Charles Waldo Haskins

THE CPA PROFESSION'S FIRST STATESMAN

By Gary J. Previts, Dale L. Flesher, and Tonya K. Flesher

In Brief

Hall of Fame Nominee

The authors recall and honor the memory of one of professional accountancy's great leaders. They take a look at his family background, education, numerous professional achievements, distinguished career, and his contributions as as an educator and author. The authors pose and leave unanswered, other than speculating about the effect of his early demise, questions as to why Haskins has not been properly honored by a number of authors writing about the profession and why he has never been inducted into the Accounting Hall of Fame, an honor which they and others believe is long overdue.

One of the most renowned names among the early CPAs was that of Charles Waldo Haskins. Besides being one of the founders and senior partner of what was to become a major international accounting firm Haskins & Sells, now Deloitte & Touche LLP, he was a leader in securing passage of the New York law that formed the CPA profession and led to the first CPA examination. He was selected as the first president of the Board of Examiners when the New York CPA law was passed in 1896 and the founding president of the New York State Society of CPAs--from 1897 until his death in 1903. Haskins helped found and was the first dean of the New York University School of Commerce, Accounts, and Finance. In addition, he held the title of Professor of Auditing and the History of Accountancy; he is the only American academic to ever be so identified. He took an active part in the work of several patriotic societies, including the National Society of the Sons of the American Revolution (for which he served as Secretary-General), the Society of Mayflower Descendants, and the Society of Colonial Wars. He was also active in several yacht clubs and country clubs. He was a prolific author and lecturer.

Elijah Watts Sells, Haskins' partner, summed up Haskins' professional contributions in 1922 with this statement: "The profession of accountancy owes him an everlasting debt of gratitude for the part he had in shaping its future." Sells went on to say: "Mr. Haskins' pride in the profession of accountancy and his labors in raising its standards by means of education had no bounds."

Despite his leadership roles in the accounting profession and education, Haskins has yet to be inducted into the Accounting Hall of Fame. His partner Sells was inducted in 1952. In the May 1987 Journal of Accountancy, 100th Anniversary issue, Stephen A. Zeff omitted Haskins from his list of 14 leaders of the accounting profession who "made a difference." John J. Kahle did not include Haskins among the profiles of 26 leading American pioneers in the evolution of accounting thought in American Accountants and Their Contributions to Accounting Thought, 1900-1930. One objective of the following commentary is to support the contention that Haskins' career should be reevaluated and that his achievements be given greater recognition. Haskins' accomplishments are comparable to others more widely honored, and there is a legitimate concern that his proper place in history is at risk. He died too early to be considered for awards such as the AICPA Gold Medal for Distinguished Service to the Profession, and the firm that he helped found no longer bears his name.

Family Background

Charles Waldo Haskins was born in Brooklyn on January 11, 1852, the son of Waldo Emerson Haskins, a New York banker--the family was related to the poet Ralph Waldo Emerson. Young Haskins was educated in the Brooklyn Polytechnic Institute, and subsequently completed his studies in Paris. He came from a wealthy family, and his wife, Henrietta Havemeyer, whom he married in 1885, came from perhaps an even wealthier family. Her uncle was twice Mayor of New York, and her grandfather was a leader of the American Sugar Refining Company ("Domino"). One of his obituaries alluded to this wealth:

Mr. Haskins occupied a position singular and unique in relation to his fellows in the profession; removed from all the petty jealousies engendered by the battle for a livelihood; possessing means more than ample for the requirements of himself and his personal family, he gave freely in time, money, and influence to every movement designed to place the certified public accountant on a par in the eyes of the world with the professions of law and of medicine

On his father's side, Haskins traced his American heritage back to at least 1728 when Robert Haskins came to Boston from England and married Sarah Cook. Robert and Sarah's son, John, born in 1729, married Hannah Upham who was descended from John Howland, a signer of the Mayflower Compact. John Haskins was a member of the Sons of Liberty and other local societies along with the Adamses and others who led the struggle for American independence. John was a Boston merchant, as was his son Robert and grandson Thomas Waldo Haskins. The latter was the largest hardware dealer in Boston. Charles Waldo Haskins was indeed graced with a notable heritage. He represented the sixth generation of the Haskins' family in America, and his ancestors had been recognized as patriots and honest, successful businessmen. This ancestry assisted Charles Waldo in establishing himself above even the examples set by his forefathers. He was to become one of the first true statesmen of the new profession of public accounting.

Perhaps indicative of the admiration for Haskins in the profession, his pallbearers included the presidents of the state societies of accountants in Illinois, Pennsylvania, Massachusetts, Maryland, and New York. The reason for such a tribute is because, according to Frederick A. Cleveland, who edited Haskin's writings after his death, he was "a cherished friend, a wise counselor, a strong, vigorous champion of right, and inspiration to higher attainment."

