October 2005
Seven Voices From the Profession
A group of prominent leaders, brought together by historian Gary John Previts, considers the
accounting profession's recent past and its future.
by Gary John Previts, Journal of Accountancy Centennial Issue
Executive Summary
The JofA asked historian Gary John Previts to bring
together a group of prominent leaders to consider the
accounting profession’s recent past and its future. Here
are the observations of David M. W alker, Olivia F. Kirtley,
Bert N. Mitchell, Don Kirk, J. Clarke Price, J. Michael Cook
and Previts himself.
The State of the
Ac c o u n t a b i l i t y P r o f e s s i o n
By David M. W alker
Recent accountability failures in the United States and other countries have led to bankruptcies
and restatements that harmed countless shareholders, employees and retirees. People lost
their investments, their jobs and their pensions. Not surprisingly, public confidence in the
integrity of the financial reporting process and auditors took a big hit. In fact, one of the
w o r l d ’ s l a r g e s t a n d m o s t r e s p e c t e d a c c o u n t i n g f i r m s , a n d o n e t h a t I wo r k e d a t f o r m a n y y e a r s
— Arthur Andersen LLP — paid the ultimate price.
T h e s e f a i l u r e s i n v o l v e d n o t m e r e l y m a r g i n a l c o m p a n i e s wi t h q u e s t i o n a b l e r e p u t a t i o n s b u t
prominent businesses and acclaimed executives. In some cases, corporate officers allegedly
pressured their auditors to help cook the books. Although most auditors did not participate in
such schemes, all too often the result was audited financial statements that inappropriately
accelerated revenues, deferred expenses, artificially smoothed earnings and boosted earnings
per share.
The accounting profession is not solely responsible for the scandals at Enron, WorldCom and
other companies, but it does bear some blame — partly because of its reluctance to adopt
long-overdue reforms. The silver lining to this sad situation is the opportunity to repair our
profession’s tarnished image and better position ourselves to meet the challenges and
opportunities of the 21st century.
Concerns about truth and transparency in financial reporting, however, are not limited to the
p r i v a t e s e c t o r . W a s h i n g t o n r e c e n t l y g o t a n u n p l e a s a n t w a k e - u p c a l l w h e n t wo g o v e r n m e n t sponsored enterprises, Fannie Mae and Freddie Mac, announced earnings restatements. My
a g e n c y , t h e U . S . G o v e r n m e n t A c c o u n t a b i l i t y O f f i c e , i s c om m i t t e d t o e n s u r i n g t h a t s u c h
accountability failures do not occur in the federal government.
In the long run, the accounting profession needs to help modernize and expand financial and
p e r f o r m a n c e r e p o r t i n g m o d e l s a s we l l a s a t t e s t a n d a s s u r a n c e p r a c t i c e s , i n c l u d i n g t h e u s e o f
continuous auditing practices. More immediately, acc ount ants and auditors must integrate best
practices into their daily routines. They must also put the public interest bef ore personal
interest; do what is ethically right and not just legally permissible; be concerned about both
fact and appearance, especially when it comes to independence issues; and recognize that
continuous improvement is essential.
M a i n t a i n i n g p u b l i c t r u s t wi l l r e q u i r e e v e r y p a r t i c i p a n t i n t h e c h a i n o f c o r p o r a t e r e p o r t i n g t o p u t
i n t o p r a c t i c e t h e v a l u e s o f t r a n s p a r e n c y , a c c o u n t a b i l i t y a n d i n t e g r i t y . T h e p u b l i c ’ s e xp e c t a t i o n s
a r e h i g h , a n d r i g h t f u l l y s o . I n t h i s c a s e , i t wi l l t a k e a c t i o n s , n o t w o r d s , t o r e p a i r t h e d a m a g e
that has been done. On each and every assignment, accountability professionals need to be
t h i n k i n g a b o u t h o w t o m a xi m i z e v a l u e a n d m a n a g e r i s k f o r t h e i r m o s t i m p o r t a n t c l i e n t — t h e
public. After all, that is what the “P” in CPA stands for.
