Rule 30-1-3.1 - General RequirementsRule 3.1.1. The practice of public accounting as defined per Mississippi Code of 1972, Section 73-33-2, and the Definitions section of these Rules and Regulations must be performed through a CPA firm meeting ownership and other requirements specified herein, including compliance with peer review as outlined in Chapter 5, and duly registered with the Board with a firm permit to practice public accounting. This rule also applies to offices located outside of Mississippi where such offices perform services described in Section 73-33-17(4) for Mississippi clients. Each office of a firm with no Mississippi office that performs services described in Section 73-33-17(4) must be registered with the Board with a firm permit.Rule 3.1.2. Authorized forms of practice. (a) A domestic CPA firm may be organized as any entity or any business form allowed by Mississippi law and must comply with the requirements thereof.(b) A foreign CPA firm may be legally organized under a law other than the law of this state. The foreign firm must comply with the requirements as stated herein.Rule 3.1.3. CPA firm ownership.(a) A certified public accountant firm located inside of the State of Mississippi shall be required to show that: (1) it is wholly owned by natural persons and not owned in whole or in part by business entities; (2) a simple majority of the ownership of the firm in terms of financial interests and/or voting rights hold Mississippi certified public accountant licenses; and (3) the certified public accountant members of the firm are registered and in good standing with the Board, unless said CPA members qualify for practice privileges pursuant to Section 73-33-17(4) of the Mississippi Code of 1972, as amended. In addition, each resident manager of each CPA firm office in Mississippi must reside in Mississippi and hold a current license to practice public accountancy in Mississippi. Exempted from the requirement of Mississippi residency is a resident manager who spends a majority of his or her work year on-site in the Mississippi offices for which the licensee is the firm resident manager. The exemption is intended to address licensees residing outside of Mississippi but are able to commute to the Mississippi offices for which the licensee is the firm resident manager on a routine and regular basis.
(b) Except as otherwise provided by Section 73-33-17 of the Mississippi Code of 1972, as amended, a certified public accountant firm or office thereof having its principal place of business located outside of the State of Mississippi that offers to perform or practices public accounting for a client or a potential client who is a Mississippi resident, has a principal place of business or is domiciled in Mississippi shall be required to show that: (1) it is wholly owned by natural persons and not owned in whole or in part by business entities; (2) a simple majority of the ownership of the firm in terms of financial interests and/or voting rights hold certified public accountant licenses from a statutorily authorized licensing jurisdiction; (3) the certified public accountant members of the firm offering to perform or performing work for a Mississippi client qualify for practice privileges pursuant to Section 73-33-17 of the Mississippi Code of 1972, as amended; and (4) the firm is in compliance with all appropriate licensing and registration requirements of the state of its principal place of business.(c) Any certified public accountant firm may include non-licensee owners provided that: (1) the firm designates a licensee of this state or licensee of another state where the firm is registered if qualifying for the practice privilege pursuant to Section 73-33-17 of the Mississippi Code of 1972, as amended, who is responsible for the proper registration of the firm and identifies that individual to the Board;(2)all non-licensee owners are natural persons and are active individual participants in the certified public accountant firm or affiliated entities;(3)all non-licensee owners are identified as owners in connection with the registration of the firm and do not hold, in the aggregate, more than forty-nine percent of the firm financial interest or voting rights;(4)all services as defined herein are under the charge of a Mississippi CPA licensee or CPA qualified for practice privileges pursuant to Section 73-33-17 of the Mississippi Code of 1972, as amended;(5)all services are performed within the requirements set out in Section 73-33-15 of the Mississippi Code of 1972 and the professional standards for such services;(6)no person not holding a valid CPA licensee shall use or assume the title certified public accountant or the abbreviation CPA or any other title, designation, words, letters, abbreviation, sign, card or device likely to be confused with or tending to indicate that such person is a certified public accountant unless said person is qualified for practice privileges pursuant to Section 73-33-17 of the Mississippi Code of 1972, as amended;(7)non-CPAs shall not have ultimate responsibility for the performance of audits, reviews or compilations of financial statements or other forms of attestation related to financial statements and may not use language in any statement related to the financial affairs or a person or entity which is conventionally used by licensees in reports on financial statements;(8)non-CPA owners are responsible for compliance with the Act and these Rules and Regulations; and(9)the firm complies with other requirements as set by the Board. (d) When the death of a licensee owner, whether shareholder or member or partner, would cause licensee ownership of a firm to fall below 50% the executive director may authorize the firm to continue to operate for up to 12 months following the death of such owner. The Board's ratification of the executive director's authorization will require submission of the following: (1) a copy of the owner's death certificate, (2) a copy of appropriate legal documents designating a CPA licensee or registration holder in good standing with the Board to manage the firm on behalf of the non-licensed owners, and (3) written evidence that a disruption in the continuation of the firm's operations would jeopardize the survivability of the firm. Rule 3.1.4. Initial Registration (Application): All CPA firms domiciled in Mississippi must register with the Board as soon as possible, but no later than 30 days after opening a Mississippi office or beginning a new CPA firm, but in no case shall a CPA firm engage in the practice of public accounting without a firm permit.Rule 3.1.5. Annual Registration: In accordance with Mississippi Code of 1972, Section 73-33-7(3), on or before January 1 of each year, each certified public accountant firm holding a permit to practice public accounting must register with the Board.Rule 3.1.6. Process. (a) Initial applications and annual renewal registrations of firms must be made upon forms prescribed and include information required by the Board and be submitted to the executive director. Application must be made upon the affidavit of a general or managing owner (individual) and in addition to other required information must include the name and address of the person upon whom service of process may be had for the firm. In accordance with Rule 3.1.12. and Chapter 5, peer review compliance is required in order to register a CPA firm.