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ARIZONA STATE BOARD OF ACCOUNTANCY OPEN SESSION MINUTES

September 26, 2016

Members of the Arizona State Board of Accountancy (Board) held a meeting at the Accountancy Board Office in Suite 165, 100 N. 15th Avenue, Phoenix, Arizona 85007. Executive Sessions were held from 9:12 a.m. to 9:36 a.m. and from 10:09 a.m. to 10:44 a.m.

BOARD MEMBERS: Layne Reid Simmons, CPA ................................................................................ President Douglas N. Kimball ............................................................................................. Secretary

▲ LeRoy M. Gaintner, CPA .................................................................................... Treasurer Giselle C. Alexander, CPA .................................................................................. Member Gary L. Freed ....................................................................................................... Member William C. Heimerdinger, CPA ............................................................................. Member Julie S. Klewer, CPA............................................................................................. Member

▲ Left the meeting at 2:58 p.m.

STAFF PRESENT: Monica L. Petersen .............................................................................. Executive Director Valli Goss ................................................ Assistant Director, Regulation and Compliance Jacki Hancock ......................................... Assistant Director, Registration and Operations John Oyas ........................................................................... Program Project Specialist 2 Christopher Rasmussen ...................................................... Program Project Specialist 2 ASSISTANT ATTORNEY GENERALS: Scott Donald, Esq.................................................................... Assistant Attorney General GUESTS PRESENT AND/ORPARTICIPATING:

Adela E. Jiménez, CPA, CGMA ...................................................COO and CFO, ASCPA David Freeland ....................... Arizona Association of Accounting and Tax Professionals John C. Todd, II, CPA .............................. Chairperson, Law Review Advisory Committee Marion Peterson, CPA ....................................................................................... Registrant George J. Coleman, Esq. ..................................................................................... Attorney Donna Benjamin, CPA ...................................................................................... Registrant Brian Semple, CPA ........................................................................................... Registrant Robert Semple, CPA ......................................................................................... Registrant PJ Pelliccio CPA .............................................................................................. Registrant Lisa Gervase Esq. ................................................................................................ Attorney

ARIZONA STATE BOARD

OF ACCOUNTANCY

100 North 15th Avenue, Suite 165

Phoenix, Arizona 85007

Phone (602) 364-0804

Fax (602) 364-0903

www.azaccountancy.gov

http://www.azaccountancy.gov/

ARIZONA STATE BOARD OF ACCOUNTANCY OPEN SESSION MINUTES September 26, 2016

Edwin Fleming, Esq.............................................................................................. Attorney D. Jay Ryan, Esq.................................................................................................. Attorney

The meeting was called to order at 8:15 a.m. by Layne R. Simmons, Board President. The following order of business was then considered: OPEN SESSION CALL TO THE PUBLIC

David Freeland of the Arizona Association of Accounting and Tax Professionals (AAATP) was present, thanked the Board for allowing him to participate, and requested if he could discuss with the Board agenda item VII.B.1.

DISCUSS, AMEND AND APPROVE MINUTES

Giselle C. Alexander provided recommended changes to the Open Session minutes from the August 25, 2016 meeting. A motion was made by Julie S. Klewer, seconded by Douglas N. Kimball and passed unanimously to approve the August 25, 2016 Open Session minutes, as amended. Giselle C. Alexander provided recommended changes to the Executive Session minutes from the August 25, 2016 meeting. After brief discussion, a motion was made by Douglas N. Kimball, seconded by Julie S. Klewer and passed unanimously to approve the August 25, 2016 Executive Session minutes, as amended.

DECLARATION OF CONFLICTS OF INTEREST LeRoy M. Gaintner declared a conflict on the following Agenda items:

IX.E.1. File No. 2013.031; Semple, Brian

IX.E.2. File No. 2013.032; Semple, Robert

IX.E.3. File No. 2015.020; Semple, Marchal & Cooper, LLP

IX.E.4. File No. 2015.021; Pelliccio, PJ Layne Reid Simmons declared a conflict on the following Agenda items:

VIII.A.1 File No. 2016.169 *

VIII.A.2 File No. 2017.001 *

VIII.A.3 File No. 2017.002 *




IX.E.4. File No. 2015.021; Pelliccio, PJ

* These declarations were declared later on in the meeting.


Gary L. Freed declared a conflict on the following Agenda items:

IX.B.1. File No. 2015.110; Estes, Charles

XIII.I.3. Westergard, Jared Lynn

XIII.K.1. O’Connor, Chris

VIII.B.4. File No. 2016.084

VIII.C.1. File No. 2016.041 Giselle C. Alexander declared a conflict on the following agenda items:

VIII.A.1 File No. 2016.169






IX.E.4. File No. 2015.021; Pelliccio, PJ CONSENT AGENDA

William C. Heimerdinger declared a conflict of interest with the following consent agenda (V) item:

F. Recommendation of the Certification Committee for Approval of Certification by Examination:

12. Heal, Matthew J.

A motion was made by LeRoy M. Gaintner, seconded by Douglas N. Kimball, to approve agenda item V.F.12. The motion passed 6 – 0. William C. Heimerdinger declared a conflict and recused himself from the vote. Gary L. Freed declared a conflict of interest with the following consent agenda (V) items:

D. Recommended for Cancellation of Certificate per Registrant’s Request Not to Renew: 4. Kevin S. McEuen 10572-E

K. Recommended Approval of Retired Status for the Following Registrants: 8. Fischer, Burt K. 10890-R

M. Recommendation of the CPE Advisory Committee for Compliance of the Following Registrants Regarding CPE Audit:

3. Blumenthal, Gilbert Barry 2979-E A motion was made by Douglas N. Kimball, seconded by Julie S. Klewer, to approve agenda items V.D.4, V.K.8, and V.M.3. The motion passed 6 – 0. Gary L. Freed declared a conflict and recused himself from the vote.


A motion was made by Douglas N. Kimball, seconded by LeRoy M. Gaintner, to approve the remainder of the following consent agenda items. The motion passed 7 – 0.

A. Recommended for Registration of Firms for the Following Applicants:

1. A Team, P.C. Partner: Kim-Uyen Thi Le 10402-E 2. Adam T. Cary, CPA PC Partner: Adam T. Cary 11497-E 3. AM CPA & Consulting LLC Partner: Albee Shaun Malaca 17541-R 4. Ferry CPA, PLLC Partner: Valerie A. Ferry 15359-R 5. Legacy CPAs, LLC Partner: Joseph Eugene Ross Jr. 1617-E 6. Michael E. Hendricks, CPA, PLLC Partner: Michael E. Hendricks 8524-R 7. Randall Brookshier CPA, PLLC Partner: Randall L. Brookshier 8003-E 8. SH Financial Services LLC Partner: Susie Herrmann 11505-E

B. Recommended for Firm Name Change: 1. Craig L. Elggren, CPA

From: Craig Elggren, CPA Partner: Craig Lewis Elggren 3268-E

2. Poulsen & Stowell, PLLC From: Poulsen & Company, P.C. Partner: Carter J. Poulsen 2893-E

C. Recommended for Firm Cancellation – Do Not Wish to Renew:

1. Allen, James R., CPA 4115-S 2. Bridges & Dunbar, CPA PLC 2490-L 3. Hunter-Smith, Teri, CPA PLLC 3302-L 4. Jensen, Nickolas C., CPA 5893-S 5. Patterson, David L., CPA 4699-S 6. Pleasant Accounting, PLLC 3530-L

