3 ACC OU NTANTS
L I CENSES

– P UB L I C A CC OUN T AN CY L A W P ERMI TS U NLI CENSED P E RS ONS T O P R EP A R E C OMPI L AT I ON A ND R E VI E W R E PORTS SUBJ ECT TO CERTAI N CONDIT I ONS

N ovember 16, 1999

T h e H o n o ra b le V

a n T . Mitch e ll H ou se of D el ega t es
I n a pr evi ous opi ni on of t hi s O ffi ce, A t t or neyG ener al Sachs c o nst rued the M ary l and P ub l i c A ccou ntancy A ct (“the A ct ”) t o p e r mi tu n l i c e n s e d a c c o u n t a n t s t o i s s u e “ c o mp i l a t i o n ” a n d “ r e v i e w” re p o rt s c o n c e rn in g f

in a n c ia l s ta te m e n ts

. See 66 O pi ni ons of

the A t t or ney G ener al 190 ( 1981) ( “t he 1981 O pi ni on”)

. Y ou have a s ked us t o r evi ew t he concl us i on of t hatopi ni on and t o cons i dert he ef fec t of s ubs equentr evi s i ons of t he A ct and of t he pr ofes s i onal s t andar ds g o v e rn in g c e rt if

ie d p u b lic a c c o u n ta n ts

. A ft err evi ew i ng t he change s t o t he l aw s i nce 1981, as w el l as t he cha nges i n pr ofes s i onal s t andar ds , w e conf i r m t he i nt erpr et at i on of t he A cts etfor t h i n t h e 1 9 8 1 O pi ni on w i t h one modi fi cat i on. W hi l e a r eas onabl e ar gum entcan be m ade f ora di ffe r ent cons t ruct i on of t he st atut e concerni ng r evi ew r epor t s , t he conc l us i on o f th e 1 9 8 1 O p in io n is c o n sis ten t w ith th e sta tu te g o v e rn in g p u b lic acc ount ant s , bot h as i texi s t ed i n 1981 and as s ubs equent l yamended. M or eover , t he 19 8 1 O pi ni on has gui ded t he appl i cat i on of t he A ct for n ear l y20 y ear s and, abs enta contr ar yi nt erpr et at i on of t he cur r ents t atut e by t he St at e appe l l at e cour t s , anys i gni fi cantchange i n t h e A c ti s t h e p r e r o g a t i v e o f t h e G e n e r a l A s s e m b l y.

I
T he 1981 O pi ni on In 1 9 8 1 , the C h a irm a n o f th e M a ry lan d S tate B o a rd o f P u b lic A ccount ancyas ked t he A t t or neyG ener al foran opi ni on w het h er4 [8 4 O p
. A tt ’y

At the time, the statute employed the term “c ertified”to describe 1 acc ountants permitted to prac ti ce c ertified public a ccounta ncy in the State. See For mer Ar ticle 75A, §14(a) (1975 Repl. Vol.). The current version of the Act now uses the term “license d.” See Annotated Code of Maryland, Business Oc cupations &Professions Article ( “B OP”), §2-101( c) a nd §2- 301.
As a

re su lt o f c od e re vis ion

theAc t be c amepa

rt of theB us ine ss 2 Occ upations & Prof

essions Article in 1989.
S i m i l ar p r o h i b i t i o n s i n th e s t atut e a g a i n s t th e u s e o f the te rm s 3 “ac countant” and “ac c o un ti n g service s” had be en dec lare d unconstitutional by

the Court of Appe als in ComprehensiveAcc ounting Servic es v. State Board of Pu b l i c Accountancy , 284 Md. 474, 397 A.2d 1019 (1979). “unl i cense d ” acc ount ant s coul d i s s ue compi l at i on and r evi ew

1
r epor t s pr epar ed i n acc or dance w i t h t he gui del i nes es t abl i s hed byt he A m er i can I ns t i tut e of Cer t i fi ed P ubl i c A ccount ant s ( “A I C PA ”) , as pu bli shed i n it s St at em ent on St andar ds f or A ccount i ng and R evi ew S e rv ice s N

o . 1 : C o m

p ila tio n a n d

R e v iew o

f F in a n c ia l S ta tem e n ts (1 9 7 8 ) ( “ S S A R S N o . 1 " ).
A tt he t im e, t he M ar y l and Publ i c A ccount ancyA ctw as cont ai ned i n A r t i cl e 75A of t he A nnot at ed C ode of M ar y l and. T hat 2 A ctcr eat ed a St at e B oar d of Publ i c A ccount ancyand es t abl i s hed a l i cens i ng and r egul at or yr egi m e fort he acc ount i ng pr ofes s i on. T he A ctr es t r i cted t he us e of va r i ous des i gnat i ons t o l i cens ed acc ount ant s , ot her w i s e know n as cer t i fi ed publ i c ac count ant s or C PA s
. I n par t i cul ar , §14 of t he A ctpr ohi bi t ed an unl i cens ed per s on fr o m h o l d i n g o u t t h a t t h e p e r s o n p r o v i d e d p u b l i c a c c o u n t i ng or
“ a u d iti n g ” se rv ice s, f ro m u sin g th e tit les “ c e rtifie d p u b lic acc ount ant , ” “publ i c ac count ant , ” or“audi t or , ” and fr om us i ng t he i ni t i al s “C PA ” or any ot hert i t l e, abbr evi at i on, w or ds , ordevi ce that “t ends t o i ndi cat e t hats uch per s on i s a ce r t i fi ed publ i c ac count antor [t hat ] i s l i kel yt o be conf us ed w i t h ‘ cer t i fi ed publ i c ac count ant ’ or ‘C P A

. ’” F o rm er A rt icl e 7 5 A , § 1 4 (a), (b), ( e). Se e als o fo r m er 3 A r t i cl e 75A , §18 ( us e of thos e t er m s i n conj unct i on w i t h unl i cens ed person’s nam e i s p rim a fa c ie ev iden ce o f v iolati o n o f A ct).G en. 3] 5

