Michigan CPA License Defense Lawyer
Defense for Accountants Facing LARA Investigations, Formal Complaints, and Board of Accountancy Disciplinary Proceedings.
A complaint against a Michigan Certified Public Accountant may involve professional judgment, accounting standards, alleged financial misconduct, ethics, or compliance with the state's licensing requirements. The Michigan Department of Licensing and Regulatory Affairs (LARA) can investigate alleged violations and pursue disciplinary action when authorized by law.
Michigan CPA matters involve several distinct regulatory bodies, including LARA's Bureau of Professional Licensing (BPL), the Michigan State Board of Accountancy, and the Michigan Office of Administrative Hearings and Rules (MOAHR). Each has a different role in the complaint and disciplinary process.
Ratliff Jackson LLP represents CPAs and accounting professionals facing licensing investigations, requests for records, allegations of professional misconduct, formal disciplinary complaints, administrative hearings, proposed consent orders, and other regulatory action.
Our defense work begins with the actual allegations, governing accountancy standards, professional records, licensing status, and procedural requirements of the case.
What Should a Michigan CPA Do When LARA Makes Contact?
The appropriate response begins with identifying the regulatory stage, what the agency is requesting, and whether the CPA is facing a preliminary investigation, formal charge, or existing licensing restriction.
A licensing complaint does not itself establish a violation. But the department can review professional records, investigate alleged misconduct, and initiate formal action when the investigation identifies evidence of an Occupational Code violation.
Identify the Document and Applicable Deadline
Determine whether the correspondence is an investigative inquiry, licensing audit, subpoena, formal complaint, or hearing notice. The 15-day election rule in MCL 339.508 applies to the specified notice accompanying a formal complaint, not to every investigative letter.
Preserve Original Accounting Records
Identify engagement letters, workpapers, electronic records, supporting financial documents, tax files, reports, communications, and peer review materials. Maintain the original record and its relevant history rather than altering documentation after receiving an inquiry.
Identify the Alleged Professional Violation
Separate claims of dishonesty or fraud from negligence, technical standards departures, continuing education issues, peer review deficiencies, or a problem involving an out-of-state practice privilege.
Review Confidentiality and Records Demands
Michigan law protects specified confidential accounting client information. Evaluate any applicable permission, statutory exception, subpoena, or other lawful basis for disclosure before preparing a production or explanation.
Assess Related Professional Consequences
Identify other accountancy licenses, federal practice privileges, firm credentials, pending professional organization matters, and separate civil or criminal proceedings that may involve the same facts.
Who Investigates and Disciplines Michigan CPAs?
Michigan regulates public accountancy under Article 7 of the Occupational Code, Public Act 299 of 1980. The regulatory process involves LARA, its Bureau of Professional Licensing, the State Board of Accountancy, and the Office of Administrative Hearings and Rules.
These names refer to different functions. A complaint received by the department, an administrative hearing before MOAHR, and a final order issued by the board are distinct events.
Department of Licensing and Regulatory Affairs
LARA is Michigan's state department responsible for administering numerous professional and occupational licensing laws. It is the parent agency within which the relevant licensing and hearing functions operate.
Bureau of Professional Licensing
BPL handles occupational licensing administration and regulatory enforcement, including investigations, formal complaints, negotiated settlements, and compliance monitoring of final disciplinary orders.
Michigan Office of Administrative Hearings and Rules
MOAHR provides an administrative hearing forum. An administrative law judge hears evidence, makes findings and legal conclusions, and issues a hearing report in a contested Occupational Code case.
Michigan State Board of Accountancy
The board regulates covered accounting credentials and determines the appropriate disciplinary disposition after a contested hearing under the applicable Occupational Code procedures.
Which Michigan Accountancy Credentials Can Be Affected?
Michigan's accountancy law distinguishes individual licensure, firm licensure, registration, and qualifying practice privileges held by accountants whose principal place of business is outside the state.
Those distinctions matter because a complaint may involve the individual's conduct, a firm's supervision of engagements, a registration issue, or authority to serve Michigan clients without a separate Michigan license.
Individual CPA License
A Michigan-licensed CPA can face discipline based on professional services, statutory misconduct, regulatory noncompliance, or other grounds recognized in MCL 339.734.
Licensed CPA Firms
Firms may face questions involving engagement supervision, professional standards, ownership and licensing requirements, peer review, and responsibility for the work performed on their behalf.
