STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

STATE BOARD OF ACCOUNTANCY, )

)

Petitioner, )

)

vs. ) CASE NO. 75-1065

)

LEO Y. LEWIS, )

)

Respondent. )

)

RECOMMENDED ORDER

After due notice a public hearing was held before Delphene C. Strickland, Hearing Officer, Department of Administration, Division of Administrative Hearings, in Room 104, Collins Building, Tallahassee, Florida, on January 7, 1976, at 10:00 a.m.

APPEARANCES

For Petitioner: CHARLES P. PILLANS, III, ESQUIRE

Bedell, Bedell, Dittman & Zehmer, P.A. 1500 Barnett Bank Building Jacksonville, Florida 32202

For Respondent: MARY CLARK, ESQUIRE

Department of Health

and Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32301 ISSUE

Whether the certificate of Respondent, Leo Y. Lewis, issued by the State Board of Accountancy on,January 28, 1972, should be revoked.

FINDINGS OF FACT

1. The Respondent, Leo Y. Lewis, from 1969 to date had been employed by the State of Florida as Internal Audit Coordinator for the Department of Health and Rehabilitative Services.

   
   

2. Respondent applied for and was issued a reciprocal certificate by the State Board of Accountancy on January 28, 1972. The reciprocal certificate was issued under the provisions of Florida Statutes, Section 473.201.

   
   

   473.201 Certificates granted to holders from other states

   1. Upon application, the board shall issue a reciprocal certificate to the holder of a valid, unrevoked certificate issued by, or under the

      authority of, another state or political subdivision of the United States only if:

      1. The original certificate was secured as the result of a written examination which in the judgment of the board was the equivalent of the examination given by the board at the time the applicant passed such written examination; provided, however, that if such written exami- nation did not include the subject of ethics the application shall not be denied for that reason. In any event, the board shall require all applicants to take and pass the same current open book examination in ethics given to applicants for the written examination in the state before issuance of a reciprocal certificate;

      2. The applicant meets all the requirements in effect, at the time of the application, for applicants to take the Florida examination;

      3. The applicant is a resident of and domiciled in the state;

      4. The applicant intends to enter into the full-time, year-round practice of public accounting in the state; and

      5. The board is otherwise fully satisifed as to the moral and technical fitness of applicant."

         
         

3. The Board now seeks to revoke the reciprocal certificate issued to Respondent for failure to comply with Section 473.201(2), Florida Statutes,

   
   

   "(2) Failure of the holder of a certificate issued under this section to be domiciled in and practice public accounting on a substantially full-time basis in the state for a continuous period of three years immediately after issuance of much

   certificate shall be prima facie evidence of the lack of the requisite intent and sufficient grounds for revocation of the reciprocal certificate issued by the board.",

   
   

   contending that Respondent has not been practicing public accounting for the three years immediately subsequent to the issuance of his certificate.

   
   

4. There was no contention by the Board in its original revocation procedures that the Respondent has failed to meet all of the requirements of Section 473.201(1) and (2), Florida Statute, with the exception of the contention that Respondent has not practiced "public accountancy". At the hearing and in the Memorandum of Law there is an argument by the Petitioner that the Respondent did not actually intend to practice public accounting at the time that he received a reciprocal certificate. There is no showing that any fraud was involved and the grounds upon which the motion for revocation of Respondent's license is on the ground that Mr. Lewis did not engage in the practice of public accounting on substantially full-time basis for a period of three years after issuance of his reciprocal certificate. His intent at the time he received his reciprocal certificate is not necessary to the determination of the issue at hand.

5. Petitioner contends:

   
   

   1. That Respondent is not in the practice of public accounting;

      
      

   2. That Section 473.08(2)(c) applies only to the Auditor General and tlie Chief Auditor of the Public Service Commission and that Section 473.08(2)(c), infra, is an exception to the general requirement that persons who have taken and passed an examination and become CPA's must have one year of public accounting experience or equivalent education in order to obtain their CPA certificates; and

      
      

   3. That the exception is not a recognition that either the Auditor General or the Chief Auditor of the Public Service Cotmission is engaged in the practice of public accounting.

   
   

6. Respondent contends:

   
   

   1. That he is in fact a Florida practitioner engaged in the practice of public accounting;

      
      

   2. That the legislature and the Board have recognized that works similar to that which the Respondent performs constitutes the practice of public accounting. Said statute as passed by the legislature is Section 473.08, Florida Statutes.

      
      

      "473.08 Qualifications of applicant for examination; certificates to successful examinees; standards

      1. A person who qualifies to take such examination pursuant to provisions of subsection (1) and who takes and passes such examination shall receive a certificate as a certified public accountant issued by the board and shall be permitted to practice public accounting in this state if he:...

   3. Shall have completed one year of employment in the office of a Florida practitioner or an out-of-state practitioner or shall have successfully completed an additional one year accounting course at an accredited college or university. However:

      1. Any person employed as an accountant in the accounting department of the Florida public service commission who is qualified to take an examination for the purpose of determining whether or not such person shall be permitted to practice in this state as a certified public accountant, and who takes and passes such examination, shall be entitled to receive a certificate under the provisions of authorizing practice in this state as a certified public accountant upon completion of one year of accounting work for said commission under the supervision and direction of a certified public accountant serving as director of commission's accounting department.

