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Services of a CPA

Aside from the normal activities, such as monitoring and auditing the various accounts of a company, and planning for investment and taxation, a certified public accountant (CPA) is these days expected to contribute to an ever growing number of roles within a company, with the ever evolving commercial climate, and this paper aims to demonstrate some of these new roles that CPAs face.

Role as advisor for a Non-Profit Organization (NPO)

A CPA can give information and advice to NPO's to help them gain tax exemption. The role of a CPA for a NPA, alongside the roles of the various employees and volunteers, managers, directors and external advisors, can help to improve the management and transparency of the NPO. It is important to note that a CPA needs to ensure that a NPA does not engage, accidently or otherwise, in fraudulent activities, or in transactions that are unfair. A CPA also has the responsibility to advise such organizations not to engage in activities that could put their exemption status under threat, for example by engaging in political activities or lobbying. A CPA's expertise can be used to help steer the procedures and policies of the NPO, assist the director with fiscal directives, and with accountability.

Advisors in the field of changing valuation

There has been a significant change in business valuation in recent times. Business valuations are now under the standardization of USPAP (The Uniform Standards of Professional Appraisal Practice), and there have been some significant legal cases, such as the Kumbo Tire Company case against Carmichael and Daubert, and the Merrel Dow case, which have had large effects on USPAP. The case of Daubert and Kumbo in respect to the IRS regulations on gift disclosure which revealed poor, unreliable and inconsistent procedures of valuation, have served to enhance the changes to USPAP. To address this issue, a skillful, experienced, well educated and knowledgeable CPA's can help with business valuations, and give key advice. However it is important to bear in mind that if valuation methods are found to be erroneous, a CPA could face disqualified testimony, and other such penalties.

Turnarounds

CPA's are in the perfect position to help turn around a company that is in disarray. They have the knowledge and experience to help root out the cause of the problem of a deteriorating company, and to know when financial crisis's are imminent. The methodology of a CPA in this role comes in three functions - stabilization, crisis management, and rebuilding. The expertise of a CPA allows them to give a thorough evaluation of the prospects and implications of turnaround plans for the short, medium and long term, and can supervise the allocation of resources, make their own systems, and give reports on the strategies that are crucial to ensure that these methods are successfully implemented. Reports are important because the CPA will be responsible for the diagnosis's and reviews they provide, including operation audits, documentation, and coming up with new systems for control and the reporting of financial matters.

References

  1. Claudia L. Kelly, Susan Anderson, (2006), The CPA's Role in Governance, Accountability and Transparency, The CPA Journal Online, August 2006 Issue.
  2. Quintero, Ronald G (1989), The CPA's role in turnarounds. The CPA Journal online, September, 1989 issue.