The Original Version of This App

The Original Version of This Appeared at --- Click Here
http://74.125.93.132/search?q=cache:L3EWakfuRz4J:www.xyztalk.com/XYZ%20credential.htm+CPA+Elliott+"Cognitor"&cd=2&hl=en&ct=clnk&gl=us

The following was extracted from the AICPA SPRING MEETING OF COUNCIL, MAY 21-23, 2000 SAN JUAN, PUERTO RICO. The original can be found at http://www.aicpa.org/members/counmin/spring00.htm . However, due to the fact that the original document is only available for download in Word format and the potential for viruses exist, I have copied those Board of Directors Minutes pertaining to the portal so that you can review them without fear of viruses.

Proposed XYZ Credential Mr. Elliott then reported on the XYZ credential strategic initiative. He said that the current CPA credential does not cover the work that the profession does. In public practice, the majority of members are not doing audits, reviews and compilations of financial statements, and in industry and government, no members are conducting independent audits. On a full time equivalent basis, perhaps no more than ten percent of the AICPA’s total membership is involved in the license that stems from the CPA credential. Fewer and fewer young people are willing to train to be auditors. Fewer young people are enrolled in accounting programs, and fewer accounting graduates are sitting for the CPA examination.

Mr. Elliott said that the CPA does not present an adequate foundation for the professional of the future for the following reasons:

1) It is not owned by the Profession. It is owned by the fifty four state and territorial accountancy statutes, which make it difficult to change.

2) A license to do audits is too narrow a foundation to support the breadth of activities currently being performed by the profession.

3) The CPA license in and of itself is not seen as offering sufficient reward.

4) Brand experts have reported that the CPA brand is not stretchable into higher and wider space.

5) An appropriate new credential must be global in scope, and the CPA is by its nature essentially local and certainly not global.

Mr. Elliott said the profession must adopt a new brand, and the XYZ project represents the best possibility of doing that. XYZ will include accountancy, but also a variety of other disciplines. He noted clearly that the CPA will not cease to have value. Audits will be as necessary as ever, but reports will be more timely and meaningful.

The eight country consortium sponsoring the XYZ recommends starting with accountancy and then broadening out to other disciplines. Initially, most CPAs would be grandfathered; others wanting to use the title would have to demonstrate that they share with the CPA high values of ethics, integrity and competence. Ultimately, there would be a required curriculum, formal education, experience and examination to merit the XYZ. In brief, XYZ offers a global credential whose holders have the breadth to understand the entire process of business and organizational behavior with a high level of competency and ethical standards.

All of the eight founding countries are English speaking countries, and work is being done to identify other countries who could grant the credential on the local level so that ultimately XYZ would be truly global. The initial thrust would be to the accountancy bodies in France, Germany, the Netherlands, Italy, Hong Kong and Japan. The next expansion would be outwards to include the consultants, the MBAs, the CMAs, and the non-CPAs in American accounting firms.

Studies are now under way of codes of ethics around the world to identify best practices. This is important because high ethical standards are the foundation for reputation building, and the result is public trust. XYZs will be expected to conform to a fundamental level of professional behavior. In addition, there will be requirements that pertain only to their particular discipline. The public will be able to expect that XYZs operate with a high degree of integrity, objectivity, public interest, competence and confidentiality. Each national credential-granting organization will have a disciplinary committee and procedural requirements to respond to complaints and to discipline XYZs, if necessary.

A global institute would be created which would own the global trademarks for XYZ. It would establish the ethical standards and develop the membership of XYZs. Each country would have a credential-granting body which would participate in the governance of the global organization in proportion to its membership. AICPA as the largest such body would have a significant voice and role.

Mr. Elliott said that no action on XYZ would be sought at this meeting. His presentation was designed as background for discussion at breakout sessions. The information generated will be fed back to the organizing consortium and further discussions will be held at the Fall Meeting of Council. If Council is so disposed, the issue could be put to a membership ballot and if approved, the first XYZ credential could be awarded in the summer of 2002.

--------------------------------------------------------------------------------

The following was extracted from the AICPA FALL MEETING OF COUNCIL OCTOBER 23 - 24, 2000, LAS VEGAS, NEVADA. The original can be found at http://www.aicpa.org/members/counmin/fall00.htm. However, due to the fact that the original document is only available for download in Word format and the potential for viruses exist, I have copied those Board of Directors Minutes pertaining to the portal so that you can review them without fear of viruses.

New Global Designation

Mr. Elliott began his presentation by referring to two documents which were sent to Council members prior to the meeting: one, an international consortium document and another, a paper focused on the interests of the U.S. as a participant in the consortium. He said that given the multitude of challenges affecting the marketplace, companies need to leverage knowledge in order to create value for their customers and shareholders. He said that the CPA brand is viewed by many as too narrow to function as the sole expert in the marketplace of the future, but that the CPA would be a complimentary expert in the future design of financial information systems. He further said that the professional with both designations would have a significant competitive advantage in the marketplace.