D. Recommended for Cancellation of Certificate Per Registrant’s Request Not to Renew: 1. Andrea W. Bauer 13608-R 2. Harley Christian 1207-E 3. Jennifer L. Youngberg 17936-E 4. Voted on Separately 5. Patricia J. Matusiak 15666-E


E. Recommended for Reissuance of Certificate Because of Name Change: 1. Issued as: Bridgette Leyva 17995-E; New Name: Bridgette Larsen 2. Issued as: Courtney Lane 17525-E; New Name: Courtney Reynolds

F. Recommendation of the Certification Committee for Approval of Certification by

Examination: 1. Bird, Nicole 2. Casperson, David 3. Dow, Meagan L. 4. Durham, Melissa S. 5. Duskin, Daniel 6. Eary, Lydia N. 7. Gavin, Scott Calvin 8. Griffith, Austin J. 9. Grommes, Erica M. 10. Hales, Andrew 11. Harding, Joseph Fredrick

12. Voted on Separately 13. James, Christopher L.

14. Jess, Jack 15. Kenneth, Michael 16. Kerr, Katy Lynn 17. Liu, Xianghui 18. Pryor, Rebecca 19. Sehorn, Sean P. 20. Taylor, Sonia 21. Zhu, Kenneth

G. Recommendation of the Certification Committee for Approval of Certification by

Grade Transfer: 1. Bohmke, Scott 2. Hee, Mary Jane 3. Higham, Andrew T. 4. Kern, Paul F. 5. Srinivasan, Srividhya

H. Recommendation of the Certification Committee for Approval of Certification by Reciprocity: 1. Gorman, Ryan D.

I. Recommendation of the Certification Committee for Approval of Certification by

Reciprocity based on Substantial Equivalency: 1. Andersen, Cody 2. Cavin, Adam L. 3. Clark, Jaime M. 4. Davis, Lori Taylor 5. Felix, Kyle 6. Fickett, Tracy T. 7. Hardcastle, Terra 8. Larsen, James Paul

9. Mertens, Scott G. 10. Olsen, Jeffrey H. 11. Rae, Patrick H. 12. Rosen, Howard M. 13. Veliz, David 14. Weinstein, Robert 15. Williams, Justin David

J. Recommendation of the Certification Committee for Approval of Examination

Candidates for the Uniform CPA Examination:


1. Agarwal, Arzoo 2. Agarwal, Chetan 3. Alvarez Villanueva, Nayeli

Marlen 4. Arora, Jai 5. Arora, Shriya 6. Basinski, Mary 7. Bennett-Gold, Joella Beth 8. Boska, Mark Anthony 9. Brink, Elyse Mckenna 10. Chitukula, Akilesh Reddy 11. Chung, Andrew 12. Corrow, Hannah Dorothy 13. Delaney, Sara Grace 14. Delbrook, Nicholas Thomas 15. Dhar, Anirbhan 16. Dhoka, Piyush

Prakashkumar 17. Dickinson, Jacob Tyler 18. Gemmell, Abbey Leigh 19. Gray, Christian Scott 20. Hedayati, Bijan 21. Henderson, Geoffrey Austin

Todd 22. Hintze, Jeffrey Aaron 23. Hofer, Jay Michael 24. Holden, Carol Joyce 25. Imtiaz, Mohamed Adnan 26. Isaac, Rameel William 27. Jones, Marc Lester 28. Kalra, Priyanka 29. Kandadai, Sripriya

Pudupakkam 30. Kapoor, Shivangi 31. Karkos, Rosanna Mae 32. Kiraka, Hanson Bernard 33. Kluwe, Michel Tristan

34. Kuchynka, Charles Kenneth 35. Liu, Ting-Ju 36. Lloyd, Catherine Anne 37. Longoria, Justin Chevelle 38. Malani, Ronak Kamal Kishor 39. Malhotra, Nikunj 40. Mann, Lincoln Joseph 41. Mason, Courtney Rubio 42. Medrano, Roman Matthew 43. Mekala, Divya Dhanraj 44. Miles, Zhun 45. Morampudi, Rashmi 46. Moran, Madeline Nicole 47. Munjal, Mayank 48. Nagpal, Gagan Deep 49. Pope, Caitlyn Ruth Johnson 50. Prakash, Divya 51. Rajaram, Shyam 52. Roberts, Bryce Joseph 53. Sabbineni, Mani Raja 54. Sanders, Mitchel Jeffrey 55. Sarin, Radhika 56. Senthil, Shibi Chakaravarthi 57. Shah, Virag Rameshkumar 58. Shah, Viral Anilkumar 59. Sharma, Sapna 60. Singh, Sandeep 61. Sundar, Christopher John

Paul 62. Taneja, Mahima 63. Urban, Nicole A. 64. Vijayakumaran, Nikhila 65. Vinaykumar, Thatavarthi 66. Vissering, Jacob Paine 67. Vittappu, Parthasarthy 68. Yang, Heehun 69. Zhang, Nannan

K. Recommended Approval of Retired Status for the Following Registrants: 1. Bauman, Jr., Edward 5099-E 2. Blauvelt, Ronald A. 4543-E 3. Bryant, William Roscoe 1458-E 4. Chard, Richard Lawrence 3180-R 5. Cobler, Walter L. 7743-R 6. Cummiskey, Thomas Emery 3351-E


7. Doane, Laurie S. 8243-E 8. Voted on Separately 9. Hernandez, Rudy Jr 2810-E 10. Jacobs, Nadine A. 6978-E 11. Jacobs, Roberta Daley 2982-E 12. Liem, Henry Albert 1587-E 13. Lum, Kevin H. T. 4806-E 14. May, Connie Stock 5146-E 15. Menaugh, P. Thomas 2252-E 16. Meyers, James A. 5362-R 17. Patterson, David L. 8269-R 18. Philpott, Paula M. 4004-E 19. Prusinowski, Richard J. 2571-E 20. Thomas, Terrell G. 8709-E 21. Waggoner, Martha 9519-E 22. Weissman, Ira J. 9931-R

L. Recommended for Reactivation of Certificate from Inactive Status:

1. Vitagliano, Nina 5414-E 2. Walburn, Collin 11705-E

M. Recommendation of the CPE Advisory Committee for Compliance of the Following

Registrants Regarding CPE Audit: 1. Anderson, Barry Theodore 7191-E 2. Angle, Tyler 16438-E 3. Voted on Separately 4. Fiddler, Eric Peter 8636-E 5. Jenkins, Roger Grant 2565-E 6. Lemaitre III, Joseph Francis 6018-E 7. Marincovich, Geoff 17469-R 8. Mendoza, German 17557-E 9. Miller, Matthew H. 8423-E 10. Nixon, Lynn R. 14633-R 11. Pike, Cynthia Lynn 8884-E 12. Stevens, Martha Barba 12927-E 13. Veldhuizen, Christine R. 7316-E 14. Wallace, R. David 11935-R

