Under what condition can a CPA firm use the name of a past owner?

A CPA firm can use the name of a past owner for up to two years after the owner's departure. This guideline is in line with the ethical standards established by the American Institute of CPAs (AICPA). The rationale behind this time frame is to allow firms to maintain continuity and a sense of legacy associated with experienced practitioners who were once integral to the firm's identity.

Using the name of a former partner beyond this two-year limit may mislead clients or the public into believing that the past owner is still actively involved with the firm, which can be considered deceptive and misleading. The decision to impose a time limit promotes transparency and ensures that clients are aware of the current composition of the firm.

In contrast, requiring posthumous approval, considering changes in ownership structure, or needing to have all current partners practicing does not align with the standards set forth by professional ethical guidelines. This ensures that CPA firms can responsibly honor their history while still adhering to professional ethics and maintaining accurate representations of their current operations.