Articles

Status of the Accounting Profession

The accounting profession is constantly changing in many respects and I consistently hear commentary regarding the status of the profession and the “Trusted Professional”. Three of the most common obstacles in the progression of the profession relate to new accounting and auditing standards, quality of life from the accountant’s point of view and staff retention from the firm’s point of view.

The accounting profession has been inundated with new accounting and auditing standards relating to the performance of attest work. These new standards, in most instances, require additional time for the accounting professionals to complete their attest work and related tasks. For example in March and May of 2006 nine (9) new Statements on Auditing Standards were issued with effective dates commencing in 2006 through 2008. These new statements on auditing standards (SAS) include SAS 112 for 2006 and SAS 104 through SAS 111 which are effective in 2007 and 2008. SAS’s 104 to 111 have been deemed the new risk assessment standards.

As new accounting and auditing standards are issued, one may conclude that these standards are based on some event that affected a big four firm, a public company audit failure or as a result of a public company restating financial statements. The most recent development has been in relation to the accounting of stock options and the alleged abuse by corporate executives in valuing options, managing the stock price and exercising the options for substantial profits. It is this type of event that drives the profession’s standard setters to develop new accounting and auditing rules. The aforementioned is a case for Big GAAP versus Little GAAP which has been a hot topic over the past year.

New standards equate to increased time to perform engagement tasks which in turn may affect quality of life. To facilitate the professional staff’s adjustment to the additional requirements of new standards, there needs to be a balance between work and quality of life. A mentoring program is a great tool that when effectively utilized and monitored, can assist professional staff in time management, individual growth, client relations and professional development. Mentoring is extremely important at all levels within a firm from the top on down. In our firm, mentoring is structured and monitored on a quarterly basis.

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