N. Recommendation of the CPE Advisory Committee for Compliance Regarding Request for Reinstatement from Expired Status: 1. Luczu, Scott Preston 9702-E 2. Theobald, Shayne P. 10155-E


ITEMS FOR REVIEW, DISCUSSION AND POSSIBLE ACTION INCLUDING DISCIPLINARY ACTION

Compliance/Non-Compliance with Firm Qualifications File No. 2017.019; Peterson MG, Consulting, PLC The Board Members (Members), Assistant Attorney General (AAG), and Staff (Staff) introduced themselves to the Registrant and his legal counsel, George J. Coleman. Mr. Coleman addressed the Board and provided a background of the situations that led to the current matters that is on the Board’s agenda regarding this file. Monica L. Petersen, Executive Director, provided clarification regarding the CPE required for the suspension. Further, she clarified that the Decision and Order (By Consent) that was offered to the Registrant was not based exclusively on the CPE, but also on the suspension for failure to complete CPE, which resulted in his certificate not being in good standing. A discussion ensued amongst the Members, Staff, and the Registrant’s legal counsel to further clarify the matters at hand. A motion was made by Douglas N. Kimball that the Board offer the Respondent Firm a revised Decision and Order (By Consent) for an administrative penalty of $100.00 per week for each week the Respondent Firm was in violation of firm qualification requirements under A.R.S. § 32-731(A)(l), due to the suspension of partner-in-charge Marion G. Peterson, which totaled $2,000.00, the maximum fine allowable for each offense. Additionally, the Registrant would be required to pay the administrative penalty within 30 days. Discussion occurred amongst the Members, Staff, and the Registrant’s legal counsel regarding the proposed motion. The motion died for a lack of a second. Gary L. Freed suggested the possibility of reducing the administrative penalty to $1,000.00 due to extenuating circumstances related to the passing of a family member. A motion was made by Douglas N. Kimball, seconded by Julie S. Klewer, that the Board offer the Respondent Firm a revised Decision and Order (By Consent) for an administrative penalty of $1,000.00, due to extenuating circumstances related to the passing of a family member. The motion passed unanimously. Discussion briefly ensured amongst the Members, Staff, and the Registrant’s legal counsel regarding A.R.S. § 32-742.

LEADERSHIP REPORT Assistant Director – Regulation and Compliance Update Update on Tiffany White and Tiffany White, CPA, PLC Matters File No. 2015.099; White, Tiffany File No. 2015.100; White, Tiffany File No. 2016.042; White, Tiffany File No. 2016.043; White, Tiffany


File No. 2016.075; White, Tiffany File No. 2016.076; White, Tiffany File No. 2016.077; White, Tiffany File No. 2016.105; White, Tiffany, CPA, PLC David Freeland asked the Board for clarification regarding the aformentioned files. Valli Goss shared that Staff received a letter from Tiffany White that had been deemed as a request for rehearing, and provided details of procedures of the matter. Discussion briefly ensued amongst Staff and Members regarding the restitution clause of the revocation order. Ms. Goss noted that after revocation, should there be any other new complaints against the Respondent, they will be retained in compliance with the Board’s records retention policies.


Request for a CPE Waiver/Extension/Exemption and/or Fee Waiver CPE Extension(s) Benjamin, Donna Marie 2344-E Donna Benjamin thanked Staff for helping her facilitate her request and provided that she has completed all the CPE for the prior two years. Jacki Hancock provided further details of the background of the request for CPE extension. A motion was by Gary L. Freed, seconded by Douglas N. Kimball, to grant the CPE extension for good cause, due to illness. The motion passed unanimously. Ms. Benjamin attempted to provide further information regarding Tiffany White, but was informed that the matter was not properly agendized for discussion.

COMMITTEE RECOMMENDATIONS – INVESTIGATION FILES/INITIAL ANALYSIS FILES

File No. 2013.031; Semple, Brian File No. 2013.032; Semple, Robert File No. 2015.020; Semple, Marchal & Cooper, LLP File No. 2015.021; Pelliccio, PJ Giselle C. Alexander, Layne R. Simmons and LeRoy M. Gaintner declared a conflict regarding the files and left the meeting room. Lisa Gervase, D. Jay Ryan, and Edwin Fleming, legal counsel for the Registrants, were present in relation to the files. Ms. Gervase provided an opening statement for the Board and requested that the reimbursement of investigative costs be focused solely on the Decisions and Orders (By Consent) related to Robert Semple and the firm, and not Brian Semple. Gary L. Freed stated that given that the CPAs are employed by the firm and these activities were done through the firm, perhaps placing the reimbursement of investigative costs on the firm file, File No. 2015.020, would be more appropriate. Ms. Gervase concurred. Mr. Freed requested that the Board go into executive session for legal advice.

EXECUTIVE SESSION


A motion was made by Gary L. Freed, seconded by Julie S. Klewer, to go in to executive session at 9:12 a.m. to obtain legal advice from the AAG, pursuant to A.R.S. § 38-431.03(A)(3), regarding File Nos. 2013.031; Semple, Brian, 2013.032; Semple, Robert, 2015.020; Semple, Marchal & Cooper, LLP, and 2015.021; Pelliccio, PJ. The motion passed 4 – 0. Layne R. Simmons, LeRoy M. Gaintner, and Giselle C. Alexander were not present during this executive session. After consideration in executive session, the Board reconvened in open session 9:36 a.m.

OPEN SESSION COMMITTEE RECOMMENDATIONS – INVESTIGATION FILES/INITIAL ANALYSIS FILES

Tax Advisory Committee File No. 2013.031; Semple, Brian File No. 2013.032; Semple, Robert File No. 2015.020; Semple, Marchal & Cooper, LLP File No. 2015.021; Pelliccio, PJ Douglas N. Kimball summarized the facts regarding the aforementioned files, and noted that there was a sanction by the federal bankruptcy judge against the firm, and that the declaration that predicated that sanction was signed by Robert Semple. Further, Mr. Kimball stated that when Registrants in other matters have omitted facts or stated misleading facts, the Board has consistently suspended them. After a brief discussion, the Members decided to have separate motions regarding the particular files. The motions were as follows: File No. 2013.031; Semple, Brian A motion was made by Douglas N. Kimball, seconded by Julie S. Klewer, to approve the Tax Committee's recommendation to offer the Decision and Order (By Consent) as amended for failure to timely respond under A.R.S. § 32-741(A)(15) with the Tax Committee's recommended $600.00 administrative penalty, and to direct Staff to amend the Decision and Order (By Consent) to remove the reimbursement of costs section. The motion passed 4 – 0. Giselle C. Alexander, Layne R. Simmons, and LeRoy M. Gaintner were conflicted and recused themselves from the vote. A motion was made by Julie S. Klewer, seconded by Douglas N. Kimball, to accept and issue the Tax Committee’s recommended Administrative Letter of Concern as drafted. The motion passed 4 - 0. Giselle C. Alexander, Layne R. Simmons, and LeRoy M. Gaintner were conflicted and recused themselves from the vote.


