The Board has moved!
Please be aware that on August 6, 2007 the Board moved into our new offices. The new address is:
Board of Accountancy
9960 Mayland Drive
Suite 402
Richmond, Virginia 23233
Publications
Biennial Report
The Virginia Board of Accountancy Biennial Report Fiscal Years 2002-2004
TABLE OF CONTENTS
- LETTER FROM THE CHAIRMAN
- MEMBERS OF THE VIRGINIA BOARD OF ACCOUNTANCY
- MISSION AND VISION
- CPA EXAMINATION CANDIDATE PERFORMANCE
- APPLICATIONS PROCESSED FOR FISCAL YEARS 2003-2004
- LICENSES & FIRM REGISTRATIONS ISSUED
- ENFORCEMENT REPORTS
- CPE AUDIT REPORT
- FINANCIAL IMPACT STATEMENT
- CUSTOMER SERVICE SURVEY
- BOARD OF ACCOUNTANCY AUTHORITY
LETTER FROM THE CHAIRMAN
November 1, 2004
The Honorable Mark R. Warner
Governor, Commonwealth of Virginia
and Members of the General Assembly
Dear Governor Warner and Members of the General Assembly:
The Virginia Board of Accountancy (Board) is pleased to submit its report for the period July 1, 2002 through June 30, 2004. The report provides a description of the Board’s regulatory activities, important financial data, and an overview of enforcement actions.
Since the last biennium the Board has made several exciting and innovative changes. One major step the Board has taken is the availability of interactive, online applications. This is a tremendous accomplishment for the Board because we are the only Board of Accountancy in the country with this convenience for applicants.
Another addition to our website is the customer service survey. This has been a very successful tool; it provides the Board with comments and suggestions from the regulants on how the Board can provide superior customer service.
The Board will continue to work diligently on making innovative changes, working towards a paperless, E-Government agency. On behalf of the Board, we thank you for the opportunity to serve you and the citizens of the Commonwealth.
Sincerely,
Harry D. Dickinson, Ph.D., CPA
Chairman
MEMBERS OF THE VIRGINIA BOARD OF ACCOUNTANCY
The Board consists of seven members, one public member who may be an accountant who does not hold a CPA certificate, one educator in the field of accounting, and five certified public accountants. The Governor appoints each member to a term of four years.
Harry D. Dickinson, Ph.D., CPA
Chairman
First four year term ends June 30, 2005
(Licensed CPA)
Stephen D. Holton, CPA
First four year term ends June 30, 2007
(Licensed CPA)
Regina P. Brayboy
First four year term ends June 30, 2008
(Citizen Member)
Lawrence D. Samuel, CPA
First four year term ends June 30 2008
(Licensed CPA)
Jane M. Little, CPA
Vice Chairman
First four year term ends June 30, 2006
(Licensed CPA)
O.Whitfield Broome, Ph.D., CPA
First four year term ends June 30,2007
(Educator Member & Licensed CPA)
Dian T. Calderone, MTX, CPA
First four year term ends June 30, 2008
(Licensed CPA)
Board members are given a per diem for most Board business and reimbursed for certain expenses when performing official duties of the Board.
MISSION STATEMENT
"The mission of the Virginia Board of Accountancy is to protect and serve the citizens of the Commonwealth by administering and implementing the laws and regulations for their health, safety, and welfare."
VISION STATEMENT
The vision of the Virginia Board of Accountancy is to serve the citizens of the Commonwealth in a professional manner, in which the most equitable, efficient and economical means available are used to limit entry barriers to the workplace. The Board also serves to deny entry to individuals who are not qualified to practice public accounting and to discipline those who do not follow acceptable, ethical or professional standards.
CPA EXAMINATION CANDIDATE PERFORMANCE
CPA EXAM ADMINISTRATION
One of the most important Board responsibilities is administering the CPA exam. As can be seen from the ensuing tables, the Board, with the assistance of CPA Exam Services (a division of the National Association of State Boards of Accountancy), administers the CPA exam to roughly 2,000 candidates in May and November of each year.
