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Independence in today’s regulatory environment
Written on Oct 19, 2023
By Jessica Salerno-Shumaker, OSCPA senior content manager
Accountants as trusted business advisors in today’s economic climate are more important than ever, and independence is a crucial part of that.
“You need to consider what independence means in today's environment and the direction of standard setting,” said Toni Lee Andrews, director of professional ethics at the AICPA.
Andrews will present at the upcoming Ohio Accounting Shows, covering “Independence Standards and Planned Activities of the Professional Ethics Executive Committee.”
Andrews stressed the importance of looking at independence from every angle.
“We know we have to be independent when we do the financial statements,” she said. “And the public is expecting us to be independent. But it's also digging a little deeper into what does having the public's trust mean, and why is that important?”
Andrews said it’s common for practitioners to do non-attest services with some attest services but if too many are performed it’s “the cumulative effect of non-attest services.”
She plans to highlight the AICPA framework for conceptual independence since the code can’t encompass every situation that CPAs might find themselves in. It’s critical to identify the threats that are present with the service being performed and how they can be mitigated.
Since the services being done by CPAs and accountants are rapidly changing, the AICPA Professional Ethics Executive Committee is working on a code of professional conduct that is “fit for purpose” , Andrews said. Emerging technology such as digital assets is putting more pressure on the profession to understand the risks for themselves and their clients.
“The public is expecting us to be independent,” she said. “But we need to dig deeper into what having the public's trust means and why that is so important.”