PLACE : 500 N. Calvert Street, 3Rd Floor Conference Room, Baltimore s1

MINUTES

BOARD OF PUBLIC ACCOUNTANCY

DATE : April 3, 2003

TIME : 9:00 a.m.

PLACE : 500 N. Calvert Street, 3rd Floor Conference Room, Baltimore, Maryland 21202

PRESENT : Jacob J. Cohen Arnold Williams Barbara R. Stewart Patricia A. Snell Leslie A. Mostow

ABSENT : Michele L. Pittman

OTHERS PRESENT : Harry Loleas, Deputy Commissioner Daphne Thomas, Management Associate Matthew Lawrence, Counsel to the Board Bert Fenwick, Consultant Carol Kirwan, MACPA George Spriggs, MSA

CALL TO ORDER

The meeting was called to order by the Chair at 9:00 a.m.

MINUTES

It was moved (I) by Mr. Williams and seconded by Mr. Mostow and unanimously carried to approve the minutes of the meeting held March 6, 2003 as amended.

REPORT OF THE CHAIR

Chairman Cohen reported that Ms. Pittman would be absent for this meeting. An appointment for the Consumer member vacancy has not been made to date.

The Chair’s report included the following:

 Submittal from NASBA regarding Specifications of Gateway System (National Examination Database) for the Computerized Uniform CPA Examination.

 SEC of 1934 was amended recently in recognition of the Sarbanes/Oxley Act to include that all broker dealers (both public and private) are to be audited by a public accounting firm.

 Mr. Don Geiger, CPA, and an adjunct faculty member who wishes to volunteer to be on a committee. The Chair asked if any of the members had any ideas how the Board may use Mr. Geiger’s services to let him know.

 Mr. Cohen reminded the Board that Mr. Wesley Johnson was nominated by the Board for NASBA’s Vice-Chair position, but Mr. Michael Weatherwax, as advised by Mr. David Costello’s memorandum, was selected by the Nominating Committee to accede the Chair for the 2004-05 term. Mr. Cohen wished Mr. Weatherwax the best during his tenure. The memorandum further solicited the Board’s recommendations of candidates for the NASBA Regional Directors and Directors-at -Large for the 2003-04 NASBA Board. However, as Mr. Wesley Johnson is still currently the Director-at-Large for another year, the Chair stated that the Board should not nominate anyone else. Mr. Cohen stated that he would speak with Ms. Foster, who currently serves on the Nominating Committee and advise the Board. April 3, 2003 Page 2

EXECUTIVE DIRECTOR’S REPORT

 Mr. Gring reported that 979 candidates registered for the exam of which 97 are first time candidates, 595 are all parts re-examinees and 235 are various parts re-examinees. There will be one site only – Timonium Fairgrounds. Admission information will be mailed on April 14, 2003. If any Board member wishes to attend the site, Mr. Gring requested that Board members contact Ms. Thomas.

 The Department's Procurement Office is reviewing the CBT Contract and have promised to move as expeditiously as possible.

 The Board's Licensing records indicated that there are currently: 13,392 active CPAs, 5,036 inactive CPAs, 478 firm permits, and 32 limited permits.

 SB188, which adds corrective language to the non-CPA ownership statute has passed in the Senate and the House. SB116 is being considered in the House Economic Matters c Committee. Member of the committee are considering an amendment to the bill that would maintain the passing grade on the Uniform CPA exam at 75%. This bill was recommend to give the Board the authority to establish the passing grade in conjunction with the new computerized administration of the CPA Exam. SB560, the Corporate Accountability Act, received an unfavorable report in the Senate; and HB1098, that required CPAs do certain audits, received an unfavorable report in the House.

 Mr. Gring reminded the members of the Board that the deadline for submission of legislation for the 2004 General Assembly is approaching soon. The deadline for submission of legislative recommendations to the Secretary’s office is traditionally August 1st.

 Mr. Gring advised that the public meeting preparations are proceeding as scheduled for May 1st, which will be held in the 2nd Floor Conference Room. He added that letter of invitation will be mailed shortly to members and representatives of the accounting industry as well as groups representing consumers of certified public accounting services.

It was moved (II) by Ms. Snell, seconded by Mr. Williams and unanimously carried to approve Mr. Gring’s report.

EDUCATION COMMITTEE’S REPORT

Dr. Stewart reported Ms. Thomas administratively approved ten (10) applications - (7) reciprocal and (3) transfer of grades – all Internet transactions.

Transfer of Grades Application

Kelly Metz - Did not meet Maryland’s educational requirements when she applied for the examination in the other jurisdiction. Can only take the required courses, obtain an original license in another jurisdiction, then reapply to Maryland or reapply under the "4 and 10" rule.