A 198 6 ame ndme nt ad de d a d e fi nition of “pra c tic e c e rtif

ie d p ub lic 4 acc ountancy” to the Ac t. SeePart I Iof this opinion. T h e A c t d id n o t d ire c tlyd e f in e th e p ra c tice o f

p u b lic acc ount i ng, but r at her s peci fi ed a r ange of acc ount i ng s er vi ces t hat 4 coul d b e per for m ed byper s ons w i t houta l i cens e. Sect i on 15( e) expl ici t l yper m i t t ed an unl i cens ed per s on t o pr ovi de t he fol l ow i ng ser vices : O f

f e rin g o r re n d e rin g to th e p u b lic bookkeepi ng and t ax s er vi ces , i ncl udi ng d i v i s i o n [s i c] and i ns t al l i ng s y s t ems, r ecor di ng and pr es ent at i on of fi nanci al i nfor m at i on or data, prepari ng fi nan ci al st at em ents , s chedul es , r epor t s and exhi b it s, ors i m i l ar s e rv ic e s
.... For m erA r t i cl e 75A , §15( e)

. Such s er vi ces coul d be pr ovi ded byan unl i cens ed per s on onl yon t he condi t i on t hatt he per s on notus e t he t i t l es ort er m s pr ohi bi t ed by§14 and:

notr epre s entt hatan ‘ audi t ’ or‘ exami nat i on’ has been made [a nd] n o t f ur ni s h w r i t t en cer t i fi cat es oropini ons conce r ni ng t he cor r ectnes s , fai r nes s , orfai rpr ese nt at i on of fi nanci al s t at em ent s , s chedul es , r epor t s , or e x h ib its

.... Id

. T hus , s om ew hati ndi r ect l y , t he A ctal l ow ed onl ya l i cens ed acc ount antt o per for m an audi tor t o r enderan opi ni on on t he corr ect ness or fai rness of f i nan ci al st at em ents

. T hen, as now , t he t er m s “compi l at i on” and “r evi ew ” did not appea ri n t he M ar y l and s t atut e. T he 19 8 1 O pi ni on quot ed t he A I C PA defi ni t i on of “c om pi l at i on”:

P re se n tin g in th e f

o rm o f f in a n c ial s tate m e n ts i nfor m at i on t hati s t he re pr es ent at i on of m a n a g e m e n t (o w n e rs) w ith o u t u n d e rta k in g to e x p re s s a n ya s s u ra n c e o n th e s ta te m e n ts

.6 [8 4 O p
. A tt ’y
SSA R S N o. 1, §100. 04 q u o tedin 66 O pi ni ons of

the At t or ney G ener ala t19 2. The 19 81 O pin i on a l s o r e l i e d o n the A I CPA defini t i on of “review , ” w hich beg i ns as foll ow s:

Per for m i ng i nqui r y and anal y t i cal pr ocedur es th a t p ro v id e th e a c c o u n tan t w ith a re a so n a b le bas i s forexp res s i ng l i m i t ed as s ur ance t hat th e re a re n o m a ter ial m o d if ica tio n s th a t sh o u ld b e m a d e to th e sta tem e n ts in o rd e r fo r th e m to be i n conform i t yw i t h gener all yacc ept ed a c c o u n tin g p rin c ip les , o r, if a p p lica b le, w ith a n o th e r c o m p re h e n s iv e b a s is o f a c c o u n tin g
. Id

. at193- 94. T he def

i ni t i on of “r evi ew ” t hen di s t i ngui s hes a r evi ew from b o t h a compi l at i on and an a udi t

. I n es s ence , w hi l e a pe r s on w ho pr ovi des a “compi l at i on” does not pr ovi de any as s ur ance on t he s t at ement s , a per s on per for m i ng a “r evi ew ” must conducts uffi ci ent anal y t i cal pr ocedur es t o pr ovi d e a rea s onabl e bas i s fora “l i m i t ed as s ur ance ”

) i.e

. , t hat the per s on i s notaw ar e of a nym at er i al m odi fi cat i ons t hatneed t o be made t o conform t he fi nanci al statem en ts t o g en era ll yac ce p ted a cc o u n ti n g p ri n ciples (G A A P ). H ow ever , a r evi ew i s notequi val entt o an audi t as “i tdoes not p ro v id e a ss u ra n c e th a t th e a c c o u n tan t w ill b e c o m e a w a re o f a ll sign ifi ca n t m att ers tha t w o u ld b e d iscl o sed in an au d it ”a n d there fo re does notper m i tt he ac count ant t o expr es s an opi ni on on t he fi nanci al s ta te m e n ts ta k e n a s a w h o le

. Id
T he 1981 O pi ni on r efe r r ed t o thes e defi ni t i ons of “compi l at i on ” and “r evi ew ” i n SSA R S N o. 1, exami ned t hem agai ns tt he M ary la nd s t atut e, and conc l uded t hatt he M ar y l and s t atut e perm i t t ed an unl i cens ed per s on t o pr ovi de compi l at i on and r evi ew r epor t s , s o l ong as t hat per s on: ( 1) us es r epor t i ng l anguage su b sta n tiallyin a c c o rd a n c e w ith th e lan g u a g e re c o m m e n d e d in SSA R S N o. 1; ( 2) does notpurpor tt o r epr es entthat he ors he had m ade a n “audi t ” or“exa m i nat i on”; and ( 3) does not gi ve an opi ni on as t o t he corr ectnes s , fai r nes s , o r f ai rpr es ent at i on of t he fi nanci al s t at ement s
. 66 O

pi ni ons of

the At t or ney G ener alat195.
Y o u h a v e a sk e d w h e th e r th a t co n c lu sio n re m a in s a v a lid i nterpret at i on of the M ary l and P ub l i c A ccou ntancyA ct

. W e first cons i deri nt er veni ng change s i n t he l aw and in pr ofes s i onal st and ards.G en. 3] 7

SeeChapters 29, 776, L aws of Ma ryland 1982; Chapters 79, 80, 5 168, 176, 595, L aw s o f Mary land 1983; Chapters 17, 255, L aws of Maryland 1984; Chapter 717, L aws of Ma ryland 1985; Chapter 780, L aws of Mar yland 1986; Chapter 3, L aws of Mary land 1989; Cha

pter 6, L aws of Mar yland 1990; Chapter 47, L aws of Ma ryland 1991; Chapters 146, 216, L aws of Ma

ryland 1992; Cha

pters 459, 639, L aws of Mary land 1993; Ch a p ter s 3 , 1 5 , 3 4 5 , L aw s o f M ar yla n d 1 9 9 4 ; Ch a

p ter 3 , L aw s of Maryland 1995; Chapters 35, 107, L aws of Ma ryland 1996; Chapters 59, 735, L aws of Ma

ryland 1997; Chapter 49, 342, L aws of Maryland 1998; Chapters 438, 525, L aws of Ma ryland 1999. II
A m endm ent s t o t he P ubl i c A ccount ancy A ct
A
. 1 9 8 6 R e v isio n o

