Classification of accountancy services;

              8 H A S K I N S & S E L LS April
matters may be an open question, which is
entirely beside the point of this discussion.
They are entitled to support in matters
where they urge representations which
permit of no argument on the basis of facts.
It should be said unreservedly that ac­countants
should not be interested in ques­tions
of expediency. If a client has title to
goods and is liable therefor, the cost of the
goods and the liability should go in the
body of the balance sheet, even though a
three-to-one current ratio may thereby be
converted into a four-to-two or a two-to-one
ratio.
The accountant is not responsible for
the acts of his client. His duty as an audi­tor
is to review the representations made
by the client and to say, without bias or
prejudice one way or the other, whether,
in his opinion, the representations are true
and correct.
A client either does or does not own
certain goods. If he owns the goods, he
should recognize the fact and acknowledge
his liability therefor. If the client fails to
do this and asks an accountant to give an
opinion in the matter, the duty of the
properly qualified accountant should be
clear. He should ask, "Who owns the
goods?" Before committing himself to an
opinion, he should seek and find sufficient
evidence, one way or another, to enable
him to make up his mind. If he decides
that the client owns the goods, there is no
course open to him but to include them in
the body of the balance sheet.
Classification of Accountancy Services
SINCE July, 1926, the subject of classifi­cation
has been under consideration by
the profession. The idea was put forward
originally by the Committee on Education
of the American Institute of Accountants
as a feature of the report of that committee
for that year. In the interval the matter
has been considered by the American So­ciety
of Certified Public Accountants, and
in September, 1930, that body issued a
classification, later transmitting it to all
state societies for the consideration of
those societies.
Recently the New York State Society
of Certified Public Accountants has taken
up active consideration of the matter to-together
with appropriate certificates,
through a joint Committee consisting of
members of the Committee on Classifi­cation
of Accountancy Services and the
Committee on Practice Procedure.
What the result will be of having the
subject of classification considered by
these various organizations is somewhat
difficult to predict, but at least it may be
said that interest is being aroused and
consciousness is being developed of the
need for a uniform classification which
accountants generally will be willing to
accept. To those who have given the
matter appropriate thought, it is obvious
that many advantages will accrue from
the adoption of a uniform classification.
Probably the most important of these
advantages is that a clearer understanding
would be had in all engagements as to the
purpose, character, and scope, not omitting
any limitations of each undertaking by an
accountant. Such understandings, remov­ing
as they would most possibilities of mis­understanding,
would eliminate many of
the controversies between client and ac­countant
which now are possible. In addi­tion
to this advantage, definition and dif­ferentiation
would be useful in litigation
and in differences of opinion between client
and accountant with respect to negligence.
Further, a sketch of the whole field of pro­fessional
endeavor would serve as a basis
for dignified publicity. Working contacts
with members of other professions and
those engaged in related lines of business
activity would be made easier and more
satisfactory. Administration of account­ancy
practice would be facilitated and
bettered. Lastly, a common language
would be afforded concerning the work of
professional accountants.
PRESS OF WILLIAM GREEN, INCORPORATED, NEW YORK