August 2002

Déjà Vu All Over Again

Too bad you didn’t print my 1994 letter (see below), regarding the future of our profession. It might have made CPAs do a little more thinking about the future. Now that we are “there,” we are a national laughingstock, as evidenced by countless editorials, jokes, and cartoons.

Eli Mason’s essay, “Public Accounting—No Longer a Profession?” (CPA Journal, July 1994), on the decline of the practice of public accounting as a profession is both thoughtful and foreboding. I agree that a deteriorating trend is now in place that will be extremely difficult to reverse. The most important concern we should have now is how the future for our profession will play out.

I believe that we, as certified public accountants, have been the primary cause of changing the public’s perception towards our work. Who said we had to listen to the marketing gurus preying on our fears? Who said we should hire outside consultants to assist us in fine-tuning our practices? Who forced us to accept commissions? Who told us to make cold calls, do telemarketing, and promote ourselves in the phone book? Who said we had to diversify, specialize, advertise, reorganize, and politicize? We now run our firms as businesses. Let’s admit it and bear the consequences.

What has happened is that we ran scared—we were intimidated and overpowered by forces, some real and some imagined, that inferred that our services may someday be unnecessary or, if needed, rendered by other nonprofessionals just as competent. We lost our confidence and sold out to our own fears of survival. Isn’t that a normal reaction?

Now we are losing our professional status. Are we all willing to bear the consequences? I personally doubt it. I predict that someday soon the auditors in our major firms will break off and form privately owned auditing firms accountable primarily to regulatory bodies protecting the public. These auditors will be known as the “professional accountants.” The remaining public accountants, certified or otherwise, will work for large public financial conglomerates rendering a vast array of financial services, not including public company audits.

The next major move ensuring that the trend from a professional practice to a business practice will inure to most of us, will be when the nation’s major accounting firms spin off their audit divisions, which will operate as privately owned LLCs, and either issue stock, in an IPO, or merge with an existing public company.

The cycle of our profession will then be complete. It will be returned to its roots, the certified public auditor, for another go-around.

Sidney M. Braverman, CPA
Davie Kaplan Chapman & Braverman, PC

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