f S ta tu te Th e Gen e r a l As s e mbl yh a s r e v i s i t e d t h e Pu b l i c Acc o u n t a n cy A cton s ever al o cc asi ons s i nce 1981. H ow ever , onl ya 1986 5
a m e n d m e n t b e a rs o n th e i s s u e r a i s e d in y o u r i n q u ir y
. See C hapt er 780, §2, L aw s o f M ar y l and 1986. T hatl egi s l at i on eff ect ed a compre hens i ve r evi s i on of t he A ctas a pr el ude t o i t s i ncl us i on i n t he n ew B u sine ss O cc u p ati o n s & P rof essio n s A rt icle thre e y ea rs l ater. A m ong ot hert hi ngs , t he 1986 amendm entr ect i fi ed a maj orom i s s i on i n t h e l a w )a n e x p licit d e f in iti o n o f th e p ra c tice o f

c e rtifie d p u b lic acc ount ancy
. I n addi ng t hatdefi ni t i on t o t he s t atut e, t he G ener al A s s embl yhad t he opportuni t y t o s quar el yaddr es s t he conc l us i on of th e 1 9 8 1 O p in io n
. T he new §2- 101( e) of t he r evi s ed A r t i cl e 75A defi ned

“ p ra c tice c e rtifie d p u b lic a c c o u n tan c y ” to m e a n :

( 1 ) C onduct i ng an audi t o ran ex am ination o f f

inan cial st atem en ts; o r ( 2) Pr ovi di ng a w r i t t en cer t i fi cat e or opi ni on as t o t he corr ectness o f t he i nfor m at i on or as t o t he fa i r nes s of t he p r e s e n t a t i o n o f

t h e i n f o r m a t i o n i n a n y: (i) F in a n c ial s tate m e n t; ( i i ) Schedul e;8 [8 4 O p
. A tt ’y

Th e te rm “ e xami natio n”wa s late r d e le te d f ro m th is d e fi nition

in 6 a no n- su bs tanti vere vis io n base d u po n th e repo rt e d v ie w o f t heAI CPA th at “ a u d it ” an d “ e xami n ati o n ” w e r e s y

n o ny mo u s in th is c o nte xt. See Chapter 3, §1, L aws of Ma ryland 1989 at p. 30 (Revisor’ s Note).
In responseto a C ourt of Appe als dec ision, a 1983 amendment ha d 7 eliminated the g eneric term “acc ountant” from the l ist of t itles that may be used only by licensed a cco un t ants. SeeChapter 79, L aws of Ma ryland 1983, and footnote 3 a

bove.
It m ay b e argu e d th at th e p r o h i b i t i o n i n B O P § 2

- 6 0 3 ( a ) a g a ins t 8 misrepresentation of a pe rson’s licensingstatus “by description of service s, methods or proce dures or otherwise” was intende d to sweep more broa dly

than forme r §14 and preven t anunlicensed pe rson from issuing compilation or re view reports beca use such repor

ts a re de fined by theAI CPA . H ow e ve r, at th e tim e of the19 86 ame ndme nt, it wa s w ide ly understood that, in ac corda nce w ith the 1981 Opinion, an unlicense d person c ould lawfully

issue a compilation or rev iew report. Thus, a representation that the person had perfor med a c ompilation or review

(continued...) (i ii ) R ep o rt ; or (i v ) E x h ib it.
T hi s l anguage w as evi dent l ydr aw n fr om t he form er§15( e) of A r t i cl e 75A w i t houts ub st ant i ve r evi s i on. I n addi t i on, por t i ons of 6 t he form er§14 of A r t i cl e 75A w er e combi ned and r ecodi fi ed i n a new §2- 603( a) : 7 [ U ]n les s a u th o riz e d to p ra c tice c e rt i fi ed p ub lic acc ount ancyundert hi s t i t l e, a per s on m aynot re p re se n t to th e p u b lic b yu s e o f th e tit le “l i cens ed c e r t i f

i e d p u b l i c a c c o u n t ant ”,

“ c e rtifie d p u b lic ac c o u n ta n t” , “ p u b lic account ant ”, or“audi t or ”, byus e of the des cr i pt i on “C PA ”, orbyot hert i t l e, by descri pti on of ser vices , m et ho ds, proced ures, o r o th e rw ise , tha t th e p e rso n is a u th o riz e d to pr act i ce cer t i fi ed publ i c acc ount ancy in the S ta te

. In su m , this ne w p rov isi o n restated , in m o re g en eric an d su m m ary for m , the p rohi bi t i ons l i s t ed i n s ever al s ubs ect i ons of for m er§14. 8G en. 3] 9

(...continued) 8 would not by

itself asser

t that the person ha d perf ormed a serv i ce or proc e durere stric te d to li c e ns e d a c c ounta nts . M or e ov e r, a s disc us se d in the next sec tion of this opinion, there is no indication in the l egi s lative history that the 1986 amendment was meant to eff ect such a chang e in the law. By contra st, other states explicitly include the ter

ms “compilation” 9 and “ re v i ew ” i n definingthe scopeof pra ctice of their license es. F or e x amp l e , th e In d i an a , Id ah o , an d M a s s a c hu s e tt s l aw s p r o v i d e th ato n l y a licenseemay

issue repor

ts on financial statements and specifically include both a “review”and “c ompilation” within the definition of “report.” Ind. Code §§25-2.1-12- 2 and 25-2.1- 12-3; I d a h o Co d e§ 54-221; M.G.L .A. 112 §8 7D . M a ine ’s pu

bli c a c c ounta

nc y law s tate s: No pe rs on

or f ir m no t ho ldi nga

va lid pe rm it issued under se ction 12251 or 12252 may issue a repor t, inc lud ing reviews a nd

c om pil ati on s, on fi na nc ia l st atemen ts o f a

ny oth e r p e rs on , f

ir m, org anizatio n o r g ov e rnme ntal un it. 32 M.R.S.A. §12755(a) (e mphasis added)