The Early Years

Upon his graduation from Brooklyn Polytechnic Institute in 1867, the college president predicted that Charles W. Haskins would become a notable engineer. However, Haskins did not care for engineering. He had taken a few business courses and decided on accounting. He began his career with a five-year apprenticeship in the accounting department at Frederick Butterfield & Company, an importer in New York. He then moved to Paris for two additional years of schooling, including the study of art. Following his European training, Haskins returned to New York where he joined the banking and brokerage house operated by his father. He soon moved to the accounting department of the North River Construction Company, which was then building the New York, West Shore, and Buffalo Railway Company. Upon completion of the railway, Haskins was retained by the railroad company as general bookkeeper and auditor of disbursements. When the railroad was absorbed by the Vanderbilt New York Central system in 1886, Haskins decided to open his own office as a public accountant.

The First Collaboration of Haskins And Sells

In 1893 Congress passed a bill creating a commission to investigate the laws affecting the executive branch of the government. This commission, known as the Dockery Commission after Congressman Alexander M. Dockery of Missouri, the chairman, hired three experts to carry out the necessary work. They were Joseph W. Reinhardt, former accounting department head for the Atchison, Topeka, and Santa Fe Railroad, who had parlayed his way to president of the corporation; Elijah Watt Sells, a former railroad station agent, who worked his way up through various railway accounting positions; and Charles Waldo Haskins. Reinhardt soon resigned,
leaving Haskins and Sells to do most of the work.

The work of the commission, originally not taken seriously by Congress, was soon progressing nicely. The recommendations made by Haskins and Sells were so clear and self evident in their common sense that one bill after another went through Congress or recommendations became law by issuance of regulations.

Although most of the media throughout the U.S. were supportive of the commission's work, this was not the case with the Washington press. The idea of making the government more efficient and effective was popular--unless you were employed as a clerk in the departments being evaluated. Government workers in Washington were fearful that Haskins and Sells would recommend elimination of their jobs. The concern was so great that one Washington paper even published a poem, entitled "Mr. Dockery's Commission," that was based on James Whitcomb Riley's "Little Orphan Annie."

Despite the criticisms, the Dockery Commission completed its work. The recommendations were often accompanied by estimates of cost savings of many thousands of dollars in a single department, accompanied by increased productivity. Interestingly, this first use of public accountants by the U.S. Government was for what today is called an operational audit, rather than a financial audit. One of the largest financial audit firms in the world was founded because of the partners' success on an operational audit.

Following the completion of work on the Dockery Commission, the two accountants moved to New York in 1895 and founded the firm of Haskins & Sells. The firm quickly prospered due to the reputations of the two partners. Early clients included Vassar College, the Post Office Department, several railroads, the Borden Company, Quaker Oats, and the City of Chicago. By 1901, the firm had an office in London to tend to the interests of international clients--particularly Barnum and Bailey's Greatest Show on Earth. By the time of Haskins' death, less than eight years after its formation, the firm employed 140 accountants. Even then the firm was truly international in scope with branch offices in London, Chicago, St. Louis, and Pittsburgh.

While the firm served all types of companies, Haskins and the firm were recognized for their distinctive contributions in many specialized areas. For instance, the 1987 centennial issue of the Journal of Accountancy used Haskins' picture more times than that of any other individual--three times to accompany three different articles. One article was on Federal government accounting, another on municipal accounting, and a third on accounting education.

The Educator and Author

The statement by Elijah Watt Sells that Haskins' labors in raising the standards of the profession "by means of education had no bounds," tells the story of Haskins' many contributions to education. Frederick Cleveland introduced a collection of his essays and addresses with, "It is in the development of the professional aspects of the field of accounting that Mr. Haskins' largest service has been rendered. Here it is that we find 'what he stood for.' The living profession stands as a monument on which may be found his name written in conspicuous letters." Cleveland continued: "Mr. Haskins, throughout his busy life, was ever an advocate of 'professional standards' in business employment..." and his essays and addresses contributed to this educational movement. Cleveland also praised his enthusiasm:

"That Mr. Haskins was thoroughly in earnest in his effort to impress professional ideals upon his fellows, his whole life stands in evidence. No meeting of accountants was too remote to be reached by him; no association of bankers, of business men, or of educators issued a call to him without generous response when it was within the range of possibility for him to be present."

As a writer, Professor Haskins was lucid, scholarly, and convincing; his writings were original and showed a wide acquaintance with the classics of the best European as well as British and American authors. Haskins was an effective communicator in French, German, and Italian and had studied art with the best instructors in Europe. During the latter years of his life, Haskins devoted considerable time to the School of Commerce, Accounts and Finance at New York University. He served as the first dean of the school and professor of the history of accountancy and organized the teaching staff. In 1901, NYU granted Haskins an honorary Master of Letters degree in recognition of his distinguished service to education.

