A group of 18 certified public accountants brought suit today against their professional organization, the American Institute of Certified Public Accountants (AICPA) charging it favors the industry giants at the expense of local and regional accounting firms.
Actions taken by the AICPA at its meeting September violate its own by-laws and enable the "Big Eight" accounting firms to "further increase their already awesome and potentially harmful domination of the public accounting field," the suit alleges.
Wallace E. Olson, president of the AICPA, issued a statement rejecting the suit's allegations and calling the suit "not a service to the public interest or the accounting profession."
An affidavit by Eli Mason, one of those who filed the civil suit in N.Y. Supreme Court here, argues that it is important to consider the AICPA September actions in the context of recent congressional concern over domination of the accounting business by "Big Eight."
The Senate Subcommittee on Reports, Accounting and Management chaired by Sen. Lee Metcalf (D-Mont.) issued a giant report in March that said the "Big Eight" audit 85 per cent of all firms listed on the New York and American stock exchanges.
The eight are: Arthur Anderson & Co., Arthur Young & Co., Coopers Lybrand, Ernst & Ernst, Haskins & Sells, Peat, Marwick, Mitchell & Co., Price Waterhouse & Co. and Touche Ross & Co.
The September AICPA actions that triggered the suit were decisions to permit accounting firms in addition to individual accountants to become members of the institute and to divide the member firms into a group that audits Security and Exchange regulated companies and one that does not.
The suit asks the court to order AICPA to submit these changes to a mail vote of the 131,000 AICPA members.