Could Idaho legally bar unlicensed people from calling themselves 'accountant' or 'auditor' on advertising or business cards?

Opinion 86-1: Restricting "accountant" to licensed practitioners survives constitutional review

Plain-English summary

Representative Crow asked the Attorney General whether Idaho's Accountancy Act, which bars unlicensed people from using the title "accountant" or similar terms (Idaho Code § 54-218(3)), could be defended against constitutional attack. The AG concluded yes. Under the police power, the state may regulate accounting practice to protect the public, and similar regulation has been upheld for decades against due process and equal protection challenges. The closer question was commercial speech under the First Amendment. Applying the four-part test from Central Hudson, the AG found that unlicensed use of "accountant" is likely to mislead the public; the state has a substantial interest in protecting consumers from confusing or unreliable financial-services representations; restricting the title directly advances that interest; and the statute (with its built-in exceptions for in-house and public-position uses) is not more extensive than necessary. The Maryland Supreme Court's contrary decision in Comprehensive Accounting Service was distinguished because it predated Central Hudson and addressed a statute with internal contradictions Idaho's law did not have.

Currency note

This opinion was issued in 1986. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Background and statutory framework

Title 54, chapter 2 of the Idaho Code is the Accountancy Act. It creates a two-tier licensing scheme: certified public accountants (CPAs) under a continuing track, and public accountants (PAs) as a closed "dying class" since July 1, 1977 (§ 54-214). Section 54-218 restricts the titles "certified public accountant" and "public accountant" to licensees and adds in subsection (3) a broader prohibition on "certified accountant," "chartered accountant," "enrolled accountant," "licensed accountant," "registered accountant," "accredited accountant," "accountant," "auditor," and the abbreviations CA, EA, RA, LA, or anything similar likely to be confused with CPA or PA. Subsection (4) reserves attestation services and opinions to licensed practitioners. The 1976 expansion to its current form coincided with the closure of the PA class.

Idaho's regulatory pattern is national. Forty-seven states plus DC, Guam, Puerto Rico, and the Virgin Islands restrict the same title set.

What the AG concluded at the time

Police power and rational-basis review

Under Jones v. State Board of Medicine and the Kellogg decisions, professional licensing falls within the police power. Rational-basis scrutiny applies to challenges under due process and equal protection. The state's interest in protecting consumers from financial misrepresentation easily clears rational basis, and Texas State Board of Public Accountancy v. Fulcher had already upheld a similar statute on those grounds. The 1920s decisions in State v. Riedell and Frazer v. Shelton (which had struck down accountant-title restrictions) reflected an interventionist era that gave way to Nebbia and Williamson v. Lee Optical.

Central Hudson and commercial speech

The closer question was First Amendment commercial speech. Holding oneself out as an accountant is commercial expression under Virginia Pharmacy Board. Central Hudson supplies the four-part test: (1) is the speech protected (lawful and not misleading); (2) is the asserted government interest substantial; (3) does the regulation directly advance that interest; (4) is it more extensive than necessary?

Step 1. The AG concluded that unlicensed use of "accountant" is likely to mislead. Even sophisticated readers do not always know which functions only a licensed accountant may perform. Allowing the term to be used by unlicensed practitioners would dilute the assurance that someone holding herself out as an accountant has met educational and examination standards.

Step 2. The state's interest is substantial. The AG quoted an Arizona Auditor General report on the importance of audited financial statements for outside decision-makers and the financial harm that incompetent or unscrupulous practitioners can cause.

Step 3. The restriction directly advances the interest by aligning what the public reads on a business card with what the state has actually verified.

Step 4. The statute is not overbroad. Section 54-218(3) carves out two important exceptions: an officer, employee, partner, or principal of an organization can use "accountant" or "auditor" in a position title within that organization; and public officials and employees can use those titles in reference to their public positions. Bookkeeping and tax preparation remain unregulated. The restriction is targeted at holding out to the general public.

Distinguishing Comprehensive Accounting Service

The Maryland Supreme Court had struck down a similar restriction in Comprehensive Accounting Service v. Maryland State Board of Public Accountancy. That decision predated Central Hudson and was driven by an internal contradiction in Maryland's statute, which permitted unlicensed accounting services while banning the very words used to describe them. Idaho's statute did not contain that contradiction. The AG also noted that Maryland required a "compelling need," which Central Hudson rejected in favor of "substantial interest."