In 1910, seven years after his death, NYU honored the memory of Haskins with the unveiling of a bust of Mr. Haskins and a quotation from his writings. In October 1910, the Journal of Accountancy stated that the "event must be of interest to all accountants in the United States, for it is probably the first time that such honor has been paid by a university to a member of the accounting profession." The article went on to state that "Mr. Haskins had a wide acquaintance throughout the United States, and all who knew him will agree that the accounting profession has never had a more genuine, active, and efficient friend."

An often overlooked attribute of Haskins' educational philosophy is the emphasis he placed on complete business education for accountants. Unlike earlier attempts, the NYU program emphasized that a person could not become a capable public accountant merely by a specialized study of figures. An article in the February issue of The Journal of Accountancy by Frank A. Vanderlip portrayed his thinking as follows:

"The efficient public accountant must look in and through the figures, and see the facts, the methods, and the men which the figures represent. He must know something of organization, of transportation, of finance, if he is to be an intelligent accountant. And on the other hand, it is no less true that the average businessman needs nothing more than a sound knowledge of accounting methods and principles. Seeing these truths, Charles Waldo Haskins did not attempt to organize a school that should simply train technical accountants and do nothing else. He was too sensible, too farsighted, to make such an error. He intended rather to organize a school in which should be brought together the information and the training that is most essential to all of us who are engaged in business affairs. This school, therefore, he called not "School of Accounting"; nor, if he had been primarily a financier, would he have called it "School of Finance"; like the broad-gauged man that he was, he approved the title School of Commerce, Accounts, and Finance.

The importance of Haskins' educational philosophy was not limited to NYU. Soon, other universities were adopting programs similar to that of NYU. Haskins' contributions brought not only accountancy, but business education in general, out of the dark ages of university education in America.

Contributor to the Profession

Haskins' interest in advancing the accounting profession got its start during his 1872-74 stay in Europe. He conceived of accountancy advancing in the U.S. to a level experienced in Europe. Based on his own writings, why he left the banking and brokerage house of his father to enter accountancy remains a question, as "(T)here was little in the field of accountancy in the U.S. to make it attractive, little to encourage a young man of ambition and superior training. Then the accountant was not much above the level of clerk or office boy; in America he was little more than a bookkeeper...." But Haskins had been able to form perceptions from his travels and education. Cleveland continued:

Training abroad, however, had suggested the possibilities of a liberal profession. Contact with the many sides of financial life pointed to the need for higher accountancy. With a serious purpose of doing what he might to raise American ideals to a higher plane, he entered the accounting department of the North River Construction Company.

From this beginning, Haskins found new opportunities with each new engagement. Small enterprises were becoming larger, and the manager could no longer know every detail of the business. The conventional accounting forms and methods that had grown up in small enterprises were being displaced. Cleveland states:

"Mr. Haskins was inspired with the idea of reducing financial records to a scientific basis of classification and
being in a position to give professional advice to those who were made responsible for the safe conduct of large affairs."

In memorializing Haskins' accomplishments in 1910, Frank Vanderlip stated that there were two features of Haskins' character which made him the professional man that he was: "First, he was filled with unselfish professional zeal; second, his eyes were turned to the future, not the past."

As noted earlier, Haskins was appointed to and elected as the first president of the New York Board of CPA Examiners, where he served for five years. The other two board members were Frank Broaker and Charles Sprague. Haskins held New York CPA certificate number 6. He was almost the holder of certificate No. 1. Professors Newman and Oliverio of Pace University recently reported that the minutes of the New York Board of Regents list Haskins as the holder of the first certificate. However, Melville Dewey, the head of the New York Department of Education, who actually issued the certificates, had a penchant for alphabetism. He or one of his staff reorganized the list into alphabetical order, awarding Frank Broaker, certificate number 1.

Haskins was also the founding president of the New York State Society of CPAs and served from 1897 until his death in 1903. He also made other contributions to the profession of public accountancy, including being a founding member of the American Association of Public Accountants (AAPA), the ancestor of the American Institute of Certified Public Accountants, and serving as the first president of the Federation of Societies of Public Accountants, a short-lived organization that subsequently merged with the AAPA. In fact, George Wilkinson attributed the establishment of the Federation to the acceptance of the idea by Haskins:

Well do I remember a cold, rainy Sunday evening when I met Mr. Haskins by previous appointment at the old Queen's Hotel in Manchester. Mr. Haskins had arrived that afternoon from London, and that Sunday evening, late in September 1902, was the only time he could give me to talk over my plans for federating the several societies of public accountants organized under state laws.

