State Board Report
“You’ll get mixed up, of course,
I am convinced that Boards of Accountancy and any other group or agency with a mandate for public service, in order to be effective must be relevant, relational, responsive and resilient to challenges and threats. And these four “Rs” of effective regulation are fueled and fired with passion for the public interest. Last month I discussed passionately serving a given purpose which in essence defines our relevance. The second “R” in our four-part series is relationships.
I must admit to a mix of perplexity, frustration and even amusement when I hear people criticize and warn CPA members of Boards of Accountancy that they are inherently conflicted with the accounting profession and must forever live under a cloud of suspicion when deliberating and making judgements about practices and people. Are CPAs any more conflicted than other Board members from other professions, disciplines and backgrounds? Do attorneys, educators, business persons and other public members of Boards not bring bias and prejudice to Board meetings? Yes, I know CPAs are part of the profession and I would assert that in some large measure they are even more critical than non-CPA members. Somewhat like I was when I coached my son in baseball for a number of years. I’m not downplaying the significance of conflicts of interest but “Life’s A Great Balancing Act” for Board members – all of them. And balancing is required because of the necessity of relationships.
Managing the perception of conflict is not divorcing oneself from the accounting profession. The strength of a CPA Board member is the current knowledge of the profession, its leadership at all levels, its policies and codes, and the direction it’s going. Significant accounting legislation is referenced to AICPA standards and codes, and to pretend to ignore such is not in the best interests of the public. Being a member of the AICPA is a strong positive, not something to be eschewed or minimized. Similarly membership in state societies of CPAs, the National Society of Accountants, and similar organizations keeps one informed about the profession and provides ongoing dialogue useful to the Board and to the public it serves. I feel it is contrary to our public mandate when I hear Boards of Accountancy and state societies do not have a positive relationship. If it’s egos that need to be parked for the good of the public, let’s find the parking lot. Let’s not hide behind the banner of perceived conflicts of interest to justify Accountancy Boards and professional societies not engaging and cooperating for the public good.
Accountancy Boards must have a 3-C relationship with the federal regulators and standard setters. By 3-C I mean cooperation, coordination and collaboration. State accountancy legislation is impacted and influenced by federal regulators and standard setters. Currently, significant issues affecting State Boards are being deliberated including: International Financial Reporting Standards; private company accounting standards; unlicensed foreign auditors practicing in our states. State Boards need to be involved with federal boards and groups both directly and through NASBA.
State boards must cultivate and sustain meaningful relationships with accounting educators. We must be proactive as educators are crucial to engage in our ongoing Board discussions particularly as they relate to curriculum, hours of study, delivery methods, experiential vs in-the-seat learning and the future of accounting education.
Many other relationships are important to the effective regulation of accounting including the business community, legislators, governors and – not the least – the general public itself. If there was ever a time when Boards of Accountancy were reactive, reserved and resistant, that day is long gone. To serve the public mandate which we so proudly embrace, we must with heads held high enlarge our circle of relationships, move boldly without fear of criticism, and proactively and collaboratively work with anyone and any group which will assist us in better serving the public interest.
“Just never forget to be dexterous and deft.
Ad astra, Per aspera
— David A. Costello, CPA
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