AICPA Requires Mandatory Quality Control Systems | AccountingWEB

AICPA Requires Mandatory Quality Control Systems

Today, the American Institute of Certified Public Accountants (AICPA) announced that it is establishing requirements for mandatory quality control systems for the five largest auditing firms to enhance compliance with existing independence rules. Some guidelines of the new quality control systems will affect all members – currently more than 1,300 – of the SEC Practice Section of the AICPA.

The new state-of-the-art systems will feature:

  • Automated investment tracking systems that will maintain auditor independence
  • Formal disciplinary systems to sanction personnel who violate rules
  • Plain English guidance that will better educate audit and non-audit professionals
  • Sophisticated training programs

The AICPA hopes this step toward complying with independence rules will reaffirm the profession’s commitment to enhancing investor confidence in the integrity of the financial reporting system. It isn’t that accounting professionals don’t want to comply with existing rules; it’s that the current requirements are outdated and unreasonable. The new system and guidelines should help.

Initial elements of the mandatory quality control system will be in place by March 2000 with the full system in effect by the end of the year. The AICPA estimates that accounting firms will spend more than $25 million to develop and implement sophisticated new investment tracking systems and other controls.

Wait, there's more!
There's always more at AccountingWEB. We're an active community of financial professionals and journalists who strive to bring you valuable content every day. If you'd like, let us know your interests and we'll send you a few articles every week either in taxation, practice excellence, or just our most popular stories from that week. It's free to sign up and to be a part of our community.
Premium content is currently locked

Editor's Choice

WHAT KIND OF FIRM ARE YOU?
As part of our continued effort to provide valuable resources and insight to our subscribers, we're conducting this brief survey to learn more about your personal experiences in the accounting profession. We will be giving away five $50 Amazon gift cards, and a $250 Amazon gift card to one lucky participant.
This is strictly for internal use and data will not be sold
or shared with any third parties.