American Institute of Certified Public

Accountants
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AICPA offices in Durham, North Carolina.

Founded in 1887, the American Institute of Certified Public Accountants (AICPA)

is the national professional organization ofCertified Public Accountants (CPAs) in
the United States, with more than 400,000 members in 145 countries in business and
industry, public practice, government, education, student affiliates and international
associates.[1] It sets ethical standards for the profession and U.S. auditing standards for
audits of private companies, non-profit organizations, federal, state and local
governments. It also develops and grades the Uniform CPA Examination. The AICPA
maintains offices in New York City; Washington, DC; Durham, NC; and Ewing, NJ.[1] The
AICPA celebrated the 125th anniversary of its founding in 2012.
The AICPAs founding defined accountancy as a profession characterized by educational
requirements, professional standards, a code of professional ethics, and alignment with
the public interest.
Contents
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1History
o

1.1History of Committees

2Mission

3Professional standards setting

4Credentialing

5360 Degrees of Financial Literacy

6WebTrust, SysTrust and SAS 70

7Government relations program

8External roles

9Expulsion

10See also

11References

12External links

History[edit]
The AICPA and its predecessors date back to 1887, when the American Association of
Public Accountants (AAPA) was formed.[2][3] In 1916, the American Association of Public
Accountants was succeeded by the Institute of Public Accountants, at which time there
was a membership of 1,150. The name was changed to the American Institute of
Accountants in 1917 and remained so until 1957, when it changed to its current name
of the American Institute of Certified Public Accountants. The American Society of
Certified Public Accountants was formed in 1921 and acted as a federation of state
societies. The Society was merged into the Institute in 1936 and, at that time, the
Institute agreed to restrict its future members to CPAs.

History of Committees[edit]
The use of committees began even before the AAPA was formed in 1887. At the first
meeting of what would become the AAPA on December 22, 1886, those present
authorized the appointment of a committee to draft rules and regulations. Beyond this
first preliminary committee the first Bylaws of the AAPA in 1897 established three
committees: Finance and Audit Committee, Committee on Elections, Qualifications and
Examinations, and the Committee on Bylaws.[4] The number of committees grew
continually over the years. In the 1940s there were 34 committees, by 1960, there were
89, and by 1970, the number had grown to 109.
In 1999, the nearly 120 existing committees underwent a re-organization with
approximately half of the standing committees being replaced with a volunteer group
model that placed an increased emphasis on the use of task forces. The increased use
of task forces allowed for more targeted efforts with the task forces being given a
specific assignment then disbanding upon completion of that assignment. Also in 1999,
the first tracking and management of task forces began. Collectively, more than 2,500
volunteers contribute to the AICPA, fulfilling its mission. [5]

Mission[edit]
The AICPA's mission is "Powering the success of global business, CPAs, CGMAs and
specialty credentials by providing the most relevant knowledge, resources and
advocacy, and protecting the evolving public interest." In fulfilling its mission, the AICPA
works with state CPA organizations and gives priority to those areas where public
reliance on CPA skills is most significant. In 2014 The American Institute of Certified
Public Accountants alongside the Chartered Institute of Management Accountants
created the Global Management Accounting Principles (GMAPs). The result of research
from across 20 countries in five continents, the principles aim to guide best practice in
the discipline of management accounting.[6]

Professional standards setting[edit]

The AICPA sets generally accepted professional and technical standards for CPAs in
multiple areas. Until the 1970s, the AICPA held a virtual monopoly in this field. In the
1970s, however, it transferred its responsibility for setting generally accepted
accounting principles (GAAP) to the newly formed Financial Accounting Standards
Board (FASB). Following this, it retained its standards setting function in areas such
as financial statement auditing, professional ethics, attest services, CPA firm quality
control, CPA tax practice, business valuation, and financial planning practice. Before
passage of the Sarbanes-Oxley law, AICPA standards in these areas were considered
"generally accepted" for all CPA practitioners.