Title restrictions are common across professions

The opinion noted that Title 54 already restricts "social worker" (§ 54-3214(2)), "medical physician" or "medical doctor" (§ 54-1804(3)), "dentist" (§ 54-903), "nurse" (§ 54-1401), and "engineer" (§§ 54-1202, 54-1212). Each rests on the same constitutional footing.

Common questions

Could a person who provides bookkeeping or tax preparation still describe their work using ordinary language?

Yes. The opinion expressly preserved the unregulated occupations of bookkeeping and tax preparation. The restriction reached only the use of "accountant" or its variants by an unlicensed practitioner holding out to the public.

Could a company with an internal "Accounting Department" continue to use that title?

Yes, under § 54-218(3)'s exception for officers, employees, partners, or principals of an organization using accountant or auditor in a position title within that organization.

Did the opinion guarantee the statute would survive any future challenge?

The opinion described it as "a close question" on commercial-speech grounds and emphasized that no factual record was before the AG. It concluded the legislature's judgment would likely be upheld, but it did not foreclose case-specific challenges.

Citations

• Idaho Code § 54-218 — title restriction at the heart of the question.
• Idaho Code § 54-201 et seq. — Accountancy Act framework.
• First and Fourteenth Amendments, U.S. Constitution.
• Central Hudson Gas v. Public Service Commission, 447 U.S. 557 (1980) — four-part commercial speech test.
• Virginia Pharmacy Board v. Virginia Consumer Council, 425 U.S. 748 (1976) — commercial speech as protected expression.
• Comprehensive Accounting Service v. Maryland State Board of Public Accountancy, 284 Md. 474 (1979) — Maryland's contrary holding (predates Central Hudson).
• Fulcher v. Texas State Board of Public Accountancy, 571 S.W.2d 366 (1978) — upholding similar Texas restriction.

Source

• Landing page: https://www.ag.idaho.gov/office-resources/opinions/
• Original PDF: https://ag.idaho.gov/content/uploads/2018/04/OP86-01.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain; the linked PDF is authoritative.

STATE OF IDAHO
OFFICE OF THE ATTORNEY GENERAL

JIM JONES
ATTORNEY GENERAL
BOISE 83720
TELEPHONE (208) 334-2400

ATTORNEY GENERAL OPINION NO. 86-1

TO: Mrs. Delores Crow
Idaho State Representative
203 11th Avenue South Extension
Nampa, Idaho 83651

Per Request for Attorney General's Opinion

QUESTION PRESENTED:

Is it constitutionally permissible to restrict the use of the word "accountant" and other labels or titles to individuals who have been certified and licensed by the Idaho State Board of Accountancy, as required by Idaho Code § 54-201, et seq.?

CONCLUSION:

Yes. It is constitutional under the first and fourteenth amendments of the United States Constitution and under article I, §§ 1, 9, 13 of the Idaho State Constitution. The state in exercise of its police powers may regulate the profession of accounting as set forth in I.C. § 54-201 et seq., and require licensing of "certified public accountants" and "public accountants" as defined in that chapter. The state may also restrict the use of the term "accountant" or other labels or terms to those who are licensed by the State Board of Accountancy.

I. Statutory Authority

Title 54, chapter 2 of the Idaho Code, known as The Accountancy Act, regulates the profession of accounting and creates the Idaho State Board of Accountancy and the Public Accountant's Advisory Committee. It creates a two-tier licensing system for "certified public accountants" and "public accountants." By definition, all members of these classes must hold a valid, unrevoked and unsuspended certificate and/or license under this chapter. I.C. § 54-206. The profession of "public accountant" is a "dying class," meaning that since July 1, 1977, with limited exceptions that have now expired, the class of licensed public accountant has been closed to new applicants. I.C. § 54-214.

The section that directly concerns the question presented is § 54-218. Subsections (1) and (2) restrict the use of the terms "certified public accountant" and "public accountant" to licensed persons. Subsection (3) states:

No person, partnership or corporation shall assume or use the title or designation "certified accountant," "chartered accountant," "enrolled accountant," "licensed accountant," "registered accountant," "accredited accountant," "accountant," "auditor" or other title or designation or any of the abbreviations "CA," "EA," "RA," or "LA," or similar abbreviations likely to be confused with "certified public accountant" or "public accountant"; . . .

Thus, the Idaho Legislature has restricted to licensed persons the use of titles containing the word "accountant" or "auditor," as well as the use of these words themselves. There shall be no profession of unlicensed accountants in the state, with the exceptions noted in subsection (3), to be discussed later.