Mr. Elliott then discussed the response which the Cognitor designation offered to the marketplace demand and the required components to earning this credential including a general academic foundation, a core professional foundation, business knowledge, experience-based competencies, and integrative competencies which were then discussed in detail. He said that non-CPAs may gain the Cognitor designation but that CPAs hold a major advantage over these individuals given the unrestricted access CPAs have to the client organizations, sole ownership of the attest function, and that, given that CPAs were forerunners in establishing the credential, they had the additional advantage of being the first Cognitors. He said that by opening the credential to non-CPAs, marketplace acceptance would be enhanced.

He described the interim and permanent paths to becoming a Cognitor and noted that given the rollout in the summer of 2002, persons qualifying by 2004, do so under the interim requirements. Persons who qualify later would come under the permanent requirements. By 2010, it is estimated that 800,000 professionals would earn the credential. He then identified the other professional organizations interested in the credential and those that are not. He said the AICPA is properly focused on the marketplace affecting its members in proposing this initiative.

The attraction of the Cognitor is that it is a global credential, that it signifies a breadth of business and organizational understanding, that it is committed to high ethical standards, and lastly, that it signifies a high level of competence. A set of global strategies, including the establishment of a Global Institute of Cognitors, were identified. This new Institute would own the intellectual rights to market the Cognitor trademark name, develop a code of ethics, set and monitor the admission standards and learning program, as well as, mount a global branding campaign. Mr. Elliott then outlined the various benefits to the marketplace and to CPAs of becoming a Cognitor. He concluded by explaining the three reasons why now was the best time to institute such a credential: (1) the transition to a knowledge economy, (2) the emergence of a global economy, and (3) the development of the Internet providing the platform for offering the credential. He then read the key sections of a resolution sent to the Council members prior to the meeting which was moved and seconded. A substitute motion was offered by council representatives of the Ohio Society of CPAs. The substitute resolution was considered acceptable to the original motion maker and seconder and the floor was opened for discussion.

Various Council members then expressed their support, questions, reservations, and concerns on the proposed resolution. Discussion focused on the desirability of expanding the CPA credential versus a new global credential, the potential competition the new credential would present to CPAs, the limitations of the current CPA credential, and the need for more information and member education in order to have a full approval of the resolution. After this discussion, by motion duly made, seconded and carried, the substitute resolution offered by the Ohio delegation was approved.

WHEREAS the member-developed Vision for our profession is to offer a broader array of value added services, and take advantage of the global economy; and

WHEREAS one of the primary missions of the Institute, its Board of Directors and management is, and will continue to be, the support, promotion and enhancement of the CPA credential and the CPA profession; and

WHEREAS both the Strategic Planning Committee and the Board of Directors have considered how best to enable members to realize the Vision concluding that a new global professional credential in addition to the CPA credential is an integral element of the Vision; and

WHEREAS Council has considered the necessity for the Institute to participate with other international professional organizations in designing, offering and promoting a new global professional credential; and

WHEREAS Council believes that a new global professional credential will further position CPAs with other professionals around the world as strategic business advisors by the promotion of high standards of practice and competencies empowering members to realize the Vision, which is in the best interests of the profession and the public; and

WHEREAS the new credential represents the professionalization of expanded competencies, and Council desires that the AICPA continue to develop this new global credential to allow interested CPAs to avail themselves of it; and

WHEREAS Council believes that the AICPA should be the holder of the rights in the United States to administer and award the new global credential and should consider options including establishing a separate organization or affiliate to be the member organization for this new global credential in the United States; and

WHEREAS Council recognizes and appreciates the support of and collaborative relationship with the state CPA societies and is committed to working with them to implement this initiative if adopted;

NOW THEREFORE BE IT RESOLVED that the AICPA Council supports continuing with the development, in cooperation with other international professional organizations, of a new global professional credential as outlined in the materials supplied for this meeting; and

BE IT FURTHER RESOLVED that the Board of Directors and management of the Institute are directed to design and implement a program to inform AICPA members on the development of this new global credential, how it will benefit CPAs, and to obtain member and state society response; and

BE IT FURTHER RESOLVED that Institute management will prepare a business plan to include financial projections demonstrating the viability of this endeavor; as well as market research results and an analysis of the implications for student enrollments, and

BE IT FURTHER RESOLVED that the Institute's General Counsel will prepare for consideration by Council at its May 2001 meeting as the next phase in the development of the global credential any bylaw amendments to be presented to the membership for approval or other documentation required to permit the Institute to create a separate organization or affiliate in order to implement the new global credential in the United States.