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AICPA chairman lays the foundation for the future.

Ronald S. Cohen believes now is the time for CPAs to be the architects of the accounting profession's future. "Change is shattering every system - CPAs are competing with other financial professionals and there is a greater demand for a wider array, of services," Said the new chairman of the American Institute of CPAs board of directors. "CPAs must revolutionize their thinking not only to endure the pace of this change, but to thrive on it."

If change is the profession's challenge, then value is Cohen's solution. "The CPA of the future must provide clients and management with services whose value exceeds their cost," said Cohen. "And the AICPA, now more than ever, must take on the responsibility to raise the level of CPAs' skills, both in public practice and in industry, to create a value-added profession."



Cohen's formula for a competitive profession begins with talent. "We must continue to encourage outstanding people to become CPAs," said Cohen. "If we do not attract the most talented people we will not be able to offer clients or management the services they need, and they will go someplace else."

In an interview with the Journal, Cohen said that in recent years the accounting profession had not consistently attracted the best and the brightest. One reason, he said, was that entry-level compensation levels for CPAs did not compete with other business careers. "In the past, college graduates always considered salaries in the accountancy profession at the high end of the scale. To attract the right people, we have to offer a competitive salary."

But Cohen, chairman of Crowe, Chizek and Company and partner in charge of its largest office, in South Bend, Indiana, knows that to offer competitive salaries, it's necessary to earn fees. "We have to employ the best talent to offer our users the best services," said Cohen. "We must pay this talent well to attract them to our profession. And to generate the fees needed to support higher pay we have to provide value-added services to both clients and management." (See graphic, page 65.)


The AICPA plays a major role in helping the accounting profession acquire the best talent, said Cohen. One area Cohen intends to focus on during his tenure is education. "The Institute needs to ensure the students we are recruiting from the colleges and universities are properly educated," he said, and he believes the academic community needs to be more attuned to what the profession needs from a graduate. "Entry-level tasks in public accounting and industry have changed dramatically. The mundane, low-level tasks that were once used for training now are done by computers. We need more mature, more broadly educated beginners ready to step in and assume responsibilities quickly."

Cohen said he would continue to push for the 150-hour education requirement to help fill the education gap. He also said he intended to get more accounting faculty involved in the AICPA committee structure to better integrate education and practice.


AICPA progress on the legislative front also could help attract talent, said Cohen, who believes it is imperative the Institute continue to regard workload compression as one of the biggest problems facing CPAs in public practice. "It is a terrible black eye for the profession, not only on the campuses where there is a whole new emphasis on lifestyle, but also for talented CPAs already in public practice who consider the workload during the first three months of the year unbearable."

Cohen also intends to continue to make securities litigation reform a high-priority AICPA initiative. "If we can reduce the liability exposure to companies of all sizes it will have a dramatic effect on recruiting," said the chairman.


It's time to establish new services for CPAs to offer their clients and management, according to Cohen. He said the need for many traditional CPA services was waning and "if we do not adapt to the changing needs of the business environment, we will not survive." Cohen said, "CPAs are a talented, versatile group with the ability to take on more responsibility and become more valuable than we have been in the past."

Cohen said one traditional service that would undergo dramatic change was the attest function. "Assurance services will not disappear," said Cohen. "There always will be a need for a third-party opinion on financial statements. But we must think beyond putting our stamp of approval on stale information."

Cohen strongly supports the AICPA initiative to explore the future of assurance services. "The special committee on assurance services, chaired by Robert K. Elliott, is examining attest services that apply to more than historical information," said Cohen. "Users no longer want to look back; they want to look forward, and supplying forward-looking information is the kind of service for which business will be willing to pay fees." Cohen told the Journal that the profession must look more closely at business consulting and specialization. "CPAs are capable of analyzing businesses' financial operations at a very high level, and their real value comes with helping clients and management become more successful and efficient."

Cohen feels work in other AICPA committees, such as the special committee on financial reporting chaired by Edmund J. Jenkins and the special committee on regulation and structure of the profession chaired by J. Curt Mingle, is the kind of long-range research and analysis the profession needs to ensure CPAs continue to be indispensable to clients. "We must accept the reality that business reporting, like business itself, must continually change and adapt to evolving informational needs," said Cohen.