      2. Any person employed as an accountant or post auditor on the staff of the auditor general who is qualified to take an examination for the purpose of determining whether or not such person shall be permitted to practice in this state as a

   certified public accountant, and who takes and passes such examination, shall be entitled to receive a certificate, under the provisions of this authorizing such person to practice in this state as a certified public accountant upon the completion of one year of experience as an accountant or post auditor under the supervision and direction of a certified public accountant serving as auditor general. Proof of compliance with the provisions of this introductory paragraph of this subsection shall be established in such form as is prescribed by the board;.

   
   

7. The Florida Statutes do not clearly define the term "public accounting", but the definitions in Section 473.011 are helpful.

   
   

   "473.011 Definitions of terms used in chapter

   1. whenever the terms `certified public or

      public accountant are used in this chapter, except as used in subsection (3), they shall be deemed and construed to mean a person holding a certificate to practice as such, issued by the state under this chapter, or any law of the state heretofore in force and effect. [(3) not applicable]

   2. whenever the term `Florida practitioner' is

      used in this chapter it shall be deemed and construed to mean a certified public accountant or public accountant, as defined in subsection (1), engaged in the practice of public accounting in Florida, whether as an individual, a partner or employee of a partner- ship, or a stockholder, officer, or employee of a professional corporation. It shall also be deemed and construed to mean a partnership or professional corporation of Florida practitioners.

      (5) Thenever the term `public accounting is used in this chapter, it shall be deemed and construed to mean:

      1. All services offered to or performed for

         the public by a Florida practitioner or an out of state practitioner involving the use of accounting skills, specifically including, but not limited to, management services, and

      2. All services offered to or performed for the public by any other person, acting as an

      individual, as a partner or employee of a partnership, as a stockholder, officer or employee of a professional corporation, or as an officer or employee of any other corporation, involving the use of accounting skills, except as follows: (not applicable)

      
      

8. Under the definition section of Rule 21A-1.10 of the Florida Administrative Code, practice of or practicing public accounting is defined as:

   
   

   "Practice of, or practicing public accounting. 'Practice of, or practicing public accounting' shall be deemed and construed to mean offering to perform, performing, or holding oneself out as being qualified to perform, those services described in Section 473.011(5), F.S." [supra]

   
   

   as:

9. Rule 21A-1.11 of the Florida Administrative Code defines practitioner

   
   

   "'Practitioner' shall be defined as either a Florida practitioner (as defined in Section 473.011(2), F.S.), or an out of-state practitioner (as defined in Section 473.011(3), F.S.), engaged in the practice of public accounting in Florida under a special permit."

10. Black's Law Dictionary, Revised Fourth Edition, defines public as: "PUBLIC, adj. Pertaining to a state, nation, or

    community; proceeding from, relating to, or

    affecting the whole body of people or an entire community. Open to all; notorious. Common to all or many; general; open to common use. Morgan v.

    Cree, 46 Vt. 786, 14 Am.Rep. 640; Crane v. Waters, C.C.Mass., 10 F. 621. Belonging to the people at large; relating to or affecting the whole people of a state, nation, or community; not limited or restricted to any particular class of the community. People v. Powell, 280 Mich. 699, 274 N.W. 372, 373,

    111 A.L.R. 721."

11. Black's Law Dictionary, Revised Fourth Edition, defines accounting as: "ACCOUNTING. An act or system of making up or

    settling accounts; a statement of account, or a

    debit and credit in financial transactions. Kansas City v. Burns, 137 Kan. 905, 22 P.2d 444."

    
    

12. The Hearing Officer finds:

    
    

    1. That the work the Respondent does in his position as Internal

       Audit Coordinator for the Department of Health and Rehabilitative Services involves the use of accounting skills and includes management services and that he is a Florida practitioner as defined in Chapter 473, Florida Statutes, and in Chapter 21A-I, Florida Administrative Code.

       
       

    2. Petitioner contends that the Respondent is a state employee and therefore cannot be independent of his client However, the evidence shows that much of the work performed by Respondent and his staff are for agencies and organizations outside the Department of Health and Rehabilitative Services which employs Respondent. There is no employee-employer relationship between Respondent and these organizations. Further, no showing has been made that the employer, the Department of Health and Rehabilitative Services, attempts to or has ever directed the work of Respondent or in any way exercised control over the audits of Respondent.

       
       

    3. Respondent is in the practice of public accounting in his capacity as Internal Audit Coordinator.

    CONCLUSIONS OF LAW

    
    

13. Section 473.201(1)(2), Florida Statutes, provides certain guidelines upon which the Board bases it conclusion as to whether an applicant may receive a recriprocal certificate. Such a certificate was issued to the Respondent and there is no contention that the Respondent has not fulfilled each of the obligations required by the statute. The Department of Health and Rehabilitative Services is a body corporate and Respondent is employed in a capacity in which the use of accounting skills and management services are necessary. The services are for the general public of the state. The statute does not exclude persons who are performing services for the public by virtue of public employment and under the definition in the statutes and otherwise it is apparent that authority to exclude individuals who perform accounting skills employed by the governmental agencies is beyond the scope of the statute.

RECOMMENDATION

Dismiss the petition of the State Board of Accountancy. DONE and ORDERED this 24th day of May, 1976.

DELPHENE C. STRICKLAND

Hearing Officer

Division of Administrative Hearings The Carlton Building, Room 530 Tallahassee, Florida 32304

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 24th day of May, 1976.

Docket for Case No: 75-001065

Orders for Case No: 75-001065