1-501. Peer review; firm registration; board oversight; waivers; privileged information; closed sessions of the board; immunity.
1-501
1-501. Peer review; firm registration; board
oversight; waivers; privileged information; closed sessions of the board;
immunity.
(a) The board may require as a condition for renewal of
a firm registration that a firm that provides attest services undergo a
peer review and submit evidence of such so that the board may
determine the degree of the firm's compliance with generally accepted
accounting principles, generally accepted auditing standards and other
similarly recognized authoritative technical standards. The reviews shall
occur at least once every three years with the cost of such review to be borne
by the firm.
(b) Upon the issuance of the first report subject to peer review, a firm
shall immediately notify the board on a form provided by the board;
register as a firm in compliance with K.S.A. 1-308, and amendments thereto; and
provide a peer review letter of completion to the board within 18 months after
the date on which the report subject to peer review was issued.
(c) A firm's completion of a peer review program
endorsed or supported by the AICPA or other substantially similar
programs shall
satisfy the requirements of this section. The board shall provide for
oversight of these programs by adoption of rules and regulations.
(d) A firm may
request in writing upon
forms provided by the board, a waiver from the review requirement. The board
may grant a waiver if
the firm does not perform or has not performed any attest services during
the twelve-month period preceding the date of application or for good cause as
determined by the board.
A firm granted a waiver on the
basis that the firm does not perform or intend to perform attest services
shall immediately
notify the board if the firm engages in
such
practice and thus becomes subject to the review.
(e) Except as provided by K.S.A. 60-437, and amendments
thereto, and subsections (f) and (h) of this section, any
reports, statements, memoranda, transcripts, findings, records, or working
papers prepared and any opinions formulated, in connection with any peer review
shall be privileged and shall not be subject to
discovery, subpoena or other means of legal compulsion for their release to
any person or entity or be admissible in evidence in any judicial or
administrative proceeding, except that such privilege shall not exist when
the material in question is involved in a dispute between a reviewer and
the person or firm being reviewed.
(f) Nothing in subsection (e) shall limit the authority of
the board to require a person whose work is the subject of a peer review or a
firm to provide a copy of an adverse or modified peer review report and any
responses to
report deficiencies from the person or firm and any
document identifying follow-up
requirements for the
purpose of determining the person's or firm's compliance with generally
accepted accounting principles, generally accepted auditing standards and other
similarly recognized authoritative technical standards, provided however, the
board may not request or require a person or firm subject to a peer review to
provide a peer review report or any other document contained in this section
unless the peer review report has been accepted by a report acceptance
committee under the peer review program after December 31, 2001.
(g) After considering AICPA standards on peer review, the
board may define, by rules and regulations, the terms "modified" and "adverse."
(h) In any proceeding before the board in which discussion
or admission into evidence of peer review report documents identified in
subsection (f) is proposed, the board or presiding officer shall conduct that
portion of the proceeding in closed session. In closing a portion of such
proceeding, the board or presiding officer may exclude any person from the
proceeding except the person whose work is the subject of peer review, members
of the permit holder's firm, the attorneys representing the parties, the
board's attorneys,
necessary witnesses and a court reporter. The board or presiding officer shall
make the portions of the agency record in which such documents are disclosed
subject to a protective order prohibiting further disclosure. Documents that
are privileged under subsection (e) and that are considered during a closed
proceeding shall not be subject to discovery, subpoena or other means of legal
compulsion for their release to any person or entity. No person in attendance
at a closed portion of such proceeding shall at a subsequent civil, criminal or
administrative hearing, be required to testify regarding the existence or
content of a document privileged under subsection (e) which was disclosed in a
closed portion of a proceeding, nor shall such testimony be admitted into
evidence in any subsequent civil, criminal or administrative hearing. All other
evidence shall be presented as part of the proceeding in an open meeting.
Offering any testimony or records in the open portion of a proceeding shall not
be deemed a waiver of the peer review privilege created in subsection (e).
(i) No person who participates in the conduct of any peer
review within the
scope of this section shall be liable in damages to any person for any action
taken or recommendation made in connection with the peer review process.
History: L. 1987, ch. 2, § 1;
L. 1990, ch. 2, § 1;
L. 1993, ch. 103, § 3;
L. 2001, ch. 120, § 6;
L. 2007, ch. 97, § 11;
L. 2009, ch. 38, § 14; Apr. 2.