Registration and Out-of-State Privileges
Registered accountants and qualifying nonresident CPAs may be affected by rules addressing use of the CPA title, practice authority, principal-state license status, and Michigan regulatory jurisdiction.
What Allegations Can Threaten a Michigan CPA License?
MCL 339.734 identifies accountancy-specific disciplinary grounds. These include dishonesty, fraud, negligence in public accounting, departure from applicable professional standards, violations of professional conduct rules, and certain criminal or outside regulatory actions.
Importantly, Michigan's statute expressly includes negligence. The legal analysis should not assume that every disciplinary charge must establish gross negligence. The exact statutory ground and relevant evidence control.
Fraud and Financial Misconduct
Allegations involving dishonest transactions, false financial information, improper diversion of funds, misrepresentations, or fraud associated with accounting services.
Audit and Attestation Deficiencies
Questions involving audit planning, workpapers, evidence, independence, professional judgment, supervision, reporting, and applicable auditing requirements.
Negligence and Professional Standards
Claims that the accountant's services departed from standards applicable at the time of the engagement or otherwise satisfy the statute's negligence or misconduct grounds.
Tax Services and Financial Reporting
Allegations involving tax return preparation, tax advice, management advisory services, financial statements, or the professional standards governing those engagements.
Ethics, Client Information, and Records
Issues involving professional conduct, confidentiality, workpaper responsibilities, engagement documentation, and compliance with applicable board regulations.
Criminal or Outside Regulatory Matters
Qualifying convictions, discipline in another licensing jurisdiction, loss of authority before a governmental agency, or specified conduct that discredits the profession.
How a Michigan CPA Licensing Investigation Develops
The Michigan Occupational Code establishes a complaint-investigation framework before formal disciplinary hearings. The department must investigate complaints and decide whether the evidence supports further enforcement.
Not every complaint reaches a hearing. A matter may be closed, discussed informally, or proceed to a specified administrative enforcement action.
Receipt and Initial Review
Under MCL 339.502, the department begins investigating a complaint and opens a correspondence file. The statute requires acknowledgment to the complainant within 15 days, not a general 15-day response from the CPA.
Evidence and Status Review
The department gathers available information and evaluates possible violations. MCL 339.504 requires an investigative status report to the director within 30 days, subject to authorized extensions.
Closure or Further Enforcement
When the investigation does not disclose a violation, the department closes the complaint under the applicable statute. When evidence supports action, the law authorizes specified enforcement alternatives.
Formal Complaint or Other Authorized Action
Depending on the evidence and law, possible actions under MCL 339.504 include a formal complaint, cease and desist order, citation, or another action authorized by the relevant statutory provision.
Conference or Settlement Discussions
The department may arrange an informal conference during the investigation or after a formal complaint. Such discussions can address disputed allegations or an authorized stipulation.
Administrative Hearing and Final Order
A contested formal complaint may be heard before MOAHR. The administrative law judge issues a hearing report, and the Board of Accountancy makes the authorized disciplinary determination.
The Occupational Code's investigation-status deadlines govern departmental action. They should not be confused with the CPA's obligations under a particular notice or formal complaint.
The 15-Day Election After a Michigan CPA Formal Complaint
When LARA serves a formal complaint under MCL 339.508, it must also provide notice describing the compliance-conference and hearing process and offer the respondent three procedural alternatives.
The respondent generally has 15 days after receiving the required notice to make an election. The appropriate selection depends on the alleged violation, available documents, compliance history, and whether a negotiated resolution is realistic.
Negotiate a Settlement
The respondent may elect to meet with the department to explore an agreed resolution. A proposed settlement must be evaluated for factual admissions, disciplinary terms, professional restrictions, and applicable board approval.
Demonstrate Compliance
A licensee or registrant may elect an opportunity to demonstrate compliance before the contested case hearing, as contemplated by the Occupational Code and Michigan's Administrative Procedures Act.
Proceed to a Contested Hearing
The respondent may elect to contest the alleged violations through an administrative hearing, where the parties can present evidence and legal arguments under the governing procedural rules.
Defending a Michigan CPA in a Contested Disciplinary Hearing
Michigan's Office of Administrative Hearings and Rules conducts contested occupational licensing hearings under the Administrative Procedures Act and applicable hearing rules.
A CPA disciplinary hearing requires analysis of the particular statutory charges and the accounting evidence. It is not merely an informal meeting with an investigator.
Review the Formal Charges
Identify every Occupational Code provision alleged, the specific professional conduct at issue, and whether the charges concern the individual, the firm, or practice privileges.