CPA EXAM CANDIDATE PERFORMANCE
| Candidates Examined For | Number Sitting For Exam | Number Passing Exam | Percent Passing Exam |
|---|---|---|---|
| AUD | 2,156 | 557 | 26% |
| LPR | 2,129 | 567 | 27% |
| FARE | 2,330 | 558 | 24% |
| ARE | 2,278 | 613 | 27% |
*First Time Candidates – 1,124
*Re-Exam Candidates – 1,427
*Total Candidates taking Exam – 2,551
CPA EXAM CANDIDATE PERFORMANCE
| Sections Scheduled For Exam | Number Sitting For Exam | Number Passing Exam | Percent Passing Exam |
|---|---|---|---|
| AUD | 1,807 | 488 | 27% |
| LPR | 1,776 | 489 | 28% |
| FARE | 1,984 | 483 | 24% |
| ARE | 1,884 | 517 | 27% |
*First Time Candidates – 742
*Re-Exam Candidates – 1,495
*Total Candidates taking Exam – 2,237
CPA EXAM CANDIDATE PERFORMANCE
| Sections Scheduled For Exam | Number Sitting For Exam | Number Passing Exam | Percent Passing Exam |
|---|---|---|---|
| AUD | 2,323 | 623 | 27% |
| LPR | 2,300 | 604 | 26% |
| FARE | 2,505 | 619 | 25% |
| ARE | 2,378 | 569 | 24% |
*First Time Candidates – 1,098
*Re-Exam Candidates – 1,652
*Total Candidates taking Exam – 2,750
All CPA exams for November 2002 – November 2003, were given at four locations around the state.
Richmond – Arthur Ashe Jr. Athletic Center, 3001 N. Blvd. Richmond, VA 23230
Norfolk – Norfolk Scope Plaza, Brambleton Avenue, Norfolk, VA 23501
Northern Virginia – Capital Expo Center / N Hall, 4368 Chantilly Shopping Center, Chantilly, VA 22030
Roanoke – Roanoke Civic Center, 710 Williamson Road NE, Roanoke, VA 24016
AUD = Auditing and Attestation
LPR = Law and Professional Responsibilities
FARE = Financial Accounting and Reporting
ARE = Accounting and Reporting-Managerial, Taxation, and Not-for-Profit and Governmental Accounting.
COMPUTER-BASED CPA EXAM
In April 2004, the Virginia Board of Accountancy, CPAES, NASBA, and Prometric together launched the first computer-based CPA exam. The Virginia Board of Accountancy was very proud to be a part of this historical event. While plans are still in the process of being implemented to shape the future of the CBT, BOA is very excited about the continued success of the CBT.
CPA EXAM CANDIDATE PERFORMANCE
| Sections Scheduled For Exam | Number Sitting For Exam | Number Passing Exam | Percent Passing Exam |
|---|---|---|---|
| AUD | 313 | 136 | 43% |
| LPR | 236 | 92 | 39% |
| FARE | 301 | 125 | 42% |
| ARE | 293 | 133 | 45% |
*First Time Candidates – 561
*Re-Exam Candidates – 1,113
*Total Candidates taking Exam – 1,679
APPLICATIONS PROCESSED FOR FISCAL YEARS 2003-2004
PROCESSING APPLICATION FOR CPA CERTIFICATES AND FIRM REGISTRATIONS
A major activity of the Board is processing initial and renewal applications for a CPA certificate and firm registration. With respect to initial applications, accurately determining whether the applicant for a CPA Certificate meets the education, examination and experience requirements in strict accordance with the Code of Virginia and the Board’s regulations is absolutely essential in order to protect the public. Likewise, accurately determining whether a CPA firm meets the peer review and other requirements for a firm license is also essential for the public’s protection. The table below shows the initial applications processed during the year.
| Fiscal Year | Original | Endorsement | Firm | Reinstatement Mail / Website |
Firm Reinstatement |
|---|---|---|---|---|---|
| FY 2003 | 758 | 162 | 215 | 270 / 0 | 0 |
| FY 2004 | 1,084 | 234 | 207 | 393 / 119 | 4 |
In July 2004 the Board of Accountancy implemented interactive, online applications, this explains the "Website" column above. The reinstatement application was used as the "test application" and as shown above was very successful. At this time the VA BOA has made all applications interactive and available online.
