But, does Florida law change = new problems?

Even before the U.S. Supreme Court announced its decision in Ianez v. State of Florida, the Florida legislature at the behest of the Florida Board of Accountancy amended the definition of the practice of public accounting in the Florida statutes. Recognizing that the hearing officer had declared the "holding out" rule invalid, as a result of a challenge mounted by Silvia Ibanez in 1992, the Board of Accountancy got the Florida legislature to write a "holding out" definition into the Florida statutes.

The Florida statute definition of practicing public accountancy includes "offering to perform or performing for the public one or more types of services involving the use of accounting skills, or one or more types of management advisory or consulting services, by any person holding himself or itself out as a certified public accountant..." Thus, the definition of whether a person is practicing public accountancy consists of two prongs.

* Services for the public that use accounting skills

* Holding oneself out as a CPA.

The circularity of the definition becomes apparent when one realizes that the definition of practicing public accounting depends upon the use of accounting skills. Justice Scalia opined during the oral arguments in the Ibanez case that accounting skills could be interpreted to include adding and subtracting. Thus, almost any mathematical calculations involved in the practice of law would seem to utilize accounting skills.

Because of the vagueness and the breadth of this definition, one is required to fall back on the second prong in order to define what the practice of public accounting is--namely, whether one is holding oneself out as a CPA.

The definition of holding out, which has been inserted into the Florida statutes, is as follows:

"Holding out" means advertising, as part of a licensee's business activities, that the licensee is a certified public accountant when providing, or offering to provide, services or products to the public which involve the use of accounting skills or one or more types of management advisory or consulting services.

As a result, when one advertises that he or she has a CPA certificate in connection with the practice of law, the legal activities of the practice of law become transmuted into the practice of public accountancy.

The Florida Board of Accountancy rules define advertising as...any statements, oral or written, disseminated to or before the public or any portion thereof, with the intent of furthering- the purpose either directly or indirectly, of selling public accounting services, or offering to perform public accounting services, or inducing members of the public to enter into any obligation relating to such public accounting services. For purposes of this rule, oral or written statements include business cards and letterhead.

Thus, the definition of advertising is dependent upon whether it is for the purpose of furthering the sale of public accounting services. This use of the definition of advertising in connection with the holding out rule in connection with the definition of public accounting is one great circle of tautology.

If this sounds confusing, it is. One wonders what the Florida Board of Accountancy will do next.

Sydney S. Traum, President Florida Association of Attorney-CPAs

Copyright American Association of Attorney-Certified Public Accountants Summer 1994
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