David M. Walker, CPA, Compt roller General of the United States, heads the U. S. Government
Accountability Office and holds a number of leadership positions in the profession, both
domestically and int ernationally. His previous experience includes serving as Assistant
Secretary of Labor f or Pension and Welfare Benefit Programs and as Public Trustee for Social
Security and Medicare, as well as in various audit, consulting and leadership positions at
Arthur Andersen, Price Waterhouse and Coopers & Lybrand.
Leadership in the
Corporate World
By Olivia F. Kirtley
CPAs are going places. Fast. In recent years, the acceleration of transformation from
supporting and information roles to leadership roles has been tremendous. CPAs are moving to
the top of organizations and into the boardroom in increasing numbers. Demand for CPA
leadership has never been greater.
Throughout history, the CPA profession has always held to its core values of competence,
i n t e g r i t y a n d o b j e c t i v i t y . N o w, C P A s h a v e e m e r g e d a s t h o u g h t l e a d e r s wh o e m b r a c e c h a n g e
and provide solutions for emerging challenges. CPAs have been the stimulus for fresh
i n i t i a t i v e s t o a d d r e s s n e e d s i n a r a p i d l y c h a n g i n g b u s i n e s s wo r l d .
A s we e n t e r e d t h e 2 1 s t c e n t u r y , t h e p r o f e s s i o n r e c o g n i z e d t h e e m e r g e n c e o f e x p a n d i n g
business needs and initiated a completely new and computerized Uniform CPA Examination
t h a t t e s t s n o t o n l y c a n d i d a t e s ’ k n o wl e d g e , b u t a l s o t h e i r s k i l l s i n a r e a s s u c h a s r e s e a r c h ,
technology and communications. Employers — whether in companies or in firm s — demand
those skills today, and the profession acted to ensure that those who hold the CPA credential
w i l l c o n t i n u e t o d i s p l a y t h e c o m p e t e n c e a n d e xc e l l e n c e t h a t w e h a v e c o m e t o s t a n d f o r .
C P A s a r e m o v i n g i n t o l e a d e r s h i p r o l e s o n a l l b u s i n e s s f r o n t s . I n y e a r s p a s t , C P A s we r e v i e w e d
primarily in financial leadership roles, but rarely as full -scope business leaders. That has
c h a n g e d . A s b u s i n e s s c o m p l e x i t y h a s i n c r e a s e d , we h a v e g a i n e d t h e r e s p e c t o f b o t h
management and investors who understand that our f inancial acumen and core values have
much broader application that can greatly benefit corporate America. CPAs are being sought
after as valuable partners in leadership alongside boards and CEOs. Our leadership roles have
b e e n wi d e l y e m b r a c e d a s e s s e n t i a l t o t h e s u c c e s s a n d f u t u r e v i a b i l i t y o f b u s i n e s s e s .
O n t h i s 1 0 0 t h a n n i v e r s a r y o f t h e J o u r n a l o f A c c o u n t a n c y , m u c h o f t h e C P A wo r l d h a s c h a n g e d .
H o w e v e r , C P A s f r o m a c e n t u r y a g o wo u l d e a s i l y r e c o g n i z e u s a s w e c o n t i n u e t o h o l d t o t h e
core values they established for this great profession. They would also see that we have not
settled for a little piece of land in the business arena but have recognized our territory to be
f a r r e a c h i n g , a n d a r e c o n s t a n t l y l o o k i n g f o r wa y s t o e x p a n d o u r i m p a c t a n d c o n t r i b u t i o n a s t h e
b u s i n e s s w o r l d a n d p u b l i c e xp e c t a t i o n s c o n t i n u e t o e v o l v e .
Olivia F. Kirtley, CPA, is a former chair of the AICPA board of directors, the first woman and
first CPA in business and industry to hold the title. She also chaired the AICPA board of
e x a m i n e r s d u r i n g t h e d e v e l o p m e n t o f t h e c o m p u t e r i ze d C P A e x a m . S h e i s a c o n s u l t a n t o n
strategic and governance issues and a corporat e director of several public companies.