. See a l so § 2 -60 3 (c) (i n co rpo rati n g ev iden ti aryrule o f f o rm er § 1 8 ).
C ons picuo u sl yabs entfr om bot h new pr ovi s i ons i s any r efe r ence t o “compi l at i on” or“r evi ew ” r epor t s
. N orhas any 9
s ubs equentamendm entadded thos e t er m s t o t he s t atut e.
T h us, t he n ew defini t i on of “p ract i ce cert i fi ed p u b lic a c c o u n tan c y ” a n d th e re v ise d p ro h ib iti o n a g a in st th e u se o f c e rta in t er m s bot h es s enti al l yi ncorpor at ed t he l anguage of t he pr e- 1986 s t atut e. B as ed on t he l anguage enac t ed i n 1986, i tdoes notappea r t hatt he G ener al A s s embl yi nt ended t o i ncl ude t he pr epa rat i on of compi l at i on and re vi ew r epor t s w i t hi n t he def i ni t i on of t he “pr act i ce cer t i fi ed publ i c ac count ancy
. ”
B
. L egis lati ve History Such a vi ew i s s uppor t ed byl egi s l at i ve hi s t or yof t h e 1986 am end m ent. H ou se B i l l 12 61 w as a produ ctof the B usi ness O ccupa t i ons A r t i cl e C om m i t t ee, t he comm i t t ee r es pons i bl e for dr aft i ng w hati n 1 9 8 9 b eca m e t he B us i nes s O ccupa t i ons and P rofessi on s A rt i cl e, as partof the on go i ng cod e revi si on process.1 0 [8 4 O p
. A tt ’y

The Committee Report stated: 10 Th is i nitiativ e wa s ta ke n b e c a us e the B us ine ss Oc c up atio ns Ar

tic leCommitte e fo un d th at

) in the context of the formal nonsubstantive revision of theprop os e d n e w B us in e s s O c c up atio ns Ar tic le

) it was unable to addre ss properly the seve ral substantive problems found to exist i n the laws on a c c ounta nc y . T hrou gh th e ini tial ef fo rt s to dra ft

a nonsubstantive revi s i on, it becameclea r that the difficulties are not mere ly aca demic. The re levant prov isi on s o f t

hec ur rent l aw havebe e n th e c a

us e of consider abl e u n c e r ta in ty a mo n g the admini s trators re sponsible for implementingthe law and a

mon gthe pra ctitioners who are re gulate d und e r i t. Thu s, Hou se Bill12 61 is prese nted to the General Assembly this session as a substantive proposal separate from the proposed Business O cc upations Article that will be int roduc e d in

a late r s e ssi on . T hesepa rate prese ntation of this bill allows the Ge neral Assemb l y

to consider the issues involved more c l e arl y an d

c ar e f u l l y. BO AC Report at p.1. See C hapt er3, §1, L aw s of M ar y l and 1989. I n r ecomm endi ng t he chang e s ma d e b yt he 1986 l egi s l at i on, t he comm i t t ee de t er m i ned t hat th e A ctrequi red som e subst anti ve revi si on as w el l as si m p le r ecodi fi cat i on. B us i nes s O ccupa t i ons A r t i cl e C om m i t t ee R epor ton H o u se B il l 12 6 1 (“B O A C R ep o rt ”). 10
T he B O A C R epor ts t at ed t hatH ous e B i l l 1261 addr es s ed t he fol l ow i ng i s s ues i n t he exi s t i ng law : ( 1) r egul at ed pr act i ce undefi ned; ( 2) obs ol et e t er m i nol ogy ; ( 3) r efe r ence s t o out dat ed pr ocedur es ; ( 4) cont r ol l i ng cour t deci s i ons not r efl ect ed i n l aw ; ( 5) uncl ear , i ncoher entl i cens i ng s cheme; ( 6) ques t i onabl e a ut hor i zat i on for“i nact i ve” l i cens ee s t atus ; ( 7) l i cens i ng of i ndi vi dual s and l i cens i ng of fi r m s notcl ear ly d iffer ent i at ed; ( 8) qual i fi cat i ons for corpor at i ons and par t nershi ps notcl ear l ydi ffe r ent i at ed; ( 9) l ow cr i m i nal penal t i es ; and ( 10) poor or gani zat i on. H ow ever , i tfur t her n o ted th a t “f

o r th e m o st p a rt, th e p ro p o sa ls u n d e r th e b ill f in d th e ir bas i s i n actual l aw and pr act i ce a nd do notdevi at e s ubs t ant i al l y f r om t h e c u r r e n t la w a s it is n o w a p p lie d .” B O A C R ep o rta t p . 2 ( emphasi s added)

. For exampl e, t he R epor t s t at ed t hatt he def i ni t i onGen. 3] 11 of “practice certified public accountancy” added by the 1986 bill “is structured from references in the current law to those accountancy services that could not be provided by a person who does not have a license.” BOAC Report at p.3. Likewise, the Senate Economic and Environmental Affairs Committee, which favorably reported the bill, noted that the bill “largely reorganizes and clarifies current law on public accountancy,” citing the new practice definition as an example. Summary of Committee Report on House Bill 1261, Accountants at p. 2. The Committee Report also identified some “substantive changes” in the bill, none of which pertain to the provision of compilation or review services. Id. Various accounting-related organizations participated in the drafting of this legislation, including the State Board of Public Accountancy, the Maryland Association of Certified Public Accountants (MACPA), and the Maryland Society of Accountants (MSA). While the bill was under consideration by the Legislature, the President of MACPA wrote to the Chairman of the Senate Economic and Environmental Affairs Committee and lauded the bill, stating that: “HB 1261 does not change current Article 75A in any significant way.” Letter of Joseph A. Novotny to Senator Norman Stone (March 24, 1986). C. Summary Thus, neither the language of the 1986 amendment nor its legislative history indicates that the General Assembly intended to disavow the conclusion of the 1981 Opinion and restrict the preparation of compilation and review reports to licensed accountants. The Legislature is presumed to have known of the interpretation of the law contained in the 1981 Opinion. See State v. Crescent Cities Jaycees, 330 Md. 460, 470, 624 A.2d 955 (1993). If the General Assembly had changed the law to limit the preparation of compilation and review reports to licensed accountants, such a turnaround would have been a “substantial” change in the application of the statute. Therefore, the statements in the legislative history of House Bill 1261 that the bill: (1) caused no “substantial” change in the law’s application; and (2) primarily reorganized and clarified existing law, suggest that the General Assembly accepted the interpretation in the 1981 Opinion.1 2 [8 4 O p
. A tt ’y

Th at de fi nition , w

h i c h rem ains thesamea ft e r S SAR S No .7 , r e a ds : 11
Fina nc ial

Sta te ment. A p r e s e ntati o n of fi na nc ia l da ta , in c ludinga c compa

nyingno te s, de ri v e d f r o ma c c o unt i n gr e c o r d s an d i nt e n d e d to commun i ca te an e ntity ’s ec onomic resources or obligations at a point i n time, or the cha ng es there in f or a pe ri od of ti me, in a c c orda

nc e wi th g enerally acc epted a ccountingprinciples or a compre hensive ba sis of ac counti ngother than g e ne ra ll y a c c e pte d a c c ounti ng pr inc ipl e s. Financi al fore casts, proje ctions and similar prese ntations, and f

ina n c ial pre s enta

ti o n s inc lude d in taxreturns a

re not fina

ncial stateme nts for purposes of this statement... . SSAR S No. 1, §100.04 (footnotes omitted). III
A m e ndm e nt s of

