LRB-4061/1
MPG:cjs&eev:jf
2013 - 2014 LEGISLATURE
January 24, 2014 - Introduced by Senator Grothman, cosponsored by
Representatives Marklein, Kooyenga, Klenke, Kapenga and LeMahieu.
Referred to Committee on Government Operations, Public Works, and
Telecommunications.
SB515,1,5 1An Act to amend 13.92 (4) (c), 13.92 (4) (d), 13.92 (4) (e), 13.92 (4) (f), 35.93 (2)
2(b) 4., 35.93 (2) (c) 1., 35.93 (3), 35.93 (3) (e) (intro.), 35.93 (3) (e) 1., 227.01 (13)
3(intro.), 227.11 (2) (intro.), 227.27 (2) and 442.01 (2); and to create 13.92 (4)
4(bm) and 227.265 of the statutes; relating to: rule-making procedures and
5practice standards for certified public accountants.
Analysis by the Legislative Reference Bureau
Current law sets forth a procedure for the promulgation of administrative rules
(rules). Generally, that procedure consists of the following steps:
1. The agency planning to promulgate the rule prepares a statement of the
scope of the proposed rule, which the governor and the agency head must approve
before any state employee or official may perform any activity in connection with the
drafting of the proposed rule.
2. The agency drafts the proposed rule, together with an economic impact
analysis, plain language analysis, and fiscal estimate for the proposed rule, and
submits those materials to the Legislative Council Staff for review.
3. Subject to certain exceptions, a public hearing is held on the proposed rule.
4. The final draft of the proposed rule is submitted to the governor for approval.
5. The final draft of the proposed rule, together with an economic impact
analysis, plain language analysis, and fiscal estimate for the proposed rule, are
submitted to the legislature for review by one standing committee in each house and
by the Joint Committee for Review of Administrative Rules.

6. The proposed rule is filed with the Legislative Reference Bureau (LRB) for
publication in the Wisconsin Administrative Code (code) and the Wisconsin
Administrative Register (register), and, subject to certain exceptions, the rule
becomes effective on the first day of the first month beginning after publication.
Under this bill, if a bill that repeals or modifies a rule is enacted, the ordinary
rule-making procedures under current law do not apply. Instead, the LRB must
publish the repeal or modification, in the code and the register, and the repeal or
modification, subject to certain exceptions, takes effect on the first day of the first
month beginning after publication.
This bill modifies certain rules published by the Accounting Examining Board
that apply to certified public accountants in Wisconsin. Under current law, the
board's rules incorporate by reference certain independence standards for certified
public accountants published by the American Institute of Certified Public
Accountants (AICPA) as of June 1, 2002. Under this bill, the board's rules
incorporate those standards as published by AICPA as of January 31, 2013.
Also under current law, the board's rules incorporate certain standards for
performing and reporting on peer reviews established by AICPA as of January 1,
2001, and certain standards for auditing, accounting and review, and attestation
engagements established by AICPA as of June 1, 2003. Under the bill, the board's
rules incorporate all of those standards established by AICPA, as well as auditing
standards established by the Public Company Accounting Oversight Board, without
regard to date.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB515,1 1Section 1. 13.92 (4) (bm) of the statutes is created to read:
SB515,3,22 13.92 (4) (bm) If 2 or more rules filed under s. 227.20 or modified under s.
3227.265 affect the same unit of the Wisconsin administrative code without taking
4cognizance of the effect thereon of the other rules and if the legislative reference
5bureau finds that there is no mutual inconsistency in the changes made by each such
6rule, the legislative reference bureau shall incorporate the changes made by each
7rule into the text of the unit and document the incorporation in a note to the unit.
8For each such incorporation, the legislative reference bureau shall include in a
9correction bill a provision formally validating the incorporation. Section 227.27 (2)

1is not affected by printing decisions made by the legislative reference bureau under
2this paragraph.
