Critics such as Nader and Briloff arise because of perceived inadequacies in social regulation. Briloff's work should be viewed in the context of the turbulent financial environment which developed in the 1960's. Financial practices began to outpace policy and created many opportunities for innovations in accounting procedures which led to unscrupulous conduct on the part of a number of promoters. During this period, for example, such practices as pooling of interests, the use of convertible bonds for acquisition purposes, and new franchising arrangements emerged. These and other practices in a number of cases were used to deceive investors, and accounting policy-makers were seen as being slow to respond to the need for improved regulation. It was in this climate that Briloff found the impetus for his crusade against inadequate accounting standards.
The trouble with BrilofPs work, as with many critics, is that it suffers from what David H. Fischer refers to as the "fallacies of factual significance." In particular, two such fallacies afflict the work of Briloff. The first is the prodigious fallacy whereby a few monstrous events are selected and assigned an absurd standard of significance when viewed against the sweeping hindsight of history. Says Fischer, "In the genre called popular history, many prodigious fallacies are perpetrated by historians who have mistaken their muse for Miss Dorothy Kilgallen, and their mission for the titillation of illiterate thrill-seekers."
The second is the furtive fallacy which posits "that facts of special significance are dark and dirty things and that history itself is a story of causes mostly insidious and results mostly invidious. It begins with the premise that reality is a sordid, secret thing; and that history happens on the back stairs a little after midnight, or else in a smoke-filled room, or a perfumed boudoir, or an executive penthouse or somewhere in the inner sanctum of the Vatican, or the Kremlin, or the Reich Chancellery, or the Pentagon. It is something more, and something other than merely a conspiracy theory, though, that form of causal reduction is a common component. The furtive fallacy is a more profound error, which combines a naive epistemological assumption that things are never what they seem to be, with a firm attachment to the doctrine of original sin."
"He who is deficient in the art of selection," wrote Macaulay, "may, by showing nothing but the truth, produce the effect of the grossest falsehood."
While there is some truth to the observation that "facts, like sinners, gain something from an unsavory reputation," the true history of the accounting profession in this period when weaned of sensationalism, will be revealed as purposive, highly sensitive to its environments, and strongly motivated toward the future. Indeed, we share the view expressed earlier of sociologist Paul Montagna, that accountants, "because of their unique position as auditors and advisers in financial and related areas to major American and world institutions, are destined to plan an increasingly important role in social policy and planning." Accounting is a living profession! It has accommodated to our changing times with greater perception and activation than many of our contemporary institutions.
In recent years, however, they have stepped up their efforts on behalf of opportunities for women in accounting, and particularly with respect to recruiting. Gayle Rayburn has completed a recent survey of the work experience of women in accounting and arrived at these findings:
- That most women remain in accounting careers because they find the work interesting and challenging. The nature of the work experience is a much greater inducement to women than salary, prestige or similar factors.
- That 62.5% of women with full-time employment in accounting in 1970 earned over $12,000 and 8% earned over $25,000.
- That 46% of women with full-time employment in accounting were married, as opposed to 40% who were single, 9% who were divorced or separated, and 5% who were widows. 36% were mothers.
- That "even though prejudice against women still appears to exist, the opportunities today are much greater than ever before. Sex is no longer the main consideration; ability and the personality to inspire confidence and respect are most important. If a woman today has master of the profession, she may find opportunities not available to the man."
Clearly progress is being made in the fight against inequality of opportunity in the accounting profession. Coping with Organization Change We pause to consider how the large public accounting firm is coping with the need for organizational change. James E. Sorenson notes that "the growth of the public accounting profession has been characterized by phenomenal changes in organization structure . . . Large public accounting firms appear to be unique since no other currently known profession has been able to develop professionally through the widespread use of nationally or regionally organized firms." Joseph J. Lengermann describes the traditional large CPA firm as being hierarchical in its organizational structure, and according to Emery and Trist, viable organizations of this type will modify to matrix-form organizations when they encounter turbulent environments. CPA firms today indeed operate in a turbulent environment and organizational changes are crucial to the continued development of the profession.
A matrix type of organization differs from a hierarchical one primarily in terms of the flow of authority: the former is typified by decentralization. Team-work is crucial to matrix organizations and persons may often have to report to a number of superiors. Some matrix organizations distinguish between pro-grammatic and resource organization structures, so that individuals may belong to a resource unit which may be called upon to perform in one or more programmatic areas.
A recent publication indicates the emergence of a matrix organization by one major public accounting firm, which we believe to be indicative of the general trend among major CPA firms. The prominent features of the new organization structures in public accounting are the greater reliance on staff specialists, teamwork and the integration of services.
These changes at the level of the firm, when added to such major restructuring as seen in the newly formed Financial Accounting Foundation and the reorganization of the AICPA, indicate clearly that the profession is coping with the need for organizational change.