Pro f e s s i ona l St anda r ds
I n 1992, t he A I C PA pr om ul gat ed SSA R S N o. 7, w hi ch amended cer t ai n por t i ons of SSA R S N o. 1 conce r ni ng compi l at i on a n d re v ie w re p o rt s
. See 175: 3 J our nal of A ccount ancy( M ar ch 1993) atpp. 98- 102. I n par t i cul ar , i tm ade tw o changes per t i nentt o y our i nqui r y
. Fi r s t , i tamended t he i nt rod uct or ypar agr aph of the re p o rtin g lan g u a g e f

o r b o th c o m p ilatio n a n d re v iew re p o rts to i ncl ude s peci fi c ci t at i on of t he “St at ement s on St andar ds for A ccount i ng and R evi ew Ser vi ces i s s ued by ” t he A I C PA , r at hert han a g e n e ra l re f

e re n c e to “ sta n d a rd s e sta b lish e d b y ” th e A IC P A . T h is change does notappea rt o al t erthe s ubs t ance of t he l anguage t hatt he A IC P A re c o m m e n d s f

o r c o m p ilatio n a n d re v iew re p o rts, b u t sim p ly m a k e s th e re f

e re n c e to A IC P A s ta n d a rd s m o re s p e c if ic

. Second, SSA R S N o. 7 added one foot not e an d ex p anded a second foo t no t e t o a p aragr aph of S S A R S N o. 1 thati ncludes a d e f in iti o n o f “ f in a n c ial s tate m e n t”

)a t er m us ed i n t he def i ni t i ons 11 of bot h “compi l at i on” and “ r evi ew ” i n SSA R S N o
. 1

. T he new f o o tn o te la n g u a g e a d d e d b yS S A R S N o . 7 c lar if ie s a r e f e re n c e to G A A P i n t h e d e f

i n i t i o n a n d p r o v i d e s c r o s s - r e f e r e n c e s t o o t h erG en. 3] 13

Th e pr epa

ratio n o f finan cia l st ate me nt o n th e ba sis of g e ne rally 12 a c c epte d a c c ounti ngprinc ipl e s w ou ld n ot n e c e ssa ri ly re qu ir e a lic e ns e under thePublic Accountanc y Act. TheAct per

mits an unlice nsed per son to provide cer

tain service s, including the prepa ration of fi n an cial state me nts . B OP § 2-1 02 (a) (3 )( iii ). Th e StateB oa rd of Pub lic Ac c ounta nc y ha s a do pte d a def

ini tio n o f “ fi na

nc ia l st ate me nt, ” sim ila

r t o the def inition i n SSAR S No. 1, that indicates that financ ial statements are prepa red in a ccordancewith GAAP “or a nother c omprehe nsive b asis of acc ounting.” COMAR 09.24.01.01A(3). A I C PA pr onouncement s con cerni ng G A A P and ot herbas es of acc ount i ng. 12
T hes e amendm ent s i n SSA R S N o. 7 cl ar i fy , but do notchange t he s ubs t ance of, t he defi ni t i ons of “com pi l at i on” and “r evi ew ” us ed in th e 1 9 8 1 O p in io n . A c c o rd in g ly , the yd o n o t th e m se lv e s m a n d a te re v is io n o f

th e 1 9 8 1 O p in io n
. IV
C ri t i que of

t he 1981 O pi ni on T hi s O ffi ce d o es n o tr eadi l yr evi s i tt he conc l us i on of a pr i or o p i ni on, even one i s s ued dur i ng t he t er m of a pr i orA t t or ney G e n e r a l

. A 1 9 8 7 o p i n i o n s t a t e d t h e s t a n d a r d s t h a tw e a p p l y:

A l t hough t he opi ni ons of t his offi ce do nothave the bi ndi ng eff ect of j udi ci al deci s i ons , never t hel es s t hey “se r ve as i m por t antgui des t o t hos e char ged w i t h t he admi ni s t r at i on of t he l aw
. ” I n t he abs ence of j udi ci al deci s i ons , A t t or ney G ener al opi ni ons p r o mo t e s t e a d ya p p l i c a t i o n o f t h e l a w. A c c o rd in g ly , th is of f ice sta n d s b y it s pr ece dent , m uch a s a cour tw oul d. L i ke t he j udi ci al doctr i ne of sta re d e c isis , ourr es pect f o rp r e c e d e n ti s n o ts i mpl yr e f l e xi ve cons er vat i s m
. I t“s er ves t he broa d ers oci et al i nt er es t s i n evenha nded, cons i s t ent , and pr edi ct abl e appl i cat i on of le gal rul es
. W hen rig h ts h a v e b e e n e re c ted o r m o d if ied in r el i an ce on e s t abl i s hed rul es of l aw , t he ar gum ent s agai ns tt hei rchange hav e s peci al1 4 [8 4 O p
. A tt ’y

Seepp. 1 2 -1 3 below. Indeed, that reportinglanguag e is often 13 proff ere d in court as a

disclaimer that preclude s relianc e on the financ ial statements by

third parties an d protec ts the prepa rer from liability

. See, e.g. , City Nati onal B ank of Florida v. Check ers, Simon &Rosner , 32 F.3d

(continued...) for ce. ” W e d o notover rul e a pr i oropi ni on s i m pl ybeca us e w e m igh thave r es ol ved a cl ose qu est i on t he o t her w a y , w ere w e fi rs t p re se n te d w ith it. A t th e sa m e tim e , w e w ill notperpetuat e a s i gni fi cantm i s t ake i n l egal r eas oni ng. W e ar e al s o pr epar ed t o r ecogni ze t hata prior opi ni on has been e r oded by chan ged ci rcum st ances. 72 O pi ni ons of

the At t or ney G ener al200, 2 0 2 (1987) ( ci t at i ons o m it ted).
A
. G ener al

