Unaccountable: How the Accounting Profession Forfeited a Public Trust - Hardcover

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Mike Brewster is the coauthor of King of Capital: Sandy Weill and the Making of Citigroup, also published by Wiley, and a former sportswriter in upstate New York. Formerly the editor of LeadersOnline, Brewster spent seven years as the communications director at KPMG. He is a graduate of the Columbia University Graduate School of Journalism.

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For thousands of years, those who controlled and monitored society s finances accountants were often the most powerful, respected, and influential members of the community. From the collectors at communal granaries in the ancient Middle East to the scribes who monitored Queen Victoria s Exchequer, the accountant s role has been to preserve the integrity of financial systems.

In the United States, twentieth-century accountants played a vital role in shaping the transparency of U.S. capital markets, counseling the Allies on financial matters in both world wars, advising Congress on the creation of the federal income tax, and inventing the concept of the gross national product.

Yet by 2003, the reputation of the public accountant was in tatters. How did the accounting profession in America squander its legacy of public service? What happened to the accountants that presidents, senators, and captains of industry turned to for advice? Why did auditors stop looking for fraud? How did this once revered profession find itself in this unlikely and humiliating state?

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The most recent round of accounting scandals has shaken our economy and tarnished the reputation of a once-respected profession. The inherent conflicts within the flawed U.S. auditing system where auditors are paid by the companies they audit and financial reports are now viewed as having little more veracity than press releases have stunned a public that once believed auditors were their eyes and ears inside the country s biggest corporations. Now, renewed public interest has prompted the government and investors to once again ask: Where were the auditors?

In Unaccountable: How the Accounting Profession Forfeited a Public Trust, former communications director for KPMG and business journalist Mike Brewster explores the fascinating transformation of CPAs from independent voices on behalf of the shareholder to close allies of Corporate America. This vivid snapshot of the twenty-first-century accounting firm clearly examines the implications of this shift for investors, the industry, and the overall economy. Brewster s exploration of the key issues facing accounting traces the profession from its birth in the Middle East, to its rise as one of the most universally respected in the Western world, to the calamitous scandals of the past two years, to the fall of Andersen and passage of the Sarbanes-Oxley law.

Shaped by the author s own experiences in the industry, primary research of accounting documents going back hundreds of years, and exclusive interviews with the Big 5 s major players, advocates, and detractors, Unaccountable questions the practices of the nation s leading accounting firms, including . . .

• Their history of providing consulting services to the same firms they audit
• Their push in the 1990s to open investment banking and law practices
• Their push for double-digit growth with no regard to the ramifications of this growth on their public mandate
• Their resistance to change, even in the face of overwhelming public criticism

. . . and discusses the recent reforms that might lead to better accounting practices and more reliable financial reporting.

From the first accountants to the future of accounting, Unaccountable offers an up-close and personal view of the accounting industry. Unaccountable turns up the heat on an already beleaguered profession, but also shows how the best and brightest within the profession can still save the day by implementing much-needed reforms.