Obtain and Examine the Evidence
Review the investigative record available through applicable procedures, documentary exhibits, accounting records, witness accounts, and the professional standards invoked by the department.
Develop Technical Accounting Defenses
Analyze engagement scope, supervision, workpaper quality, the information known at the time, and whether expert accounting evidence would assist with disputed professional standards.
Prepare Testimony and Hearing Arguments
Organize exhibits, witness preparation, legal objections, administrative motions, and a defense grounded in the statutory elements and evidentiary record.
Evaluate the Hearing Report
The administrative law judge issues a report containing findings of fact and conclusions of law. The report is transmitted to the board for the appropriate final disciplinary determination.
What Evidence Matters in a Michigan CPA Licensing Defense?
A licensing defense must distinguish an actual violation of professional standards from a client complaint, unfavorable business outcome, difference in judgment, or allegation unsupported by the accounting record.
MCL 339.734 requires attention to the professional standards applicable to the engagement at the time it was performed. The regulatory analysis must be connected to the historical facts and relevant professional responsibilities.
Scope and Assignment
Engagement letters, work descriptions, client instructions, service limitations, reporting duties, and who accepted responsibility for particular decisions.
Workpapers and Financial Records
Audit files, testing, supporting documentation, review notes, financial statements, tax records, and contemporaneous electronic evidence.
Rules Applicable at the Time
Accounting, auditing, attestation, financial reporting, or tax-related standards adopted or otherwise applicable to the professional services involved.
Professional Judgment and Conduct
Communications, decision-making history, information available to the CPA, claimed misrepresentations, and evidence bearing on negligence or dishonesty.
Peer Review and Licensing History
Firm responsibilities, supervision of engagements, peer review reports, continuing education, licensing status, and previous regulatory communications.
Other Orders and Proceedings
Qualifying criminal judgments, final agency determinations, other accountancy board actions, civil findings, and legally significant external disciplinary records.
Confidential Client Information, Workpapers, and Document Retention
Michigan provides specific statutory protections for information obtained through accounting services. The law also identifies circumstances in which disclosure is permitted and distinguishes ownership of workpapers from the separate question of confidentiality.
Client Confidentiality and Defense Exceptions
Michigan generally protects information derived from covered professional accounting services, subject to the statute's express exceptions.
One exception permits a CPA whose professional competence is challenged in court or before an administrative agency to disclose otherwise confidential information as part of the defense. Other exceptions address specified professional review and governmental disclosures.
The statute also protects certain departmental investigation records from public disclosure, subject to exceptions involving contested cases and formal agency action.
Workpaper Ownership and Retention
Section 339.733 generally recognizes the accountant's ownership of prepared workpapers, subject to contrary agreements and exclusions for client records and reports.
Rule 338.5104 generally requires covered practitioners and firms to maintain sufficient engagement documentation for at least five years. Peer review documentation is governed by its separate retention provision.
Ownership does not eliminate applicable preservation duties or determine whether material must be provided under lawful process.
Michigan CPA Consent Orders, Suspension, Revocation, and Fines
Michigan authorizes several disciplinary sanctions. The general Occupational Code provisions must be read together with the accountancy-specific provisions because the latter establish a higher maximum administrative fine for covered violations.
An informal resolution or consent order may contain findings, conditions, fines, or restrictions. Its precise language should be reviewed for licensing and collateral consequences before acceptance.
Suspension and Revocation
Section 339.602 authorizes suspension or revocation of licenses and certificates of registration for qualifying violations. The operative final order determines the extent and effective date of any restriction.
Administrative Fines Up to $25,000
Section 339.734(2) authorizes fines up to $25,000 per violation for covered accountancy violations, notwithstanding the general fine provision in section 339.602(e). The maximum is not a mandatory fine.
Censure and Probation
The Occupational Code permits censure and probation. A negotiated order may include ongoing compliance terms, depending on the violations and governing authority.
Denial or Nonrenewal
Denial of a covered credential or renewal may be available as an authorized sanction, subject to the particular statute, findings, and procedural requirements.
Restitution
Under section 339.602(h), restitution may be required on the basis of proofs and findings made following a contested case, as provided by the statute.
Consent Orders and Settlement Terms
A settlement may resolve allegations without a fully contested hearing, but the board can reject a proposed agreement and require further proceedings under MCL 339.508.
Reporting Outside Discipline and Protecting Multi-State CPA Credentials
Michigan's accountancy law imposes specific reporting duties for certain final outside determinations and extends regulatory authority to qualifying out-of-state CPA practice privileges.
