AICPA council votes

AICPA Council Authorizes Bylaw, Code Changes and Member Vote on Key Issues

The AICPA council approved a change to the council resolution under Rule 505 Form of Organization and Name of the AICPA Code of Professional Conduct to bring it in line with approved changes in the Uniform Accountancy Act by providing that only a simple majority of a firms owners must be CPAs. (See Council Proceeds With Sweeping Regulation Reform , JofA, Aug.97)

Council approved changes to the implementing resolutions under bylaw section 2.3.3 to provide for uniformity, flexibility and innovation in deriving methods of learning and measurement of the continuing professional education requirement. One of the resolutions states that compliance with CPE requirements can be achieved by any means, "however measured, that would be reasonably expected to maintain professional competencies in the members area of practice or employment." There will be no required annual minimum of CPE, just a total for three years. Members in business and industry will have to earn 120 hours in a three-year period, up from the current 90. These CPE changes will not take effect until January 1, 2001.

Council also agreed to submit to a membership vote for a change in rule 505 concerning sole practitioners use of names of former owners of their firms. A bylaw change, also to be put to membership vote, would exempt members who limit their practices to certain services—consulting, for example—from required membership in an Institute-approved practice-monitoring program. Only firms that perform services within the scope of practice-monitoring standards and that issue reports purporting to be in accordance with AICPA professional standards would have to enroll.

Ballots on the bylaw and code changes went out to AICPA members in late August.

The council also authorized the assurance services executive committee as a senior committee, allowing it to make public statements and publish measurement criteria without clearance with the council or the board of directors. It also established two nonvoting membership categories: "international associate" and "student affiliate." The requirements for the new membership categories, as well as other council actions not requiring member approval, appear in Official Releases.

ISB Update: Independence Board Holds First Meeting

Members of the newly established Independence Standards Board (ISB) met for the first time in the New York City offices of the American Institute of CPAs. The boards chairman, William T. Allen, director of New York Universitys Center for Law and Business, said the new independence oversight body had to establish policies, procedures and due process for its work product. The eight-member board was formed by the Securities and Exchange Commission and the AICPA to create, codify, amend and preserve independence standards for auditors of public companies.

Chairman Allens first order of business was to formally adopt existing SEC rules and interpretations on auditor independence for use as the groundwork for the ISBs own independence guidelines.

The board also discussed the facilities and staff support of the ISB by the AICPA. ISB board member and AICPA President Barry Melancon said the AICPA would house the boards support staff and executive director. The executive director will be responsible for overseeing the staff, proposing research and preparing an annual report.

Although the AICPA will provide the budget for the board, its executive director and staff, it will be considered an independent body. Allen emphasized that the ISB was "not an organ" of the AICPA SEC practice section. The SEC and the AICPA will review the ISBs work after five years to ensure it is serving public interest and protecting investors.

The board is expected to meet again in mid-September for a private meeting to educate its members about the role of independence in auditing public companies financial statements.

New Jersey Public Accountant to Head NASBA

The nominating committee of the National Association of State Boards of Accountancy named Milton Brown as its choice for 1997-98 vice-chairman. If, as expected, he is formally elected at the groups annual meeting this month, Brown—a public accountant—will become NASBAs 1998-99 chairman and its first licensed public accountant (LPA) chief executive. Brown spent 11 years on the New Jersey State Board of Accountancy, including 2 years as its president.

Fighter for reciprocity
The past chairman and current member of NASBAs Uniform Accountancy Act committee, Brown has long promoted the idea of substantial equivalency. Despite NASBAs and the American Institute of CPAs progress in this area, each individual state can set its own licensing laws. "Its terrible that its often easier for an Australian or Canadian accountant to gain reciprocity privileges in the United States than for a U.S. accountant to have reciprocity with the state next door," said Brown. "Its kept the profession from moving forward." He cited the increasingly common engagements over the Internet: " Current regulations are forcing accountants to break state laws when the Internet takes them across state lines."

Eclectic background
Brown also has been active in the National Society of Accountants, serving as its president for 1994-95. The NSA membership consists of LPAs, CPAs, enrolled agents and unlicensed accountants. "There isnt as much difference between the NSA and other groups as one might expect," said Brown. "As I see it, all accountants are concerned about whats best for the profession."

AICPA Publications Honored
The Society of National Association Publications gave awards to two American Institute of CPAs publications: the Journal of Accountancy and the CPA Letter. The Journal received the silver award in the category of "magazines, general excellence, ad revenues over $1 million." The Letter received a bronze award in "newsletters, most improved." The latter award is based on the newletters recent redesign and inclusion of member segment supplements.

Brown has his own firm in Clifton, New Jersey.

Bowsher in New Oversight Job

Although Charles A. Bowsher completed his 15-year term as comptroller general of the United States, his oversight work is not done. He just became the newest member of the Public Oversight Board, which oversees the self-regulatory programs of the SEC practice section of the American Institute of CPAs division for CPA firms. He replaces Paul W. McCracken, who has retired. Bowsher also is a trustee of the Financial Accounting Foundation.

The POB, based in Stamford, Connecticut, is an autonomous five-member body that appoints its own members and establishes its own operating procedures.

AICPA Welcomes Entire Online Community

The American Institute of CPAs launched a Web-based forum as part of its Web site, AICPA Online, providing an online conference center to anyone in the world who can access the Internet. For no fee beyond normal access time charges, members and nonmembers can read messages and leave ones of their own. Although the forum serves the same purpose as the CompuServe Accountants Forum (see sidebar), it is not limited to users of a particular online service provider and it has some additional useful features.

CompuServe Redux
Contrary to reports and rumors, the Accountants Forum on CompuServe is not closing down. According to a public message from AICPA Sysop Hal G. Clark thanking all the people who had commented on the discontinuation of Accountants Forum, the AICPA has extended its contract with CompuServe to continue the forum. The CompuServe Forum and AICPA Online Forum are completely separate entities. Messages posted on one do not get transfered to the other.

The Forum on AICPA Online is actually six forums, or areas: general, accounting, auditing, taxation and information technology (more forums are planned). The previously launched assurance services forum has been rolled into the new structure. The six areas are simple to use—they are not very different from the CompuServe Accountants Forum—and extensive directions are posted. First-time users see a registration screen with step-by-step directions. After registering, users can pick a forum and go to an index page. They can click on any of the messages to bring that message onto the screen. Each message offers an opportunity to jump to the next message, the previous message or to reply, as in the CompuServe forum.

Customizing the forum experience

The forums offer many options. For example, they display a brief header, or title, of each message on the opening page. Viewers can elect to see just the opening message of each "thread" or all the responses. (This is comparable to looking at a book index and deciding whether to view just the main entries or all the subentries, too.) In Web-speak, a thread consists of an initial message on a given subject followed by the responses to the first message, the responses to the responses and so on. Users can opt to view messages posted within a certain time period or on a certain subject.

Messages can be customized: Users can create a standard sign-off on all messages posted, so they automatically end with: "Jane Doe, Doe & Roe, CPAs, serving the Midwests tax needs since 1953." The creative can easily add an "emoticon," an icon that clues readers into the tone of the message, such as positive response ("happy face" icon) or query ("question mark" icon).

An enormous time-saver is the notification option: If Mary posts a message and John responds a day later, the forum will automatically send Mary an e-mail notifying her. This spares users from having to log on again and again to see if there are any responses. This feature can be turned on and off with each message. The details of all these features and others appear in the forum instructions.

Web surfers can visit the forums directly at or they can hotlink from the AICPA home page.


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