A History of the Development of the AICPA's Specialty Designation Program

CPA Journal, The, Jan 2006 by Chiasson, Michael, Gaharan, Catherine, Mauldin, Shawn

The wisdom of the accreditation of CPAs in specialized or specific areas of practice has long been debated. While many AICPA members favor accredited specializations and believe the profession will benefit in the long run, others believe specializations have a divisive effect on the profession. The debate over specializations has surfaced many times over the past 50 years. The history of the efforts to develop an accounting specialization program begins in the late 1950s and continues with the recent decision of the AICPA Council to retain the three specialty credentials and provide financial support for them.

Early Efforts

The AICPA has been struggling with the concept, as well as the practicality, of specialists in the accounting profession since the late 1950s, when it requested a study from the Committee on Long-Rang� Objectives to determine whether it should create separate sections for groups within the profession with common interests. The finding of that committee was favorable toward specialty groupings. This first serious consideration by the AICPA of any specialty grouping was met with skepticism, and the concept was rejected by the AICPA Council. Such skepticism is not surprising in light of the fact that, until 1981, CPAs were prohibited from claiming a specialty. It was understood that CPAs had special abilities in accounting matters, particularly in auditing; thus, claims of specialties were thought to be unnecessary, misleading, and divisive.

In the early 1960s, the concept of specialty groupings was again considered. With overwhelming support of its 13,000 survey respondents, the AICPA's Ad Hoc Committee on sections recommended in 1961 that the AICPA establish several such groupings. Suggested specialty areas included accounting service needs specific to small businesses; tax; internal management; reporting by public corporations; and reporting by government agencies. The AICPA Council, however, did not act on that recommendation. In 1962, the Council again considered the concept of specialties. Although specialization had been effective in both the medical and the legal professions, some CPAs were adamant in their belief that promoting CPA specialties would be divisive to the profession. Because of this strong opposition, the AICPA Council did not further consider the concept. (see C.D. Izard and J.D. McKinney, "The Certification of Tax Specialists: Some Empirical Results," Journal of the American Taxation Association, Fall 1983, and P.E. Lambert, "Accrediting Specialties in Public Accounting ... A Logical Step," Management Accounting, March 1977.)

Ten years later, in 1972, the AICPA revisited the concept of CPA specialists by requesting that the newly created Committee on Scope and Structure study the concept and make recommendations. The committee (as reported in an exposure draft) recommended that the AICPA support the development of a specialty program for CPAs. The development of individual specialties should be accomplished through the AICPA's senior committees, which should design specialty credentials in their areas. The design should include developing appropriate examinations and other criteria the credential holder must meet, as well as establishing programs to support individuals meeting the criteria. It is worth noting that this report also suggested the inclusion of non-CPAs as candidates for these specialty credentials. (see E.G. Lewis, "Specialization: Have We Reached True Professional Maturity?," Accounting Horizons, December 1989.)

As a result of these recommendations, as well as the membership's reaction to them, the AICPA in 1975 created the Special Committee on Specialization, which was primarily charged with determining whether a need for a specialty program for CPAs existed. The results of this Special Committee's study formed the basis for creating specialists within the CPA profession that would have commonly accepted definitions of areas of practice, generally understood labels for those who practice in these areas, and uniform standards of accreditation.

Finally, in 1981, due to pressures to offer a personal financial specialist credential, the AICPA eliminated its prohibition of CPA specialists. Under section ET 502.05 of the AICPA's 1978 Professional Standards, CPAs could not promote themselves as specialists because a method for recognizing competence in specialized fields had not been developed and self-designations would likely cause misunderstanding or deception. Because the AICPA now intended to develop standards to recognize specialized competence, this prohibition was no longer necessary and was eliminated.

Accredited Personal Financial Specialist

After the AICPA's withdrawal of the prohibition of CPA specialists, in 1985 the Colorado Society of Certified Public Accountants (CSCPA) formally established the profession's first specialty credential, the Accredited Personal Financial Specialist (APFS). In developing this specialty program, the CSCPA established specific standards for CPAs to meet in order to achieve and maintain the credential, including an examination, experience, attestation of quality from others, and continued experience and education after achieving the specialty credential.