Those obligations must be distinguished from routine investigative inquiries or allegations that have not resulted in a covered final determination.
Thirty-Day Reporting Under MCL 339.734(3)
A licensee or registrant must report specified final agency determinations, judgments, or convictions involving violations in which dishonesty, fraud, or negligence is an element, generally within 30 days after the covered determination.
Discipline Imposed Elsewhere
Section 339.734 recognizes certain outside accountancy licensing actions and loss of rights before governmental or oversight agencies as grounds that may support Michigan discipline.
Out-of-State CPA Practice Privileges
Section 339.734a subjects qualifying nonresident CPAs and their employing firms to Michigan regulatory jurisdiction and requires cessation of covered services when the principal-state license is no longer valid.
Separate Civil and Criminal Proceedings
A lawsuit, criminal investigation, professional ethics inquiry, and Board of Accountancy disciplinary case may involve overlapping evidence while remaining legally distinct proceedings.
Michigan CPA Disciplinary Appeals and License Restoration
Challenging the lawfulness of a final disciplinary order is different from seeking restoration of professional authority after a valid sanction. The available procedure depends on the order, the credential, and governing law.
Judicial Review of Final Board Orders
Qualifying final contested-case decisions may be reviewed in the appropriate Michigan circuit court under the Administrative Procedures Act, subject to any controlling special review procedure.
Where MCL 24.304 governs, the general petition deadline is 60 days after mailing of notice of the final agency decision, with separate timing for certain timely rehearing requests.
Filing for review does not automatically stay enforcement. The agency or court may consider a stay under applicable law.
Reinstatement or Relicensure After Discipline
A CPA seeking to resume practice after suspension or revocation must examine the original order, current licensing status, applicable reinstatement or relicensure requirements, and any outstanding board conditions.
The Bureau of Professional Licensing's Compliance Section processes reinstatement and reclassification applications. The requirements for a disciplinary restoration case may differ from ordinary renewal or relicensure after expiration.
A pending application does not, by itself, restore authority to provide regulated accounting services.
How Ratliff Jackson LLP Handles Michigan CPA Licensing Matters
A Michigan CPA licensing defense must connect the Occupational Code, accountancy regulations, accounting evidence, and the procedural stage. The objective and available defenses depend on what the department alleges and what the record supports.
Identify the Complaint and Governing Authority
Review the LARA communication, alleged statutory provisions, credential affected, records requested, procedural stage, and any response requirements.
Examine Accounting Evidence and Standards
Review engagements, workpapers, applicable professional standards, firm responsibilities, and evidence bearing on negligence, dishonesty, or other asserted violations.
Prepare the Investigative or Formal Response
Address production scope, confidentiality, factual explanations, formal complaint elections, and regulator communications according to the actual notice.
Develop the Administrative Hearing Defense
Prepare evidence, motions, witnesses, professional accounting analysis, and arguments responsive to the specific charges in a contested proceeding.
Evaluate Consent Orders and Proposed Sanctions
Examine findings, administrative fines, probation, suspension, revocation, restitution, settlement terms, and possible reporting consequences.
Review Final Orders and Other Licensing Exposure
Evaluate compliance obligations, available administrative or judicial review, restoration requirements, and consequences for additional credentials.
Michigan CPA Licensing Laws, Enforcement Rules, and Board Resources
These government resources address different parts of a Michigan accountancy case. They provide information about the licensing framework, investigations, hearings, professional standards, disciplinary orders, and firm obligations.
Michigan State Board of Accountancy
The official board portal provides licensing guides, credentials, board schedules, current statutory resources, and access to applicable accountancy regulations.
Michigan Administrative Code, Accountancy
Official accountancy regulations address adopted professional standards, engagement record retention, continuing education, peer review, and other professional obligations.
September 2025 Accountancy Amendments
The official rule amendment updates Michigan's adoption of specified AICPA, PCAOB, and other professional standards used to assess regulated accounting work.
Bureau of Professional Licensing Enforcement
Explains the bureau's role in administrative complaints, formal proceedings, settlement negotiations, compliance monitoring, and disciplinary orders.
MOAHR Occupational Licensing Hearings
The Michigan Office of Administrative Hearings and Rules explains contested hearings, the administrative law judge's report, and the board's final decision-making role.
Occupational Disciplinary Action Reports
Public reports identify issued disciplinary orders, effective dates, sanctions, and the general basis of completed disciplinary actions. An open investigation is not listed as final discipline.