I wondered what sort of a
reception the Big Fellow would give to the idea. Lybrand and the
Pennsylvania Association, Max Teichman [sic] and the Maryland fellows, Joe Goodloe and the Ohio bunch,
Harvey Chase and the Bostonese, and all the other state society presidents had endorsed the plan of the Illinois Association, but what would the Heap-Big-Chief say to me? Well I knew that what Charles Waldo Haskins would say would go with the biggest society of them all.... A hearty welcome, a warm handshake, and a cheery coal fire awaited me in the Big Chief's sitting room.... It didn't take long to outline to a man whose vision was so clear the plan which the
Illinois Association had brought forward to federate in one national body the several societies of public
accountants in the United States. The short recital over, the answer came promptly. "Bully scheme, Wilkinson, let's do it. New York will come in." And so it was settled. What had looked so doubtful in the prospect seemed so easy in the fulfillment. The Big Chief's enthusiasm for the plan was one of the happiest memories of my visit to England. All doubt about the federation going through was ended.

Perhaps Frederick Cleveland gave the best summary of the many contributions of Haskins when he stated that the profession of public accountancy serves
as a monument to Charles Waldo
Haskins.

To Whom Much Is Given,
Much Is Expected

Haskins was fortunate to have been born into a family of wealth and opportunity. His financial situation allowed him to attend fine schools and to travel and study abroad. He had the time and the ability to envision the accounting profession as it could be, not as it was. His biographer speculated that Haskins would probably not have chosen accounting as his career if his views of the profession had been limited to the American scene.

Haskins' background was different from that of his partner, Sells. Sells was six years younger. He was educated in the public schools of Iowa and attended Baker University, but did not graduate. "With two completely different personalities, Haskins and Sells worked well together. Haskins was an urbane New York progressive with excellent family connections and a scholarly bent. Sells, more reserved by nature, was accustomed to life in the small railroad towns of the Midwest, where he spent the first half of his life.

The factors that motivated Haskins' accomplishments would seem to be found in his fortunate background. He had the education, time, and freedom to envision the future of the profession. He had the knowledge and connections to bring this vision to reality. Haskins and Sells "found that the methods and the high professional ideals of the other were in harmony..."

A Life Too Short

The death of Charles Haskins came suddenly. At a meeting on January 2, 1903, a week before his death, he was described by Frederick Cleveland as being "a man of commanding physique, by far the largest and, as he then appeared, the most rugged one in the company." The next day he was ill with pneumonia; he died on January 9, 1903.

At the time of Haskins' death, the firm of Haskins & Sells was the most respected native firm in the country. This firm had been entrusted with some of the most important work for an accountant to perform, including the revision of the accounting system of the United States Government, the examination of the accounts of the City of Brooklyn prior to the consolidation with New York, the investigation of the accounts and finances of the Island of Cuba, and the revision of the assessment accounting system of the City of Chicago. With 140 accountants, it was also probably the largest firm in the country.

More important than his firm's accounting work was his work for the profession of accountancy. Through his work on the Board of Examiners, his leadership roles in professional organizations, and his recognition of the importance of formal education for the profession, Charles Waldo Haskins left his mark on American accountancy. One biographer, William George Jordan concluded:

No true history of accountancy can ever be written that does not recognize the vital part in its development played by Mr. Haskins with others in laying the foundation of a profession destined to a still higher and greater future.

He was a recognized professional at a time when few recognized accountancy as a profession. He was a leader with integrity who served as an example to other accountants. He had the ear of Congress and of municipal and business leaders. Public accountants respected him as the ideal of their profession. He was, indeed, the first statesman of the accounting profession.

Posthumous Nominee

Today, nearly a century after his death, Haskins has not been recognized by inclusion in the Accounting Hall of Fame or by having an award named for him, as has been the case for Sells, who is the namesake for the AICPA award given to the top CPA exam scorers. One explanation for this omission is that Haskins died at a young age, 51, and at a time when the accounting profession and accounting education were still in the very early stages of development. Kahle's list of outstanding contributors to accounting thought begins with the year 1900 and Haskins died in January 1903. In comparing the profile of Elijah Watts Sells prepared for his induction into the Accounting Hall of Fame, Haskins made every type of contribution that Sells is credited with except for service as an officer with the AICPA. Sells served two terms as president of what is now the AICPA (1906-1908), although he did not become a member until 1901--years after Haskins had been a founding member. Comparably, Haskins was the founding president of the Federation of Societies of Public Accountants--a position historically equivalent to that of an AICPA leader, and the founding president and president for five years of the New York State Society of CPAs He was also the first president of the Board of Examiners in New York. In addition, he was the first dean of the NYU School. Haskins' accomplishments meet or exceed those of his partner, who died in 1924, and others in the Hall of Fame.

The purpose here has been to recall and honor the memory of a great professional leader--one of accountancy's first. The hope is that the case presented is strong enough to preserve an appreciation of his contributions. *