SB515,2 3Section 2. 13.92 (4) (c) of the statutes is amended to read:
SB515,3,54 13.92 (4) (c) The legislative reference bureau may insert in the Wisconsin
5administrative code a note explaining any change made under par. (b) or (bm).
SB515,3 6Section 3. 13.92 (4) (d) of the statutes is amended to read:
SB515,3,87 13.92 (4) (d) Sections 227.114, 227.116, 227.135, and 227.14 to 227.24 do not
8apply to any change made by the legislative reference bureau under par. (b) or (bm).
SB515,4 9Section 4. 13.92 (4) (e) of the statutes is amended to read:
SB515,3,1110 13.92 (4) (e) The legislative reference bureau shall prepare and keep on file a
11record of each change made under par. (b) or (bm).
SB515,5 12Section 5. 13.92 (4) (f) of the statutes is amended to read:
SB515,3,1413 13.92 (4) (f) The legislative reference bureau shall notify the agency involved
14of each change made under par. (b) or (bm).
SB515,6 15Section 6. 35.93 (2) (b) 4. of the statutes, as affected by 2013 Wisconsin Act 20,
16is amended to read:
SB515,3,1917 35.93 (2) (b) 4. Copies of all rules filed with the legislative reference bureau
18under s. 227.20 (1) or modified under s. 227.265 since the compilation of the
19preceding register, including emergency rules filed under s. 227.24 (3).
SB515,7 20Section 7. 35.93 (2) (c) 1. of the statutes, as affected by 2013 Wisconsin Act 20,
21is amended to read:
SB515,3,2422 35.93 (2) (c) 1. Each chapter of the Wisconsin administrative code that has been
23affected by rules filed with legislative reference bureau under s. 227.20 (1) or
24modified under s. 227.265
, in accordance with sub. (3) (e) 1.
SB515,8 25Section 8. 35.93 (3) of the statutes is amended to read:
SB515,4,14
135.93 (3) The legislative reference bureau shall compile and deliver to the
2department for printing copy for a register which shall contain all the rules filed
3under s. 227.20 or modified under s. 227.265 since the compilation of rules for the
4preceding issue of the register was made and those executive orders which are to be
5in effect for more than 90 days or an informative summary thereof. The complete
6register shall be compiled and published before the first day of each month and a
7notice section of the register shall be compiled and published before the 15th day of
8each month. Each issue of the register shall contain a title page with the name
9"Wisconsin administrative register", the number and date of the register, and a table
10of contents. Each page of the register shall also contain the date and number of the
11register of which it is a part in addition to the other necessary code titles and page
12numbers. The legislative reference bureau may include in the register such
13instructions or information as in the bureau's judgment will help the user to correctly
14make insertions and deletions in the code and to keep the code current.
SB515,9 15Section 9. 35.93 (3) (e) (intro.) of the statutes, as affected by 2013 Wisconsin
16Act 20
, is amended to read:
SB515,4,2117 35.93 (3) (e) (intro.) The legislative reference bureau shall incorporate into the
18appropriate chapters of the Wisconsin administrative code each permanent rule filed
19with the legislative reference bureau under s. 227.20 (1) or modified under s. 227.265
20and, for each chapter of the administrative code affected by a rule, do all of the
21following:
SB515,10 22Section 10. 35.93 (3) (e) 1. of the statutes, as affected by 2013 Wisconsin Act
2320
, is amended to read:
SB515,5,424 35.93 (3) (e) 1. Publish the chapter in the appropriate end-of-month register
25in accordance with the filing deadline for publication established in the rules

1procedures manual published under s. 227.15 (7) or , in an end-of-month register
2agreed to by the submitting agency and the legislative reference bureau , or, in the
3case of a rule modified under s. 227.265, in the end-of-month register for the month
4in which the bill modifying the rule is enacted
.