File No. 2013.032; Semple, Robert A motion was made by Douglas N. Kimball, seconded by William C. Heimerdinger, to offer a Decision and Order (By Consent) as amended for failure to timely respond under A.R.S. § 32-741(A)(15), and for dishonesty and discreditable acts, for a suspension of up to one year, completion of eight hours of live ethics classes by the end of the suspension period, a $600.00 administrative penalty, deletion of the reimbursement of costs section, with early termination of the suspension if the provisions have been completed. The motion passed 4 – 0. Giselle C. Alexander, Layne R. Simmons, and LeRoy M. Gaintner were conflicted and recused themselves from the vote. A motion was made by Gary L. Freed, seconded by Julie S. Klewer, to accept and issue the Tax Committee’s recommended Letter of Concern, as drafted. The motion passed 4 – 0.

File No. 2015.020; Semple, Marchal & Cooper, LLP A motion was made Gary L. Freed to offer an amended Decision and Order (By Consent) for suspension of the firm’s registration for up to one year pending the payment of an administrative penalty of $2,000.00, and 100% reimbursement of Board costs, along with an additional 8 hours of live CPE for all CPAs and individuals working under a CPA within the firm. Such suspension could be terminated early, once the provisions of the Decision and Order (By Consent) are completed. The motion died for a lack of a second. A motion was made by Douglas N. Kimball to offer an amended Decision and Order (By Consent) with 100% of reimbursement of Board costs being placed on the firm. The motion died for a lack of a second. A motion was made by Julie S. Klewer, seconded by Douglas N. Kimball, to offer an amended Decision and Order (By Consent) for suspension of the firm’s registration for up to one year, reimbursement of 100% of the Board’s fees and costs, and a $600.00 administrative penalty, with an early termination provision allowing for termination of the suspension upon payment of the penalty and fees and costs. The motion passed 3 – 1. Gary L. Freed voted nay. Giselle C. Alexander, Layne R. Simmons, and LeRoy M. Gaintner were conflicted and recused themselves from the vote. Discussion briefly ensued amongst Members, Staff, and the AAG regarding what number of votes were necessary for the motion to pass.


The Board recessed from 9:57 a.m. – 10:02 a.m. Scott Donald confirmed that a vote 3 – 1 would allow the motion to pass. A motion was made by Gary L. Freed, seconded by Julie S. Klewer, to accept and issue the Tax Committee’s recommended Administrative Letter of Concern, as drafted. The motion passed 4 – 0. Giselle C. Alexander, Layne R. Simmons, and LeRoy M. Gaintner were conflicted and recused themselves from the vote. File No. 2015.021; Pelliccio, PJ A motion was made by Gary L. Freed, seconded by William C. Heimerdinger, to accept and issue the Tax Committee’s recommended Administrative Letter of Concern as drafted. The motion passed 4 – 0. Giselle C. Alexander, Layne R. Simmons, and LeRoy M. Gaintner were conflicted and recused themselves from the vote.

COMMITTEE RECOMMENDATIONS – COMPLAINT/INITIAL ANALYSIS FILES

Accounting and Auditing Advisory Committee File No. 2016.169 File No. 2017.001 File No. 2017.002

A motion was made by Julie S. Klewer, seconded by William C. Heimerdinger, to accept the A&A Committee’s recommendations to close the initial analysis files due to no violations of professional standards. The motion passed 5 – 0. Giselle C. Alexander and Layne R. Simmons were conflicted and recused themselves from the vote.

ATTORNEY GENERAL’S REPORT EXECUTIVE SESSION

A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, to go into executive session at 10:09 a.m. to obtain legal advice regarding agenda item VI, pursuant to A.R.S. § 38-431.03(A)(3).

After consideration in executive session, the Board reconvened in open session at 10:44 a.m.

OPEN SESSION



Emergency Rulemaking and Board Policy Regarding A.A.C. R4-1-455.03(D) (1) and R4-1-454 LeRoy M. Gaintner asked for clarification regarding the language that was recommended by the AAG to reflect the needed changes in Rule. Monica L. Petersen provided that the change would be a repeal of A.A.C. R4-1-455.03(D)(1), and that the Board may also need to consider revising the peer review rule. A motion was made by LeRoy M. Gaintner, seconded by William C. Heimerdinger, to repeal A.A.C. R4-1-455.03(D)(1) and to direct Staff to draft language to amend R4-1-454, in conjunction with direction from the AAG, which might be affected by the aforementioned rescindment. The motion passed unanimously. Layne R. Simmons requested that Monica L. Petersen work with the ASCPA regarding this matter. Ms. Petersen agreed that once the proper steps are taken, she would collaborate with the ASCPA to communicate the matter. Scott Donald recommended that the Board also consider making a motion directing Staff to perform their duties in conformity with the most recent motion. A motion was made by LeRoy M. Gaintner, seconded by Gary L. Freed, to direct Staff to perform their duties in conformity with the most recent motion. The motion passed unanimously.

Law Review Committee Update and Board Direction Uniform Accountancy Act Retired Status AICPA/NASBA Statement of Standards for CPE Programs Chartered Global Management Accountant (CGMA) Designation Law Review Committee Chairperson John C. Todd, II stated that the Law Review Committee is seeking advice and recommendation regarding the direction it should take regarding agenda items XIII.B.2-4. Layne R. Simmons stated that the Board should develop a consensus on whether the Board would like the Law Review Committee to review the aforementioned topics. After a brief discussion, there was a general consensus amongst the Board that the Law Review Committee should not review the topic of the Uniform Accountancy Act Retired Status. After brief discussion, there was a general consensus amongst the Board that the Law Review Committee should review the topic of the American Institute of Certified Public Accountants (AICPA)/National Association of State Boards of Accountancy (NASBA) Statement of Standards for CPE Programs.


After brief discussion, there was a general consensus amongst the Board that the Law Review Committee should review the topic of the Chartered Global Management Accountant (CGMA) Designation. Law Review Committee Update and Board Direction Firm Registration John C. Todd, II provided a summary of the matter of firm registration and further provided a historical background on what the Committee has discussed regarding the matter. Mr. Todd stated that the Committee reaffirms its position that the Board regulates the designation and not the practice of accounting. Mr. Todd provided a brief summary of the September 14, 2016 Committee meeting. Mr. Todd reiterated that he is before the Board so that they may accept the Committee’s recommendation or provide the Committee alternate direction before they proceed. Discussion ensued amongst Members, Staff, and Mr. Todd regarding the topic of firm registration. A motion was made by Layne R. Simmons, seconded by Douglas N. Kimball to have the Law Review Committee look further into the topic of firm registration. The motion passed unanimously.

LEADERSHIP REPORT Executive Director Update Budget Update Agency Operations Monica L. Petersen stated that she had provided information regarding the matters in the Board packet and that she would be happy to answer questions regarding the reports if Members had any questions. No questions were asked by the Board at this time. Systems Manager Update Monica L. Petersen stated that the Systems Manager would be available to answer any questions if the Board had any. No questions were asked by the Board at this time.

COMMITTEE RECOMMENDATIONS – COMPLAINT/INITIAL ANALYSIS FILES

Tax Advisory Committee File No. 2016.119 File No. 2016.120 After brief discussion, a motion was made by LeRoy M. Gaintner, seconded by Julie S. Klewer, to accept the Committee’s recommendation to close the initial analysis files due to no violations of professional standards. The motion passed unanimously.

