September 2002

Teaching Russians

Jay Dismukes’ article, “Goodwill Accounting: CPA Brings Modern Business Training to Russia” [The Trusted Professional, page 9, June 2002], brought back many memories of the days when I initiated a program of teaching modern American business methods and accounting to Russian entrepreneurs, government officials, accountants, bankers and anyone in the potential business community who was interested.

My first trip to Leningrad was in February 1991, just when the Russian “revolution” was getting started.

I was invited by The Survivors of Leningrad, a group of people who were interested in doing business with the United States. The truth is that they didn’t have a clue as to what they had to do or what to expect. They believed that the streets in America were paved in gold and that ‘biziness’ people were lined up at the airport waiting to join them in whatever ventures they had to offer.

After explaining the facts of life to the class, we got down to the task at hand. The first thing that I tried to do was explain what a certified public accountant is and does. It was a fascinating experience, and when we finished, a new concept was born—the CPA. Then we started on the entire gamut of doing business in America, in a most basic manner. We discussed the way business operated in the United States and spent a good deal of time going over the differences in reporting between the Russian and American financial statements. (The Russian method reported on production quantities, while the U.S. was interested in the profit motive.) Since I don’t speak Russian, I used two interpreters each day to relay the information, and we developed a great deal of interesting repartee with the class.

In November 1991, I returned to meet primarily with accountants. I spoke to them about international standards of accounting and auditing, reading and understanding financial statements, and preparation of business plans. During this visit, I helped to organize a joint venture, International CPA Corp. (ICPA Corp.), which was the first privately held accounting firm in St. Petersburg (Leningrad’s new name). Between 1991 and 1993 approximately 150 to 200 other accounting companies were established in St. Petersburg.

When I returned from the first session in 1991, I went to Washington, D.C., to try to convince the USAID [United States Agency for International Development] to fund a program that would pay for the transportation costs for practicing CPAs to travel to Russia so that they could train Russians in the practical aspects of doing business. The USAID explained (over and over) that they would only fund educators who were teaching at a college or university. I’m delighted that the policy changed.

Subsequent trips to the SSR, Estonia and the Ukraine from 1994 to 1996 spread the message of free enterprise to the underdeveloped areas. It was a fascinating experience that offered help to people who were interested in joining the changeover from the state-owned economy to a free economy.

Edwin J. Kliegman, CPA
NYSSCPA Member