The American Institute of CPAs marked the 125th anniversary of its founding during its Spring Meeting of Council, with meetings on Capitol Hill and at the White House with lawmakers and policymakers, and a host of high-profile guest speakers, with a lavish black tie reception as a highlight.
In his opening address, AICPA president and CEO Barry Melancon reminisced about the long history of the institute. "Who could have imagined 125 years ago where our profession would be today?" he asked. "Our clients used to be the people in our communities, next door, around the corner, but now they're global."
He also looked ahead, speculating on how the AICPA might look on its 250th anniversary, with a video chat with a purported CPA from the future. Melancon and AICPA chairman Greg Anton presented video clips of past institute chairmen and CPA profession leaders talking about the challenges and initiatives they tackled during their careers.
He noted that the AICPA visited the White House at the start of the meeting to talk with some of President Obama's economic advisors. According to Melancon, they talked about risk management in the wake of the JPMorgan Chase multi-billion-dollar trading loss, as well as tax reform.
"The key questions that the leading economic advisors to the president asked about were risk management, and the opportunity for the profession, both inside corporations and from an assurance perspective, to be much more involved in processes and metrics around risk management that are critical to the successful operation of a business," said Melancon.
Melancon also talked about some of the challenges confronting the profession today, including recent proposals for mandatory audit firm rotation; the likelihood of a delay in a final decision about incorporating IFRS into U.S. financial reporting; and the likely shape of the Financial Accounting Foundation's final decision about private company standard-setting, which was due out the following week (see our
Melancon described the institute's continuing efforts at financial literacy education, and also reported that AICPA vice chair Rich Caturano, the managing partner of the Boston office of Top 10 firm McGladrey, is leading an effort to expand diversity in the CPA profession, and plans to bring together a group of leaders this fall to examine what strategies work.
Melancon noted that the profession had seen declining numbers in the 1990s, and the AICPA made an investment in programs to attract younger people to the profession. Those efforts were successful, and by 2009 there were record numbers of people majoring in accounting, both in Bachelor's and Master's degree programs. In 2010, there were all-time-record numbers of people taking the CPA Exam, and today there are a record number of members of the AICPA.
More recently, the AICPA has been expanding internationally through its joint venture with the Chartered Institute of Management Accountants to offer the Chartered Global Management Accountant credential. They began offering the CGMA for free to CPAs with management accounting experience at the end of January. So far, more than 13,500 CPAs have signed up for the new credential.
LOOKING BACK
At a luncheon on the second day, Moss Adams chairman Robert Bunting, a past chair of the institute, offered a fascinating look back at the earliest days of the organization.
"I looked up our founding fathers who started this whole institute," Bunting said. "One thing I noticed about them is they were all men. The other thing I noticed about them is they all had European British surnames." As a sign of progress, he noted that the profession includes women and minorities -- though he cautioned that there was still work to do. "We do not necessarily reflect the society out there, but I think we have made some progress in that regard."
The original founders, he quipped, were not about diversity: "Their interest in diversity stopped at allowing two accountants from California to join."
But many of their values still inform the profession. "What were they interested in, these founders? One of the values at the AICPA is competence. They wanted to elevate the profession both in the eyes of the public and by working on the credentials of the profession. They elevated it by requiring education and training, and requiring experience to be a practitioner, and by having some form of entrance examination."
Perhaps most important, the profession was willing to do the hard work necessary to live up to its values: "It is built into our DNA to make a promise, and then make the payments on it," he said.
At the end of his speech, Bunting gathered an unprecedented collection of previous institute chairs to thank them for their service and take pictures.
SPECIAL GUESTS
The Council agenda also included panels and addresses by a number of high-profile regulators.
Public Company Accounting Oversight Board Chairman James Doty spoke about the history of the accounting profession in the United States and paid tribute to the institute. "In 125 years of leading the accounting profession, the AICPA has achieved an enormous amount," he said. "I have the utmost respect for what you have put forth for the public interest in those years and I have high expectations for the years to come."
In a panel discussion of standard-setters, International Auditing and Assurance Standards Board chair Arnold Schilder thanked the AICPA for its help in completing the Clarity Project, revising the institute's suite of standards for auditing and assurance engagements with private entities. He said the IAASB's similar standards have now been adopted and would soon be used in 87 countries around the world.
The chair of the Financial Accounting Standards Board, Leslie Seidman, praised the AICPA as an American institution and likened it to baseball, hot dogs and TV. She noted that the original Committee on Accounting Procedures had estimated in the 1930s that it would take only five years to do its work.
Another regulator to address the Council was Internal Revenue Service Commissioner Doug Shulman, who congratulated the institute on its anniversary. In looking back at the IRS's own history and how much it had changed, Shulman noted, "125 years ago, the main activity at the IRS was breaking up alcohol stills." He went on to emphasize the importance of its dialogue with major stakeholders like the AICPA and the tax preparer community -- citing the robust back-and-forth over the recently enacted tax preparer registration regime as an example, and noting that the input of groups like the AICPA led to CPAs and certain other groups being exempted from some of the registration requirements.
Other high-profile figures to address the meeting included International Accounting Standards Board vice chair Ian Mackintosh; former Senator Alan Simpson, who delighted attendees at an evening reception with his sense of humor; Iowa Governor Terry Branstad, who joined a panel on how to stimulate the U.S. economy; and former U.S. Comptroller General David Walker, who spoke on the second day of the meeting about the dangers of the nation's out-of-control budget deficit and national debt. "I'm still an active CPA and I'm proud to be a CPA," Walker said. "We have a responsibility to lead the fight for truth."
NEW TOOLS
The institute also used the Council meeting as an opportunity to launch a new tool to help the public think more clearly about the role and extent of taxes in their lives. Its new Total Tax Insights Calculator lets users estimate the total amount of taxes they pay every year for the most common federal, state and local taxes, based on data they enter such as where they live, their marital status, their income, their number of dependents, and even such variables as whether they smoke. (Users do not need to identify themselves, and the data is erased as soon as they leave the site.)
The AICPA plans to periodically update the calculator to reflect the most recent changes in federal, state and local taxes.
For more details and our daily reports from Council, see our
