Renaissance in accountancy;

              ATLANTA PORTLAND
BALTIMORE HASKINS & SELLS PROVIDENCE
BIRMINGHAM
BOSTON SAINT LOUIS
SALT LAKE CITY
BROOKLYN SAN DIEGO
BUFFALO
CHICAGO CERTIFIED PUBLIC ACCOUNTANTS SAN FRANCISCO
SEATTLE
CINCINNATI TULSA
CLEVELAND WATERTOWN
DALLAS BULLETIN DENVER DETROIT BERLIN
KANSAS CITY LONDON
LOS ANGELES PARIS
MINNEAPOLIS SHANGHAI
NEWARK NEW ORLEANS
NEW YORK E X E C U T I V E O F F I C ES HAVANA
PHILADELPHIA HASKINS & SELLS BUILDING MEXICO CITY
PITTSBURGH 37 WEST 39TH ST. NEW YORK MONTREAL
VOL. IX NEW YORK, JANUARY, 1926 No. 1
A Renaissance In Accountancy
SIGNS which gradually are taking form
along the horizon indicate the dawn
of a new era in the relationship of public
accountants to those who have occasion to
utilize their reports.
The reverberations of a recent business
failure sound ominous warnings which leave
no doubt that accountants must make
clearer to those who retain their services
and make use of their reports the differen­tiation
of services.
A physician prescribes for different kinds
of maladies. No one medicine serves
every purpose. A surgeon is not expected
to have a standard form of operation which
relieves alike for mastoiditis and gangrene.
Nor, incidentally, is the surgeon expected
to remove a portion of the intestine, by
mistake for the vermiform appendix, when
he knows he is dealing with a case of
appendicitis.
In the development of accountancy prac­tice
the general public, commercial bankers,
investment houses, and others have been
slow to recognize distinctions among vari­ous
classes of service which accountants
render. The financial statements in reports
of recognized accountants admittedly have
been taken as Gospel without perusal of
the entire reports. Uncertified statements
have been accepted apparently without
appreciation of their lack of value as a
basis for reliance. Reports on limited
examinations and balance sheet audits
have had as much standing as those result­ing
from general audits.
The question which naturally might be
expected is, "How is the bewildered gen­eral
public, banker, and the collective other
person to know the differences among these
various types?" Accountancy is a techni­cal
profession dealing among other matters
with the highly technical subject of ac­counting.
How is the layman to deter­mine
what is what and which is which?
The only official attempt of known
record which has been made publicly to
inform those interested as to what may be
expected of accountants is a "Tentative
proposal for uniform methods for the
preparation of balance sheet statements"
issued by the Federal Reserve Board in
April, 1917. This praiseworthy manual
commonly is referred to as the "Balance
sheet audit of the Federal Reserve Board."
Being uninformed to the contrary, the
general public perhaps is justified in as­suming
that all audits are balance sheet
audits, which is only one step removed
from the possibility of gaining the impres­sion
that accountancy exists for the sole
purpose of performing balance sheet audits.
The time has come, apparently, when
accountants, through an authoritative
medium, must let the public know some­thing
about what they undertake to do;
to define and differentiate their various