Accounting and Auditing Advisory Committee File No. 2017.047 A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, to accept the Committee’s recommendation to open the investigation file. The motion passed unanimously.


Tax Advisory Committee File No. 2016.084 A motion was made by Julie S. Klewer, seconded by Douglas N. Kimball, to accept the Committee’s recommendation to open the investigation file on File No. 2016.084. The motion passed 6 – 0. Gary L. Freed declared a conflict and recused himself from the vote. File Nos. 2016.069 and 2016.164 File Nos. 2016.070 and 2016.165 File Nos. 2016.108 and 2016.109 File Nos. 2017.020 and 2017.021 A motion was made by LeRoy M. Gaintner, seconded by Gary L. Freed, to accept the Committee’s recommendation to open the investigation files. The motion passed unanimously. File No. 2017.045 A discussion between the Board Members and the AAG ensued regarding the proper procedural process in taking action on the following files. A motion was made by LeRoy M. Gaintner, seconded by Gary L. Freed, to open the investigation file. The motion passed unanimously.

File No. 2016.044; Wengert, Trace File No. 2016.045; Wengert, Trace, CPA, PLLC File No. 2017.045 A motion was made by Gary L. Freed, seconded by William C. Heimerdinger, to direct the AAG to file a Complaint and Notice of Hearing for revocation against Trace Wengert (File No. 2016.044) for violations of Arizona Administrative Code (A.A.C.) R4-1-455(B), R4-1-455(B)(2)(e), R4-1-455.03(A), and R4-1- 455.03(D)(1); file a Complaint and Notice of Hearing for revocation against his currently registered firm, Trace Wengert CPA (File No. 2017.045), since if Mr. Wengert’s certificate is revoked, the firm will no longer meet qualifications under A.R.S. §§ 32-742(A) and 32-731(A)(1); and direct the AAG to file an injunction against Trace Wengert and against the expired firm, Trace Wengert CPA, PLLC, for unlawful use of the designation under A.R.S. § 32-747. Additionally, to direct the AAG that if Mr. Wengert provides adequate written assurances in writing by October 19, 2016 that he is no longer using the expired firm’s name, that no injunction lawsuit will be filed. The motion passed unanimously.

File No. 2016.041 LeRoy M. Gaintner provided a minor technical correction to the draft Administrative Letter of Concern.


A motion was made by LeRoy M. Gaintner, seconded by Julie S. Klewer, to direct Staff to amend the Administrative Letter of Concern to reflect the minor technical change as discussed and to issue it as amended. The motion passed 6 – 0. Gary L. Freed declared a conflict and recused himself from the vote.

COMMITTEE RECOMMENDATIONS – INVESTIGATION FILES/INITIAL ANALYSIS FILES

Tax Advisory Committee File No. 2016.145; Koivisto, Ryan A motion was made by Julie S. Klewer, seconded by William C. Heimerdinger, to accept the Committee’s recommendation to close the investigation file due to no violations of professional standards. The motion passed 7 – 0. Accounting and Auditing Advisory Committee. File No. 2015.110; Estes, Charles A motion was made by LeRoy M. Gaintner, seconded by William C. Heimerdinger, to accept the Committee’s recommendation to issue the Decision and Order (By Consent) due to a violation of A.R.S. § 32-741(A)(9)(violation of Board rules), specifically as it relates to Respondent’s failure to comply with applicable AICPA professional standards, ET Section 501 (Acts Discreditable) and Interpretation 501-4 (Negligence), incorporated in the Board’s rules at A.A.C. R4-1-455.01(H) and A.A.C. R4-1-455.04. The motion passed 6 – 0. Gary L. Freed declared a conflict and recused himself from the vote. File No. 2016.127; Scott, Kenneth The Board reviewed a letter that was sent by the Registrant to Staff. A discussion ensued amongst the Board regarding the letter. Layne R. Simmons suggested a wording change on the Decision and Order (By Consent). A motion was made by Layne R. Simmons to offer the Decision and Order (By Consent) with changes to the practice restriction section that states that the Registrant will not be able to sign and issue audits, compilations, review, and financial preparation statements for period of three years. With regards to pre-issuance peer review, the Registrant would not be able to sign and issue any audits, compilations review, and financial preparation statements without the peer review restrictions. The motion died for a lack of a second. A motion was made by William C. Heimerdinger, seconded by Douglas N. Kimball, to direct Staff to amend the Decision and Order (By Consent), under the practice restriction, to state that the Registrant shall be prohibited from signing and issuing audit opinions for a minimum period of three years and to modify the CPE provisions accordingly. The motion passed unanimously.


Tax Advisory Committee File No. 2016.039; Lange, Sylvin A motion was made by Gary L. Freed, seconded by Julie S. Klewer, to accept the Committee’s recommendation to direct the Assistant Attorney General to file a Complaint and Notice of Hearing due to violations of A.A.C. R4-1- 455.01(G) and R4-1-455.03(A), and to direct Staff to notify the Internal Revenue Service (IRS) Office of Professional Responsibility. The motion passed unanimously.

COMMITTEE RECOMMENDATIONS – PEER REVIEW

File No. 2016.158; Bear, Teresa, CPA Staff noted that it has not been confirmed if the sole practitioner firm performs attestation or not. LeRoy M. Gaintner stated that there appears to be many concerns and inquired as to further action that could be taken. LeRoy M. Gaintner noted that he would like to place on the Board’s agenda for a future agenda item for discussion of EERs and its specific rule. A motion was made by Gary L. Freed, seconded by LeRoy M. Gaintner to defer the file and to have Staff further research the matter. The motion passed unanimously. File No. 2017.022; Fiszbein, Michael D., CPA, P.C. File No. 2017.023; Crance, Janet L., P.C. File No. 2017.035; Century Small Business Solutions & Tax Svcs, PC File No. 2017.036; Levidow, Lloyd J., CPA, PC A motion was made by LeRoy M. Gaintner, seconded by Gary L. Freed, to approve the Administrative Letters of Concern as drafted. The motion passed unanimously. File No. 2017.037; Yocum, Sunny J., P.C. William C. Heimerdinger stated that there may be some inconsistencies with the last sentence on Item #3 of the LOC. Members briefly discussed technical corrections. A motion was made by William C. Heimerdinger, seconded by Julie S. Klewer, to direct Staff to amend the Administrative Letter of Concern by omitting the last sentence on Item #3 and issue it. The motion passed unanimously.

ALLEGED UNLAWFUL USE OF DESIGNATION

File No. 2016.142 Christopher Rasmussen provided a summary of the matter to the Board. A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, to close the file. The motion passed unanimously.

The Board recessed from 12:02 p.m. to 12:30 p.m.



