Daniel J. Dustin, CPA

Executive Secretary of the State Board for Public Accountancy

By Louis Grumet

What are your duties and responsibilities as executive secretary of the State Board for Public Accountancy?

As executive secretary of the State Board for Public Accountancy, I report directly to the deputy commissioner for the professions, Johanna Duncan-Poitier. An important function of the executive secretary is to coordinate the work of the board in advising the Board of Regents and the State Education Department by facilitating communication to and from the state board and the professional community. Public protection and the integrity of the profession are at the forefront of all of our activities.

I oversee the operations of the state board office and its staff, including providing administrative services for all board meetings and other functions. I work with other units within the Office of the Professions to carry out professional preparation, licensure, and practice functions. This includes responding to questions from applicants, licensees, and the public. In addition, I work with other state board offices regarding any cross-professional issues related to the accounting profession.

I also interact with state and national professional groups such as the AICPA, the NYSSCPA, and the NASBA.

The executive secretary applies the laws and policies approved by the Board of Regents and the State Education Department to specific cases and situations of professional practice. I work with the Office of the Professions legal staff and the department's Office of Legal Counsel to promote good practice through interpreting and applying the laws, rules, and regulations that cover professional conduct and the practice of public accountancy. This includes involvement in the disciplinary aspects of professional practice.

The State Education Department recently proposed legislation to redefine CPAs' scope of practice. What was the role of the state board in developing this proposal? How will it change the profession?

We recognize that the profession of public accountancy has evolved considerably since the Education Law regulating the practice of public accountancy was enacted in 1947. We believe that our proposal to expand the definition of the scope of practice will have a major positive impact on the profession. This change is needed to maintain current practice, to continue to provide the professional responsibility the profession is noted for, and to ensure public protection and the future of the CPA as a financial expert.

Last year, as a result of the Ibanez and Miller cases and the proposed sale of the nonattest assets of Goldstein, Golub, Kessler & Co. to American Express Tax and Business Services, the department undertook an extensive study of New York's accountancy law and the types of services being offered by CPA firms. This study included a review of the laws in effect in several other states.

The department concluded that the current scope of practice, set out in Education Law, is limited to the core attest services being offered by CPA firms (with some exceptions) and does not incorporate the full range of services being offered by CPAs. In response, the department's legislative proposal brings tax preparation, advisory services, bookkeeping services, financial advisory services, and management advisory services into the definition of the accounting scope of practice. The proposed redefinition of the scope of practice will hold CPAs and PAs responsible for their actions for any of these professional services offered, thereby enhancing the integrity of the profession. The proposal does not challenge the Ibanez and Miller court decisions.

The state board played a critical role in the development of the proposed legislation. A series of discussions with the board provided guidance for the department's bill. The board (which represents public accounting, private industry, education, and the public) and the department agree that establishing a more inclusive scope of practice goes to the heart of the practice of the profession and is critical to the future of CPAs and PAs.

As you know, the NYSSCPA has submitted legislation to update the state's accounting law. What do you think of it?

Earlier, we discussed the importance of the department's proposal to expand the scope of practice to include nonattest services performed by CPAs or PAs, no matter where employed. The NYSSCPA legislative proposal contains a number of important provisions, some of which may have a positive impact on the public and the accounting profession. For example, the NYSSCPA proposal removes the inactive status provision in the mandatory continuing education law, requiring CPAs and PAs employed outside of public accounting to meet the same CPE requirements as those CPAs and PAs practicing in public accounting. This is particularly important at a time when almost 50 percent of CPAs are employed outside of public accounting. In addition, the NYSSCPA proposal would preserve the scope of public accounting only to licensees, as opposed to the current law, which effectively protects the use of the title. This change needs to be studied as it moves to the legislature.

On the other hand, some NYSSCPA proposals could have a negative impact on the public and the profession. For example, the proposal to modify the experience requirement for licensure could compromise public protection. Under the NYSSCPA proposal, an applicant for licensure could meet the one-year experience requirement without attest experience by providing any type of services or advice using accounting, attest, management advisory, financial advisory, tax, or consulting skills while employed in the private sector, government, academia, or public practice.

As Eli Mason, a former president of the NYSSCPA and a former chair of the State Board for Public Accountancy, recently stated in a letter to the NYSSCPA, "an individual working for McDonald's in charge of inventory of sesame rolls can become a CPA ... if his division is supervised by a CPA."

CPA candidates benefit from employment in public accounting firms. While employed by a public accounting firm, candidates are exposed to a professional work environment--one that relies on professional training and continuing education, one that is held accountable to New York state regulation, one that is responsible to a code of professional conduct, and one that prides itself on a tradition of providing only quality services to the public. Modifying the professional experience requirement may result in lowering the experience, the quality of preparation, and in turn the status of the CPA designation in the eyes of the public. This may result in the license being viewed as more of a commodity than a professional license.

Where do you see the accounting profession headed, and what challenges do you think it faces as we approach the 21st century?

There has been wide press coverage of the need for the accounting profession to react to the globalization of world economies and the impact the Internet is having on the practice of the profession. Public accountancy in the United States, particularly in New York state, continues to be highly regarded around the world. There are hundreds, if not thousands, of CPA candidates who travel to this country to pass the exam and become CPAs. This truly shows the value that the public and the world's financial community place in the CPA license.

While some in the profession explore reciprocity across the 54 regulating jurisdictions, New York must do so without degrading a system that has produced a high level of public protection and an equally high standard of practice. New York's standards are among the most stringent in the country, and they have helped to make New York the world's financial center. We must remain committed to professional regulation that serves the public and maintains high standards, integrity, objectivity, and independence. Without this direction, we risk losing the credibility, value, and prestige our license currently holds.