[IMGCAP(1)]When I went to Toronto last week, I expected to feel right at home for a number of reasons, not the least of which is that I’ve been there many times before.
You see, my father grew up there before emigrating to the U.S., and we still have a lot of family in Hogtown, so I’ve traveled north of the border for any number of reunions, weddings, anniversaries, random visits and, sad to say, funerals. I recognize the major landmarks, have a good mental picture of the street grid, and know my way around the larger neighborhoods. My many cousins, as well as the bars and restaurants they like, the places they work now and the places they worked before that, and all the stuff they recommend that I go see are scattered all over town, so I expect to feel right at home no matter what neighborhood I’m in -- even if I’m not actually at home. (It helps that Canadians are a pretty friendly and welcoming bunch, especially those who are your cousins.)
[IMGCAP(2)]This trip, though, I felt just a little bit more at home than usual, in part because the cousins outdid themselves in hospitality, but also because I kept running into accounting references. Almost literally -- on the first day, entering Toronto on the Gardiner Expressway after an eight-hour drive across Upstate York, I passed a giant floral display of the Deloitte logo on the side of the road. The next day, while taking a ferry to Centre Island in the harbor (where my father lived for part of the Depression), I noticed that one of the very few business logos that stands out in the Toronto skyline is that of PwC (see the picture below, taken by my cousin Sarah Hood). There’s the Rogers Centre (the Major League ballpark named for a major Canadian telecoms company) and the Fairmont Royal York (the hotel where the Queen stays when she’s in town), but that’s about it -- so PwC’s in good company.
As I spent a lot of time zipping back and forth on the Gardiner, and a lot more time zipping back and forth around the harbor, I saw a lot of those two logos, and felt right at home.
It was the third accounting reference that really sparked me to write this column, though. It actually came while I was on my way home -- headed west on the Gardiner this time, past the Deloitte logo and stuck in a traffic jam near Fifty Road on the way to the U.S. border. I dialed up a little Canadian talk radio to get some details on the traffic jam (which they delivered up right away), and then kept the radio on to see what Canadian talk radio was like (just as opinionated as the U.S. kind, but a lot more polite about it).
The topic that morning was a recent report that the debt of the Province of Ontario equaled $16,000 per citizen, compared to California’s debt of $10,000 per citizen. The guest was a successful Canadian entrepreneur who claimed that the provincial government was destroying the business environment and burdening future citizens with unpayable debt. I will leave that as an issue for Ontarians and their elected officials and talk radio hosts to decide -- what interested me was that the guest ended all of his frequent descriptions of the many ways the provincial government was poisoning the business environment by saying, “And the accountants are right there -- ready to show businesses how to leave the province and set up elsewhere.” At least four times, he mentioned how “the accountants” (never a particular firm, just the profession as a whole) were ready, willing and eager to show businesses how to set up in the Canadian West, in the U.S., or even further abroad, and he always said it in the tone one reserves for describing vultures and other carrion eaters.
My first reaction was, “Good for the accountants!” I have a professional interest in seeing accountants (whether chartered or certified public) succeed, and one of the surest ways to succeed is to identify opportunities for your clients, including those that involve regulatory arbitrage, so the whole thing struck me as a win for the accountants and their clients, even if it was a loss for Ontario.
In the long ride home, though, I started to wonder.
What the entrepreneur on the radio described was in no way illegal, and I don’t think you can classify it as even remotely unethical, but it seemed clear to me that he thought what these firms are doing was definitely the latter, and should probably be the former.
I didn’t come around to his point of view, but I did start to wonder. What sort of duty do accountants owe the state (or province) or country where they live and operate? They’re licensed and regulated by those governmental bodies, and have some obligations to operate in the public interest -- but how far in the public interest? How far, for instance, do they have to go in preventing or reporting tax or accounting fraud? Should they avoid encouraging clients to seek out low-tax or low-regulation environments, if it means a loss of jobs in their own country?
It was a day-long drive (including an hour idling at the border), but I came to no conclusions – so I’m looking for your opinions. Do accountants have any obligations above and beyond those of the average businessperson? Are those obligations personal, professional, national, optional? Leave a comment below, or e-mail me.
In the meantime, I wonder what the state of accounting in Tahiti is like ... .
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