Court Upholds Ad Restrictions on Accountants

The California Supreme Court, upholding limits on commercial advertising, held Thursday that a state board can bar non-certified accountants from promoting themselves as accountants.

In a 4-3 decision, the court found that unqualified use by non-certified practitioners of the terms accountant or accounting in the Yellow Pages and other advertisements could be misleading to consumers.

The court, in an opinion by Justice Marvin R. Baxter, said a public opinion poll commissioned by the state attorney general showed 55% of respondents believed people who advertised as accountants had to be licensed.

The justices added, however, that unlicensed accountants may use the terms in their ads if they also warn that they are not licensed.

In a dissent, Justice Stanley Mosk criticized the restrictions as a violation of the right of free speech. The court, he said, could have adequately protected the public by merely barring unlicensed accountants from advertising themselves as licensed.

Moreover, Mosk said, the restriction was of “questionable validity” because it came from a state Board of Accountancy, which is dominated by certified accountants with an “obvious pecuniary interest” in preventing unlicensed practitioners from advertising as accountants. Justice Ronald M. George, joined by Mosk and Justice Joyce L. Kennard, said in a separate dissent that the Legislature never intended to permit the board to bar unlicensed practitioners from calling themselves accountants.

The decision added strength to governmental limits on advertising by unlicensed professionals in a variety of fields who perform some of the same services as licensed professionals, officials said.

In California, only certified public accountants--those who have completed an internship, passed a test and met other requirements--have been permitted by the board to advertise as accountants. By recent count, 28 other states have similar regulations.

CPAs, numbering about 65,000 in the state, can legally perform all accounting work. Another estimated 60,000 people are lawfully performing some limited accounting and bookkeeping services but are not licensed.

In the case before the court, Bonnie Moore, an unlicensed San Francisco accountant, brought suit challenging the restriction after the board ordered her to stop advertising herself as an accountant.

Moore holds a college degree in accounting and once was a chief financial officer for a small firm. Now a law student, Moore previously ran an accounting office that offered small businesses accounting services, such as preparing monthly financial statements and auditing books.