Cohen believes the AICPA must continue to build a stronger profession for the future by expanding its influence in the business community. Professions that do not do this by taking on more responsibility are in danger of decline, according to Cohen. "The Institute must seek out opportunities to serve. This means speaking out on public issues." The chairman said a good example was the work the AICPA was doing on the proposed reform of the Securities and Exchange Commission. "The Institute has formed a committee and is ready to give the profession's input and viewpoint on what improvements should be considered by Congress."

Another area in which the A[CPA must continue to be involved is tax simplification, said Cohen. As the debate heats up regarding a new tax structure, the AICPA should continue to use its influence to convince Congress that the tax system we choose must be simpler.


Cohen believes the value of the non-CPA's role in CPA practices should be recognized. "This is a very emotional subject," he said. "If we really want to be broad-based advisers to our clients, we must accept the fact that people with accounting degrees do not always have the tools necessary to meet every client's demands."

Cohen said that allowing non-CPAs employed by CPA firms to be entity owners would enable the profession to broaden its scope of services and provide greater value to users. Cohen said employing professionals from other disciplines to offer nontraditional services was not new to CPA firms. "But how can the profession attract and keep these skilled outsiders if they are not allowed to be full owners of CPA firms?" asked the chairman.


Cohen wants to build on the active strategic planning process in place in the AICPA. He said that previous planning reports generated by the Institute were outstanding, and it is now time to begin to aggressively implement the recommendations and initiatives. "We need to plug operations - the staff and the volunteer committee efforts - into the strategic plan," said Cohen. He intends to form a strategic planning advisory committee, made up of representatives of volunteer committees. "This will create a bridge between the strategic planning committee and the rest of the committee structure," said Cohen.

Cohen also plans to focus more attention on AICPA members in industry. "CPAs in industry make up some 42% of our membership," said Cohen. "We need to find more ways to involve them in the committee structure and, more important, we need to provide them with more services they require." Cohen intends to increase their visibility and involvement in the Institute by regrouping committees by common industry to facilitate communications among people with similar roles and interests. "Bringing related groups into the committee structure will allow them to address their problems in terms of size, position and type of industry," said Cohen.

Cohen considers the concerns of the AICPA's young members a high priority as well. "As with the industry members, I intend to get more young CPAs involved in the Institute's committee structure. We must continue to ascertain and speak to their experiences and concerns."

Cohen also wants a technology focus in all AICPA initiatives. He told the Journal he wants both the Institute and the profession to embrace and harness advances in technology. "It is one of the profession's most valuable tools," said Cohen. "The Institute must see to it that its members acquire the skills, knowledge and support they need to be empowered - not overpowered - by technology."


Cohen is pleased with recent initiatives to improve the relationship between the AICPA and state societies. "Bob Israeloff's outreach to members and state societies in the past year was very effective," said Cohen. "And the Institute's new president, Barry Melancon, adds his experience to our efforts at understanding what makes the state societies tick."

Cohen said he planned to continue building a collaborative effort to provide cost-effective, quality services to CPAs throughout the United States. "State societies and the AICPA cannot work independently, nor can we continue to duplicate services and products. I plan to step up the effort to work together with state societies to provide services geared to what our members and users want."

Another important issue Cohen would like to tackle is the lack of uniformity in state regulations. Cohen said even the smallest practitioners currently practice across state lines as CPAS continue to specialize by industry and function. "But the lack of reciprocity within the United States is confusing to students, educators, small and large CPA firms and CPAs in industry who move and work across jurisdictions," said Cohen. "The AICPA must continue to work toward a solution to this issue to facilitate free exchange of information and professional knowledge across state lines."

The chairman said the problem also had made it impossible to grant foreign reciprocities to CPAs or their equivalents in other countries. He said the Mingle committee was looking into a resolution to this issue.


Cohen wants the AICPA to accelerate the pace of change in the CPA profession. "The Institute needs to keep pushing for change, efficiency, service and, most important, value in each of its projects and initiatives," said Cohen. He plans to lay the foundation for long-term change in the profession and the Institute. "I want to clarify where we are headed and get us on the road," said Cohen. To summarize his intentions, Cohen quoted Will Rogers: Even if you are on the right track, you can get run over if you just sit there. "We are going to get on the right track and move forward," said Cohen.

John von Brachel is a Journal news editor. Mr. von Brachel is an employee of the American Institute of CPAs and his views, as expressed in this article, do not necessarily reflect the views of the AICPA. Official positions are determined through certain specific committee procedures, due process and deliberation.
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Title Annotation:Chairman Ronald S. Cohen
Author:Von Brachel, John
Publication:Journal of Accountancy
Date:Nov 1, 1995
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