LICENSES & FIRM REGISTRATIONS ISSUED
| Date | Individuals | Firms |
|---|---|---|
| JULY 2002 2003 |
16,649 16,456 |
1,186 1,331 |
| AUGUST 2002 2003 |
16,699 16,433 |
1,200 1,347 |
| SEPTEMBER 2002 2003 |
16,693 16,414 |
1,224 1,353 |
| OCTOBER 2002 2003 |
16,711 16,441 |
1,244 1,373 |
| NOVEMBER 2002 2003 |
16,676 16,428 |
1,264 1,382 |
| DECEMBER 2002 2003 |
16,741 16,395 |
1,282 1,394 |
| JANUARY 2003 2004 |
16,626 16,482 |
1,245 1,406 |
| FEBRUARY 2003 2004 |
16,525 16,534 |
1,246 1.413 |
| MARCH 2003 2004 |
16,484 16,618 |
1,252 1,429 |
| APRIL 2003 2004 |
16,476 16,668 |
1,253 1,433 |
| MAY 2003 2004 |
16,466 16,746 |
1,256 1,453 |
| JUNE 2003 2004 |
16,466 16,832 |
1,310 1,476 |
A major activity of the Board is processing initial and renewal applications for a CPA certificate and firm registration. Determining whether CPA Certificate and Registration Certificate holders meet the requirements (e.g., Continuing Professional Education, Peer Review) for continued licensure is essential for the public’s protection. The following table shows the total number of CPA Certificate and Firm Registration holders during the fiscal year ended June 30, 2004.
ENFORCEMENT REPORTS
COMPLAINTS PROCESSED FOR JULY 2002- JUNE 2004
| DATE | PENDING | NEW | CLOSED | TOTAL OPEN |
|---|---|---|---|---|
| JULY 2002 2003 |
11 12 |
2 9 |
0 5 |
13 16 |
| AUGUST 2002 2003 |
13 16 |
3 12 |
2 8 |
14 20 |
| SEPTEMBER 2002 2003 |
14 20 |
2 4 |
2 1 |
14 23 |
| OCTOBER 2002 2003 |
14 23 |
6 6 |
0 8 |
20 21 |
| NOVEMBER 2002 2003 |
20 21 |
12 2 |
3 1 |
29 22 |
| DECEMBER 2002 2003 |
229 22 |
5 0 |
16 7 |
18 15 |
| JANUARY 2003 2004 |
18 15 |
15 6 |
10 3 |
23 18 |
| FEBRUARY 2003 2004 |
23 18 |
10 2 |
11 0 |
22 20 |
| MARCH 2003 2004 |
22 20 |
9 4 |
6 11 |
25 13 |
| APRIL 2003 2004 |
25 13 |
14 3 |
14 3 |
25 13 |
| MAY 2003 2004 |
25 13 |
9 1 |
15 1 |
19 13 |
| JUNE 2003 2004 |
19 13 |
6 8 |
13 0 |
12 21 |
The Board’s two-member Enforcement Committee reviews information compiled by the investigative staff and determines whether violations of the statutes and regulations governing the practice by Certified Public Accountants (CPA) and CPA firms have or have not been committed. The Committee recommends appropriate action to the full Board for final disposition. The official complaint form with filing instructions is provided on the Board’s website at www.boa.virginia.gov to make it convenient for Virginia citizens. The Enforcement committee strives to enhance the efficiency and effectiveness of complaint resolution through the use of consent agreements, and by adopting mediation as a method of dispute resolution in certain cases.
ENFORCEMENT ACTIVITIES
No activity of the Board is more important than its enforcement activity. Due to the substantial consequences to both the regulant and the public, the Board and its staff spend considerable time on this activity. During the past biennial, the Board dealt with a large number of cases, some involving very complex issues.
