A and B, two 40-something PAs, are raising a few glasses at the local pub to celebrate their 15 years in partnership, and are taking the opportunity to reflect over their choice of career.
A: All in all, I think public accounting has been a good career choice for me. I’ve been able to do very challenging, analytical work. I’ve had the opportunity to be very helpful to many business owners and have seen a number of my clients become millionaires—and I think I can give some of the credit for that to the good financial advice I gave them, especially in those really tough times when they didn’t know how they were going to cover the next payroll! And I think my assurance reports added value to financial reports and was helpful to the people using them, even if I didn’t even know specifically who those people were a lot of the time. But, at the same time, it’s been really hard work and long hours, and I probably could have made more money with less effort if I had become a lawyer or a doctor.
B: I think you are probably right about that. Sometimes I think being a public accountant is like taking some kind of “vow of poverty.” Our clients get rich, but we are only allowed to charge by the hour because otherwise, say if we took shares in our client’s companies instead of fees or took a percentage of the tax savings we identify for them, we would lose our appearance of independence. To me the big irony of being a public accountant is that our duty is to serve the public, and so we need to stay independent of the clients we report on, but the public doesn’t pay us—our clients do! If we are going to make a living at this we need to maximize our profitability, and yet it seems the rules of professional conduct are designed to prevent us from ever making a lot of money at this!
Discuss the views of the two PAs, that public accountants’ duty to the public and operating a profit-oriented business are incompatible. Do you agree? Generate some possible solutions that would resolve the dilemma they see. Evaluate the solutions you have generated in terms of their effectiveness and practicality, given the context in which public accounting is practiced and the public needs that it fills. Which of your possible solutions do you think would be the most practical and effective?