Responsibility to
Embrace Diversity
By Bert N. Mitchell
In his inaugural address in Oc tober 1968, AICPA chair Ralph Kent noted that the time had
c o m e t o i n t e g r a t e t h e C P A p r o f e s s i o n i n f a c t a n d n o t m e r e l y i n i d e a l . T h i s c h a l l e n g e c a m e we l l
a f t e r t h e A I C P A h a d c e l e b r a t e d i t s 7 0 t h a n n i v e r s a r y , a n d s t i l l t h e r e we r e l e s s t h a n 1 5 0 b l a c k
CPAs in the entire country. Until then, there had been almost no consciousness on the part of
t h e p r o f e s s i o n o f a s o c i a l r e s p o n s i b i l i t y t o e m b r a c e d i v e r s i t y . N o w t h a t we a r e w e l l i n t o o u r
s e c o n d c e n t u r y , we m u s t e v a l u a t e h o w w e l l we h a v e r i s e n t o t h e c h a l l e n g e a n d t o wh a t e xt e n t
we are committed to diversity as a social responsibility.
Today, more than 50% of the new entrants to our profession are women, a reality that not even
t h e m o s t v i s i o n a r y p r e -W o r l d W a r I I p r a c t i t i o n e r w o u l d h a v e f o r e c a s t . H o w e v e r , t h e n o r m s o f
o u r s o c i e t y c h a n g e d d u r i n g t h e b a b y b o o m e r a . N o w w e f a c e n e w r e a l i t i e s wi t h a m o r e p r a c t i c a l
and less fearful stance. If our profession had not dropped the artificial barriers that impeded
w o m e n , i t wo u l d n o t b e p o s s i b l e t o m e e t i t s p r e s e n t s t a f f i n g d e m a n d s .
Most of our progress has been made as a result of economic necessity and much less so
b e c a u s e o f i d e a l s . H o w e v e r , i f we a r e t o f u l f i l l o u r p u b l i c t r u s t , we m u s t s e r i o u s l y c o m m i t
ourselves to the social responsibility of diversity in our profession — not only at the entry level
b u t a t t h e l e a d e r s h i p l e v e l s a s we l l . W e m u s t b e c om e m u c h m o r e p r o a c t i v e i n i n c r e a s i n g t h e
participation of ethnic minorities, thereby making our profession more representative of our
population overall.
The CPA profession, like the corporate community, has become concentrated over the last
quarter of a century; this is evident in the fact that the four largest firms represent more than
75% of the revenues derived by the entire profession. Moreover, there is only a slight
representation of ethnic minorities in the leadership ranks of these firms. Of the more than
8,000 partners in the Big Four combined in the United States, less than 100 are African
Americans and even fewer are Latinos, at a time when these two ethnic groups re present more
than 25% of our population.
Yes, one can point out that the CPA profession is not alone in such paucity of diversity, but it
certainly has not been a champion of diversity either. Ralph Kent challenged the profession to
de facto integration, but there is an apparent lack of commitment to the ideal.
A s we c e l e b r a t e t h e c e n t e n n i a l o f t h e J o u r n a l o f A c c o u n t a n c y a n d c o p e wi t h t h e m a n y n e w
realities required of us as professionals — especially the responsibilities under the law we
a c c e p t a s we p r o v i d e s e r v i c e s t o o u r c l i e n t s — l e t ’ s r e m e m b e r t h a t a p r o f e s s i o n t h a t d o e s n o t
commit itself to full opportunity for all the major segments of our society denies itself the full
potential of that most precious resource that fuels its engine — human capital.
Bert N. Mitchell, CPA, is chairman & CEO of Mitchell & Titus LLP, the nation’s largest African
American CPA firm. Mr. Mitchell has been active in the accounting prof ession and has served
on the AICPA board of directors. He has been a frequent contributor to the JofA over the past
35 years.
Regaining Trust
By Don Kirk
In 1978 Jacques Barzun, then a University Professor Emeritus at Columbia University, wrote an
a r t i c l e e n t i t l e d “ T h e P r o f e s s i o n s U n d e r S i e g e ” ( e xc e r p t e d i n t h e M a r c h 1 9 8 4 J o f A ) . B a r z u n ’ s
c l a r i o n c a l l w a s f o r t h e l e a d e r s h i p n e e d e d t o r e s t o r e p r o f e s s i o n s , i n c l u d i n g o u r o wn , t o a
r e s p e c t e d p l a c e i n o u r s o c i e t y . I n 1 9 8 0 W i l l i am R . G r e g o r y , t h e n c h a i r m a n o f t h e A I C P A ,
warned that competitive pressures in the profession “have created in some CPAs atti tudes that
are intensely commercial and nearly devoid of the high -principled conduct that we have come
t o e x p e c t o f a t r u e p r o f e s s i o n a l . ” B o t h m e n ’ s wr i t i n g s w e r e o f t e n q u o t e d b u t s e l d o m s e r i o u s l y
c o n s i d e r e d . M u c h o f wh a t t h e y f e a r e d h a s h a p p e n e d .
