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The new AICPA chairman: a goodwill ambassador for the profession; Gerald A. Polansky; we should be proud of our profession and what we do.

There is no mistaking Gerald A. Polansky's pride in his profession. He expressed it early in a recent Journal interview: "We have an excellent profession with a good reputation. Go out into the communities around the country and you'll find the stature of the CPA is superb." When asked if this will be part of his message as chairman, he replies, "Absolutely."

He adds, "In my opinion, the CPA is, by and large, doing a good job in all areas--public practice, industry, government and education. We don't need to be apologetic at all. In short, I'm very bullish on the profession and I want to get that message across during my term in office."

Polansky particularly would like to convey that message to his home town of Washington, D.C. "I hope that in some small way I can be an ambassador for the acccounting profession in Washington over the course of this year. I'd like to help educate legislators and regulators about the role of the CPA, especially in the attest area, and give them a better idea of what an audit involves. If I can move that understanding forward, I will have accomplished something worthwhile during my term as chairman."



Polansky has lived and worked in Washington, D.C., for over 30 years, so he is certainly familiar with the city's inner workings. He notes, for example, that Washington is really three cities wrapped up in one: the business community, which is much like that of any other city; the federal government, which Polansky calls "a whole other community" and is a significant employer and very influential; and the diplomatic community, which lives and works in Washington only because it is the seat of the federal government. For most of his career, Polansky was associated with the business community, but he has become more involved with federal government activities in the last five years.

Like many Washingtonians, Polansky is a transplant, from the paper mill town of Wisconsin Rapids, Wisconsin, where he was born and grew up. On receiving a scholarship to the University of Wisconsin, Polansky's first goal was to become a physicist. However, the jokingly says, "I ran into advanced calculus in my sophomore year, which was enough to convince me that physics and Jerry Polansky were not compatible." So he followed in the footsteps of an older brother whom he admired and switched to an accounting major.

He and his wife, who was a classmate at the University of Wisconsin, were married eight days after their graduation in 1957. Polansky accepted a position in the Detroit office of a predecessor firm to Deloitte & Touche, and three years later was transferred to the Washington, D.C., office, where he served as managing partner from 1967 to 1985. He is currently a senior partner of Deloitte & Touche and managing partner of its Washington federal services office.

Polansky became involved in AICPA volunteer work shortly after moving to Washington. He estimates he has been active in the AICPA for over 25 years. He first served on the relations with Housing and Urban Development committee and was chairman of the relations with the General Accounting Office committee. He also was the first chairman of the public service committee, chaired the legislative task force and is still a member of the government affairs committee. He served as AICPA treasurer and chairman of its finance committee for three years before becoming vice-chairman.


Polansky strongly believes in the grass-roots approach to achieving goals. He intends to call for the help of individual AICPA members in meeting the challenges the profession faces as he becomes chairman.

For example, he is firmly committed to the AICPA key person program, having observed its effectiveness firsthand. The key person program identifies CPAs who have close working relationships with members of Congress. Polansky says, "I have attended many of the congressional luncheons held by the AICPA over the past 18 months. It's abundantly clear to me that what counts with the policy makers is the constituency back home. I will urge CPAs to ge involved with legislators in their local communities on matters important to the profession. To me, this is a critical factor in our ability to influence legislation."

To make the grass-roots effort more effective, Polansky looks for an ambitious membership drive at the AICPA. "The Institute should refocus its effort on member services and ought to have a goal of having every CPA in the United States as a member. The public expects a high standard of conduct from the CPA, the business owner's principal adviser, and the AICPA is the organization that sets professional standards, conducts the profession's peer review and quality review programs and provides continuing education to its members."

Polansky also hopes to gain membership support on a number of other issues he will spotlight during his term as chairman.

* Limited liability. Polansky says bluntly, "We must pass the revision to Rule 505 permitting CPAs to practice in whatever form they wish, including general corporate form. Tom Rimerman made a very strong case for revision in his October 1991 Journal article, and I fully agree with his position. We also need to make people aware that CPAs cannot be the insurers of other people's financial statements. We cannot continue to be the 'deep pockets' that are open to anyone who feels harmed."

He adds, "I don't think this issue detracts at all from our dedication to quality of work. As I understand it, passing the revision to Rule 505 will not allow those who incur liability to escape it. However, if proportionate liability, a concept the AICPA is promoting, is applied, the CPA will bear responsibility only for the consequences of his or her own actions, not those of everyone else.

"I don't think anyone can argue that the concept of proportionate liability is not fair. This is particularly true when it's compared with joint and several liability, where the CPA can bear the full brunt of a damage claim because everyone else is bankrupt and penniless."

* Ethical concerns. Polansky believes that accountability is best achieved in the financial reporting process through a spirit of partnership, with management having the ultimate responsibility for reporting the financial position of the enterprise and the auditor attesting to management assertions. He stresses that audits take place with cooperation and coordination between the client and the auditor, but the tone for ethical conduct in a business must start at the top. He says, "Managements should not view the auditor as the conscience of last resort by pushing at the limits of proper conduct, expecting auditors to return them to appropriates standards when necessary."

* Internationalization. Polansky welcomes the continued development of international accounting and auditing standards. "We are now operating in a global economy and all of us in the United States are affected--small companies as well as large ones." He looks forward to the day when "a set of financial statements from a company in a developing country are prepared under standards that are as acceptable as financial statements prepared in this country. We've moved along that road, but we've still got a long way to go."

* Financial reporting issues. Polansky strongly supports the work of the recently appointed special committee on financial reporting. He also supports the issuance of the newly revised Uniform Accountancy Act and greater uniformity of professional regulations across the states. Polansky also will encourage the AICPA to speak out more often on key financial reporting and auditing issues.


In summing up his view of the profession as he begins his term as AICPA chaiman, Polansky says, "We have a number of issues facing the profession, but I believe all of them are opportunities--and I intend to preach that message throughout the year. I don't kid myself that I can propose a new program that will be a revelation for the profession. I'm here for just one year in a 104-year continuum.

"But I'm proud of where we are. As a profession, we voluntarily spend a lot of our own time, effort and money each year on programs that enhance the quality of our profession and therefore benefit our clients and all those we serve. Still, we have the opportunity to do things better. That doesn't mean we're not doing them well now, but we can always improve. And I'd like to think that, at this time next year, we'll be just a little bit better than we are right now."
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Article Details
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Author:Barrett, Gene R.
Publication:Journal of Accountancy
Article Type:Interview
Date:Dec 1, 1991
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