SB515,11 5Section 11. 227.01 (13) (intro.) of the statutes is amended to read:
SB515,5,126 227.01 (13) (intro.) "Rule" means a regulation, standard, statement of policy,
7or general order of general application which has the effect of law and which is issued
8by an agency to implement, interpret, or make specific legislation enforced or
9administered by the agency or to govern the organization or procedure of the agency.
10"Rule" includes a modification of a rule under s. 227.265. "Rule" does not include, and
11s. 227.10 does not apply to, any action or inaction of an agency, whether it would
12otherwise meet the definition under this subsection, which:
SB515,12 13Section 12. 227.11 (2) (intro.) of the statutes is amended to read:
SB515,5,1514 227.11 (2) (intro.) Rule-making authority is expressly conferred on an agency
15as follows:
SB515,13 16Section 13. 227.265 of the statutes is created to read:
SB515,5,21 17227.265 Repeal or modification of rules. If a bill to repeal or modify a rule
18is enacted, the procedures under ss. 227.114 to 227.21 and 227.26 do not apply.
19Instead, the legislative reference bureau shall publish the repeal or modification in
20the Wisconsin administrative code and register as required under s. 35.93, and the
21repeal or modification shall take effect as provided in s. 227.22.
SB515,14 22Section 14. 227.27 (2) of the statutes is amended to read:
SB515,6,323 227.27 (2) The code shall be prima facie evidence in all courts and proceedings
24as provided by s. 889.01, but this does not preclude reference to or, in case of a
25discrepancy, control over a rule filed with the legislative reference bureau or the

1secretary of state
under s. 227.20 or modified under s. 227.265, and the certified copy
2of a rule shall also and in the same degree be prima facie evidence in all courts and
3proceedings.
SB515,15 4Section 15. 442.01 (2) of the statutes is amended to read:
SB515,6,155 442.01 (2) No The examining board may not adopt a standard or rule relating
6to professional conduct or unethical practice may be adopted until the examining
7board has held a public hearing with reference thereto, subject to the rules
8promulgated under s. 440.03 (1). No Except for a rule modified under s. 227.265, no
9rule or standard shall become effective until 60 days after its adoption by the
10examining board. Any person who has appeared at the public hearing and filed
11written protest against any a proposed standard or rule may, upon the adoption of
12such standard or rule by the examining board, obtain a review thereof under ch. 227.
13Thereafter every person practicing as a certified public accountant in the state shall
14be governed and controlled by the rules and standards prescribed by the examining
15board, including any modifications under s. 227.265.
SB515,16 16Section 16. Accy 1.003 (1) of the administrative code is amended to read:
SB515,6,1917 Accy 1.003 (1) "Attest service" means any of the following, if performed or
18intended to be performed in accordance with the statements incorporated under s.
19Accy 1.205
:
SB515,6,2220 (a) An audit or any other engagement that is performed or intended to be
21performed in accordance with the statements incorporated by reference in s. Accy
221.205 (1)
.
SB515,6,2523 (b) A review of a financial statement that is performed or intended to be
24performed in accordance with the statements incorporated by reference in s. Accy
251.205 (2)
.
SB515,7,3
1(c) An examination of prospective financial information that is performed or
2intended to be performed in accordance with the statements incorporated by
3reference in s. Accy 1.205 (3)
.
SB515,17 4Section 17. Accy 1.101 of the administrative code is amended to read:
SB515,7,7 5Accy 1.101 Independence standards. The following independence
6standards of the accounting profession are adopted by reference and shall be used
7by certified public accountants in Wisconsin:
SB515,7,148 The Code of Professional Conduct ET Section 101, including Sections ET 101.01
9through ET 101.16 101.19, available on the Internet at
10http://www.aicpa.org/about/code/et101.htm#101-1
11http://www.aicpa.org/Research/Standards/CodeofConduct/Pages/sec100.aspx, as of
12January 31, 2013,
and published by the American Institute of Certified Public
13Accountants in print form as AICPA Professional Standards Volume 2 3, as of June
141, 2002
January 31, 2013. The printed volume is available at:
SB515,7,1515 American Institute of Certified Public Accountants
SB515,7,16 161455 Pennsylvania Ave., NW 1211 Avenue of the Americas
SB515,7,17 17Washington, DC 20004-1081 New York, NY 10036-8775
Note: Definitions of terms used in the independence standards, ET Section 101,
are included in ET Section 92 of the Code of Professional Conduct published by the
American Institute of Certified Public Accountants and available at on the Internet site
http://www.aicpa.org/about/code/def92.htm
at
http://www.aicpa.org/Research/Standards/CodeofConduct/Pages/et_92.aspx
and in the
same printed volume as ET Section 101. Copies of the Standards described above are on
file in the offices of the Accounting Examining Board and the Legislative Reference
Bureau.
