Will 2004 be the year that the decades-old debate on differential accounting standards finally comes to a head?

Leaders at the American Institute of CPAs are among those who hope so.

During a sit-down with the editors of Accountants Media Group this week, AICPA chief executive Barry Melancon and chairman Scott Voynich talked about some of the institute’s priorities for the coming year, including why they believe the time is right to force an issue that has been stuck to the underside of the accounting profession longer than a chewed piece of gum under a high school desk.

Melancon and Voynich think it’s time for the accounting community to debate and discuss the issue, and then to finally settle it. But they don’t expect a resolution to come easily.

As Mr. Melancon put it, “I can tell you it won’t be a unanimous opinion.”

The argument over whether separate accounting standards are needed for public and private companies isn’t new, and it isn’t as simple as two sets of standards or one. But the reasons for settling the long-standing debate in a hurry may have changed.

As Voynich pointed out, timing is critical: The 2005 deadline for public companies in the European Union to adopt international accounting standards is looming. Those standards are thought by some to be even more geared toward large, multinational companies than U.S. GAAP.

And Melancon noted that the gap between large, multinational companies and the mom-and-pop shop down the street is larger than ever.

Melancon said -- and he may be right -- “If it’s ever going to happen, next year is the opportunity.”

Or maybe it’s never going to happen. Maybe, as opponents of differential standards contend, a “Big GAAP/Little GAAP” system would undermine the comparability and credibility of financial reports and would add costs to users, auditors and preparers that would offset any benefits of a differential reporting system. That’s for the accountants to decide.

But even if some sort of accord is eventually reached on whether two sets of standards are indeed needed, the infighting isn’t likely to end there. If the conclusion is again, as it has been in the past, that one set of standards is enough, those who champion differential standards aren’t likely to let the issue die. And if the conclusion is that a separate set of standards for private companies is appropriate, that leaves the question of what body will set those standards. But that’s a question for another year.

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