The Journal news staff talks with President Barry Melancon about key issues.

A Talk with Barry Melancon

Recently, AICPA President Barry Melancon sat down with the Journal news stafffor the first of a series of periodic talksto share his thoughts on issues ranging from the CPA Vision Project to derivatives legislation. From his unique vantage point, what does he see in the immediate future for the profession?

Journal: What are the major items on your agenda at this moment?
Melancon: CPA WebTrust is an immense project, of course, and the Institute is committed to making it successful. Im also very pleased with the CPA vision project. In one year, we put together 200 full-day forums, which over 3,000 members attended. I think even a for-profit company would have had trouble doing as much so quickly. I am pleasantly surprised that international issues appear to be very important even to smaller firms and companies. Businesses everywhere are going to be interacting much more internationally.

Journal: The Institute has two accreditationsPFS and ABV. Are any more under consideration?
Melancon: Council just approved a new approach to accreditation on the basis of a report from the special committee on accreditation of specialization, chaired by Robert Israeloff. It requires us to be more proactive, and were planning to dedicate staff to manage the expansion of the accreditation program. The eldercare assurance service, too, may lead to a new accreditation.

CPAs may need to think differently about specialization than they have in the past. First, practitioners should consider accreditations as being tied closely to the CPA designation: Youre not a PFS or an ABVyoure a CPA/PFS or a CPA/ABV. You build on the CPA. Some small firms may think specialized accreditations work against them because they cant possibly specialize in every areaand thus earn every new designation we issue. However, by specializing in one or two areas, a small firm can gain a reputation among the general public and other CPA firms for expertise and thus become part of a one-stop shopping network. Heres an example: A former partner of mine has his own firm now and does only high-level tax consulting work. By concentrating on this niche, hes earned a reputation far beyond the town where hes located. He gets referrals from firms that do not specialize in his area, and, in return, he refers clients who need audits, for example, to firms equipped to handle them. He has become part of a referral network, and thus he can help his clients even when they want services he does not personally provide.

Journal: Lets talk about state regulation. Whats happening with issues such as the Uniform Accountancy Act and the 150-hour requirement?
Melancon: Were making some progress with the UAA; its important for the profession and were not going to lose sight of that. Our goal is forty states and I think well get there. The UAA may change as we go forward, but the overall premise of what were trying to create is winning over the profession. A number of states recently approved the 150-hour requirement, bringing the total to 43, with several more very close.

The American Accounting Association has been with us on this with great leaders, such as Steve Albrecht and Mike Diamond, who are attuned to changes in the profession and the need to make changes in educational programs. We have been discussing the issue with the leadership of the National Association of Black Accountants, which has been trying to help us on this issue. NABA contributed to the success in the key state of Massachusetts, which recently passed the 150-hour requirement.

Journal: Looking at traditional financial accounting, what is your view of the FASB, especially now that it is under attack for its proposed derivatives standards?
Melancon: My positionthe Institutes positionhas always been that the FASB is the best of our known alternatives, which would include government standard-setting. Theres certainly room for improvement, as there is in any organization, but we support FASBs process.

Journal: Any final words on your priorities?
Melancon: Repositioning the profession for tomorrow and embracing an entrepreneurial spiritthese have long been on my list and will not go away.