Audit reforms still pose new frontiers, but the members of the American Institute of CPAs (AICPA) are trying to put the worst battles behind them and making an effort to put to good use their $2-per-member dividend from the Sarbanes-Oxley Act.
The amount of the dividend represents the funding AICPA has in the past provided each year to the Financial Accounting Standards Board (FASB). AICPA spokesperson Linda Dunbar explains, "The $2-per-member amount is a number that was assigned in 1978 by AICPA as a reasonable amount to allocate to FASB, and it has been honored annually since then."
Starting in 2003, however, under the Sarbanes-Oxley Act, the FASB will be funded largely through fees paid by public companies under a system to be set up by the Public Company Accounting Oversight Board (PCAOB), which in turn is overseen by the U.S. Securities and Exchange Commission (SEC). So the AICPA is now free to reallocate the $2-per-member funds for the benefit of its members.
Asked how the funds will be spent, Ms. Dunbar said the money would be used for initiatives described in speeches made by AICPA President Barry Melancon and AICPA Chairman Bill Ezzell. These initiatives include improving financial reporting, reforming corporate governance and internal controls to combat fraud, and ensuring appropriate-standard setting for the accounting profession.
Among the early results of these and other initiatives is a series of white papers and issue briefings posted on the AICPA's Web site to help forge a reasonable path through the emerging frontiers of state regulation. The papers were released by the newly formed AICPA Special Committee on State Regulation.