive
basis of accounting.
(o) This section shall remain in effect only until January 1,
2014, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2014, deletes or extends
that date.
5076.1. (a) The board shall appoint a peer review oversight
committee of certified public accountants of this state who maintain
a license in good standing and who are authorized to practice public
accountancy to provide recommendations to the board on any matter
upon which it is authorized to act to ensure the effectiveness of
mandatory peer review.
(b) The committee may request any information from a
board-recognized peer review program provider deemed necessary to
ensure the provider is administering peer reviews in accordance with
the standards adopted by the board in regulations. Failure of a
board-recognized peer review program provider to respond to the
committee shall result in referral by the committee of the provider
to the board for further action. Any information obtained by the
board, its representatives, or the peer review oversight committee in
conjunction with its review of peer review program providers shall
not be a public record, and shall be exempt from public disclosure,
provided, however, this information may be disclosed under any of the
following circumstances:
(1) In connection with disciplinary proceedings of the board.
(2) In connection with legal proceedings in which the board is a
party.
(3) In response to an official inquiry by a federal or state
governmental regulatory agency.
(4) In compliance with a subpoena or summons enforceable by court
order.
(5) As otherwise specifically required by law.
(c) The members of the committee shall be appointed to two-year
terms and may serve a maximum of four consecutive terms.
(d) The board may adopt, as necessary, regulations further
defining the minimum qualifications for appointment as a committee
member and additional administrative elements designed to ensure the
effectiveness of mandatory peer review.
(e) This section shall remain in effect only until January 1,
2014, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2014, deletes or extends
that date.
5078. In each office of a certified public accountant or public
accountant in this state which is not under the personal management
of such an accountant, respectively, work shall be supervised by a
certified public accountant or public accountant.
5079. (a) Notwithstanding any other provision of this chapter, any
firm lawfully engaged in the practice of public accountancy in this
state may have owners who are not licensed as certified public
accountants or public accountants if the following conditions are
met:
(1) Nonlicensee owners shall be natural persons or entities, such
as partnerships, professional corporations, or others, provided that
each ultimate beneficial owner of an equity interest in that entity
shall be a natural person materially participating in the business
conducted by the firm or an entity controlled by the firm.
(2) Nonlicensee owners shall materially participate in the
business of the firm, or an entity controlled by the firm, and their
ownership interest shall revert to the firm upon the cessation of any
material participation.
(3) Licensees shall in the aggregate, directly or beneficially,
comprise a majority of owners, except that firms with two owners may
have one owner who is a nonlicensee.
(4) Licensees shall in the aggregate, directly or beneficially,
hold more than half of the equity capital and possess majority voting
rights.
(5) Nonlicensee owners shall not hold themselves out as certified
public accountants or public accountants and each licensed firm shall
disclose actual or potential involvement of nonlicensee owners in
the services provided.
(6) There shall be a certified public accountant or public
accountant who has ultimate responsibility for each financial
statement attest and compilation service engagement.
(7) Except as permitted by the board in the exercise of its
discretion, a person may not become a nonlicensee owner or remain a
nonlicensee owner if the person has done either of the following:
(A) Been convicted of any crime, an element of which is dishonesty
or fraud, under the laws of any state, of the United States, or of
any other jurisdiction.
(B) Had a professional license or the right to practice revoked or
suspended for reasons other than nonpayment of dues or fees, or has
voluntarily surrendered a license or right to practice with
disciplinary charges or a disciplinary investigation pending, and not
reinstated by a licensing or regulatory agency of any state, or of
the United States, including, but not limited to, the Securities and
Exchange Commission or Public Company Accounting Oversight Board, or
of any other jurisdiction.
(b) (1) A nonlicensee owner of a licensed firm shall report to the
board in writing of the occurrence of any of the events set forth in
paragraph (7) of subdivision (a) within 30 days of the date the
nonlicensee owner has knowledge of the event. A conviction includes
the initial plea, verdict, or finding of guilt, pleas of no contest,
or pronouncement of sentence by a trial court even though that
conviction may not be final or sentence actually imposed until
appeals are exhausted.
(2) A California nonlicensee owner of a licensed firm shall report
to the board in writing the occurrence of any of the following
events occurring on or after January 1, 2006, within 30 days of the
date the California nonlicensee owner has knowledge of the events:
(A) Any notice of the opening or initiation of a formal
investigation of the nonlicensee owner by the Securities and Exchange
Commission or its designee, or any notice from the Securities and
Exchange Commission to a nonlicensee owner requesting a Wells
submission.
(B) Any notice of the opening or initiation of an investigation of
the nonlicensee owner by the Public Company Accounting Oversight
Board or its designee.
(C) Any notice of the opening or initiation of an investigation of
the nonlicensee owner by another professional licensing agency.
(3) The report required by paragraphs (1) and (2) shall be signed
by the nonlicensee owner and set forth the facts that constitute the
reportable event. If the reportable event involves the action of an
administrative agency or court, the report shall identify the name of
the agency or court, the title of the matter, and the date of
occurrence of the event.
(4) Notwithstanding any other provision of law, reports received
by the board pursuant to paragraph (2) shall not be disclosed to the
public pursuant to the California Public Records Act (Chapter 3.5
(commencing with Section 6250) of Division 7 of Title 1 of the
Government Code) other than (A) in the course of any disciplinary
proceeding by the board after the filing of a formal accusation, (B)
in the course of any legal action to which the board is a party, (C)
in response to an official inquiry from a state or federal agency,
(D) in response to a subpoena or summons enforceable by order of a
court, or (E) when otherwise specifically required by law.
(5) Nothing in this subdivision shall impose a duty upon any
licensee or nonlicensee owner to report to the board the occurrence
of any events set forth in paragraph (7) of subdivision (a) or
paragraph (2) of this subdivision either by or against any other
nonlicensee owner.
(c) For purposes of this section, the following definitions apply:
(1) "Licensee" means a certified public accountant or public
accountant in this state or a certified public accountant in good
standing in another state.
(2) "Material participation" means an activity that is regular,
continuous, and substantial.
(d) All firms with nonlicensee owners shall certify at the time of
registration and renewal that the firm is in compliance with this
section.
(e) The board shall adopt regulations to implement, interpret, or
make specific this section.