B y t h e t i m e o f B a r z u n ’ s wr i t i n g , t h e A I C P A h a d l o s t i t s r e s p o n s i b i l i t y f o r t h e e s t a b l i s h m e n t o f
accounting standards to the independent Financial Accounting Standards Board and was, in
response to congressional criticism, in the process of establishing a governanc e structure —
the SEC practice section and the Public Oversight Board — for carrying out and overseeing
p e e r r e v i e ws . T h a t g o v e r n a n c e s t r u c t u r e h a s s i n c e b e e n s w e p t a w a y i n a w a v e o f a c c o u n t i n g
frauds, audit failures and governmental reforms. The crowning blow was the loss of the
profession’s responsibility for establishing generally accepted auditing standards for publicly
o wn e d c o m p a n i e s .
T h e l e s s o n s w e l e a r n e d f r o m t h e s e e x p e r i e n c e s , i t i s h o p e d , wi l l l e s s e n t h e c h a n c e s o f
r e p e a t i n g m i s s t e p s b e c a u s e , wi t h o u t a d o u b t , o u r p r o f e s s i o n wi l l r e m a i n u n d e r s i e g e .
I n m y 4 5 y e a r s o f a s s o c i a t i o n wi t h t h e p r o f e s s i o n I h a v e h a d s e v e r a l v a n t a g e p o i n t s f r o m wh i c h
t o i n f l u e n c e o r o b s e r v e p r o f e s s i o n a l b e h a v i o r . W h a t d i s a p p o i n t e d m e m o s t we r e p r o f e s s i o n a l s
convincing them selves that doing anything other than what was specifically prohibited was fair
g a m e b e c a u s e o u r p r o f e s s i o n a l o b j e c t i v i t y a n d i n t e g r i t y we r e e n o u g h t o p r o t e c t t h e p u b l i c a n d
prevent jeopardizing our professional reputation. The resulting rationalizations l ed to attempts
to downplay or dismiss the long -held notion that appearances should be considered in
assessing independence; they led to flirtation with public ownership of firms; and they led to
t h e b e l i e f t h a t p r a c t i c a l l y n o s e r v i c e — e v e n t h e a g g r e s s i v e m a r k e t i n g o f wh a t h a v e p r o v e n t o
be abusive tax shelters — would call into question the objectivity and integrity of the
p r o f e s s i o n . C a p a l l t h a t wi t h t h e y e a r s o f e f f o r t t o m i n i m i z e t h e p r o f e s s i o n ’ s r e s p o n s i b i l i t y f o r
t h e d e t e c t i o n o f f r a u d , a n d y o u h a v e s o m e o f t h e r e a s o n s wh y r e g a i n i n g t r u s t wi l l t a k e a
g i g a n t i c e f f o r t o f , i n B a r z u n ’ s wo r d s , “ m o r a l a n d i n t e l l e c t u a l l e a d e r s h i p . ”
So, what should be done? For those activities and practices still in the control of the
profession, let’s act on Barzun’s advice : Let’s never forget that our franchise is “a privilege
g i v e n i n e xc h a n g e f o r a p u b l i c b e n e f i t . ” L e t ’ s h a v e t h e wi l l t o p o l i c e o u r s e l v e s i n a n o p e n a n d
t r a n s p a r e n t w a y “ wi t h n o f r a t e r n a l h a n d , wi t h n o t h o u g h t o f p u b l i c r e l a t i o n s . ” L e t ’ s i n s t i l l i n o u r
m em bers, m em ber firm s and profession al associatio n s the convictio n that “eth ical be ha vio r is
d e s i r a b l e , wi d e l y p r a c t i c e d , a p p r o v e d , a n d a d m i r e d . ” L e t ’ s r e m e m b e r t h a t w e a r e l i c e n s e d t o
use our accounting and auditing skills for the public good and that our cod e of ethics calls for
us to do that with objectivity, independence and integrity. Let’s keep reminding ourselves that
audited financial statements are for the benefit of shareholders and that services performed for
audit clients that are not closely relate d to the audit or our accounting and auditing skills will
call into question the objectivity of the auditor. Believe me, appearances do matter, especially
now in the effort to regain public trust.