SB515,18 18Section 18. Accy 1.205 (intro.), (1), (2) and (3) of the administrative code are
19consolidated, renumbered Accy 1.205 and amended to read:
SB515,8,19 20Accy 1.205 Standards for auditing, accounting and review services,
21and attestation engagements.
The following standards of the accounting and

1auditing
profession shall be used by that certified public accountants in Wisconsin:
2 (1) The shall use are (1) the Statements on Auditing Standards issued as of June 1,
32003 by the Auditing Standards Board of the American Institute of Certified Public
4Accountants and published as AICPA Professional Standards, volume 1 by the
5American Institute of Certified Public Accountants, Inc., New York, New York are
6incorporated by reference into this section.
(2) The, the Statements on Standards
7for Accounting and Review Services issued as of June 1, 2003 by the Accounting and
8Review Services Committee of the American Institute of Certified Public
9Accountants and published as AICPA Professional Standards, volume 2 by the
10American Institute of Certified Public Accountants, Inc., New York, New York are
11incorporated by reference into this section.
(3) The, and the Statements on
12Standards for Attestation Engagements issued as of June 1, 2003, by the Auditing
13Standards Board, the Accounting and Review Services Committee, and the
14Consulting Services Executive Committee of the American Institute of Certified
15Public Accountants and
, published as AICPA Professional Standards, volume 2 by
16the American Institute of Certified Public Accountants, Inc., New York, New York is;
17and (2) the auditing standards of the Public Company Accounting Oversight Board.
18All of those Statements and Standards are
incorporated by reference into this
19section.
Note: Copies of the Statements described above may be purchased from the
American Institute of Certified Public Accountants, 1211 Avenue of the Americas, New
York, NY 10036-8775.
Note: Copies of the Statements described above are on file in the offices of the
Accounting Examining Board and the Legislative Reference Bureau.
SB515,19 20Section 19. Accy 9.01 (4) of the administrative code is repealed.
SB515,20 21Section 20. Accy 9.06 of the administrative code is amended to read:
SB515,9,9
1Accy 9.06 Conducting a peer review. In conducting a peer review, a
2board-approved peer review program shall comply with requirements for
3performing system reviews, engagement reviews, and report any other reviews
4established under the "Standards for Performing and Reporting on Peer Reviews"
5issued by the American Institute of Certified Public Accountants, effective January
61, 2001, specifically identified in paragraphs 25 - 71, and reproduced in Appendix
7A to this chapter
available on the Internet at
8http://www.aicpa.org/Research/Standards/PeerReview/DownloadableDocuments/P
9eerReviewStandards.pdf
.
Note: Paragraphs 25-71 of these standards are included as Appendix A to this
chapter and are also available from the Internet at
http://www.aicpa.org/members/div/practmon/stdstitledl.htm
SB515,21 10Section 21. Accy 9 Appendix A of the administrative code is repealed.
SB515,22 11Section 22. Effective dates. This act takes effect on the day after publication,
12except as follows:
SB515,9,1413 (1) The treatment of section 35.93 (2) (b) 4. and (c) 1. and (3) (e) (intro.) and 1.
14of the statutes takes effect on January 1, 2015.
SB515,9,1515 (End)
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