Coming To Terms With Accountants

 

Like most specialists, accountants have their own set of acronyms and terms. Here is a glossary of the accounting profession's most common ones.

Big Eight: The eight major multi-national public accounting firms. Listed alphabetically, with number of U.S. officers in parentheses, the Big Eight includes Arthur Andersen (65); Arthur Young (84); Coopers & Lybrand (85); Deloitte Haskins & Sells (105); Ernst & Whinney (116); Peat; Marwick, Mitchell & Co. (100); Price Waterhouse (69); and Touche Ross (77).

CMA: Certificate in Management Accounting. The CMA is granted by the NAA's Institute of Management Accounting to management accountants who meet certain educational standards, pass a five-part exam, and have at least two years of related professional experience.

CPA: Certified Public Accountant. A CPA is an accountant who has passed certain state requirements, including education, work experience, and an examination prepared by the AICPA and administered by the state.

FASB: Financial Accounting Standards Board. The FASB is an independent body maintained by the Financial Accounting Foundation in Stamford, Conn. Founded in 1972, its purpose is to define, improve, and promote accounting and reporting standards. The board is currently studying the need to develop different standards of financial reporting for small companies.

GAAP: Generally Accepted Accounting Principles. These are the conventions and rules that define accepted practice in preparing general-purpose financial statements.

MAS: Management Advisory Services. This is the term CPAs commonly use to describe their consulting services.

PA: Public Accountant. A PA is an accountant who may meet certain state requirements, is usually registered in the state, but is not certified -- i.e., has not passed the Uniform CPA exam.

Major Professional Groups

AAA: American Accounting Association. This is an organization for promoting research and education in accounting. Based in Sarasota, Fla., the AAA has 12,000 members, most of whom are academics.

AICPA: American Institute of Certified Public Accountants. A national society for CPAs, this group prepares and grades the CPA exam for state licensing bodies. With headquarters in New York and 175,000 members, the AICPA is the oldest and largest group in the accounting profession.

NAA: National Association of Accountants. Composed of management accountants, this New Yor-based group has 100,000 members.

NCCPAP: National Conference of CPA Practitioners.This is a new organization for local and medium-sized accounting firms. Founded in 1979 and based in New York, the group now has about 1,000 members.

NSPA: National Society of Public Accountants. Based in Alexandria, Va., the NSPA is a professional society of 16,000 public accountants.

All five groups above are represented among the 440 respondents to INC.'s survey of accountants. The largest number of respondents belong to AICPA (90%), followed by NCCPAP (27%), NAA (25%), NSPA (4%), and AAA (2%). The total exceeds 100% because some accountants belong to more than one organization. More than 7 out of 10 accountants who responded to the survey also indicated membership in state societies. The participation in state professional groups ranged from 77% of the local accountants to 28% of those representing Big-Eight accounting firms.