Licensed Accountant Guide and FAQs
Official guidance explains individual CPA licensing status, professional qualifications, reciprocity, renewal requirements, and related compliance questions.
Accountancy Firm Licensing Guide
Explains firm authority, supervision of attest and compilation engagements, license renewal, peer review, and ownership or good-standing requirements.
Accountant Temporary Practice Permit Guide
Official licensing guidance addresses temporary practice permission and requirements relevant to accountants seeking to perform certain services in Michigan.
Michigan CPA Complaints, Hearings, and Licensing Discipline
These answers concern Michigan Occupational Code proceedings. The actual document, credential, legal grounds, and procedural stage determine the applicable requirements.
Who investigates complaints against Michigan CPAs?
The Michigan Department of Licensing and Regulatory Affairs (LARA), through its Bureau of Professional Licensing (BPL), handles complaints and enforcement involving accountants. The Michigan State Board of Accountancy exercises applicable licensing and final disciplinary authority.
Does a LARA complaint mean my CPA license will be disciplined?
No. A complaint is not a final finding of professional misconduct. Under MCL 339.504, the department may close a complaint when an investigation does not disclose a violation or pursue an authorized enforcement action when the evidence supports one.
How long do I have to respond to a Michigan CPA formal complaint?
MCL 339.508 generally permits a respondent 15 days after receiving the notice accompanying a formal complaint to select settlement discussions, an opportunity to demonstrate compliance, or a contested hearing. An initial investigative letter may carry different requirements.
What happens if I do not select an option within 15 days?
Under MCL 339.508, if the respondent does not timely select one of the offered alternatives, the department proceeds to a contested case hearing. Missing the election deadline does not automatically revoke the CPA license.
Does Michigan discipline CPAs for negligence or only gross negligence?
MCL 339.734 expressly includes dishonesty, fraud, or negligence in the practice of public accounting as possible grounds for discipline. It also addresses departure from standards applicable at the time of an engagement. The actual allegations must be assessed under the statute and relevant professional standards.
What is the maximum administrative fine in a Michigan CPA case?
MCL 339.734(2) authorizes an administrative fine of up to $25,000 per violation for covered violations of the accountancy article and related rules or orders. This is an authorized maximum, not an automatic fine. Other disciplinary measures may also apply.
Can LARA obtain confidential client accounting records?
MCL 339.732 generally protects certain confidential accounting client information while recognizing exceptions, including specified disclosures when the CPA's professional competence is challenged before a court or administrative agency. The scope and legal basis of any particular demand should be evaluated.
How long must Michigan CPAs retain workpapers?
Michigan Administrative Rule 338.5104 generally requires covered accountants and firms to retain sufficient engagement documentation for at least five years. Peer review records have a separate retention rule, including retention through final adjudication of a related complaint when later.
Who issues the final decision after a Michigan CPA hearing?
At a contested occupational licensing hearing, an administrative law judge from the Michigan Office of Administrative Hearings and Rules issues a hearing report. The Michigan State Board of Accountancy then determines the applicable disciplinary disposition under the Occupational Code and issues the final order.
Must a Michigan CPA report discipline or judgments from another jurisdiction?
MCL 339.734(3) requires reporting within 30 days after specified final agency determinations, court judgments, or convictions involving violations in which dishonesty, fraud, or negligence is an element. Not every pending complaint, allegation, or arrest is automatically covered.
Can a Michigan CPA appeal a final disciplinary order?
Potentially. Qualifying final contested-case orders may be reviewed in circuit court under Michigan's Administrative Procedures Act, subject to any applicable special review provision. Where MCL 24.304 governs, the general deadline is 60 days after mailing notice of the final order, with different timing for certain timely rehearing requests. Filing does not automatically stay discipline.
What does a Michigan CPA license defense lawyer do?
Counsel reviews the allegations and governing law, examines accounting records and professional standards, addresses LARA inquiries and confidentiality issues, evaluates formal complaint options, prepares contested hearings, reviews settlements and disciplinary orders, and assesses related licensing consequences.
A Michigan CPA Board Complaint Should Be Defended Under the Actual Accountancy Law and Evidence.
Professional discipline may involve detailed accounting records, adopted technical standards, statutory misconduct allegations, and procedural rules that determine how the case moves from investigation to final board action.
Ratliff Jackson LLP represents CPAs and licensed professionals in regulatory and disciplinary matters. If you have received a LARA inquiry, formal complaint, hearing notice, proposed consent order, or final licensing decision, we can evaluate the record and the legal options available at the current stage.