Don Kirk, CPA, is a former chairman of the Financial Accou nting Standards Board and has
been a partner of Price Waterhouse, a prof essor at the Columbia Univ ersity Graduat e School of
Business, vice-chairman of the Public Oversight Board and a corporate director and audit
committee chair. He is a member of the Acco unting Hall of Fame at The Ohio St ate University
a n d a r e c i p i e n t o f t h e A I C P A ’s G o l d M e d a l f o r D i s t i n g u i s h e d S e r v i c e .
Education With Purpose
By Gary John Previts
I n 1 9 0 5 w h e n t h e J o u r n a l o f A c c o u n t a n c y m a d e i t s d e b u t , a h i g h s c h o o l e d u c a t i o n wa s t h e
c o m m o n e xp e c t a t i o n a m o n g t h e f e w s t a t e s t h a t h a d p a s s e d C P A l e g i s l a t i o n . E xp e r i e n c e i n
p r a c t i c a l s k i l l s wa s a C P A ’ s k e y f e a t u r e . I t wo u l d b e 2 0 y e a r s b e f o r e a l l s t a t e s h a d p a s s e d
comparable CPA statutes, and decades before a bachelor’s degree would become the norm for
C P A q u a l i f i c a t i o n , a l o n g wi t h t h e e m p h a s i s o n t e c h n i c a l ( C P A - e x a m - d r i v e n ) s k i l l s . T h e n , i n
1 9 6 7 , t h e l a n d m a r k s t u d y H o r i zo n s f o r a P r o f e s s i o n i n t r o d u c e d a m o r e c o m p l e t e v i e w o f f o r m a l
accounting education. Today, a majority of new CPAs have achiev ed the postgraduate
e d u c a t i o n a l l e v e l a n d C P A s a r e b e i n g b e t t e r p r e p a r e d f o r a n “ o wn e r s h i p ” s o c i e t y , s e r v i n g m o r e
s o p h i s t i c a t e d c l i e n t s wh o d e m a n d g r e a t e r a c c o u n t a b i l i t y .
Education is a key to fulfilling what we can do as CPAs. Because much has to be under stood
f o r s o m e o n e t o b e c o m e t e c h n i c a l l y p r o f i c i e n t , we o f t e n f o c u s o u r e d u c a t i o n a l e f f o r t s o n
c o m p e t e n c y a l o n e , w h i l e v i e wi n g s o c i a l r e s p o n s i b i l i t y a s a n a d d - o n r a t h e r t h a n a b u i l t - i n
c u r r i c u l u m f e a t u r e . T e c h n i c a l s k i l l s a r e s i g n i f i c a n t i n t o d a y ’ s e d u c a t i o n a l e n v i r o n m e n t , i n wh i c h
we are adjusting to a new psychometrically validated computerized testing process and new
mandates from recent legislation and regulation. As important as technical competence is to
satisfying the market’s demand for efficiency, h owever, it is but one aspect of the purpose of a
CPA’s education.
O u r 2 1 s t c e n t u r y w o r l d f e a t u r e s i n s t a n t c h a n g e , g l o b a l c o n n e c t i v i t y a n d p e r p e t u a l l y p e r p l e xi n g
pressures, so our responsibilities require more than an average educational experience. They
d e m a n d a n e d u c a t i o n wo r t h y o f a l e a r n e d p r o f e s s i o n , n o t m e r e l y a t e c h n i c a l l y c r e d e n t i a l e d o n e .
D e s p i t e r e c e n t t u r m o i l , we r e m a i n a p r o f e s s i o n s o l o n g a s we s e e k f i r s t t o s e r v e o n e o f t h e
most important rights of our free ent erprise system — the constitutional right of an individual to
o wn p r i v a t e p r o d u c t i v e p r o p e r t y . T h i s r i g h t i s a t t h e c o r e o f o u r e c o n o m i c s y s t e m , wi t h i t s
opportunities and its promise of prosperity and liberty. It is now exercised commonly in equity
and security investments and begets a r ight to reliable information. W ithout this information,
individuals are less able to control their investments — their private productive property — and
end up forfeiting them to capital market intermediaries or agents.
