By Brimer H.B. No. 1080 A BILL TO BE ENTITLED 1-1 AN ACT 1-2 relating to public accountants and to certain acts of public 1-3 accountants. 1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: 1-5 SECTION 1. Title 4, Civil Practice and Remedies Code, is 1-6 amended by adding Chapter 86 to read as follows: 1-7 CHAPTER 86. PUBLIC ACCOUNTANTS 1-8 Sec. 86.001. DEFINITION. In this chapter, "accountant" 1-9 means a person holding a certificate or registration issued by the 1-10 Texas State Board of Public Accountancy. 1-11 Sec. 86.002. LIABILITY LIMITED. An accountant is not liable 1-12 for an act or omission committed in connection with compiling, 1-13 reviewing, certifying, auditing, or otherwise reporting or 1-14 analyzing a financial statement or other information unless: 1-15 (1) the injured person contracted directly with the 1-16 accountant to perform those services; or 1-17 (2) the accountant: 1-18 (A) was aware at the time the services were 1-19 performed that the financial statement or other information would 1-20 be made available to the injured person for use in connection with 1-21 a specified transaction and the injured person was specifically 1-22 identified to the accountant; 1-23 (B) communicated directly with the injured 2-1 person concerning the financial statement or other information; and 2-2 (C) was aware that the injured person intended 2-3 to rely on the financial statement or other information in 2-4 connection with the specified transaction and communicated that 2-5 awareness by words or conduct. 2-6 SECTION 2. This Act takes effect September 1, 1993, and 2-7 applies only to a cause of action that accrues on or after that 2-8 date. A cause of action that accrued before the effective date of 2-9 this Act is governed by the law in effect at the time the action 2-10 accrued, and the former law is continued in effect for that 2-11 purpose. 2-12 SECTION 3. The importance of this legislation and the 2-13 crowded condition of the calendars in both houses create an 2-14 emergency and an imperative public necessity that the 2-15 constitutional rule requiring bills to be read on three several 2-16 days in each house be suspended, and this rule is hereby suspended. 2-17 COMMITTEE AMENDMENT NO. 1 2-18 Amend HB 1080 on page 2 between lines 4 and 5 by adding the 2-19 following subparagraph (3): 2-20 (3) For purposes of subparagraph (2) above, if the 2-21 accountant (i) identifies in writing to the client those persons 2-22 who are intended to rely on the services, and (ii) sends a copy of 2-23 such writing or similar statement to those persons identified in 2-24 the writing or statement, then such accountant or any of its 2-25 employees, partners, members, officers or shareholders may be held 3-1 liable only to such persons intended to so rely, in addition to 3-2 those persons in privity of contract with such accountant. 3-3 Averitt