It was moved (III) by Ms. Snell, seconded by Mr. Mostow and unanimously carried to approve the Education Committee’s report.

EXPERIENCE COMMITTEE’S REPORT

None reviewed for this meeting.

INFORMAL MEETINGS

Two denied applicants for the May, 2003 Uniform CPA Examination appealed to the Board as follows: Somaree Taru - Denied for the lack of U. S. business law and auditing. Ms. Taru explained that these two courses did not appear on her transcript due to some financial obligations with the school. She appealed to the Board stating that she had met the requirements at that institution 1½ years ago. The April 3, 2003 Page 3

INFORMAL MEETINGS CONTINUED

Board, was given with the official transcript reflecting the completion of U>S business law and auditing, advised Ms. Taru that Ms. Thomas would inform her of their decision after the meeting.

Robert Valentine - Denied for non-receipt of his official University of Baltimore (UB) transcript. Mr. Valentine stated that he had submitted the application to the Board’s office two weeks before the end of January. He was advised that his UB transcript never received by the Board’s. He submitted documentation from Mr. Nathan Kale, Associate Registrar that the transcript was mailed to the Board on January 31, 2003, the Board informed Mr. Valentine that he too would be advised by Ms. Thomas of their decision after the meeting.

The Board reviewed the “first draft” of examination regulations governing administration of the Uniform CPA Examination under computerized administration, which was distributed to the Board on March 6, 2003. Mr. Gring explained that in the draft, relevant elements suggested in the Uniform Accountancy Act were incorporated in the proposed language. The Board, covered several issues, but was satisfied that the draft language covered all of the relevant issues. Mr. Gring recommended that the regulations be prepared and be formally proposed by the Board in time to become effective on January 1, 2004

As for the May 1st meeting/hearing, the Board felt the following groups should be invited, if not already included in Mr. Gring’s listing:

AICPA NASBA Academia Credit Rating Agencies Chamber of Commerce Companies – Big 4 Accounting Firms/Small Firms MD Non-Profit Association Banking Association Assessments & Taxation Commissioner of Financial Regulation Members of the MD Legislature Maryland Congressional Delegation

The Board discussed the time to allow speakers which should be included in the letter indicating that the time is limited and suggest that written comments be forwarded to the Board. The Board also concurred that no issues should be mentioned in the outgoing letter but make note of the Sarbanes/Oxley Act. Mr. Gring stated that he would draft a letter and send it to the Board for review.

CORRESPONDENCE

The Board received a letter from Mr. Arjun Banarjee, who had been denied for the May, 2003 Exam for the lack of U. S. federal income tax, U. S. business law and oral communications. Mr. Banarjee proposed using the same course that he credited for written communications to meet the requirements for oral communications. After some discussion, the Board found that Mr. Banarjee had a master’s degree and therefore did not need a written communications course and determined that he needs a 3-semester hour course in oral communications. The Board noted that he is currently enrolled in both U. S. federal income tax and U. S. business law, and suggested that Ms. Thomas advise that he apply for the November 2003 Exam, the deadline of which is August 8th. It was moved (IV) by Mr. Mostow, seconded by Ms. Snell and unanimously carried to uphold the previous denial.

EXECUTIVE SESSION

It was moved (V) by Dr. Stewart, seconded by Mr. Williams and unanimously carried to go into Executive Session at 10:10 a.m. in the 3rd Floor Conference Room, 500 N. Calvert Street, Baltimore, Maryland 21202. The purpose of this session was to consult with counsel. This session was permitted to be closed pursuant to State Government Title Section 10-508(a)(7). Upon completion of the session, the Board resumed their public meeting at 10:15 a.m. OTHER BUSINESS

It was moved (VI) by Dr. Stewart, seconded by Mr. Williams and unanimously carried to approve the examination applications for both Ms. Somaree Taru and Mr. Robert Valentine to sit for the May, 2003 Exam and Ms. Thomas will so advise each. April 3, 2003 Page 4

OTHER BUSINESS CONTINUED

The Board reviewed an ADA request and it was moved (VII) by Mr. Williams, seconded by Mr. Mostow and unanimously carried to allow 25% more time, a separate room and a proctor/reader. Ms. Thomas will so advise the candidate.

The Board reviewed information from a licensee regarding a previous conviction and it was moved (VIII) by Ms. Snell, seconded by Mr. Williams and unanimously carried to allow renewal of his license.

COMPLAINTS

It was moved (VII) by Ms. Snell, seconded by Mr. Williams and unanimously carried to take the following actions on the complaints noted:

Case No. CPAS020007 - Case closed. Case No. CPAS020012 - Case closed.

ADJOURNMENT

There being no further business, the meeting adjourned at 10:20 a.m.

______With corrections

______Without corrections

______Chair Date