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235.18.1-224-25-6. Financial Requirements

AR ADC 235.18.1-224-25-6Arkansas Administrative CodeEffective: August 6, 2022

West's Arkansas Administrative Code
Title 235. Arkansas Department of Labor and Licensing
Division 18. Contractors Licensing Board
Rule 1. The Rules and Regulations of the Contractors Licensing and Bond Law
Effective: August 6, 2022
Ark. Admin. Code 235.18.1-224-25-6
Formerly cited as AR ADC 033.00.1-224-25-6
235.18.1-224-25-6. Financial Requirements
Currentness
(a)(1) Except as provided in subsection (e), all applications for an Unrestricted license must contain an audited or reviewed financial statement of the applicant's year end or more current, and prepared on the GAAP or accrual income tax basis, of the company, an audited Opinion Letter or Review report from an Independent CPA or RPA.
(2) All applications for a Restricted license must contain a compiled financial statement of the applicant's year end or more current, prepared on the GAAP or accrual income tax basis. The compiled statements must contain a report from the licensed Independent Certified Public Accountant or Public Accountant but are not required to include footnote disclosures unless specifically requested by the Board.
(b) Minimum Business Related Net Worth (new and renewal applications). Minimum Business Related Net Worth for Classification(s) Requested: (Property not used for Business purposes is not acceptable.) New applicants must have one half (1/2) of the minimum Net Worth requirement in cash.
HEAVY
$50,000
HIGHWAY, RAILROAD, AIRPORT
50,000
MUNICIPAL & UTILITY
50,000
BUILDING
50,000
LIGHT BUILDING
20,000
MECHANICAL
20,000
ELECTRICAL
20,000
SPECIALTY
5,000
(c) Working Capital will also be reviewed and considered in determining whether to issue a new or renewal license. New applicants are required to show a positive working capital.
(d) If the Board determines that the financial information provided by an applicant for a renewal license does not satisfy the financial requirements, the Board may, at its option, deny the application or place the application in Improve status. An applicant who is placed in Improve status will have its license extended thirty (30) days, pending further information being provided and/or changes being made by the applicant to resolve any difficulties. The license is effective only until the next regular meeting of the Board and will expire at the next regular meeting unless further action is taken by the Board.
(e)(1) A bond in lieu of a financial statement, as authorized by Ark. Code Ann. ยง 17-25-304(c), may be filed by a contractor seeking a license. The bond shall be made by surety companies which have qualified and are authorized to do business in the State of Arkansas. The bonds shall be executed by a resident or nonresident agent, broker or producer licensed by the Arkansas Insurance Commissioner to represent the surety company executing the bond and shall file with the bond the agent's, broker's or producer's power of attorney to demonstrate his authority.
(2) The bond shall be on the form provided by the Contractors Licensing Board.

Credits

Amended Jan. 1, 2012; Dec. 2, 2017; Aug. 6, 2022.
Current with amendments received through February 15, 2024. Some sections may be more current, see credit for details.
Ark. Admin. Code 235.18.1-224-25-6, AR ADC 235.18.1-224-25-6
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