In a speech made to the Yale Club in New York on September 4, 2002, AICPA President Barry C. Melancon announced that the American Institute of CPAs (AICPA) is committing to fulfilling six leadership roles to help restore confidence in the accounting profession.
Highlights of the six roles:
- Obtain greater involvement of users of financial statements in setting auditing standards, while developing new guidance on such topics as auditor rotation requirements and compensation policies for audit partners.
- Serve as a liaison between market institutions and corporations, finding new ways to communicate anti-fraud controls and programs to the public and facilitating input on these measures from stock exchanges and others, (e.g., in the form of a "summit" meeting).
- Promote academic research into such topics as how investors can help protect themselves against fraud through alliances, such as one with the Association of Certified Fraud Examiners.
- Change the continuing education rules for CPAs to include more credits on fraud detection and help develop educational and training materials for inclusion in college courses and textbooks, as well as training courses for management and directors.
- Initiate debates on such topics as big GAAP/little GAAP, (i.e., use of the same or different generally accepted accounting principles for big and small companies), and work with other standard-setters in improving transparency of financial and business reporting.
- Revise standards so the public will be put on notice when an auditor communicates internal control weaknesses to an audit committee.
The speech was Mr. Melancon's first opportunity to address an audience outside the accounting profession following enactment of the Sarbanes-Oxley Act of 2002, a law that established a new regulatory framework for the accounting profession in response to a public "vote of no confidence" in the profession's ability to self-regulate itself under AICPA's leadership.
Download the full speech.