A s s es s m ent

of the 1981 O

pini on U p o n re v iew , the 1 9 8 1 O p in io n a p p e a rs to b e a re a so n a b le c o n stru c tio n o f

th e S tate law g o v e rn in g p u b lic a c c o u n ta n ts a s it appli es to a ccount i ng pr act i ces t hatar e nots peci fi cal l ydefi ned i n, o r e x p licitlyre g u late d b y , the sta tu te. T h e 1 9 8 1 O p in io n in ter p re ts t he s t atut e i n a manner t hat ens ur es r egul at oryover s i ghtof audi t i ng pr act i ces , w hi l e not undul y r es t r i ct i ng compet i t i on forot hert ypes of ac co u n ti ng s er vi ces
. I n t he nea r l yt w o deca des s i nce the 1981 O pi ni on w as i s s ued, t he C our tof A ppeal s has a p p arent l ynothad occa s i on t o cons t rue t he A ctt o di ffe r enteffec t. N orhas t he L egi s l atur e expr es s ed a c ont r ar yi nt ent , des pi t e s e v e r al oppor tuni t i es in b ills a m e n d in g th e A c t.
T he keyques t i on now , as t hen, i s w het hera “c om pi l at i on” or “r evi ew ” i nvol ves an “opi ni on on t he cor r ectnes s of t he i nfor m at i on ort he fa i r nes s of t he pr es ent at i on of t he i nfor m at i on” i n t he fi nanci al st at em ents

. C om

pa re B O P §2- 101( f) ( defi ni t i on of “pr act i ce ce rt ifi ed p u b li c a cc o u n tanc y ”) w ith for m er A r t i cl e 75A , §15( e)

. T he A I C PA defi ni t i on of “compi l at i on” s t at es t hat t he ac count antgi ves no as s ur ance on t he fina nci al s t at ement s
. M or eover , t he r ecomm ended r epor t i ng l anguage t hati s t o acc o mpa n ya c o mpi l at i on re p o rt is m o re in th e n a tu r e o f a d isc laim e r th a n a n a ss e rtio n a s to cor r ectnes s or fai r nes s of t he fi nanci al s t at ement s
. T hus , t he 13G en. 3] 15

(...continued) 13 277, 281 n.1 (7 Cir. 1994) (district court dismiss ed fraud and neg lige nce th action ag ainst acc ounting firm based in pa rt on “cle ar and un amb iguous dis c la ime rs ” in c omp ilatio n r epo rtinglangua g e ); Ashland Oil Co., Inc. v

. Arne tt , 8 75 F .2 d 1 27 1, 12 84 -8 5 ( 7 Cir . 1 98 9) (“ dis c la ime r”in th c omp ilatio n r epo rting langua g e do e s n ot re lie vea c c ounta nt f ro m duty to ref rain from knowing pa

rticipation in fra

ud). A regulation adopted by the S tate Board of Public Accounta ncy 14 i n 1 9 9 2 m ay support such a vie w. In that regulation, the Boa rd def ined “written cer

tificate or

opinion as to the correctne ss of the financ ial statement or a s to the fairne ss of the prese ntation” to include “a ny ...form of languag e which e xpressly disclaims an opinion wh en th at form of languag e is conve ntionally understood to imply any positive assura nce a s to the reliability

o f th e f

in an c ial s tate ments...” COMAR 09.24.01.01A(9)(b)(i).
Th e repo rtinglangua g e re c omm e nd ed for a re view repo rt is 15 mark e dly sim ila

r to an e xamp le prov ide d in the Re state me nt 2d of To rt s of circumstances in which a n acc ountant would n o t b e held liable f or neg lige nt m i s representation. SeeRestatement 2d Torts §522, Comment (continued...) c o n c lu sio n in th e 1 9 8 1 O p in io n a s to c o m p ilatio n s a p p e a rs s o u n d ly g ro u n d e d in th e s ta tu te

. W i t h r e s p e c t t o r e v i e ws , t h e i s s u e i s l e s s c l e a r
. Th e A I CPA defi ni t i on of “r evi ew ” char act er i zes i t as a “l i m i t ed ass ur ance ” t hat n o m aterial m o d ifi ca ti o n s n ee d b e m ad e t o the s tat em en ts t o co n fo rm w i t h gener al l yac cept ed ac count i ng pr i nci pl es ( G A A P)

. T he re c o m m e n d e d lan g u a g e th a t is to a c c o m p a n ya re v iew a ss e rts, w ith som ew hat l ess force, t hat th e a c cou ntanti s no taw are of any sig n if ica n t d e v iatio n s f

ro m G A A P . T h u s, a re v iew a rg u a b ly in v o lv e s a n “ a ss u ra n c e ” c o n c e rn in g th e f in a n c ial s tate m e n ts th a t, al t ho ug h st at ed in neg a tiv e t erm s ) i

. e. , l ack of know l edge of defi ci enci es i n t he s t at ement s , has aff i r m at i ve i m pl i cat i ons as t o t he i nformat i on i n t he s t at ement s
. I n t hatvi ew , onl yl i cens ed accou ntant s m ayprovide such servi ces. 14
O n the o ther ha n d , the re p o rt ing lang u ag e re co m m en d ed fo r a r evi ew r epor ti s phr as ed i n s uch n eg at i ve t er m s t hati ti s not u n rea so n ab le t o co n clud e, as t h e 19 8 1 O p inion d id, th at i t fall s sh o rt o f a n a f f irm a tiv e “ o p in io n o n th e c o rre c tn e ss ” o f th e in f o rm a tio n in t h e f i n a n c i a l s t a t e me n t s o rt h e f a i r n e s s o f

i t s p r e s e n t a t i on. 151 6 [8 4 O p
. A tt ’y

(...continued) 15 c, I llustration 3. Se eals o Union Bank v. Ernst &W hinney , 278 Cal. Rptr. 490, 495-96 (Cal. Ct. App. 1991) (quotingrepor ting languag e and holding that acc ountant’s re view report may not be basis for f

raud or neglig ence claim by third party

).
I f th e G e n e r a l A s s e mb ly inten d e d

to p r o h ib it

un li c e n s ed 16 acc ountants from preparing revie w repor ts, it need only

have looke d to the laws of Virg inia for a

n example of a c lear

prohibition. V i rgi nia law p r o h i b i t s anun l i c e n s e d

a c c o unt antf

r o mu s i n gth e t e r

m“ g e n e ra lly acc epted ac co unting principles” in conne ction with the prepa ration of a fi na nc ia l st ate me nt, from u sin gthete rm “ re view” or