Subsection (4) similarly provides that only a licensed person may render opinions or perform attestation as an accountant or auditor.

Similar restrictions regarding the titles and functions of accountants have existed for nearly 70 years. The Idaho State Board of Accountancy was established in 1917 to issue certificates to practice as a certified public accountant "and no other person shall be permitted to assume and use such title, or to use any words, letters or figures to indicate that the person using the same is a certified public accountant." 1917 Idaho Session Laws, ch. 126, § 3. Similar language was retained in the law until a new chapter was enacted in 1974 stating that no person shall assume or use the titles of "certified public accountant," or "public accountant" or the letters "C.P.A." in connection with his name or business in this state without holding a valid, unrevoked and unsuspended certificate issued or recognized by the board. 1974 Idaho Session Laws, ch. 263, § 54-218. In 1976, when the licensing of "public accountants" was written into the law as a dying class, the more specific and restrictive use-of-title language that we have today was added to § 54-218(3).

Idaho is not unique in its regulatory scheme. Accountancy laws governing the licensing of professional accountants have been enacted in all fifty states, the District of Columbia, Guam, Puerto Rico and the United States Virgin Islands. Certified public accountants (CPAs) are licensed in all states. Forty-seven (47) states, as well as the District of Columbia, Guam, Puerto Rico and the United States Virgin Islands, have regulatory accountancy laws that restrict to licensees the use of the titles "Certified Public Accountant," "Public Accountant," and other similar titles, and that regulate the performance of specific professional accounting services. Digest of State Accountancy Laws and State Board Regulations, 1985, published jointly by the American Institute of Certified Public Accountants, Inc. and the National Association of State Boards of Accountancy.

II. Due Process and Equal Protection

The question addressed in this opinion deals mainly with the constitutional limits upon the state's authority to license and thereby to regulate certain professions, including accounting. This authority is grounded in the police power, which is the intrinsic power of the state to protect the health, safety and general welfare of its people. Jones v. State Board of Medicine, 97 Idaho 859, 868, 555 P.2d 399 (1976) cert. denied 431 U.S. 914, 97 S.Ct. 2173, 53 L.Ed.2d 123 (1977); Comprehensive Accounting Service Co. v. Maryland State Board of Public Accountancy, 284 Md. 474, 397 A.2d 1019 (1979); Heller v. Abess, 134 Fla. 610, 184 So. 122 (1938); Montejano v. Rayner, 33 F.Supp. 435 (Dist. Id. 1939); Dent v. West Virginia, 129 U.S. 114, 122, 9 S.Ct. 231, 233, 32 L.Ed. 623 (1889).

There have been no cases in Idaho interpreting § 54-218 or other sections of the Accountancy Act, but the Idaho Supreme Court has upheld similar professional licensing requirements in the field of medicine when challenged by persons in the field of naturopathy, an unlicensed occupation. State v. Kellogg, 102 Idaho 628, 636 P.2d 750 (1981); State v. Kellogg, 98 Idaho 541, 568 P.2d 514 (1977); State v. Maxfield, 98 Idaho 356, 564 P.2d 968 (1977).

Under the fourteenth amendment of the United States Constitution, and art. I, §§ 1 and 13 of the Idaho Constitution, challenges to police power regulations such as those found in The Accountancy Act may be made on a number of bases. Challenges may be made that such regulations interfere with the liberty and property interests protected by the due process clauses of both constitutions and that a classification established by the regulation violates the equal protection clause of the U.S. Constitution. The standard to measure a violation under any of these constitutional grounds is the same: the law or rule complained of need only bear a rational relationship to a legitimate legislative purpose. Bint v. Creative Forest Products, 108 Idaho 116, 697 P.2d 818 (1985); Minnesota v. Clover Leaf Creamery, 449 U.S. 456, 101 S.Ct. 715, 66 L.Ed.2d 659 (1981); Nebbia v. New York, 291 U.S. 502, 537, 54 S.Ct. 505, 516, 78 L.Ed. 940 (1934).

The rational relation standard of review receives near unanimous acceptance today. Cases from the 1920's that allowed the unlicensed use of the term "accountant," and found its restriction unconstitutional on due process and equal protection grounds, reflected the courts' interventionist views of that era. See, State v. Riedell, 109 Okla. 35, 233 P. 684 (1924); Frazer v. Shelton, 320 Ill. 253, 150 N.E. 696 (1926).