The CPA profession’s role in our so ciety is to satisfactorily serve this right to information. Our
educational programs — those at entry level, those that maintain our competency and those
t h a t r e a c h o u t t o i m p r o v e t h e f i n a n c i a l l i t e r a c y o f o u r c o m m u n i t i e s — a r e i n c o m p l e t e wi t h o u t a
strong sense of com m itm ent to this info rm ation ri ght. Both technical com pete nce an d ou r
commitment to this information right, therefore, are the necessary components of education for
CPAs in the 21st cent ury. Our challenge is to addres s this simple but powerful p urpose.
Gary John Previts, CPA, PhD, is professor of accountancy at Case Western Reserve University
in Cleveland. An advocate of professional education, he has worked to advance research
about, and the study of, the history of accounting thought and regula tion.
Ad v o c a t e , R e g u l a t o r , N e t w o r k
and Conscience
By J. Clarke Price
Just as the CPA profession has evolved over the past hundred -plus years, so too have the
organizations that represent the collective interests of those who have earned the CPA
credential. The AICPA, the state societies and the various firm associations play a special role
in helping CPAs enter new practice areas, expand competencies and more effectively serve the
public interest. W hile the roots of these organizations are in serving CP As and representing
their interests, all have evolved into unique entities that act as advocate, regulator, network
provider and conscience.
Occasionally characterized by some as being internally focused and looking out solely for their
o wn o r t h e i r m e m b e r s ’ i n t e r e s t s , t h e o r g a n i z a t i o n s s e r v i n g t h e p r o f e s s i o n h a v e g r o w n f r o m
purely networking forums to fulfill a dual purpose of serving member interests while also
holding members to high performance standards.
The profession’s organizations have driven chang es that benefit the public interest, ranging
from adopting the most rigorous continuing education requirements of any profession to
implementing comprehensive peer review requirements. These actions represent the CPA
profession’s commitment to police itsel f through its professional organizations.
The events that led to the Sarbanes -Oxley legislation challenged the CPA profession’s image in
a wa y t h a t w a s u n l i k e a n y t h i n g w e h a d f a c e d i n t h e r e c e n t p a s t . T h e p r o f e s s i o n ’ s o r g a n i z a t i o n s
r e s p o n d e d o n t wo f r o n t s — i m p l e m e n t i n g c o m m u n i c a t i o n s a n d p u b l i c r e l a t i o n s s t r a t e g i e s t o
h e l p r e s t o r e t r u s t a n d c o n f i d e n c e i n C P A s a n d t h e p r o f e s s i o n , a n d wo r k i n g t o s t o p a f l o o d o f
mostly overreaching state legislation.
W hile dismissed by some as ineffective, ethics enforcement is at the heart of the profession’s
self-regulatory activities and has recently been the subject of much attention. Unfortunately,
the ethics program is com plaint -based a nd works onl y whe n a com plaint is regist ere d. CPAs
themselves are often loath to repor t the substandard work or unethical behavior they
encounter. Others assert that ethics enforcement is superficial since the ultimate sanction is
only to “throw the offenders out of the club.” That kind of thinking and behavior doesn’t do the
profession or the public any good.
T h e o r g a n i z a t i o n s s e r v i n g t h e p r o f e s s i o n a r e o n l y a s g o o d a n d a s e f f e c t i v e a s t h e m em b e r s
m a k e t h e m . T h e y c a n b e c o m e m o r e e f f e c t i v e o n l y i f t h e m e m b e r s e xp e c t m o r e . W e n e e d t o wa l k
t h e f i n e l i n e t h a t a l l o ws u s t o s e r v e m e m b e r i n t e r e s t s w h i l e h e l p i n g t h e p r o f e s s i o n t o r e m a i n a t
the pinnacle of quality.
J. Clarke Price, CAE, is president and CEO of the Ohio Society of CPAs, with which he’s been
affiliated for 33 years in a variety of roles.
Happ y People, Happ y Clients
By J. Michael Cook
Can these four words adequately convey the mission of a global professional services firm?
