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A Goal Achieved... A Reason for Pride In 1896 Frank Broakerof New York State became the first certified public accountant in the United States. Since that time hundreds of thousands of men and women have studied and worked for years to earn the privilege of taking a rigorous four-part, three-day, 191/2 hour examination. Their goal and the reward of those who pass: the right to place the initials "CPA" after their name. Certification is official recognition that an accountant has achieved the levels of competence and proficiency demanded of those who want to call themselves certified public accountants. Like the licensed physician and practicing attorney, the CPA is a professional who must not only take and pass required college courses but also satisfy a "jury of his peers" that he is competent to practice his profession. For the applicant who has satisfied the educational requirements (in addition to several years of actual work experience in some states) the CPA test is the final hurdle. Behind the more obvious mechanics of the test—which covers accounting practice, accounting theory, business law and auditing — is the complex structure consisting of national organization, state professional groups, practicing CPAs and educational institutions whose efforts are required to produce semi-annual examinations that reflect the changing requirements of U.S.—indeed international —business, law and finance. And overshadowing it all is a rich tradition and heritage stretching back more than 75 years. All U.S. CPA exams today are developed and administered by the American Institute of Certified Public Accountants (AICPA), first incorporated in 1887 as the American Association of Public Accountants. At the end of its first year the AAPA, designed to foster more respect in this country for the profession of accounting and modeled after the Institute of Chartered Accountants in England and Wales, had a membership of 25 fellows and seven associates. Today the AICPA has some 90,000 members. In 1893 the New York Board of Regents granted a charter for incorporation to the New York School of Accounts, the first school of accounting in the United States. Seven pupils enrolled in the first class. Three years later, in 1896, New York became the first state in the Union to establish legal requirements for anyone wanting to call himself a CPA: He had to be a citizen of the U.S., a resident of New York or doing business in that state, of good moral character, and he had to possess a university certificate attesting to the fact that he had the qualifications to practice as a public accountant. If the "good moral character" requirement of the 1896 legislation has a quaint ring to it, we might point out that today some 40 states require CPA candidates to take and pass supplementary ethics exams before they can be certified. A CPA found guilty of unethical practices can lose his certification, as can one convicted of criminal charges. Charles Waldo Haskins, who with Elijah Watt Sells founded Haskins & Sells in 1895, took an active interest in passage of the 1896 Act to Regulate the Profession of Public Accountancy in New York. Mr. Haskins qualified as a CPA under the Act and was named first president of the Board of State Examiners of Public Accountants, which was established by the Act. Mr. Haskins also played a key role in the founding in 1900 of the School of Commerce, Accounts and Finance of New York University and was its first dean. In 1917 the AAPA changed its name to American Institute of Accountants and on June 14 and 15 of that year held its first CPA examinations. One hundred twenty-one candidates sat for that test, and 93 passed. (More than 30,000 candidates sat for the November 1972 exams.) Most state accounting laws were passed between the turn of the century and the early 1930s. It was not until 1952 that the last of the states- Pennsylvania-adopted the AICPA uniform exam for CPAs, and it was only in 1962 that New Jersey became the final state to utilize the advisory grading service of the AICPA. As presently structured the CPA exam is unique: It is a national examination whose results are generally accepted in 54 jurisdictions, including the 50 states, District of Columbia, Puerto Rico, Guam and the Virgin Islands. Earlier, individual states had administered their own CPA tests, a system far more expensive than the present arrangement. Even more serious were the certification problems that sometimes arose because of differences in state tests and requirements for CPAs moving from one state to another. One of the major advantages of the present system lies in its making the passing of one standardized test mandatory for anyone anywhere in the country who wants to be a CPA. Exactly how does the CPA exam system work? If the AICPA forms the broad organizational base for the program, the 16-member Board of Examiners is the operational g roup charged with development, administration and grading of each test. Members of the Board, about half with primary interests in the practicing profession and the other half from the academic world, are selected by the president of the AICPA and serve a three-year term. Roughly half the Board's membership is made up of current or former members of state boards of accountancy. All are CPAs and usually chosen because of a particular field of expertise, such as taxes, law, statistics or computers. Because of the important relationship that must be maintained between the profession and the college and university system, most of the practicing accountants on the Board have some association with the academic world. The Board of Examiners meets twice a year and works at least three examinations in advance, a procedure demanded by the complex logistics involved in giving the same exam to more than 30,000 people simultaneously in 93 cities across the United States and in Puerto Rico. (Some 50,000 copies of each exam are printed and the security that must be maintained would give nightmares to the head of security at Fort Knox.) After the tests are taken, all papers-identified only by serial number to guarantee anonymity of the candidate and impartiality of the grader-are forwarded to AICPA headquarters in New York City for grading, which is done by
Goal achieved... A Reason for pride
Accounting -- Examinations, Questions, etc.
Broaker, Frank, 1863-
Haskins, Charles Waldo, 1852-1903
Sells, Elijah Watt, 1858-1924
Beamer, Elmer G.
H&S Reports, Vol. 10, (1973 autumn), p. 22-24
|Source||Originally published by: Haskins & Sells|
|Rights||Copyright and permission to republish held by: Deloitte|
|Format||PDF page image with corrected OCR scanned at 400 dpi|
|Collection||Deloitte Digital Collection|
|Digital Publisher||University of Mississippi Library. Accounting Collection|