The views of the 1920's changed direction in the 1934 U.S. Supreme Court case of Nebbia, supra, which espoused the rational relation standard. See also, Williamson v. Lee Optical, 348 U.S. 483, 75 S.Ct. 461, 99 L.Ed. 563 (1955). Under this standard, courts have routinely upheld the constitutionality of statutes regulating accountants against challenges that such statutes violate fourteenth amendment rights to due process and equal protection. Texas State Board of Public Accountancy v. Fulcher, 515 S.W.2d 950 (Tex. Civ. App. 1974); Comprehensive Accounting Service, supra. It is our opinion that a challenge to the Idaho accountancy statute on similar grounds would likewise be dismissed as lacking in merit.

III. First Amendment and Commercial Speech

This opinion also addresses the issue of a possible constitutional violation of free speech under the first amendment of the United States Constitution and art. I, § 9, of the Idaho Constitution. While there is little doubt that The Accountancy Act, § 54-201 et seq., is constitutional on due process and equal protection grounds, the question is closer when the Act is tested for violation of free speech because the standard of review is different than in the due process/equal protection areas.

Protection of commercial speech is a recent development in constitutional jurisprudence. In Central Hudson Gas v. Public Service Commission, 447 U.S. 557, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980), the United States Supreme Court defined commercial speech as "expression related solely to the economic interests of the speaker and its audience." The cornerstone of commercial speech is the dissemination of information. The ability to hold oneself out and advertise in an occupational area such as accounting meets this definition. Such speech enjoys protection under the first amendment of the United States Constitution. See, Virginia Pharmacy Board v. Virginia Consumer Council, 425 U.S. 748, 765, 96 S.Ct. 1817, 1827, 48 L.Ed.2d 346 (1976).

As with other forms of speech, however, commercial speech may justifiably be regulated or even suppressed in certain situations. In fact, the protections afforded commercial speech are somewhat less than other forms of speech. Zauderer v. Office of Disciplinary Counsel, 53 LW 4587 (No. 83-2166, May 28, 1985); Bolger v. Young Drug Products Corp., 463 U.S. 60-65, 103 S.Ct. 2875, 2879, 77 L.Ed.2d 469 (1983); Metromedia, Inc. v. San Diego, 453 U.S. 490, 506, 101 S.Ct. 2882, 2892, 69 L.Ed.2d 800 (1981); Central Hudson, supra at 562-63.

In determining the validity of government restrictions on commercial speech, a four-part test was enunciated in Central Hudson, supra:

At the outset, we must determine whether the expression is protected by the First Amendment. For commercial speech to come within that provision, it at least must concern lawful activity and not be misleading. Next, we ask whether the asserted governmental interest is substantial. If both inquiries yield positive answers, we must determine whether the regulation directly advances the governmental interest asserted, and whether it is not more extensive than is necessary to serve the interest.

447 U.S. at 566, 100 S.Ct. at 2351.

[The opinion proceeds through each of the Central Hudson prongs, concluding that unlicensed use of the term "accountant" is likely to mislead the public; that the government's interest in protecting consumers of financial services is substantial; that the title restriction directly advances that interest; and that, in light of § 54-218(3)'s exceptions for in-house and public-position uses, the regulation is not more extensive than necessary. The opinion then distinguishes Comprehensive Accounting Service v. Maryland State Board of Public Accountancy and notes parallel title restrictions for social workers, doctors, dentists, nurses, and engineers in Title 54 of the Idaho Code.]

It is our opinion, therefore, that the regulation of commercial speech by The Accountancy Act is constitutional under the four-part test of Central Hudson. The use of the term "accountant" by unlicensed persons is likely to mislead the public. The government has a substantial interest in protecting the public from such misleading representation. Requiring that persons who hold themselves out to the public as "accountants" be licensed is a direct and reasonable means of attaining this goal. Idaho's regulatory scheme is not more extensive than is necessary to serve its valid purposes.

In summary, the use of the term "accountant" and other restrictions of title found in The Accountancy Act directly advance the state's substantial interest in protecting the public from misleading advertising. The unrestricted use of such terms can be deceptive and misleading. We stress, however, that the question before us is not presented in a factual context. Hence, although it is a close question, we believe the legislature's judgment in restricting this and other terms is constitutional when tested by the standard of review applicable to commercial speech under the first amendment of the United States Constitution and art. I, § 9, of the Idaho Constitution.

DATED this 24th day of January, 1986.
ATTORNEY GENERAL
State of Idaho

ANALYSIS BY:
JOHN J. McMAHON
Chief Deputy Attorney General

BARBARA ROBERTS
Intern