Inside the CBA; CalCPA member & CBA president David Swartz: focused on the public.

"It's ridiculous," says Swartz. "Someone in New York, who hasn't even set foot in this state, has to get a practice privilege. Imagine if you worked on returns in 30 states--which we do, some of our clients are in 30 states. We'd have to look at every state's license requirement and determine whether we need to get something similar to a practice privilege. It's horrendous."

At a recent CBA meeting, Swartz says the board related the problem to having to get different driver's licenses while traveling cross-country. "You can argue that lawyers have to be licensed in every state, but the laws of every state are different. We're dealing with GAAP and GAAS that are the same nationally--almost internationally.

"There really is no logic, in my opinion, for people to have to get separate licenses for every state one works in, whether you physically enter that state or not," continues Swartz. "What is the consumer getting by having a CPA licensed in every state? I would argue that they are getting nothing. The user of the statements or service, if they're unhappy, will report that CPA. The license does not give more assurance to a consumer."

The two pathways issue melds into the mobility question, because California CPAs that choose Pathway 1 are not considered "substantially equivalent," which is a requirement in most states.

"We're going to need to deal with that in some fashion," says Swartz. "At our last meeting, we discussed the fact that maybe the states should just trust each other."

In other words, if a CPA gets licensed in one state, maybe that should be good enough for another state and vice versa.

The last issue on Swartz's agenda is dealing with audit documentation issues, and the CBA has a regulation working its way through the process that Swartz says "will resolve the issues that are facing the profession, and provide a better product for the consumer.

By the end of his term, Swartz hopes to have the information needed to also put into legislation the issues related to mobility and peer review. "That's taking all of our time and attention," he says. "Although they won't get passed this year, if we can get them through our board, and into the queue at the state level, then I will have accomplished all I can."

THE REWARDS OF WORKING FOR THE PUBLIC

"Our main focus is the public," says Swartz. "CPAs are at the back of the line when it comes to the issues we deal with. Even though we deal with issues of mobility and peer review, which one would argue are licensee issues, the consumer benefits."

Swartz sees implementing peer review as part of serving the public, as it ensures quality service that adheres to regulations. "There are 42 states that have peer review. Our state prides itself on being the most consumer concerned, yet we are one of a handful that don't have peer review. There's a real disconnect there and we really have to get it connected.

"Another example is audit documentation," continues Swartz. "There's no harm in letting an accounting firm have 30 or 60 days to clean up its files after issuing a report, rather than before, which keeps the client, banker and other users of that financial service waiting. It doesn't make a lot of sense to me.

"In both these instances you can argue that it's better for the CPA, but it's really better for the consumer," he adds. "We have no doubt what our mission is: to serve the consumer better."

It's this public service aspect that keeps Swartz on task, and it's why he recommends other CPAs follow his lead.

"My time on the board is one of the more fulfilling things I've done in my career," he says. "If you stand back and look at the big picture, we're really making a big difference. There's a lot to be accomplished by really being involved in state service. I would encourage fellow CPAs to attend our meetings, serve on our task forces and learn more about the profession. It's good to know what's going on in the state you live in."

Swartz also points out the legion of volunteers that could use help from anyone who wants to get involved. The CBA staffs two committees, Administrative and Qualifications, with volunteer CPAs. "They are very dedicated people that don't get the kind of notoriety they deserve. They really make a commitment to the profession and the public, and I encourage any interested CPAs to get involved there. My hat is off to them--it's people like them that really provide the leadership."

And more involvement from dedicated CPAs is always needed, as issues old and new will continue to face the profession.

"Future issues will be over-regulation and the imposition of rules that are promulgated to deal with the public markets being foisted upon private companies, which are the backbone of most CPA practices and the major portion of business in the United States," says Swartz. "This is already starting to happen and it needs to be addressed."

As far as Swartz is concerned, now is a time of great opportunity for CPAs, as long as the profession plays its cards right.

"The CPA profession has never been better in terms of opportunities for the professionals and the impact we can make in the business community by being the most trusted adviser," says Swartz. "The scope of our services continues to expand almost as fast as the number of pronouncements that are being generated by the ASB, FASB, SEC, PCAOB and all the other acronyms that are regulating us. As long as we do the right thing we will always be OK. Those that don't will pay the consequences. I just hope the actions of a few don't negatively impact the profession, as it did with Enron and the like. That will be our challenge."

Damien B.M. English is California CPA's managing editor. You can reach him at damien.english@calcpa.org.