(b) Foreign CPA firms domiciled within Mississippi or domiciled outside of Mississippi for which a firm permit is required must submit along with the initial application and annual renewal registrations all requested information including but not limited to its current corporate certificate of authority or certificate of registration with the Mississippi Secretary of State, if such registration is required by Mississippi law. Such documents on file with the Secretary of State must agree with the records of the Board. The filing of these registrations will consider the restrictions as set elsewhere in these Rules and Regulations including but not limited to CPA firm name restrictions. Rule 3.1.7. Firm Permit. Upon satisfaction of the application and registration requirements, the Board will issue to a CPA firm an annual firm permit to practice public accounting.Rule 3.1.8. Failure to apply or register. For firms required to, the absence of filing of the required application, failure to register on or before January 1, or satisfaction of this rule shall be construed to mean that no entity exists as an authorized CPA firm for the practice of public accounting. In such case the Board may take disciplinary action against the firm's members.Rule 3.1.9. Disclaimer by non-qualified firms. An entity that is not qualified to register as a CPA firm or otherwise engage in or hold-out as being able to engage in the practice of certified public accounting, but which engages in aspects of public accountancy as permitted by statute and employs or engages licensee(s) or registration holder in such work must include an asterisk by the name of the employer or principal in each advertisement or written statement by the licensee or registration holder and/or by his employer or principal in which reference is made to the licensee or registration holder or his association with the employer or principal as such, which asterisk shall refer to a notation included within conspicuous proximity and with reasonable prominence that states "This firm is not a CPA firm."Rule 3.1.10. Notices. A CPA firm registered under this rule must give notice to the Board within 30 days after significant changes including but not limited to: (a) formation of new firm;(b) changes in ownership including the admission, withdrawal, or death of an owner, partner, member, shareholder;(c) dissolution of the firm;(d) changes in legal form of organization;(e) establishment, withdrawal, or changes of offices;(f) change in physical location and/or address;(g)change in the firm name;(h) occurrence of any event(s) which would cause the firm to become out of compliance with the Act or the Rules and Regulations including compliance assurance as described in Rule 5.3.6. This notice shall be provided on an amendment form prescribed by the Board.
Rule 3.1.11. Firm Names. (a) A CPA firm may not use a CPA firm name unless that name has been registered with the Board.(b) It is prohibited for a CPA firm to use any name that is misleading. A misleading CPA firm name is one which: (1) Implies the existence of a partnership or registered limited liability partnership or a professional corporation or professional limited liability company if the firm is not, in fact, one of those entities;(2) Includes the name of an individual who is not a CPA if the words "certified public accountants" or "CPAs" are included in the firm name;(3) Includes information about or indicates an association with persons who are not current or former members of the firm, unless the name is that of a firm network;(4) Includes the terms "& Company", "& Associates", or "Group", but the firm does not include, in addition to the named partner, shareholder, owner, or member, at least one other unnamed partner, shareholder, owner, member, or staff employee;(5) Contains any representation that would be likely to cause a reasonable person to have a false or unjustified expectation of favorable results or capabilities, including names indicating qualitative superiority or pricing differences;(6) Claims or implies the ability to influence a regulatory body or official;(7) Includes the name of an owner whose license has been revoked for disciplinary reasons by the Board whereby the licensee has been prohibited from practicing public accountancy or prohibited from using the title CPA or holding themselves out as a Certified Public Accountant.(c) The following is a non-exhaustive list of types of CPA firm names that are not in and of themselves misleading and are permissible so long as they do not violate other firm name provisions:(1) A firm name that includes the names or initials of one or more former or current owners;(2) A firm name that excludes the names of one or more former or current owners;(3) A firm name that uses the "CPA" title as part of the firm name when all named individuals are owners of the firm who hold the CPA title or are former owners who held the CPA title at the time they ceased to be owners of the firm;(4) A firm name that includes the name of a non-CPA owner if the words "certified public accountant" or "CPA" title are not a part of the firm name.(d) Any CPA firm registered in another jurisdiction that registers a Mississippi firm permit pursuant to MS Code Section 73-33-17(4), may register and practice under the name as registered with that jurisdiction provided that the name is not misleading. If required by Mississippi law, such firm will register to do business in Mississippi with the Secretary of State under the name registered with the Board.Rule 3.1.12. In addition to other requirements set herein, firms must comply with Peer Review as defined per Chapter 5. in order to register a CPA firm.Rule 3.1.15. Sole Proprietors (a) Every sole proprietorship having an office in Mississippi while engaged in the practice of public accountancy in this state (whether full or part time) must register as a CPA firm with the Board. Sole proprietors whose principal place of business is outside Mississippi shall register as a CPA firm with the Board if performing services as defined per Mississippi Code of 1972, Section 73-33-17(4), including:
(1)any financial statement audit or other engagement to be performed in accordance with Statements on Auditing Standards;(2)any examination of prospective financial information to performed in accordance with Statements on Standards for Attestation Engagements;(3)any engagement to be performed in accordance with PCAOB Auditing Standards.(b) Death of a Sole Proprietor. Upon written authorization from the executive director, a sole proprietorship may continue to operate for a period of up to 12 months following the death of the sole proprietor. The executive director, subject to ratification by the Board at the next Board meeting, may permit the continued operation of the sole proprietorship when the following has been provided: (1)a copy of the sole proprietor's death certificate;(2)a copy of the power of attorney from the sole proprietor's executor, administrator, or heir designating a CPA licensee or registration holder in good standing with the Board to manage the sole proprietorship on behalf of such party. When such party is not a licensee or registration holder, the power of attorney must authorize a licensee or registration holder to manage the sole proprietorship on behalf of such party; and(3)written evidence that a disruption in the continuation of the sole proprietorship would jeopardize the survivability of the firm.