Question

Describe on the roles of the CPA firms and the Institute of CPA. Do they share the same roles? Why or Why not

Answer 1

A CPA Firm is an entity consisting of one or more CPA members.

Role of CPA Firms:

Auditing – The firms conduct the detailed audit of books of account so as to give an opinion on financial performance and position of a company.

Tax Advisory – The firms assist the companies with their tax planning and compliance process.

Business Consulting – The CPA firms also provide consultancy services on various aspect of business right from setting up a business plan to financing.

AICPA is a governing body providing the framework for CPA and CPA firms.

Role of Institute of CPA:

Setting up standards – AICPA develops standards for audit of companies and other services offered by CPA firms / CPA.

Examination and Continuous Learning – AICPA regulates the examination for enrolment as a CPA and also provides guidance materials for continuous development of its members.

Ethical Compliance – AICPA prescribes and monitors the code of ethics for governing actions of its members and CPA firms to upheld the high professional standards of the profession.

As described above, the role of CPA firms and AICPA is certainly not the same. CPA firms regulate the functioning of company through independent audit and opinion while AICPA regulates the action of CPA Firms and its members.