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State Board Report

April 2015

Often, the topics for this Memo are the result of current events, developing issues or on-going matters of importance. On occasion, I get recommendations from stakeholders, which I truly appreciate. I recently received an email from a former public member of a northwest Board of Accountancy who remains an important part of NASBA as an Associate Member. In her email, she suggested that I write a column on "public members" and the key role that they play in our regulatory system. So in this Memo, I would like to give a shout-out for the public — public members that is.

In the United States, almost all Boards of Accountancy include public members. In fact, a super majority of all regulatory boards in the U.S. have public members, and most have included them for many years. In my 15- year relationship with State Boards and NASBA, I don’t recall any serious discussion about the specific role or the importance of public members. Recent events (including the Supreme Court’s decision in FTC v. NC State Board of Dental Examiners, see SBR 3/15) and my research for this Memo have led me to conclude that this discussion is needed and timely.

Let me begin by saying that my personal experience with public members has been a positive one. Public members I have witnessed come to meetings well-prepared and attentive, and are fully engaged in the process. I have seen this across the country as I have visited many State Boards’ meetings. Most of these folks have learned "accounting" as a second language through their businesses, civic activities or formal education, and they have developed a comprehension of accounting-related matters without being engaged in public practice. Among the many valuable "public members" there have been teachers, ministers, attorneys, retired Civil Service workers and small business owners, to name a few. However, the most important role they play is not based on their accounting-related experience or education, but on their being unbiased observers who are participating in fair regulatory processes to insure good public policy for the protection of the public.

The much talked about Dental Examiners decision has been somewhat of a wakeup call for all regulatory boards. An important allegation of that case was that a regulatory board made disciplinary decisions that, at least, appeared to be based more on competition than on public protection. All regulatory boards, including Boards of Accountancy, should be cognizant of the risks associated with even the appearance of their professional members being self-serving or allowing competitive considerations to become a determining factor in setting public policy. Who better than our public members to serve as a check and be particularly focused on insuring that regulatory boards never lose sight of their main purpose for existing — to protect the public.

I want to stress that I am a dedicated advocate and defender of the regulatory model used by State Boards of Accountancy. Our system of allowing professional peers, who are subject matter experts, to judge conduct based on the extremely complex and ever changing rules and standards is a proven one. The fact that the system is self-funded by licensees and practitioners, and thus protecting the public with no cost to them, is a level of practicability that does not usually exist in government. Having well-prepared public members integrated into the process only amplifies the integrity of the process.

My hat is off to all the volunteers who serve on Boards of Accountancy. It is often a thankless job that requires significant time investment and sacrifice so that the public can continue to rely on the accounting profession. We should all give special thanks to those with no direct nexus to the profession who do the same heavy lifting as those who are CPAs. So here is a special shout out for our public Board members.

Semper ad meliora. (Always toward better things.)

— Ken L. Bishop
President and CEO

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