“ SSARS”wi th re sp e c t to fi nanci a l st ate me nts , a nd from i mplyingprof

ic ie nc y wi th financ ial standards established by the AI CPA. SeeVa. Code Ann. §54.1- 2007(A)( 5)-( 7). The V i rgi n i a statute a lso explicitly permits unlicensed acc ountants to prepare compilations. SeeVa. Code Ann. §54.1-2001(B )- (C). The AI CPA subsequently modified ea ch of the se introductory 17 paragraphs in S S AR S No. 7. Those amendments do not aff ect the conclusion in this opinion. SeePart I I Iof this opinion. M o reo v er, th e A ct ex p li cit lyp erm it s u n li ce n sed p erso n s to p rep are f in a n c ial s tate m e n ts a n d re p o rts n o t “ ex p re ss ly i ncl uded i n t he defi ni t i on of pr act i ce cer t i fi ed publ i c account ancy
. ” B O P §2- 102( a) ( emphasi s added)

. I n s uch ci r c u ms t ance s , abs enta contr ar ydi r ect i ve f ro m th e L e g isla tu re o r th e a p p e lla te c o u rts, w e w o u ld o rd in a rily decl i ne t o m odi fyt he 1981 O pi ni on. 16
B
. O m is s i on of

P ar t of R epor ting L anguage A s i gni fi cant om i s s i on i n the 1981 O pi ni on, how ever , has been br oughtto our at t ent i on. I n m eas ur i ng t he def i ni t i ons of “compi l at i on” and “ r evi ew ” aga i ns tt he Publ i c A ccount ancyA ct , the 1981 O pi ni o n q u ot ed r epor t i ng l anguage r ecomm ended byt he A IC P A f o r c o m p ila tio n s a n d f

o r r e v ie w s
. See 66 O

pi ni ons of

the A t t or ney G ener alat192 ( compi l at i on r epor t i ng l anguage), 194 ( r evi ew r epor t i ng l anguage )

. A tt he t i m e of t he 1981 O pi ni on, t he 17 A I C PA r ecomm ended the fol l ow i ng l anguage : f orcom pi l at i ons :
I ( w e) have c om pi l ed t he ac company i ng bal ance s heet of X Y Z C om panyas ofG en. 3] 17
D ece m ber31, 19 X X , and t he r el at ed s t at ement s of i ncome , r et ai ned ea r ni ngs , and c a sh f lo w s f o r th e y e a r th e n e n d e d , in acc or dance w i t h s t andar ds es t ab l i s hed byt he A m e ric a n In stitu te o f C e rtifie d P u b lic A ccou ntant s. A c o m p ilatio n is lim ited to p re se n tin g in t he for m of fi nanci al s t at ement s infor m at i on t hati s t he r epr es ent at i on o f m anage m ent ( ow ner s )

. I ( w e) have notaudi t ed orr evi ew ed t he ac company i ng fi nanci al s t at eme n ts and, acc or di ngl y , do not expr es s an opi ni on orany o t h e rf o r m o f a s s u r a n c e o n t h e m. f or revi ew s:
I ( w e) have r evi ew ed t he ac company i ng bal ance s hee tof X Y Z C om panyas of D ece m ber 31, 19X X , and the re l at ed s t at em ent s of i ncome, r et ai ned ea r ni ngs , and c a sh f lo w s f o r th e y e a r th e n e n d e d , in acc or dance w i t h s t andar ds es t abl i s hed byt he A m e ric a n In stitu te o f C e rtifie d P u b lic A c c o u n tan ts. A ll i n f

o r m a tio n in c lu d e d in t hes e fi nanci al s t at ement s i s t he r e p r es ent at i on o f t h e ma n a g e me n t( o wn e r s ) o f XYZ C o m p a n y
. A r evi ew cons i s t s pr i nci pal l yof i nqui r i es of c o mpa n y p e r s o n n e l a n d a n al y t i cal p ro c e d u re s a p p lied to f in a n c ial d a ta. It is su b sta n tiallyles s in s c o p e th a n a n a u d it i n acc or dance w i t h gener al l yacc ept ed audi t i ng s t andar ds , t he obj ect i v e of w hi ch i s t he expr es s ion of an opi ni on r egar di ng t he fi nanci al st at ement s t aken a s a w hol e. A ccor di ngl y , I ( w e) do notexpr es s s uch an opi ni on.
B as ed on my ( our ) r evi ew , I am ( w e ar e) n o taw ar e of a nym at er i al m odi fi cat i ons t hat1 8 [8 4 O p
. A tt ’y

s houl d be m ade t o t he ac company i ng fi nanci al sta tem e n ts in o rd e r f o r th e m to b e in confor m it y w it h g en eral l y acc ept ed accou nti ng pri ncipl es. S S A R S N o . 1

. T h e re c o m m e n d e d re p o rtin g lan g u a g e th u s g e n e ra lly descri bes t he n at ure of t he p art i culart ype o f report

. Ital so d istin g u ish e s c o m p ilatio n s a n d re v iew s f ro m a n a u d it an d e x p licitly d is c la im s a n yo p in io n th a t w o u ld b e b a s e d u p o n a n a u d it.
W i t h r es pectt o bo th com pi l at i ons and r evi ew s , t he 1981 O pi ni on acc ur at el yquot ed por t ion s of t he r ecomm ended r epor t i ng l anguage , but in e ach i ns t ance om i t t ed w i t houtexpl anat i on t he i nt r oduct or ypar agr aph of t he re por t i ng l anguage r ecomm ended by t he A I C PA

. T he 1 9 81 O pi ni on concl uded t hatan unl i cens ed acc ount antm ayl aw ful l ypr ovi de a com pi l at i on orr evi ew i f, among o th e r th in g s, th e re p o rt in c lu d e s lan g u a g e “ su b sta n tially sim ilar” to t h a t r e c o mme n d e d b y SS AR S No. 1

. Howev e r , t h e 1 9 8 1 O pi ni on p ro v id e d n o g u id a n c e o n w h e th e r th e u n lice n se d a c c o u n tan t is to us e, par aphr as e, ori gnor e t he i n tr oduct or ypar agr aph of the re c o m m e n d e d re p o rtin g lan g u a g e . W e b e liev e it is a p p ro p ria te to f ill th e g a p le f

t b yth e 1 9 8 1 O p in io n
. C
. Modi f i cati on of

C onclusi on A par tfr om s t at i ng t he t im e p eri od cover ed byt he fi nanci al st at em ents