W h i l e we h a d f a n c i e r m i s s i o n s t a t e m e n t s f o r e x t e r n a l c o m m u n i c a t i o n s , t h i s s i m p l e e x p r e s s i o n
worked well for me in guiding a firm for almost 15 years. The words are simple. The challenges
t o a c h i e v e t h e m we r e m u c h g r e a t e r .
People. They are our intellectual property and, along with our clients, the only asset of our
f i r m t h a t r e a l l y m a t t e r e d . W h a t d i d i t t a k e t o m a k e t he m h a p p y ? T h e c h a n g e s i n t h e i r n e e d s a n d
e xp e c t a t i o n s o v e r t h e y e a r s l e d u s t o d i s c o v e r t h e d i f f e r e n c e we c o u l d m a k e f o r o u r p e o p l e a n d
h o w i m p o r t a n t t h i s c o u l d b e f o r u s w h e n we g o t i t r i g h t . I n a b o u t a g e n e r a t i o n w e c h a n g e d f r o m
an all-male group to a fully diversified firm. When large numbers of talen ted women became a
k e y f a c t o r f o r o u r s u c c e s s , w e c h a n g e d h o w , w h e n a n d wh e r e we w o r k e d t h r o u g h o u r i n i t i a t i v e
f o r t h e r e t e n t i o n a n d a d v a n c e m e n t o f w o m e n . T h e b e s t p r a c t i c e s we l e a r n e d f r o m t h a t
e xp e r i e n c e s p r e a d t o a l l o f o u r h u m a n r e s o u r c e s p o l i c i e s a n d p r a c t i c e s , f o r t h e b e n e f i t o f a l l o f
our people. This propelled us to no. 8 on Fortune’s “100 Best Companies to W ork for in
A m e r i c a ” l i s t i n t h e y e a r I r e t i r e d f r o m D e l o i t t e . T h e s e r e s u l t s we r e c l e a r l y d e m o n s t r a t e d t o m e
in 2003 when I attended the 10th an niversary of the initiative’s launch as the guest of more
t h a n 5 0 0 w o m e n p a r t n e r s — a t e n f o l d g r o wt h f r o m t h e f e we r t h a n 5 0 ( 3 % o f t h e p a r t n e r s ) a t t h e
o u t s e t . W h a t a wo n d e r f u l e x p e r i e n c e t o h a v e b e e n a p a r t o f a c h a n g e p r o c e s s wi t h s u c h a
dramatic impact.
Clients. Identifying the ultimate client and meeting his or her needs and expectations are
continuous challenges. Our profession has always been tested in balancing our obligation to
t h e p u b l i c wi t h o u r d e s i r e t o r e s p o n d t o t h e v a r i e d n e e d s a n d e x p e c t a t i o n s o f t h e c o m p a n i e s
that employ us to provide attest services. W e now face, as a consequence of the intense
changes in recent years, a period of lessened self -regulation and increased government
oversight. Some are concerned that our image has been tarnish ed. Our challenge is to accept
and adapt to these changes and to remove questions about the credibility and value of our core
service — the reason for our existence as CPAs — the independent audit. But even those of
o u r c l i e n t s — p u b l i c i n v e s t o r s a n d t h e c a p i t a l m a r k e t s — wh o a r e n o t h a p p y t o d a y k n o w w e a r e
fully capable of changing. I and others are responding by rededicating ourselves to the highest
levels of integrity, independence and competence in serving the public interest.
J. Michael Cook, CPA, is the retired chairman and CEO of Deloitte & Touche. He is a member
of the board of directors of Comcast, Dow Chemical, Eli Lilly and International Flavors and
Fragrances. He chairs the audit committees of Comcast and IFF, is a member of the audit
c o m m i t t e e s o f D o w a n d L i l l y , a n d c h a i r s D o w ’s c o m m i t t e e o n d i r e c t o r s a n d g o v e r n a n c e .
I n Ap p r e c i a t i o n
T h e J o f A wi s h e s t o t h a n k G a r y P r e v i t s , p r o f e s s o r o f a c c o u n t a n c y a t C a s e W e s t e r n R e s e r v e
U n i v e r s i t y , C l e v e l a n d , f o r h i s m a n y c o n t r i b u t i o n s t o o u r c e n t e n n i a l i s s u e . H i s e f f o r t s we r e
crucial to its success