Indiana CPAs - In the beginning …

Before there was a tax code (1913), before there was a Department of Labor (1913), before the SEC (1935) and before the PCAOB (2002), even before audits, there were CPAs (New York – 1896). How did the profession rise to the level of prominence in business without license to do something specific?

What were the requirements in 1915? Well … you had to be 21 years old, a high school graduate, have three years of experience as a professional accountant and submit “proof” of all of that to the newly created “state board of certified accountants”. Then, per Indiana law, “shall be granted without examination a certificate authorizing him to practice as a certified public accountant”. Of course this had to be done within 90 days. After that you would have had to take an examination. The early CPAs were grandfathered. That is how the profession got its start.

The first accounting standards were issued somewhere around 1938, and by 1959 there were 51 pronouncements known as Accounting Research Bulletins – this eventually became GAAP. The pronouncements were issued by the Committee on Accounting Procedure (CAP). The first auditing standards were issued in 1939 by the American Institute of Accountants committee on auditing procedure. In 1941, the SEC mandated that the auditor’s report had to be made in accordance with GAAP (they didn’t do that in 1935 because there was no GAAP).

To learn more, read the article “In the beginning …” posted on the Indiana CPA Society blog on February 16, 2012 by Gary Bolinger.