In the early 2000s, federal public policy makers concluded that where independent
financial statement audits of public companies regulated by the U.S. Securities and
Exchange Commission are concerned, that the AICPA's standards setting and related
enforcement roles should be transferred to a government empowered body with more
enforcement authority than a non-governmental professional association, such as the
AICPA could provide. As a result, the Sarbanes-Oxley law created the Public Company
Accounting Oversight Board (PCAOB) which has jurisdiction over virtually every area of
CPA practice in relation to public companies. However, the AICPA retains its
considerable standards setting, ethics enforcement and firm practice quality monitoring
roles for the majority of practicing CPAs, who serve privately held business and
individuals.

Credentialing[edit]
The AICPA offers credentialing programs in certain subject areas for its members. The
credentials are similar to state board certification for attorneys, which also recognize
subject matter specific expertise. The AICPA credential for expertise in business
valuation is the Accredited in Business Valuation (ABV) designation. For financial
planning, it is the Personal Financial Specialist (PFS) designation and for forensic
accounting, Certified in Financial Forensics (CFF). The AICPA also offers an information
technology credential, Certified Information Technology Professional (CITP). Beginning
January 31, 2012, the AICPA in a joint venture with the Chartered Institute of
Management Accountants (CIMA) began issuing the Chartered Global Management
Accountant (CGMA) credential.

360 Degrees of Financial Literacy[edit]

The professional organization also runs extensive public interest programs. One of the
most important is an award-winning program called 360 Degrees of Financial
Literacy. The program, launched in 2004, is a multi-faceted effort, spearheaded by the
AICPA with the support of state CPA societies. It encourages CPAs to take a broad
leadership role in volunteering to educate the American public, from school children to
retirees, on financial topics that apply to their particular stage of life. This program has
an extensive website with a variety of financial literacy resources.

WebTrust, SysTrust and SAS 70[edit]

WebTrust is a family of e-commerce assurance and auditing programs co-developed by
the AICPA with the Canadian Institute of Chartered Accountants (CICA);[7] accounting
associations in the UK, Australia, New Zealand and Hong Kong also participate in the
program.[8][9] A specialized variant of the program exists for certificate authorities.[10][11] A
2005 academic book noted that while cost of a WebTrust seal is considerably higher
than that of similar products from its competitors (BBB On-Line, TrustE and VeriSign),
the scope of a WebTrust certification is more comprehensive than those of its
competitors, although this fact is usually lost on consumers who have trouble
differentiating such seal programs, which explains the rather limited market penetration
of WebTrust.[12] A 2009 academic paper which chronicled in some depth the adoption
followed by the abandonment of the WebTrust seal at a large US telecom company,
noted that the management did not find the cost-benefit tradeoff worthwhile: the
$100,000 per year cost for WebTrust being about twenty times higher than that of a
TrustE seal.[13]

Government relations program[edit]

The AICPA has a Washington office and a political action committee. On behalf of its
members, the AICPA monitors and advocates on legislative and other matters that
affect the accounting profession. Working with state CPA societies and other
professional organizations, the AICPA provides information to and educates federal,
state and local policymakers regarding key issues. Whether serving as an information
resource or offering recommendations, the AICPA represents the profession while
protecting the public interest.
The AICPA's Political Action Committee is a contributor to U.S. Congressional
representatives and Senators from both parties who sit on various legislative
committees of relevance to CPAs.
The AICPA has spoken out in support of both the Digital Accountability and Transparency
Act of 2013 (H.R. 2061; 113th Congress) and the Digital Accountability and
Transparency Act of 2014 (S. 994; 113th Congress), two bills in the 113th United States
Congress.[14] The AICPA said that they believe the act "appropriately specifies a financial
data reporting standard that Federal agencies can implement using a currently available
nonproprietary computer language. Ultimately, the benefits of using data standards to
tag financial data will enhance the accuracy and transparency of financial and
performance information."[15] The data standard being discussed was XBRL (eXtensible
Business Reporting Language), which AICPA approves of. The Senate's version, S. 994,
passed in both the House and the Senate in April 2014.[16]