| NATURE OF COMPLAINT | TOTAL FOR BIENNIUM |
|---|---|
| Advertising | 2 |
| Embezzlement | 0 |
| Due Professional Care (Negligence) |
8 |
| Falsify Application | 0 |
| Fee Dispute | 5 |
| Licensing Eligibility | 18 |
| Unlicensed Practice | 17 |
| Tax Deficiency | 17 |
| Unprofessional Conduct | 5 |
| Violations of Standards of Practice | 9 |
| Conflict of Interest | 1 |
| Insider Trading | 1 |
| CPE Deficiency | 14 |
| Reinstatement License Agreement | 54 |
| Public Interest | 1 |
CPE AUDIT REPORT
| SELECTION MONTH | TOTAL SELECTED | ININTIAL COMPLIANCE | NUMBER SIGNED CONSENT ORDERS |
NUMBER PENDING 6 MONTH COMPLIANCE |
TOTAL CLOSED* |
|---|---|---|---|---|---|
| JULY 2002 2003 |
32 29 |
31 28 |
0 0 |
1 1 |
0 0 |
| AUGUST 2002 2003 |
27 31 |
25 28 |
1 0 |
2 3 |
0 1 |
| SEPTEMBER 2002 2003 |
27 32 |
22 32 |
0 0 |
4 0 |
0 0 |
| OCTOBER 2002 2003 |
32 30 |
32 26 |
0 0 |
0 4 |
0 0 |
| NOVEMBER 2002 2003 |
32 31 |
32 26 |
0 0 |
0 5 |
0 0 |
| DECEMBER 2002 2003 |
32 32 |
31 28 |
1 0 |
0 4 |
0 2 |
| JANUARY 2003 2004 |
32 32 |
31 28 |
1 0 |
0 4 |
0 2 |
| FEBRUARY 2003 2004 |
36 38 |
33 37 |
2 1 |
1 0 |
0 0 |
| MARCH 2003 2004 |
45 50 |
38 47 |
2 0 |
5 3 |
0 0 |
| APRIL 2003 2004 |
33 36 |
32 34 |
1 0 |
0 2 |
0 0 |
| MAY 2003 2004 |
36 37 |
31 28 |
0 0 |
5 9 |
0 0 |
| JUNE 2003 2004 |
30 34 |
27 28 |
0 0 |
3 6 |
0 0 |
Each month a random audit is conducted from a sample of CPAs whose licenses expire 6 months hence. Further, the Board instituted new disciplinary procedures to address the issue of deficient licensees. The Board, in an effort to meet the changing needs of the regulants and to increase competence, broadened the types of continuing education credits that are acceptable. For example, CEU or CE, CLE, QAS, or Semester/Quarter Hour Credits are accepted as long as they maintain or increase the professional competence of the CPA. The new disciplinary procedures are to assure the regulants and the public of quick action if CPAs are non-compliant. Such initiatives meet the Governor’s priorities, which include: (i) the enhancement of the performance of CPAs; (ii) the strengthening of the disciplinary process for CPAs who fail to comply with CPE requirements; and (iii) the maintenance of a highly competent and ethical accounting profession, which would raise public confidence in the profession.
FINANCIAL IMPACT STATEMENT
| Board of Accountancy | FY02 | FY03 | FY04 | FY05 | FY06 |
|---|---|---|---|---|---|
| Appropriation | $586,000 | $628,514 | $559,630 | $586,000 | $586,000 |
| Revenues | $480,214 | $388,180 | $555,000 | $580,000 | $585,000 |
| Expenditures | $487,531 | $388,180 | $555,000 | $580,000 | $585,000 |
| Cash Balance | $626,880 | $815,121 | $914,883* | $994,883* | $1,084,883* |
| Board of Accountancy | FY02 | FY03 | FY04 | FY05 | FY06 |
|---|---|---|---|---|---|
| Licensed CPAs | 16,055 | 16,466 | 16,832 | 16,952 | 17,250 |
| Registered CPA Firms | 1,238 | 1,310 | 1,476 | 1,725 | 1,925 |
*From time to time varying amounts of the cash balance will be transferred to the BOA Trust Account (established 7-1-04).
NOTE: Significant expenditures are projected for FY04, FY05 and FY06 to cover anticipated Additional staffing needs, move to larger quarters and additional IT equipment purchase/ maintenance. BOA is a special fund agency supported by fees from CPAs and CPA firms licensed in Virginia. BOA does not receive any general funds.
CUSTOMER SERVICE SURVEY
Help Virginia's Board of Accountancy to better serve You.
Please take a few moments to complete this Customer Service Survey. Recently, you received customer service from the Board; we are interested in your feedback. Please check only one in each row and, if necessary, add any comments. Forward this survey by to the Board office by clicking the Submit Survey button below.
