CPA ethics checklist before joining a referral partner program

Why run this checklist before you register

Most ethics problems with referral programs start at the first introduction, not at sign-up: a partner names a client the firm reviews, sends a trial balance to show the opportunity is real, or forgets to put the disclosure in writing. Answering the questions below once, as a firm, turns each later introduction into a short, repeatable check.

The rules in play are AICPA rule 1.520 on commissions and referral fees and rule 1.510 on contingent fees, both in the AICPA Code of Professional Conduct (a copy hosted by the Minnesota Society of CPAs; the AICPA's online Code is the current version), plus each state board's own rule. State rules can be stricter: the New Jersey Society of CPAs' overview of commissions and contingent fees shows one state departing from the AICPA text. The state-by-state comparison helps you find yours.

Sections 2 and 5 repeat for every client you consider introducing. The other sections are firm decisions you make once and revisit when something changes.

The checklist

1. Which rules bind you

• List every state where you hold a license or serve clients under mobility, and pull each board's commission and referral fee rule.
• Confirm whether each person who would make introductions is an AICPA member and whether they act in public practice for the clients concerned.
• Locate the firm's written policy on outside compensation and third-party referral relationships, and name who approves exceptions.
• If the firm sits inside a network, a merger integration or an alternative practice structure, ask the independence team which entity's rules govern; the guide to PE-backed CPA firms and APS explains why that matters.

2. Attest screen, for every client

• Check the client against the firm's attest list: audits, reviews, the compilations the rule covers and examinations of prospective financial information.
• Include work done by other offices and affiliated firms, not only your own engagements.
• Look at the period covered by any attest engagement, not just whether one is open today.
• Record the result, the date and who ran the check.

3. What kind of payment this is

• Agree with your ethics adviser whether the reward is a commission or a referral fee under your rules; SourceX's service is not a CPA service, which points toward commission.
• Ask whether a reward that depends on a deal closing raises any contingent-fee question for this client.
• Note for the disclosure that SourceX pays the reward from its own fee and never deducts it from the client's proceeds.

4. How you will disclose

• Choose a format: an engagement letter clause, a stand-alone disclosure letter, or both.
• Deliver it in writing before the introduction.
• Explain the basis: 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.
• Explain the timing: rewards become payable only after the buyer pays and SourceX receives its fee, and no reward is guaranteed.
• Get the client's acknowledgment and file it with the engagement.

5. Confidentiality and client consent, for every client

• Ask the client's permission before you mention its name to SourceX.
• If the firm prepares the client's tax returns, ask your tax risk partner whether consent under IRC section 7216 is needed before return information is used to spot or suggest the introduction.
• Never send statements, ledgers, exports or sample files; partners pass on basic fit information only.
• Offer the client your referral link so it can apply itself and share only what it chooses.

6. Where the money lands

• Decide whether the firm or an individual holds the partner relationship, consistent with partner and employment agreements.
• Decide how the income is booked and who in leadership is told.
• Expect information reporting: the IRS explains when a business files Form 1099-NEC for payments to independent contractors; confirm the treatment with your tax adviser.
• Revisit the decision after any merger, outside investment or change to the partner agreement.

7. The program terms

• Read the program terms in full and keep a dated copy with the firm's policy.
• Confirm the attribution rule: the first valid referrer to introduce a company that then files a verified application inside the attribution window gets the credit.
• Confirm that partners never export, upload or describe confidential records.
• Confirm the company baseline: a US business with 50+ full-time employees at peak (contractors excluded), several years of documented operations, rights to license its records and an authorized sponsor.

8. Anything said in public

• If the program appears in a newsletter, webinar or social post, state that the firm may be paid for referrals. The FTC's Endorsement Guides, at 16 CFR Part 255, include a section on disclosing material connections between endorsers and advertisers.
• Put the copy through the firm's normal marketing review.

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

How to read your results

Red flags that should stop an introduction

• The client is an attest client of any office or affiliate.
• Someone suggests sending sample files or exports to prove the data is real.
• The client's records mostly belong to its own customers, as at many agencies and outsourcers, and those customers have not agreed.
• The data is mainly consumer personal information or medical records without a licensing basis.
• Archives were deleted, or no one at the client can run an export.
• Headcount never got to 50+ full-time employees at peak (contractors excluded), or the same data is already licensed for AI training.
• The owner expects you to run the licensing process or sign on the company's behalf.

For a preliminary, non-binding read on company fit before you raise it with a client, use the company fit checker.

Next step

Work through the firm-level sections with your managing partner, then register as a partner. The referral guide for accountants suggests where in your client base to start, the rules-by-role overview helps colleagues in other professions run their own checks, and Can a CPA accept a referral fee? explains rule 1.520 in depth.