One Greenway Plaza, Suite 1003 • Houston, Texas 77046 • 713.627.3737 (phone) • 713.627.3738 (fax)
© 2018 Forrest McElroy, P.C. All Rights Reserved
Accountant Malpractice, Accountant Liability, and Commercial Litigation
CPAs and their firms are often the target of litigation relating to the services they provide to their clients. Whether based on allegations of negligence, fraud, conspiracy, or any other claim, we use our unique knowledge and experience of the laws relating to accountants to help CPAs defend against these types of lawsuits. If retained early, we seek to fully evaluate the claims as soon as possible and give early advice on the risk and exposure of the CPA to facilitate early decisions on defending the case, including mediation, settlement, or asserting a full defense through trial.
Subpoenas for CPA Accounting and Tax Records
Texas and federal subpoenas (including civil, criminal, grand jury, duces tecum, and witness subpoenas) for CPA records are subject to certain confidentiality requirements found in the Texas Public Accountancy Act and the IRS Code (26 U.S.C. § 7216, 26 C.F.R. § 301.7216-1 through 3). These provisions make it necessary in most instances for the CPA to follow strict Texas and IRS guidelines for gaining the client consent to disclose any information. We assist CPAs with all aspects of their response to subpoenas, including complying with consent regulations, avoiding conflicts of interests, seeking protective orders against objectionable requests, and avoiding claims against the CPA for violation of confidentiality laws.
CPA Regulatory Compliance and Professional License Defense
Texas CPAs work in a world regulated by multiple agencies, boards, and committees, not just the Texas State Board of Public Accountancy (TSBPA). Complying with the range of ethical and professional standards of all the groups is a daunting task for all CPAs and we assist CPAs with maintaining their credentials from all those groups, including the Texas State Board of Public Accountancy (TSBPA), but also the American Institute of Certified Public Accountants (AICPA), the Texas Society of Certified Public Accountants (TSCPA), the Public Company Accounting Oversight Board (PCAOB), the Internal Revenue Service (IRS), the Securities and Exchange Commission (SEC), and others. We have assisted clients in all such matters, including hearings conducted by the State Office of Administrative Hearings (SOAH) on claims brought by the TSBPA.
TSBPA Cease and Desist Orders
The Texas State Board of Public Accountancy (TSBPA) and the Texas Public Accountancy Act have certain restrictions on the use of the words "CPA", "certified public accountants", and other terms related to accountants in Texas. The TSBPA utilizes agents and volunteers to monitor the websites, publications, and advertisements of Texas companies, individuals, and firms to ensure compliance with these technical requirements. After a hearing, the TSBPA may heavily fine and further restrict individuals and entities that use those terms without complying with its rules. We defend CPAs and non-CPAs who are investigated by the TSBPA through the negotiations with the TSBPA and the hearing that may follow. In many cases, we assist with avoiding the issuance of a cease and desist order and any accompanying fine altogether.
CPA and CPA Firm Contracts
CPAs are parties to numerous contracts, including not only those with their clients but also among themselves in their firms. In addition to engagement letters and partnership agreements, we also assist CPAs with mergers and acquisitions of firms along with choosing the correct structure for their practice. In crafting CPA contracts, we ensure that all of the CPA's needs are met while still complying with the myriad of laws, rules, and regulations that are unique to CPAs.
CPA Insurance Defense
We work with all of the leading accountant malpractice insurance companies to provide representation of CPAs and CPA firms in Texas. Contact us if you have malpractice insurance and would like to know about our relationship with your carrier.