May 11, 1989
TO: INVESTMENT ADVISER MEMBERS NO. 28-89
INVESTMENT ADVISER ASSOCIATE MEMBERS NO. 27-89
RE: IDAHO EXCLUDES CPAs FROM INVESTMENT ADVISER LAW
__________________________________________________________
On March 29, 1989, Idaho Governor Cecil Andrus signed Idaho
House Bill No. 276 into law. A copy of HB 276 is attached.
The legislation amends the Idaho investment adviser law to
exclude from the definition of investment adviser "a certified
public accountant or licensed public accountant who holds himself
out to the public as a certified public accountant or licensed
public accountant." The legislation also amends the existing law
to delete "accountant" from the exclusion previously available to
an accountant. That exclusion was available to an accountant who
gave investment advice about securities only on a basis which was
"solely incidental" to the practice of his or her profession.
As you may know, the accountant industry has been actively
seeking state law exclusions from the definition of investment
adviser based on their argument that they are already regulated
by the American Institute of Certified Public Accountants and/or
by various state boards of public accountancy. The Institute and
many others have argued strenuously that while these accountancy
boards may regulate accountants with regard to tax and financial
advice, they do not regulate accountants with regard to advice
given about securities. Idaho is the first state to permit a
total exclusion for accountants, although Maryland and other
states are considering similar action.
We will keep you informed of any developments.
Robert L. Bunnen, Jr.
Assistant General Counsel
Attachment