A Fresh Look at Standards of Professional Conduct

The special committee on standards of professional conduct for CPAs has issued an interim report to the American Institute of Certified Public Accountant's (AICPA) governing council. The report recognizes the need for reform, noting recent challenges to the 13 rules of conduct of the AICPA Code of Professional Ethics. The committee's 2 main recommendations are: 1. that the existing ethical and performance standards be substantially modified, and 2. that a mandatory quality assurance review (QAR) program be established to monitor and improve practice. The existing code would be replaced with a goal-oriented code that would apply equally to all members, which the existing code does not. The QAR program is an active, systematic monitoring of accounting practice. The proposed enforcement system departs from the existing one by focusing on the quality of practice rather than on specific violations of rules and penalties. If the new code is to be adopted and a QAR program implemented successfully, the profession must reassess traditional orientations and attitudes and long-held assumptions, accepting and responding positively to the currents of change in society.