HB 2613 – Arizona Department of Administration (ADOA) Non-Health Regulatory Board Licensing Study Monica L. Petersen stated that there were technical shortcomings in the study. Ms. Petersen stated that, given Staff’s increased quality in output, the recommendations made by the study would set back much progress already accomplished, and that such recommendations, if implemented, may adversely affect business processes and outcomes. Ms. Petersen noted that she has been given advice by the Governor’s Office to write a response to the Legislature. A discussion amongst the Board ensued regarding the actions that the Board may take. The Board provided direction to Staff to write a letter to the Governor applauding his efforts, and outlining the concerns that the Board has. Julie S. Klewer stated that she agrees with the action since the discussion is still in its preliminary stages. Layne R. Simmons requested that an outline of the response be provided to the Board at the November meeting and that the actual draft response be provided to the Board at its December meeting.

Board to Review and Consider CPE Audit Extension Request and Possible Disciplinary Action File No. 2017.029 Valli Goss provided a background and summary of the file, noting that the Registrant did not report the felony convictions to the Board on his renewal application form, that he is incarcerated in state prison currently, and that there were discrepancies on his form and in information the Registrant and his power of attorney provided to the Board about the reason for the Registrant’s failure to timely complete his CPE audit, and that the Registrant had not disclosed to the Board that the reason for his inability to timely complete his CPE audit is because he is in prison. Ms. Goss clarified that the Registrant should not be disciplined because of the reason why he is incarcerated, but that the concern is whether the Registrant was trying to conceal information from or mislead the Board. Julie S. Klewer expressed hesitation to impose revocation right away given the Registrant’s indication that he is in rehabilitation, and noted that a suspension may be preferable due to various unknown variables. A discussion ensued amongst the Board and Staff regarding the possible actions that the Board could take regarding the file. A motion was made by Gary L. Freed to offer a Decision and Order (By Consent) for suspension for one year with possible early termination if he completes his CPE audit and to require that the Registrant go in front of the Board to explain why the Board should take him off suspension. The motion died for a lack of a second. A motion was made by Gary L. Freed, seconded by Julie S. Klewer, to suspend the Registrant’s certificate for one year for failure to comply with the CPE audit and acts discreditable for failure to disclose a felony within 30 days and to impose an administrative penalty of $1,000.00 with possible early termination of suspension once he completes all of the Decision and Order (By Consent) provisions. The motion passed unanimously.


Rescind July 11, 2016 Board Motion to Offer Registrant Decision & Order (By Consent) for Revocation DBD Consulting Company LTD 1281 Jacki Hancock provided a brief background on the matter. A motion was made by Gary L. Freed, seconded by LeRoy M. Gaintner, that the Board rescind their previous motion to offer a Decision and Order (By Consent) for revocation. The motion passed unanimously.

G & S Certified Public Accountant, LLC 3019 Jacki Hancock provided a brief background on the matter. A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, that the Board rescind the previous motion to offer a Decision and Order (By Consent) for revocation. The motion passed unanimously. Board to Review Compliance or Non-Compliance with Decision and Order (By Consent) File Nos. 2015.074; Renberg, Mark and 2015.094; Renberg, Mark LeRoy M. Gaintner stated that revocation is too harsh, when the Registrant is trying to comply. After brief discussion, a motion was made by Gary L. Freed, seconded by Douglas N. Kimball, to direct the AAG to file a Complaint and Notice of Hearing for Revocation of the Registrant's certificate pursuant to A.R.S. § 32-741(A)(9) for non-compliance with the January 2016 Decision and Order (By Consent), by failing to provide proof to the Board that the Registrant asked the complainants for the dollar amounts he owed them for restitution, and for failing to provide proof that he has, in fact, paid any restitution. The motion passed 4 – 3. William C. Heimerdinger, Julie S. Klewer and LeRoy M. Gaintner voted nay.

Response/Non-Response to Offered Decision and Order (By Consent) File No. 2017.008; O’Brien, Joseph Jacki Hancock provided the Committee an addendum, which the Registrant has sent to the Board for to provide further information, and also provided the Board a historical background of the file. A motion was made by LeRoy M. Gaintner, seconded by Julie S. Klewer, to grant the Registrant’s request for an exemption of the remaining 64 hours of CPE in the form of a Decision and Order (By Consent) to include voluntary relinquishment of his certificate effective December 31, 2016. The motion passed 5 – 2. Giselle C. Alexander and Gary L. Freed voted nay.


File No. 2017.010; Charvoz, Charles Monica L. Petersen informed the Board on how Staff calculated the administrative penalty on the Decision and Order (By Consent) and that the nature of the file may create precedent in the future for how administrative penalties are calculated. A motion was made by LeRoy M. Gaintner, seconded by Gary L. Freed, for the Board to offer the Respondent a Decision and Order (By Consent) with an administrative penalty of $100.00 per week for each week that the Respondent was in violation of CPE requirements under A.R.S. § 32-741(A)(9) and A.A.C. R4-1- 453(C), which totaled $100.00. The motion passed unanimously. File No. 2017.014; Muratore, Charles A motion was made by LeRoy M. Gaintner, seconded by Douglas N. Kimball, that the Board offers a revised Decision and Order (By Consent) which reduces the administrative penalty to $500.00 for failure to timely respond, pursuant to R4-1-455.03(F) and A.R.S. § 32-741(A)(9). The motion passed 6 – 0.

William C. Heimerdinger was not present for the vote.

Compliance/Non-Compliance with Firm Qualifications File No. 2017.017; O’Shea Accounting Services, PLC A motion was made by Gary L. Freed, seconded by LeRoy M. Gaintner, that the Board rescind their July 11, 2016, motion to offer the Registrant Firm a Decision and Order (By Consent) for revocation, because the firm qualification issue under A.R.S. § 32-742(A) has now been cured by the partner-in-charge's renewal of her individual certificate. Further, the Board motioned to offer the Respondent Firm a revised Decision and Order (By Consent) for an administrative penalty of $100.00 per week for each week the Respondent Firm was in violation of the firm qualification requirements under A.R.S. § 32-731(A)(l), for a maximum penalty of $2,000.00, due to the suspension of partner-in-charge, Jill O'Shea; but that the administrative penalty be reduced to $1000.00 for this matter, to better align with the penalty motioned for another firm that was similarly-situated. The motion passed 4 – 2. Julie S. Klewer and Douglas N. Kimball voted nay. William C. Heimerdinger was not present for the vote.

Application to Sit for the Uniform CPA Examination, Recommended Denial by Certification Committee Krishnan, Jailaxmi Siameja, Chilufya


After brief discussion, a motion was made by Gary L. Freed, seconded by Julie S. Klewer, to accept the Certification Committee’s recommendation to deny the individuals’ application to sit for the Uniform CPA Examination. The motion passed unanimously.

A discussion amongst the Board and Staff ensued regarding the background for agenda item XIII.I.2.

Westergard, Jared Lynn A motion was made by Julie S. Klewer, seconded by Douglas N. Kimball, to accept the Certification Committee’s recommendation to deny the individual’s application to sit for the Uniform CPA Examination. The motion passed 6 – 0. Gary L. Freed declared a conflict and recused himself from the vote. Application for Certification by Exam/Grade Transfer, Recommended Denial by Certification Committee Brennan Jr., Barry F. Cilwa, Rachel Cole, Mark Davidson, Kevin Hunter, Wesley Marshall Munn, Brady A motion was made by Julie S. Klewer, seconded by William C. Heimerdinger, that the Board accept the Certification Committee’s recommendation for denial and allow the Executive Director or Assistant Director to conduct a settlement conference, if requested by the applicants. The motion passed unanimously. LeRoy M. Gaintner asked what happens at a settlement conference. Monica L. Petersen stated that Staff will review the files again and try to air out any disagreements.

