Does the AICPA Code apply to a CPA working as a fractional CFO?

The short answer: check which part of the Code you work under

The AICPA Code of Professional Conduct is organized by the kind of work a member does. Part 1 covers members in public practice, Part 2 covers members in business, and Part 3 covers other members, such as those who are retired or between roles. The commissions and referral fees rule (1.520) and the contingent fees rule (1.510) sit in Part 1, so they reach you when you are in public practice. The Code text hosted by the Minnesota Board of Accountancy sets out both rules; the AICPA's online Code is the authoritative current version.

Most fractional CFOs should work on the assumption that Part 1 applies. If you run your own practice, sign engagement letters with several companies and describe yourself as a CPA when you market, you are performing professional services for clients while holding out as a CPA, which is the heart of public practice. A CPA on one company's payroll as its full-time CFO is the clearer member-in-business case.

What 1.520 says once it applies

The rule bars a member in public practice from accepting a commission for recommending a product or service to a client when the member or the member's firm also performs an audit, a review, certain compilations or an examination of prospective financial information for that client. Where a commission or referral fee is allowed, it must be disclosed to the client. The full walk-through is in Can a CPA accept a referral fee?

For a fractional CFO, three consequences follow:

• The attest screen covers your firm, not just you. If a colleague or an affiliated firm compiles or reviews the client's statements, the restriction can reach you even though you only sit in the CFO seat. The guide to clients that bar a CPA from taking a commission goes through each engagement type.
• A SourceX reward is likely to be analyzed as a commission. The rule separates compensation for recommending another party's product or service from referral fees for recommending a CPA's services. How the AICPA Code labels a reward covers that distinction.
• Disclosure is required even when the reward is allowed. Settle the wording before the introduction, not after a deal closes.

Public practice or member in business: how to tell

The Code's definitions draw the line. In broad terms, public practice means performing professional services for a client while holding out as a CPA. A member in business is someone employed or engaged, including on a contractual basis, in an executive, staff, governance, advisory or administrative capacity, and that definition excludes members in public practice. A contract CFO can read both definitions as describing them, which is exactly why the safer working assumption is Part 1.

If you genuinely do both, for example a small tax practice alongside an employed CFO role, ask the AICPA ethics staff how each part applies to each relationship.

How state rules sit on top

The AICPA Code binds AICPA members. Your state board's rules bind you as a licensee whether or not you belong to the AICPA, and some states legislate on commissions directly. Florida, for example, regulates CPA commissions and referral fees in section 473.3205 of its statutes, including written disclosure of commissions; the linked page shows the 2017 text, so read the current version. Compare your own state in CPA commission and referral fee rules by state.

If you hold licenses in several states, or serve clients across state lines under mobility provisions, check each state that could claim the engagement.

Contracts can be stricter than the rules

Ethics rules set a floor. Your engagement letter, the client's conflict policy and, at sponsor-backed clients, the private equity owner's portfolio policies can go further. Read for clauses on outside compensation, conflicts of interest, confidentiality and authority to commit the company. If you hold an officer title, bank signing authority or a seat in the contract approval chain, plan to step out of the licensing decision even where the rules permit the reward.

Disclosure that works for a fractional CFO

1. Put it in writing before the introduction, addressed to the owner or board chair rather than to someone who reports to you.
2. Name the payer and the source: SourceX, from its own platform fee, never deducted from the company's proceeds.
3. Describe the timing honestly: payable only once the buyer has paid and SourceX has received its fee.
4. State your role: you introduce, you never handle the company's records, and you will not approve or sign the license.
5. Keep the countersigned copy with the engagement file.

Questions to put to your state board, the AICPA ethics staff or counsel

1. Given how my engagement is structured, am I in public practice for this client?
2. Does anyone at my firm or an affiliated firm perform attest work for the client, and over what period does that matter?
3. Is the reward a commission under the Code and under my state's rule, and what form must the disclosure take?
4. Does my engagement letter or the client's sponsor restrict outside compensation?
5. As an officer of the client, should I recuse myself from approving the license?

This is general information, not legal, tax or financial advice. Confirm with your own counsel, tax adviser or professional body before acting.

How the reward fits into the analysis

Partners earn 25% of the eligible platform fees SourceX actually collects from the referred company's licensing deals, capped at $100,000 per referred company. Rewards become payable only after the buyer pays and SourceX receives its fee; a lead, meeting or signed agreement alone does not trigger payment, and no reward is guaranteed.

Some of your clients will fit the profile: US companies whose headcount hit 50+ full-time employees at peak (contractors excluded), that hold years of finance, CRM, support and operations history, own the rights to those records and have an owner who can sign. The referral guide for fractional CFOs covers which clients to raise it with, and the company fit checker offers a preliminary screen that asks for no contact details.

Next step

Settle the public-practice question and the attest screen first, read the program terms, then register as a partner.