(a) The board shall grant or renew permits to practice as a CPA firm or PA firm to entities that make application and demonstrate their qualifications for the permits in accordance with subsections (b)-(i) or to CPA firms originally licensed in another state that establish an office in this state. A firm with multiple locations shall obtain a permit for each location. A firm must hold a permit issued under this section in order to provide attest services or to use the title “CPAs,” “CPA firm,” “PAs” or “PA firm.”
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Terms Used In Tennessee Code 62-1-108

  • Attest: means providing the following services:
    (A) Any audit or other engagement to be performed in accordance with the Statements on Auditing Standards (SAS). See Tennessee Code 62-1-103
  • Board: means the state board of accountancy established under §. See Tennessee Code 62-1-103
  • Certificate: means a certificate as certified public accountant issued under §. See Tennessee Code 62-1-103
  • Contract: A legal written agreement that becomes binding when signed.
  • Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
  • Licensee: means the holder of a license. See Tennessee Code 62-1-103
  • Manager: means a manager of a limited liability company. See Tennessee Code 62-1-103
  • PA firm: means a sole proprietorship, corporation, partnership or any other form of organization issued a permit under §. See Tennessee Code 62-1-103
  • Permit: means a permit to practice as a CPA firm issued under §. See Tennessee Code 62-1-103
  • Person: includes a corporation, firm, company or association. See Tennessee Code 1-3-105
  • Professional: means arising out of or related to the specialized knowledge or skills associated with CPAs. See Tennessee Code 62-1-103
  • Report: when used with reference to attest services, means an opinion, report or other form of language that states or implies assurance as to the reliability of any financial statements or assertion. See Tennessee Code 62-1-103
  • Rule: means any rule, regulation or other written directive of general application duly adopted by the board in accordance with the Uniform Administrative Procedures Act, compiled in title 4, chapter 5. See Tennessee Code 62-1-103
  • State: means any state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands and Guam, except that "this state" means the state of Tennessee. See Tennessee Code 62-1-103
  • Veto: The procedure established under the Constitution by which the President/Governor refuses to approve a bill or joint resolution and thus prevents its enactment into law. A regular veto occurs when the President/Governor returns the legislation to the house in which it originated. The President/Governor usually returns a vetoed bill with a message indicating his reasons for rejecting the measure. In Congress, the veto can be overridden only by a two-thirds vote in both the Senate and the House.
(b) Permits shall be initially issued and renewed for periods of not more than two (2) years but, in any event, expiring on December 31 following issuance or renewal. Applications for permits shall be made in the form and, in the case of applications for renewal, between the dates that the board may specify by rule.
(c) An applicant for initial issuance or renewal of a permit to practice under this section shall be required to show that:

(1) Notwithstanding any other law, a simple majority of the beneficial ownership of the firm, in terms of financial interests in the equity capital and voting rights held by all partners, officers, shareholders, members or managers, belongs to holders of a certificate who are licensed in some state, and such partners, officers, shareholders, members or managers, whose principal place of business is in this state, and who perform professional services in this state hold a valid certificate issued under § 62-1-107 or the corresponding provision of prior law or are public accountants registered under § 62-1-109. Although firms may include nonlicensee owners, the firms must be controlled by holders of a certificate who are licensed by some state and the control may not be relinquished by contract through the issuance of minority veto rights or otherwise. The firm and its ownership must comply with rules promulgated by the board;
(2) Any individual licensee who is responsible for supervising attest services and signs or authorizes someone to sign the accountants’ report on the financial statements on behalf of the firm shall meet the experience requirements set out in the professional standards for those services; and
(3) Any individual licensee who signs or authorizes someone to sign the accountants’ report on the financial statements on behalf of the firm shall meet the experience requirement of subdivision (c)(2).
(d) Any CPA firm may include nonlicensee owners; provided, that:

(1) The firm designates a Tennessee licensee/owner to provide the board with the names and amounts of equitable ownership and voting rights of all CPAs and other owners practicing in this state and the name of the resident manager of each office in this state;
(2) All nonlicensee owners are active individual participants in the CPA firm or affiliated entities; and
(3) The firm complies with other requirements that the board may impose by rule.
(e) An applicant for initial issuance or renewal of a permit to practice under this section shall be required to obtain a permit for each location of the firm within this state with the board and to show that all attest services rendered in this state are under the charge of a person holding a valid certificate issued under § 62-1-107 or the corresponding provision of prior law or some other state law.
(f) The board shall charge a fee for each application for initial issuance or renewal of a permit under this section in an amount prescribed by the board. The board has the authority to establish late fees for any applications, renewals or reports that are filed late.
(g) An applicant for initial issuance or renewal of permits under this section shall in the application list all states in which the applicant has applied for or hold permits as CPA firms and list any past denial, revocation or suspension of a permit by any other state; and each holder of or applicant for a permit under this section shall notify the board in writing, within thirty (30) days after its occurrence, of any change in the identities of partners, officers, shareholders, members or managers whose principal place of business is in this state, any change in the number or location of offices within this state, any change in the identity of the persons in charge of those offices and any issuance, denial, revocation or suspension of a permit by any other state.
(h) Firms that fall out of compliance with the section due to changes in firm ownership or personnel after receiving or renewing a permit shall take corrective action to bring the firm back into compliance. The board may grant a reasonable period of time for a firm to take corrective action. Failure to bring the firm back into compliance within a reasonable period as defined by the board will result in the suspension or revocation of the firm permit.
(i) All firms holding a valid permit to practice as a CPA firm or PA firm issued by this state prior to October 1, 1998, shall be deemed to have met the requirements of this section.
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