Ala. Admin. Code r. 30-X-6-.04
Current through Register Vol. 42, No. 10, July 31, 2024
Section 30-X-6-.04 - Responsibilities To Clients(1)Confidential Client Information. A registrant shall not disclose any confidential information obtained in the course of a professional engagement except with the consent of the client. (a) This rule shall not be construed 1. to relieve registrant of his obligation under Rules 30-X-6-.03(2) and 30-X-6-.03(3),2. to affect in any way his compliance with a validly issued subpoena or summons enforceable by order of a court,3. to prohibit review of a practitioner's professional practices as a part of voluntary quality review, or,4. to preclude him from responding to any inquiry made by the ethics division or Trial Board of the American Institute of CPAs, by a duly constituted investigative or disciplinary body of a State CPA Society or PA Association, or under State statutes.(2) Contingent Fees. A member in public practice shall not(a) Perform for a contingent fee any professional services for, or receive such a fee from a client for whom the member or the member's firm performs, 1. an audit or review of a financial statement' or2. a compilation of a financial statement when the member expects, or reasonably might expect, that a third party will use the financial statement and the member's compilation report does not disclose a lack of independence; or3. an examination of prospective financial information; or(b) Prepare an original or amended tax return or claim for a tax refund for a contingent fee for any client.(c) The prohibition in (1) above applies during the period in which the member or the member's firm is engaged to perform any of the services listed above and the period covered by any historical financial statements involved in any such listed services.(d) Except as stated in the next sentence, a contingent fee is a fee established for the performance of any service pursuant to an arrangement in which no fee will be charged unless a specified finding or result is attained, or in which the amount of the fee is otherwise dependent upon the finding or result of such service. Solely for purposes of this rule, fees are not regarded as being contingent if fixed by courts or other public authorities, or, in tax matters, if determined based on the results of judicial proceedings or the findings of governmental agencies.(e) A member's fees may vary depending, for example, on the complexity of services rendered.(3) Sale or Transfer of Licensee's Practice. A licensee that sells or transfers all or part of the licensee's practice to a successor firm or individual and will no longer retain any ownership in the practice shall comply with all of the following: (a) send a written notice regarding the sale or transfer of the practice via first class mail to the last known address of each client that may be subject to the sale or transfer. The notice shall contain, at a minimum, the following: a request for the client's consent to transfer that client's files or records to the successor firm or individual and a notice that the client's consent will be presumed if it does not notify the licensee that it objects within 90 days from the date of the written notice. The licensee may not transfer any client files or records to the successor firm or individual until either the client's consent is obtained, or the time indicated in the licensee's written notice has lapsed without any objection from the client, whichever is shorter. The licensee is required to retain a copy of the written notice and any document reflecting the client's consent or objection to the transfer. The written notice and any document reflecting the client's consent or objection to the transfer of the client's files shall be retained for not less than five years from the sale or transfer of the licensee's practice.(b) if the client objects to the transfer of their files or records, client records as defined in 30-X-7-.07(2), to the successor firm or individual, the licensee shall return the files or records in a reasonable period of time or as agreed upon with the client; and(c) with respect to files or records not subject to the sale or transfer, a licensee shall return the client's files or records in a reasonable period of time or as agreed upon with the client.(d) If the licensee is unable to contact a client, that client's files or records, if not transferred or returned, shall be retained by the licensee for a period of not less than five years from the date of sale or transfer of the licensee's practice. After the five-year retention period required by this section, the licensee shall dispose of or arrange for the disposal of client records that are no longer to be retained by the licensee by shredding, erasing, or otherwise modifying the personal information in those records to make it unreadable or undecipherable through any means.(4) Discontinuance of Licensee's Practice. (a) In the case of a discontinuance of a licensee's practice without a sale or transfer of the practice to a successor firm or individual, a licensee shall send a written notice via first class mail regarding the discontinuance of the practice to the last known address of each client. The licensee shall also return the client's files or records, client records as defined in 30-X-7-.07(2), in a reasonable period of time, or as agreed upon with the client.(b) If the licensee is unable to contact a client, that client's files or records shall be retained for a period of not less than five years from the date the licensee's practice discontinues. After the five-year retention period required by this Section, the licensee shall dispose of or arrange for the disposal of client records that are no longer to be retained by the licensee by shredding, erasing, or otherwise modifying the personal information in those records to make it unreadable or undecipherable through any means.Ala. Admin. Code r. 30-X-6-.04
Filed September 3, 1982. Amended: Filed March 21, 1994; effective April 25, 1994.Amended by Alabama Administrative Monthly Volume XLI, Issue No. 01, October 31, 2022, eff. 12/15/2022.Author: Alabama Board of Public Accountancy
Statutory Authority:Code of Ala. 1975, §§ 34-1-1, et seq.