Several professional accounting organizations play an active role in improving the quality of accounting information that is used by investors, creditors, management, and others. The American Institute of CPAs, the Institute of Management Accountants, the Institute of Internal Auditors, the American Accounting Association, and the Committee of Sponsoring Organizations of the Treadway Commission are particularly important.
American Institute of CPAs (AICPA)
The American Institute of CPAs is a professional association of Certified Public Accountants. Its mission is to provide members with the most relevant knowledge, resources, and advocacy, thereby enabling members to protect the evolving public interest.8 The AICPA participates in many aspects of the accounting profession. The AICPA conducts accounting research and works closely with the FASB in the establishment and interpretation of generally accepted accounting principles. In fact, prior to the establishment of the FASB, the AICPA had primary responsibility for the establishment of accounting principles. The AICPA’s Auditing Standards Board has developed the standards by which audits of private companies are conducted, and the PCAOB has accepted many of these standards for audits of public companies. The AICPA also issues standards for the conduct of other professional services. The AICPA is a major provider of continuing professional education for CPAs and provides other services to support the careers of professional accountants.
Institute of Management Accountants (IMA)
The mission of the Institute of Management Accountants is to provide a forum for research, practice development, education, knowledge sharing, and the advocacy of the highest ethical and best business practices in management accounting and finance.9 The IMA is recognized by the financial community as a respected organization that influences the concepts and ethical practice of management accounting and financial management. The IMA sponsors a number of educational activities for its members, including national seminars and conferences, regional and local programs, self-study courses, and in-house and online programs. The IMA offers a certification program—the Certified Management Accountant (CMA). This designation testifies to the individual’s competence and expertise in management accounting and financial management.
Institute of Internal Auditors (IIA)
With more than 180,000 members in over 170 countries, the Institute of Internal Auditors is the primary international professional association dedicated to the promotion and development of the practice of internal auditing.10 It provides professional development through the Certified Internal Auditor® Program and leading-edge conferences and seminars; research through the IIA Research Foundation on trends, best practices, and other internal auditing issues; guidance through the Standards for the Professional Practice of Internal Auditing; and educational products on virtually all aspects of the profession. The IIA also provides audit specialty services and industry-specific auditing programs, as well as quality assurance reviews and benchmarking services.
American Accounting Association (AAA)
Membership in the American Accounting Association is made up primarily of accounting educators, although many practicing accountants are members as well. The mission of the AAA is to further the discipline and profession of accounting through education, research, and service. The focus of many of the AAA’s activities is on improving accounting education by better preparing accounting professors and on advancing knowledge in the accounting discipline through research and publication. An important contribution of the AAA to the integrity of accounting information is its impact through accounting faculty on the many students who study accounting in college and subsequently become professional accountants.
Committee of Sponsoring Organizations of the Treadway Commission (COSO)
COSO is a voluntary private-sector organization dedicated to providing thought leadership through the development of comprehensive frameworks and guidance on enterprise risk management, internal control, and fraud deterrence designed to improve organizational performance and governance and to reduce the extent of fraud in organizations.11 COSO was originally formed in 1985 to sponsor the National Commission on Fraudulent Financial Reporting (chaired by former SEC Commissioner James C. Treadway, Jr.). The National Commission on Fraudulent Financial Reporting studied the causal factors that lead to fraudulent financial reporting and made a series of recommendations for improving financial reporting, auditing, and accounting education. The original sponsors of the National Commission on Fraudulent Financial Reporting, and the current sponsors of COSO, are the AAA, the AICPA, Financial Executives International, the IIA, and the IMA. COSO is best known for its work in developing the standards for evaluating internal control—particularly internal control over financial reporting. As a result of the Sarbanes–Oxley Act, public companies now need to evaluate the effectiveness of their internal control over financial reporting on a yearly basis, as well as have their auditors separately report on the auditors’ evaluation of the effectiveness of internal control over financial reporting. The standard for evaluating the effectiveness of internal control over financial reporting is contained in COSO’s 2013 publication, Internal Control–Integrated Framework: 2013.
- William J., Bettner M., & Carcello, J. (2021). Financial & Managerial Accounting19th Edition. McGraw-Hill Education. ISBN13: 9781260247930
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