Magazine article The CPA Journal

Inbox: Letter to the Editor

Magazine article The CPA Journal

Inbox: Letter to the Editor

Article excerpt

Regarding ? Pathway for Access to the Profession'

The American Accounting Association's (AAA) Pathways Commission on Accounting Higher Education's recent report, "Charting a National Strategy for the Next Generation of Accountants" represents a missed opportunity. Joanne Barry's Publisher's Column ("A Pathway for Access to the Profession," The CPA Journal, September 2012) highlighted the most admirable of the report's objectives, including engaging and retaining "the best and brightest students and educators" and "the establishment of a high school accounting class that would be eligible for advanced placement (AP) credit."

But although the Pathways Commission's report represented a broad constituency of "views and perspectives ... [from] more than 40 conferences or meetings during 2010, 2011, and 2012," there were also some serious omissions (http://commons.aahq.org/ files/Ob 14318188/Pathways_Commission_ Final_Report_Complete.pdf, p. 27). The fact is that Pathways Commission's report did not address the most critical issue facing the CPA profession today:

When it comes to assigning blame, when do we stop looking elsewhere and start looking in the mirror? (Louis Grumet, "Losing Our Moral and Ethical Compass," Publisher's Column, The CPA Journal, May 2009)

Admirable Objectives

The focus of the report is clear and its goals are admirable. The Pathways Commission states: "The value proposition of any profession, accounting included, rests squarely on the ability and willingness of the profession and its members to honor the commitments implicit in the profession's social contract, i.e., to serve the profession's broad public interest" (p. 23). The report adds: "Absent a highly competent membership, thoroughly committed to the profession's ideals and purposes, the accounting profession has little hope of living up to its commitments and responsibilities to market participants as well as to society at large" (p. 23).

The report goes further by highlighting the importance of the profession's work: "Absent the confidence and trust engendered in market participants by the ready availability of reliable accounting information, domestic and global markets would cease to function efficiently, businesses would fail to thrive and flourish, and global prosperity would become something less than an attainable goal" (p. 22). The first recommendation in the report is: "Build a learned profession for the future by purposeful integration of accounting research, education, and practice for students, accounting practitioners, and educators" (p. 11).

Shortcomings

In this reader's opinion, the Pathways Commission's conclusions are not dissimilar from those in the AICPA's CPA Horizons 2025 report, published in 2011. (The AICPA (»sponsored the Pathways Commission's report.) Both reports share certain shortcomings, including the following:

* The credibility gap. The report ignores the most critical issue facing the accounting profession today.

* The "learnedprofession " gap. The report doesn't distinguish between the differences in career tracks between the professions and recommend curriculum changes.

* The ethics gap. The report ignores the responsibility of public accountants to society and doesn't recommend their training include courses in fraud detection, ethics, and social responsibility.

The credibility gap. The Pathways Commission's report is notably silent on this fundamental issue. As this writer has argued (Richard H. Kravitz, "Auditors' Responsibility for Detecting Fraud: Putting Ethics and Morality First," The CPA Journal, June 2012), during the past four years, clean audits were rendered on dozens of businesses that subsequently became bankrupt (MF Global, Peregrine Financial Group, and Lehman Brothers), were forced to merge (Countrywide, Washington Mutual, Merrill Lynch), or were found to be Ponzi schemes (Madoff, Stanford, and others).

Furthermore, the magnitude and extent of fraudulent and materially misstated financial reporting (whether intentional or unintentional) continues to grow. …

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