This Customer Service Survey was made available online October 15, 2003. This has been a very successful tool; it provides the Board with comments and suggestions from the regulants on how the Board can provide superior customer service.
During this period we have surveyed approximately 15,438 regulants and we have received 4,980 responses.
BOARD OF ACCOUNTANCY
AUTHORITY
Code of Virginia
54.1-4400 through 4422
The Virginia Board of Accountancy (Board) was created in 1910 and the 2001 General Assembly enacted law to establish the Board as a supervisory board and separate agency of state government effective on July 1, 2001. The Board has a dynamic three-year history
A considerable amount of effort by the seven Board members and staff was expended on the many tasks of transitioning the Board during the months prior to July 1, 2001. The Board has met monthly to discuss and decide on various issues centered around the regulation of Certified Public Accountants (CPA) and CPA firms. The Board’s Executive Director, Nancy Taylor Feldman is responsible for the daily operations of the Board. She is directly responsible to the Board and to ensure the Governor’s initiatives are implemented. On June 1, 2004, the Board staff moved its new offices in Suite 378 at 3600 West Broad Street in Richmond.
Under the leadership of Carole Mulzer Hersch, CPA and Barbara S. Pocalyko CPA, the Accountancy team has continued its aggressive effort to enhance its IT system to include the first online interactive application process, with payment by credit card, in the Commonwealth. An online survey is sent to all online customers and the responses indicate that the Board has a rating of excellent from 80% of its customers. 93% of Virginia’s Certified Public Accountants (CPA) and CPA firms continue to choose to renew online which means a significant savings in processing costs during the biennium.
The Board staff, Mary Charity, Mark D’Amato and Jean Grant, Darrin Adams and Gwen Corprew have been instrumental in the success of highly efficient daily operations. The new approach to Continuing Professional Education (CPE) compliance implemented in 2001 has proven successful, as compliance rates have increased more than 50%. The Board adopted a policy requiring strict compliance with the requirements for CPE. The members agreed that failure to complete the required CPE by the prescribed deadlines would result in tough penalties for licensees. The investigation and adjudication of complaints process was redesigned in 2001. "Investigations of complaints," the members said, "will include detailed written responses from the licensees specifically addressing all allegations." Three Board members, Harry D. Dickinson, CPA, Barbara S. Pocalyko, CPA, and Jane M. Little, CPA have served on the Board’s Enforcement Committee. They are responsible for review of complaint investigations and for recommending appropriate disciplinary action to the Board.
On June 30, 2004, Ellis M. Dunkum, CPA, and Howard Rogers completed two four year terms on the Board, and Barbara S. Pocalyko, CPA completed a four-year term on the Board. In 2003, Carole Mulzer Hersch, CPA completed two four year terms on the board and Barbara S. Pocalyko, CPA was elected Board Chairman and Harry Dickinson, Ph.D., CPA, was elected Vice Chairman. In 2004, Harry Dickinson, Ph.D., CPA, was elected Chairman and Jane M. Little, CPA was elected Vice Chairman. New Board members were appointed by Governor Mark Warner. O. Whitfield Broome, Ph.D. CPA and Stephen D. Holton, CPA were appointed July 1, 2003 and Regina P. Brayboy, MPA, Dian T. Calderone, MTX, CPA and Lawrence D. Samuel, CPA were appointed on July 1, 2004. Richard B. Zorn, Senior Assistant Attorney General provided legal counsel to the Board in 2003 and Howard T. Macrae, Assistant Attorney General assumed the role in 2004.
The Board has devoted much of its time to the development of the computerization of the Uniform CPA examination. Candidates began taking the new computerized exam, administered in every state, in April 2004. During this biennium, the accounting profession has regained its momentum following close public scrutiny in 2001,amid allegations of serious standards of practice violations by some CPA firms outside the Commonwealth. The Board has been, and continues to be, extremely concerned about the erosion of the public’s confidence in the profession. In 2003, a new statute was enacted requiring two hours of Ethics CPE for all practicing CPAs. During 2003 and 2004, the Board worked diligently in the area of regulatory review to ensure that its standards are at the highest level necessary to adequately protect Virginia’s citizens. These efforts will continue under the leadership of Dr. Dickinson during FY2005.
