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| THEN AND NOW: PRACTICE DEVELOPMENT IN THE LATE 19TH CENTURY — BALTIMORE PUBLIC ACCOUNTING COMMUNITY1
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By Stephen E. Loeb
Ernst & Young Alumni Professor of Auditing,
University of Maryland, College Park
and historian, Maryland Association of CPAs
From the January/February 1999 edition of the Statement
In a previous issue of the Statement, I noted that Frank Blacklock had written "a 'series of articles' to assist individuals who recently had entered the accounting profession ..."2 Mr. Blacklock’s second article in this series was published in the December 1897 issue of Business: The Office Paper and dealt with the ever timely topic of practice development.3 While Frank Blacklock appears to have written this second article primarily for the younger practitioner, the comments seem useful for public accountants in general.
Near the beginning of his article, Blacklock stated that "to be a successful public accountant,
one must be a good salesman to attract customers."4 Published in 1897, the article, among other things, suggests techniques that individuals in public accounting could use to develop their public accounting practice. Frank Blacklock’s use of the term "customers" suggests that the term client had not yet become the customary way to describe those parties who hired public accountants, and also that at that point in time public accounting was in an early stage of the process of becoming a recognized profession in Maryland and likely elsewhere in the United States.5 For example, it was not until 1900 that Maryland enacted its accountancy law and until 1901 that the MACPA was founded.6
The practice development techniques suggested by Frank Blacklock in his article7 were probably used at that time by public accountants in the major commercial centers throughout the United States. However, since Frank Blacklock was based in Baltimore (this is indicated in a footnote to his article8), it seems reasonable to conclude that the techniques suggested by
him were commonly used in the Baltimore public accounting community at that
time. Three of the practice development techniques suggested by Blacklock were:
- "Have some neat cards engraved. ... Move around among your friends and acquaintances,
and leave the cards along the line."9
- "It may be well to do some newspaper advertising, but this is to be indulged in very
sparingly, especially at the start, as the expense may exceed the results obtained."10
- "A glass paperweight, with your name, business, and address will prove a good way to
advertise, but should only be given to personal friends or left where a good impression has
been made, as these glass paperweights are too expensive to be thrown around loosely."11
Blacklock’s comments suggest that advertising was an ethically accepted practice
development technique in use at the time. He seemed to have been especially concerned with
the cost of the advertising and whether the cost was worth the benefits that might result
from the advertising.
Mr. Blacklock also suggested that it would be wise for a public accountant to be involved
with various groups. More specifically, he noted that a practitioner should "move among clubs, lodges, and social organizations, so as to get personal acquaintances, but never talk shop out of the office, and always let the other fellow introduce the subject. Should you hear of someone who wants to see you, do not follow that person, if you see him in front of you, but contrive to meet him and let him start the subject,—you will then be in a more independent position when the fee comes to be discussed, being able to say, 'Why, you sent for me, I did not solicit the work.'"12
In this extract, Frank Blacklock was suggesting that the public accounting practitioner
carefully engage in what today might be termed networking. He had some interesting advice
for the fee negotiation process. Next, in his article Blacklock suggested that in seeking referral
of business from others the practitioner should cultivate "railroad and bank men, lawyers and
professionals of all kinds; in fact, a public accountant cannot have too many acquaintances,
any one of whom may send him business in the most unexpected way and at any unforeseen
time."13
Frank Blacklock also seems to suggest that legal liability considerations should not be
ignored. More specifically, Blacklock noted that "It is well, at the outset of all engagements, to learn what is wanted and on what line the audit or investigation is to be pursued; and in giving his certificate of the result, an accountant must be extremely careful to use the exact wording, as he will be held strictly to what he says. The public have no leniency in dealing with accountants, and generally put all the blame on the accountant (should anything go wrong), that can be conveniently worked on him."14
In this extract, Mr. Blacklock also seems to suggest that a practitioner reach an understanding
with the client as to what is expected from an engagement.
Additionally, Frank Blacklock seems to have been suggesting to the young practitioner who
was beginning a practice "to have a side line to run with the main profession of public expert
accountant" while establishing an accounting practice.15 During the 20th century, I would suspect that a number of younger public accountants followed such a course while developing a public accounting practice.
Most, if not all of Frank Blacklock’s comments that I have quoted and/or discussed here,16 have applicability to the current public accounting environment. Furthermore, it seems to me that Blacklock’s comments provide additional evidence of the remarkable professional insight and ability of this early leader of the public accounting profession in the State of Maryland.
Footnotes
1. Donal Byard was of help in finding Frank Blacklock’s article, which is the basis for my short article.
2. Stephen E. Loeb, November 1998, "Some Reflections of an Early Maryland Public
Accounting Pioneer," Statement, p.20. My article published in the November1998 issue of
the Statement essentially commented on, quoted (including the quote within the quote in this
sentence) from, and made reference to Frank Blacklock, November 1897. "Suggestions to
Those Who Would Enter the Profession of Accountancy: Paper I," Business: The Office
Paper, p.337.
3. Frank Blacklock, December 1897. "Suggestions to Those Who Would Enter The
Profession of Accountancy: II-'To get the Work to Do,'" Business: The Office Paper, p. 370.
4. Ibid.
5. See the discussion of the use of the terms "client" and "customer" as they relate to the
professionalization process in Ernest Greenwood, July 1957. "Attributes of a Profession,"
Social Work, pp.47-48.
6. See, for example, Stephen E. Loeb and Gordon S. May, June 15,1976. A History of Public Accounting in Marvland, Maryland Association of Certified Public Accountants, Inc., p.23.
7. Frank Blacklock, December 1897. "Suggestions to Those Who Would Enter The
Profession of Accountancy: II-'To get the Work to Do,'" p.370.
8. Ibid.
9. Ibid.
10. Ibid.
11. Ibid.
12. Ibid.
13. Ibid.
14. Ibid.
15. Ibid.
16. Ibid.
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