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| CPA CENTENNIAL SERIES: THE FIRST CPA LAW
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By Dale L. Flesher, University of Mississippi;
Gary J. Previts, Case Western Reserve University;
Tonya K. Flesher University of Mississippi
Nineteen ninety-six marks the 100th anniversary of the CPA exam in the
United States. The first law establishing the CPA designation was passed in
New York on April 17, 1896. This passage was the culmination of
years of efforts by accountants.
As early as 1894, a rough draft of a
bill providing for a professional examination was circulated in
Albany, N.Y., by Charles E. Sprague, who would later
hold New York CPA certificate No. 11). Sprague learned from his
friend, Melville Dewey (the innovator who developed the Dewey
Decimal System for libraries), that his best bet for passage was to
put the enforcement of the CPA law under the jurisdiction of the
Regents of the University of the State of New York. The bill was
introduced to the New York Legislature in February 1895 but failed
to emerge from a House committee and was defeated in the Senate.
At the same time, another bill was circulated by members of the
American Association of Public Accountants (AAPA), an
organization with many British-born members. That bill had been
written by an AAPA member, Francis Gottsberger, who did not
notify the membership of his action until February 1895, after the bill
had been sent to the legislature. Upon hearing of the bill, the AAPA
expressed its support and appointed Gottsberger as head of the
legislative committee.
Several members of the AAPA and Institute of Accounts called a
meeting in March 1895 to negotiate the differences between the two
bills. Forty-five accountants attended and formed a group to decide
what terms should be in the bill to be supported by the accounting
profession. This group was known as the "Committee of 14."
Accountants representing the AAPA included James T. Anyon, W.
Sanders Davies, James Yalden and Francis Gottsberger, the chairman
of the Committee of 14. Other members included the renowned
educator Silas S. Packard.
The committee quickly decided that the
institute's bill proposing a title should be pushed over the
association's bill, which proposed a license. Despite the efforts of the
Committee of 14 and its lobbyist, neither bill passed.
A bill with similar provisions was introduced in 1896, passed by
almost unanimous vote and signed by the governor on April 17,
1896. The AAPA, under the leadership of Frank Broaker, took
charge of the 1896 lobbying campaign.
One reason for the ease of passage in 1896 (as opposed to the difficulties of 1895) was the fact
that the earlier bill limited the CPA designation only to U.S. citizens.
The 1896 version made the designation available to citizens and any individual who had duly declared his intention to become a citizen. This amendment opened the way for British chartered
accountants and other non-Americans who had not yet secured their
citizenship papers.
Alternatively, it has been said that Sen. Albert Wray, who introduced the 1896 bill into the Senate, supported the bill because he wanted American companies to have an alternative to
hiring British chartered accountants for their audits.
A similar CPA law was passed in Pennsylvania in 1899, followed by Maryland in
1900 and California in 1901. Washington and Illinois followed in
1903. By 1921, with the passage of the New Mexico law, all 48
states had CPA legislation.
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