Society Will Remain Leader in Restoring Trust in the Profession

By Jo Ann Golden

By the time you read this column, the leadership of all levels of the New York State Society of CPAs will have met for its Second Annual Leadership Conference, July 14 to July 16, 2002. The conference brings together a vastly diverse group of individuals, including Society officers, board of directors, committee chairs, representatives from the 17 chapters, the Foundation for Accounting Education board, the political action committee board, the Society's representatives to the American Institute of CPAs council, and Society senior staff.

The two-day conference, culminating in an open board ofdirectors meeting, will be intense, the agenda rigorous. The importance of this conference cannot be underscored enough. Not only will we be charting a course for the future of our organization; we will be focusing on how we as an organizationcan seize the moment to actively influence the molding of the future of our profession in these troubled times.

In the 2001-2002 year, the Board began the process of developing a strategic plan for the Society. The plan emerged with four identified areas of focus: committees, chapters, education and advocacy.

The first three arenas are traditional to our function as a state society. It is the area of advocacy or public affairs that has risen to a level of importance never before felt in our profession.

The board, in a February resolution, identified several possible agendas in the advocacy arena for the Society to pursue. These include the implementation of a governmental relations program that advances the needs of the Society's members while advancing the public interest; developing the Society as a knowledge resource on policy issues within the purview and knowledge of the CPA profession; building relations with other state and national professional organizations; and striving to attract new members to the CPA profession.

These are, indeed, just a beginning. The current climate dictates that we, as a state society, as a profession, must go further. It is incumbent upon us to address the public concerns about our profession as a whole. We must restore the public's confidence in the profession. Some food for thought:

• How can we, as CPAs in New York State, claim to be self-regulated when the members of our Society are not required to be a part of the Peer Review Program?

How can we, as CPAs in New York State, make the claim that our professionals are already subject to adequate regulatory oversight, subject to discipline by the New York State Board of Public Accountancy, when only those who are registered with board are under its jurisdiction?

• How can we assure the public that we are adhering to our continuing education requirements when no detailed reporting requirement to our oversight body exists?

These are but a few of the areas that require attention in New York state in order for us to maintain public confidence. We must step up to the plate to ensure that the ethical standards of the profession in New York are clearly defined and above reproach.

The Society Board of Directors and its Executive Committee have been committed to working on the passage of legislation in New York state that will address the public concerns and strengthen the profession in the public's eyes. During the past several months, we have been testifying at legislative hearings and personally meeting with legislators to attempt to ensure that any change that occurs will be consistent with our position. In the near future, we will call upon the membership to do the same.

At both the federal and state levels, we are being barraged by proposed legislation as well as regulation that could impose limitations on our practices. Should we be allowed to perform attest services for the same clients for whom we provide consulting services? Many in the public sector believe we should not. There are those in our profession who believe that this will only affect SEC practice. "It's a problem for the larger firms." But, what happens when the bank that handles the small local business demands that that small business follow the SEC rules for the audited financial statements they require? The trickle down effect is real.

Supplementing the most recent Proposed Rule by the SEC to create a Public Accountability Board (PAB), the SEC's Chief Accountant will soon be presenting a proposed rule to further address the limitation or even full elimination of self-regulation. Some of the expected proposals, such as, strengthening the role of the audit committee, have merit. However, some could create a quagmire of strong limitations on providing incidental consulting services to audit clients. The economic impact could be tremendous. Just imagine, in a simplified example, the local small business owner who has to hire two firms, one to do the audit and one to help with the simple QuickBooks questions that arise. We must be out in front responding to the myriad of proposals and legislation affecting the profession. The NYSSCPA must participate actively in the debate.

The Society has been a vocal force in dealing with proposed change in our profession. Yes, we reacted with fervor to the proposal for the XYZ credential. We have responded to components of the failed Uniform Accountancy Act. But now the task is broader, more daunting. The impact upon the profession resulting from the events of the past seven months will far outlast our professional lifetimes. We have a duty to guarantee that our profession properly ensures that the public's protection is maintained.

The Society, through its members, must speak out and act. We must respond to media spin. We must not only respond to proposed legislation before Congress and our New York state legislature, we must guide its development . We must take a strong position with respect to proposed rules by the SEC. The collective efforts by CPAs must be strong. We must enlist the involvement of the AICPA and other state societies where it is appropriate. The NYSSCPA has, in the past, taken a leadership role in the profession. We must continue to do so.

To accomplish these tasks, we can hope to succeed in having a positive impact on change only if we work together, only if we share our views and ideas. The Leadership Conference this month will be a vital forum in that process. The continued input and participation of all the members of the Society, however, is what will ensure success.