Birtcher, Justin B. Layne R. Simmons stated that the applicant has provided additional information regarding the application and that Staff has recommended that the matter be remanded back to the Committee. A motion was made by Layne R. Simmons, seconded by Gary L. Freed, to remand agenda item XIII.J.1 back to the Certification Committee for a recommendation as more information has been supplied by Mr. Birtcher. The motion passed unanimously. Miller, Michael J. Gary L. Freed noted that if a course is entitled Accounting Ethics, it is understandable that a significant portion of that class is not specifically regarding accounting, but a large chunk of it may be, and expressed that it should be accepted as an accounting course, rather than a related course. Jacki Hancock provided a historical background of requests of similar nature


and noted that A.R.S. 32-701(25)(k) specifically identifies “Ethics” as a related course, which the Certification Committee has interpreted as including any Ethics course. A motion was made by Gary L. Freed, seconded by LeRoy M. Gaintner, to accept the Accounting Ethics class as an accounting course, rather than a related course, which would grant the Applicant enough credits for certification. The motion failed 3 – 4. Julie S. Klewer, Douglas N. Kimball, William C. Heimerdinger and Layne Reid Simmons voted nay. A motion was made by, Julie S. Klewer seconded by Douglas N. Kimball that the Board accept the Certification Committee's recommendation for denial. The motion passed 4 – 3. Giselle C. Alexander, LeRoy M. Gaintner, and Gary L. Freed voted nay. Application for Certification by Exam/Grade Transfer, Deferral to Board by Certification Committee O’Connor, Chris A motion was made by LeRoy M. Gaintner, seconded by Julie S. Klewer, to accept the Certification Committee's recommendation for approval, pursuant to A.R.S. § 32-721(A)(4). The motion passed 6 – 0. Gary L. Freed declared a conflict and recused himself from the vote. Application for Certification by Reciprocity, Recommended Denial by Certification Committee Schertz, Amie M. After a brief discussion, a motion was made by Layne R. Simmons, seconded by Douglas N. Kimball, that the Board accept the Certification Committee's recommendation for denial. The motion passed 7 - 0. Request for Inactive Status Adams, Tawni M. 11821-E Ballard, Shawn A. 11215-E Barrieault, Shayne E. 11295-E Benham, Brent A. 11817-E Brandstrom, Sharalyn M. 11895-E Burke, Jason D. 12184-R Chirico, Abigail J. 10370-E Denton, Mary Lee 13937-E Eutsler, Jared 15537-E Foster, Michael James 4034-E Gilmore, Bernadine L. 7698-E Jensen, Nickolas C. 15117-E Kersh, Mary Jo 5706-E Kramer, Mary C. 12789-E

ARIZONA STATE BOARD OF ACCOUNTANCY MEETING MINUTES September 26, 2016

Lavelle, Matthew S. 10459-E Martens, Megan A. 11394-E Martin, John N. 14797-E May, Donald Fredrick 5543-E McDonald, Camille A. 16016-E Nelson, Tanya M. 9237-E Ortiz, Daniel 8931-E Quintero, Jr., Felipe G. 6479-E Rendell, Stacy A. 12457-E Schmeling, Rayanna Marie 12925-E Scott, Christa Lynn 14729-E Trottier, Steven C. 10310-E Wander, Melissa 10468-E A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, to approve the aforementioned Registrants for inactive status. The motion passed unanimously. Baughman, Jon Raymond 566-E A motion was made by Douglas N. Kimball, seconded by Gary L. Freed, to approve the aforementioned Registrant for inactive status. The motion passed unanimously. Julie S. Klewer clarified to the Board that the Registrant has been living in Oklahoma for many years now. Gary L. Freed expressed that he is in favor of granting inactive status and not opening any compliance file. Davison, Dale L. 3238-E Gary L. Freed expressed that he believes that those who teach accounting should have an active CPA status. A motion was made by Julie S. Klewer, seconded by Douglas N. Kimball, to approve the aforementioned Registrant for inactive status. The motion passed 6 – 1. Gary L. Freed voted nay. Hughes, Lisa 8979-E A motion was made by LeRoy M. Gaintner, seconded by William C. Heimerdinger, to approve the aforementioned Registrant for inactive status for the 2014-2016 and 2016-2018 renewal periods. The motion passed unanimously. Watkins, Larry E. 2240-R Gary L. Freed expressed that he believes that those who teach accounting should have an active CPA status. A motion was made by Julie S. Klewer, seconded by William C. Heimerdinger, to approve the aforementioned Registrant for inactive status. The motion passed 6 – 1.


Gary L. Freed voted nay. Request for a CPE Waiver/Extension/Exemption and/or Fee Waiver CPE Extension(s) Heath, Holly A. 17764-R A motion was made by Gary L. Freed, seconded by Julie S. Klewer, that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed with a formal hearing. The motion passed unanimously. Hunter-Smith, Teri L. 9509-E A motion was made by Gary L. Freed, seconded by Julie S. Klewer, that the that the Registrant 's request for a CPE Extension be denied for failure to show good cause, and that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed with a formal hearing. The motion passed unanimously. Nguyen, Bichloan Thanh 16528-R LeRoy M. Gaintner stated that HE recommends approval of the extension request for good cause, but he defers to the Board to determine the appropriate length of time for the extension. A motion was made by LeRoy M. Gaintner, seconded by Gary L. Freed, to approve the Registrant’s Request for a CPE extension for good cause to December 31, 2016. The motion passed unanimously. Song, Laureen G. 4917-E A motion was made by Gary L. Freed, seconded by Julie S. Klewer, to approve of the extension request to October 31, 2016 for good cause. The motion passed unanimously. Spear, James Randall 7411-R Jacki Hancock provided that the Registrant had submitted further information regarding his CPE and it was completed on the September 19, 2016, and further clarified that this agenda item is for a request for an extension. A motion was made by Gary L. Freed that the Registrant 's request for a CPE extension be denied for failure to show good cause, and that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE. Discussion ensued amongst the Members and a second was not provided to Mr. Freed’s motion. Layne R. Simmons advised that the motion would be inappropriate since the CPE has been completed. A discussion amongst the Board and Staff to clarify the technicalities of taking further possible action.