)w hi ch maybe obvi ous fr om t he s t at ement s t hemsel ves

)the i ntr oduct oryp ara g rap h o f th e re co m m en d ed rep o rt ing l anguage forbot h compi l at i ons and re vi ew s adds not hi ng t o t he des cr i pt i ons of t he t er m s “compi l at i on” and “ r evi ew ” o ther tha n t o m ake a gener al r efe r ence t o t he s t andar ds of t he A I C PA

. T he dra ft erof t he 1981 O p inion m ays i m pl yhave thoughtt he i ni t i al par agr aphs r edundantorw i t houts ubs t ance
. N onet hel es s , t hos e par agr aphs do p ro v id e a re f

e re n c e , h o w e v e r g e n e ra l, th a t w o u ld p e rm it a re a d e r to o b t a i n f u r t h e ri n f

o r ma t i o n o n t h e n a tu r e o f a c o mp i l a t i o n o rr e v i e w. A t t he s ame t i m e, how ever , i n r epr es ent i ng t hat t he pe rson has pr epar ed t he s t at ement s “i n acc or dance w i t h s t and a r d s e s t a b l i s h e d by t he A m er i can I ns t i tut e of Cer t i fi ed Publ i c A ccount ant s , ” t he in tro d u c to ryp a ra g ra p h s c re a te s o m e p o ten tial f o r c o n f u sio n a s to wh e t h e rt h e p r e p a r e r i s a CP A

) i.e ., a lice n se d a c c o u n tan t

)and im p li ca te t h e A ct’s pro h ibit ion ag ains t th e m i slead ing u se o f th e term “ce r t i fi ed publ i c ac count ant

. ”G en. 3] 19

In theory , an unlicense d person preparing a compilation or revie w 18 could avoid such c onfusion by omitti ngany

ref ere nce to the A I CPA. Ho we ve r, tha

t so lution

wo uld ultimate ly

prov ide a us er wi th l e ss inf or matio n a bo ut t henature of

therepo rt

. A nys uch conf

us i on can be r emedi ed by an expl i ci ts t at ement t hatt he pr epar er o f t he r epor ti s notl i cens ed. T he r epor t i ng l anguage al r eadydi s t i ngui s hes a compi l at i on orr evi ew fr om an audi t

. T he r epor ts houl d s i m i l ar l yens ur e t hatt her e i s no s ugges t i on t h a tt h e p e r s o n p r o v i d i n g t h e r e p o r t i s l i c e n s e d t o p e r f o r m a u d i t s
. To t hi s end, w e m odi fy t he concl us i on of t he 1981 O pi ni on t o s t at e t hat a n u n lice n se d p e rso n m a yp ro v id e a c o m p ila ti o n o r re v iew re p o rt, b u t o n lyif

h e o r sh e u se s re p o rtin g lan g u a g e su b sta n tially i n acc or dance w i th t he l anguage r ecomm ended byt he A I C PA t hat i ncl udes notonl ya s t at ement t hatt he r epor ti s nott he r es ul tof an au d it , b u t al so a statem en t th at the pre p are r i s n o t l icen sed to p erf o rm audi t s
. A ccor d ingl y , t he s econd pa r agr aph of the r epor t i ng

18 l anguage us ed b yunl i cens ed per s ons w ho pr ovi de compi l at i on or r evi ew r epor t s s houl d i ncl ude s uch a di s cl ai m er
. Such l anguage , i nd i cat ed in i t al i cs, cou l d read sub st anti al l yas fol l ow s: f or com pilati on s: A c o m p ilatio n is lim ited to p re se n tin g in t he form of fi nanci al sta t ement s i nfor m at i on t hati s t he re pr es ent at i on of m anage m ent ( ow ner s )

. I ( w e) have not per for m ed a r evi ew o f th e a c c o m p a n y in g f

in a n c ia l s ta te m e n ts

. I a m (w e a re

) no t li c e n se d

to p e rfo rm a u d its an d h ave n ot audit ed these statem en ts. A ccor di ngl y , I ( w e) do not expr es s an opi ni on o ra n yo t h e rf

o r m o f a s s u r a n c e o n t h e m. f or revi ew s: A r evi ew cons i s t s pr i nci pal l yof i nqui r i es of c o m p an y per s onnel and ana l y t i cal p ro c e d u re s a p p lied to f in a n c ial d a ta. It is su b s ta n tia llyles s in sc o p e th a n a n a u d it i n acc or dance w i t h gener al l yacc ept ed audi t i ng s t andar ds , t he obj ect i ve of w hi ch i s t he expr es s i o n o f an opi ni on r egar di ng t he2 0 [8 4 O p
. A tt ’y
fin an cial stat em en ts take n as a w h o le. I am ( w e ar e) notl i cens ed t o per f or m audi t

s and ha ve no t a u d ited th e se st atem ents

. A ccor di ngl y , I ( w e) do notexpr es s an opi ni on on t he fi nanci al s t at ement s as a w hol e.

V
C oncl usi on I n s um m ary , w e conf

i r m t he conc l us i on of t he 1981 O pi ni on th a t a n u n lice n se d p e rso n m a yiss u e c o m p ilatio n a n d re v iew re p o rts o n f i n a n c i a l s t a t e me n t s i n c e r t a i n c i r c u ms t a n c e s
. Ho we v e r , we m o d if yth e c o n d iti o n s sta ted in th a t o p in io n to a v o id c o n f u sio n a s to th e lice n sin g sta tu s o f

th e p e rso n iss u in g th e re p o rt. A c c o rd in g ly , in ouropi ni on, a per s on w ho per for m s acc ount i ng s er vi ces b u t is not l i cens ed byt he St at e B oar d of Publ i c A ccount ancym ayi s s ue compi l at i on and r evi ew r epor t s i n acc or dance w i t h t he s t andar ds s et for t h byt he A I C PA i n t he r el evant SSA R S, s o l ong as t hatper s on: ( 1) us es r epor t i ng l anguage s ubs t ant i al l yi n acc or dance w i t h the lan g u a g e re c o m m e n d e d b yth e A IC P A a n d in c lu d e s a sp e c if ic s t at ement t hathe ors he i s notl i cens ed t o per for m audi t s ; ( 2) does notpurpor tt o r epr es entt hathe ors he has per for m ed an “ audi t ”; and (3 ) d o e s n o t p ro v id e a n o p in io n a s to th e c o rre c tn e ss , fa irn e ss , o r f a ir present at i on of the fi nan ci al st at em ents

. J. Jo sep h C u rran , Jr. A t t or ney G ener al
M at t hew A

. L aw r ence A s s is tan t A tt o rn ey G en eral
R o b e rt N . M c D o n a ld C hi ef Counsel O pi ni ons and A dvi ce