In a conference call on January 3, AICPA President Barry Melancon and Chairman James Castellano announced that the AICPA membership has defeated the proposal to go forward with a proposed Global Credential.
The proposal was soundly defeated by a vote of 83,890 (62.7%) opposed and 50,034 (37.3%) in favor. The total of 133,924 votes that were cast represents about 39% of the membership.
"We believe we took the right course by putting this proposal into the hands of the members." said Mr. Melancon. "The members have spoken, and we will not move forward with this initiative."
The foreign accounting bodies that had agreed to participate in the global credential process include accounting groups from France, Italy, Canada, New Zealand, and Australia. Mr. Melancon indicated that all of those groups had been contacted this morning by e-mail informing them of the AICPA vote results, and that a conference call with all the groups would occur later today. Mr. Melancon had no knowledge as to whether the participating foreign groups would attempt to proceed with a global credential on their own.
The global credential, alternatively referred to as XYZ, Cognitor, and Strategic Business Professional (IISBP), has been a source of controversy among members of the profession since it was first proposed almost two years ago.
AICPA President Melancon indicated that the Institute spent just under $5 million over three fiscal years in developing the initiative, but that much of the research associated with this initiative will be put to good use in other initiatives that the AICPA is spearheading, specifically student recruitment campaigns and improving the image of the CPAs in the public marketplace.
Mr. Castellano mentioned that the members appreciated the opportunity to have participated in the debate, and that "AICPA members must be congratulated for exploring such tough issues. The process worked," he said.
The issue has polarized the profession, and now the profession must come together to move forward. Mr. Castellano identified four issues at the top of his agenda:
- Modernizing and increasing the value and effectiveness of assurance services, an issue that was in the works before Enron
- Protecting and enhancing the self-regulatory process
- Student recruitment
- Continuing to enhance the profession's image, and broadening the image of the CPA
Would the vote have been different had not the profession been preoccupied with the recent controversy over auditor independence issues and particularly the Enron situation? "It's hard to tell how any particular outside events may have impacted the vote," said Mr. Castellano. "Certainly this issue is just one of the many strategic initiatives we're working on."
Responding to the AICPA's announcement, Susan Bradley, co-founder of the Web site xyztalk.com, voiced a warning to members of the accounting profession: "I think the fat lady hasn't sung yet. Not only has this been informative to the AICPA, this has been informative to the rank and file membership of the AICPA. This is not a victory; this is a wakeup call to all of us in the organization to make it OUR organization. I said when I started the xyztalk Web site that the problem was that the AICPA was not listening to us and we weren't talking to them. This hasn't changed."
You may listen to the AICPA's press conference by dialing toll-free 1-800-475-6701 and using code 618646. This service will be available until January 17.
Read all about the proposed global business credential at AccountingWEB's Global Credential Resource Center.