A motion was made by Gary L. Freed that the Registrant 's request for a CPE extension be denied for failure to show good cause, and that the Registrant be offered a Decision & Order (By Consent) that includes a $300.00 civil penalty, that includes an indication that they understood that their license was on suspension until they cured the suspension. If not accepted by the Registrant within 30 days, for the Board to proceed with a formal hearing. Discussion ensued amongst the Members. A second was not provided to Mr. Freed’s motion. Further discussion ensued amongst the Members and Staff regarding the CPE extension process and the components of a Decision and Order (By Consent) for suspension for non-compliance with CPE requirements. A motion was made by Layne R. Simmons, seconded by Douglas N. Kimball, to deny the CPE Extension request and offer a Decision and Order (By Consent) with an administrative penalty of $300.00, due to late compliance with CPE requirements, to be paid within 30 days. The motion passed 4 – 3. Giselle C. Alexander, Gary L. Freed, and LeRoy M. Gaintner voted nay. Wexler, Laurence Victor 1023-E A motion was made by, Gary L. Freed, seconded by LeRoy M. Gaintner, to retroactively approve the Registrant 's request for a third CPE extension, due to good cause. The motion passed unanimously. LeRoy M. Gaintner left the meeting at 2:58 p.m. The Board recessed from 2:58 p.m. to 3:03 p.m. CPE Exemption(s) Merkatz, Philip S. 830-R A motion was made by Gary L. Freed, seconded by Giselle C. Alexander, that the CPE exemption request be denied, as the Registrant is actively providing accounting services to the public; and, pursuant to A.R.S. § 32-703, the primary duty of the Board is to protect the public, which is supported through the continuing professional education requirements, and that a CPE extension of 120 days be granted, rather than the more generally applied standard of 60 days, as the Registrant's current medical condition does give evidence of good cause and appears to be a significant barrier to completing CPE. The motion passed 6 – 0. Tellez, Jennifer D. 10803-E A motion was made by Gary L. Freed, seconded by Giselle C. Alexander, that the CPE exemption request be denied, as the Registrant is actively providing accounting services to the public; and, pursuant to A.R.S. § 32- 703, the primary duty of the Board is to protect the public, which is supported through the continuing professional education requirements, and that a CPE extension of 120 days be granted for a period longer than the more generally applied standard of 60 days, as the Registrant's current medical condition has not yet allowed her to return to work, per the physician statement. The motion passed 6 – 0.


Review of Compliance/Non-Compliance with Peer Review Requirements Allis, John III, CPA, P.C. 6-C A motion was made by Julie S. Klewer, seconded by Douglas N. Kimball, that the Board accept the Peer Review Oversight Advisory Committee's recommendation to subject the firm to peer review. The motion passed 6 – 0. Elsen, Joanne, CPA, P.C. 1205-C A motion was made by Douglas N. Kimball, seconded by Julie S. Klewer, that that the Board accept the Peer Review Oversight Advisory Committee's recommendation to subject the firm to peer review. The motion passed 6 – 0. Review of Compliance/Non-Compliance with CPE Requirements Humphryes, Edward Joseph 3587-E A motion was made by Gary L. Freed, seconded by Julie S. Klewer, that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed to a formal hearing. Passed 6 – 0. Lopez, Bryon David 6983-E Jacki Hancock provided more information regarding the file and Monica L. Petersen noted that the action to be made on this file would be regarding non-compliance with CPE. Discussion ensued amongst the Members regarding what action should be taken and if the matter should be deferred. Staff were instructed to determine through additional research whether or not there is evidence from the CPE vendor of 0.6 CEU that equates to 6.0 CPE, which might be considered in declaring the final CPE deficiency. A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed to a formal hearing. The motion passed 6 – 0. Shembekar, Renuka 15676-E A motion was made by Gary L. Freed, seconded by William C. Heimerdinger, that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed to a formal hearing. The motion passed 6 – 0. Siegler, Lawrence Michael 2845-E A motion was made by Gary L. Freed, seconded by William C. Heimerdinger, the Board to offer a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE;


and, if not accepted by the Registrant within 30 days, for the Board to proceed to a formal hearing. The motion passed 6 – 0. Smith, Kristen 12906-E A motion was made by Gary L. Freed, seconded by William C. Heimerdinger, that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed to a formal hearing. The motion passed 6 – 0. Stevens, Glenn Michael 6038-E A motion was made by Gary L. Freed, seconded by William C. Heimerdinger, that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-

compliance with CPE requirements, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed to a formal hearing. The motion passed 6 – 0.

Review of Compliance/non-Compliance with CPE Requirements and Potential False and Misleading Statements to the Board Hughes, Timothy F. 6518-E Jacki Hancock provided a background of the matter to the Board and noted on particular CPE certificates of completion. Gary L. Freed inquired with staff if it is possible to assign an investigator to this matter. Layne R. Simmons noted that the CPE Committee has looked extensively into the matter. Discussion ensued amongst the Members on what action should be taken and the CPE certificates of completion provided by the Registrant. Gary L. Freed stated that his preference would be to defer this matter to the next meeting. Layne R. Simmons questioned if the Board would like to remand the file back to the CPE Committee. Discussion ensued amongst the Members and Staff regarding the possibility of opening a compliance file and offering a Decision and Order (By Consent) for non-compliance with CPE requirements. A motion was made by Julie S. Klewer, seconded by Douglas N. Kimball, that the Registrant be offered a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, for being short two CPE hours, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed to a formal hearing and for a compliance file to be created to look further into the matter regarding the Registrant’s certificates of completion. The motion passed 6 – 0. Lopez, Bryon David 6983-E Later in the meeting, Scott Donald noted that the Board needed to specify in their prior motion regarding Agenda item XIII.P.2 Lopez, Bryon David the number of hours that are to be indicated in the Decision and Order (By Consent) for further clarification.


A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, to amend indicate on the Decision and Order (By Consent) that the Registrant was three hours short. The motion passed 6 – 0. Review of Compliance/Non-Compliance with CPE Requirements and Non-responsiveness Bordeleau, Jerry A. 12602-E A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, that the Board offer a Decision & Order (By Consent) for suspension for one year for non-compliance with CPE requirements, with possible early termination upon completion of the required CPE; and, if not accepted by the Registrant within 30 days, for the Board to proceed to a formal hearing and that the Board require a $200.00 administrative penalty for failure to timely respond due to the response being 14 days late. The motion passed 6 – 0. Failure to Respond and/or Failure to Timely Respond Jenkins, Laura B. 10503-E A motion was made by Gary L. Freed, seconded by Douglas N. Kimball, that the Board offer a Decision and Order (By Consent) with an administrative penalty of $100.00 for failure to timely respond, for being four days late responding to the CPE audit request. The motion passed 6 – 0. File No. 2017.006; Maniuszko, Keith A motion was made by Gary L. Freed, seconded by William C. Heimerdinger, to take no action on the Registrant’s untimely response to the offered Decision and Order (By Consent), as the Registrant had signed and returned the offered Decision and Order (By Consent). The motion passed 6 – 0. Issues from and regarding the American Institute of Certified Public Accountants (AICPA) August 17, 2016 Exposure Draft Regarding Proposed Changes to the AICPA Standards for Performing and Reporting on Peer Reviews A motion was made by Gary L. Freed, seconded by Julie S. Klewer, to take no action on the item. The motion passed 6 – 0.

SUMMARY OF CURRENT EVENTS

No items were discussed at this time. IDENTIFICATION OF FUTURE MEETING AGENDA ITEMS

Monica L. Petersen noted LeRoy M. Gaintner’s request to place on a future agenda the discussion of Educational Enhancement Reviews, a desire for more flexibility, and its applicable statutes and rules.

ADJOURNMENT

A motion was made by Julie S. Klewer, seconded by William C. Heimerdinger, to adjourn the meeting. The motion passed 6 – 0. The meeting adjourned at 3:42 p.m.

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