Nevada Administrative Code Chapter 628 - Accountants
1. Revocation of CPA License for Negligence
Background:
A Nevada CPA failed to properly audit a mid-sized company. The CPA missed material misstatements in financial statements, which led to significant losses for investors.
Issue:
Whether the CPA’s license should be revoked under NAC 628 for negligence or misconduct.
Decision:
The Nevada State Board of Accountancy conducted a hearing.
The CPA argued the errors were unintentional and based on incomplete client records.
The Board found that the CPA failed to comply with professional standards, including adequate verification procedures.
The CPA license was revoked for two years, and the CPA was required to complete remedial education before reapplying.
Key Lesson:
NAC 628 gives the Board authority to revoke licenses for negligence that violates professional standards, even if unintentional.
2. Disciplinary Action for Fraudulent Conduct
Background:
An accountant submitted fraudulent expense reports and claimed personal expenses as business deductions for multiple clients.
Issue:
Whether the accountant engaged in conduct that warranted disciplinary action under NAC 628.
Decision:
The Board determined that knowingly submitting false claims violated the ethical and professional standards outlined in NAC 628.
The accountant’s license was permanently revoked.
The Board also issued a public reprimand to protect the public and maintain professional integrity.
Key Lesson:
Fraudulent conduct, not just errors, can result in permanent revocation under NAC 628.
3. License Denial Due to Criminal Background
Background:
A CPA applicant disclosed on the license application that they had a felony conviction for financial fraud in another state.
Issue:
Whether NAC 628 allows the Board to deny licensure based on past criminal conduct.
Decision:
The Board conducted a character and fitness evaluation.
NAC 628 allows denial if the applicant’s criminal history demonstrates a risk to the public or professional misconduct.
The Board denied the application, citing risk of repeated misconduct and violation of professional trust.
Key Lesson:
Criminal history, particularly financial crimes, is a valid basis for license denial under NAC 628 to protect the public.
4. Dispute Over Continuing Education Requirements
Background:
A licensed CPA argued that the Board miscalculated the number of continuing education (CE) hours required for license renewal.
Issue:
Whether the Board correctly applied NAC 628 rules on CE requirements.
Decision:
NAC 628 mandates a specific number of CE hours in ethics, accounting, and auditing every two years.
The CPA had submitted hours for courses that did not meet the specific ethics or auditing criteria.
The Board required the CPA to complete additional CE hours before renewing the license.
Key Lesson:
Compliance with NAC 628 CE requirements is strict; only approved courses count toward renewal.
5. Reprimand for Advertising Violations
Background:
A CPA firm advertised “guaranteed financial success” in marketing materials.
Issue:
Whether NAC 628 prohibits misleading or exaggerated advertising by licensed accountants.
Decision:
The Board held a hearing and found the advertising violated professional conduct standards.
The firm was issued a formal reprimand and required to remove all misleading claims.
No license suspension occurred because there was no direct client harm.
Key Lesson:
NAC 628 regulates professional advertising; firms must avoid exaggeration or misrepresentation.
6. Complaint Regarding Conflict of Interest
Background:
A CPA audited a company while simultaneously providing consulting services for the same company without proper disclosure.
Issue:
Whether NAC 628 prohibits accountants from auditing a client in which they have a financial or consulting interest.
Decision:
The Board determined this was a conflict of interest violating ethical standards.
The CPA received a suspension of six months and was required to undergo ethics training.
Key Lesson:
Conflict of interest rules under NAC 628 are strictly enforced to maintain objectivity and independence.
7. Appeal of Disciplinary Fine for Late Filing
Background:
A CPA failed to file required license renewal forms and fees on time. The Board imposed a fine.
Issue:
Whether NAC 628 allows fines for late filing when no other misconduct occurred.
Decision:
NAC 628 explicitly grants the Board authority to impose administrative fines for late filings.
The fine was upheld, but the CPA was allowed to complete renewal requirements afterward.
Key Lesson:
Even procedural violations, such as late filings, can result in enforceable penalties under NAC 628.
✅ Summary of Key Themes
Professional Conduct: Fraud, negligence, conflicts of interest, and misleading advertising are strictly regulated.
Licensing Authority: The Board has power to deny, suspend, or revoke licenses based on ethics, criminal history, or competency.
Continuing Education: CPAs must comply with CE rules; deficiencies can block renewal.
Procedural Enforcement: Administrative penalties (fines, reprimands) are enforceable even for non-harm violations.
Ethics & Public Protection: NAC 628 emphasizes protecting the public and maintaining trust in the accounting profession.
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