Read All the Essential Steps and Requirements for Preparing for a SOC 2 Audit to Ensure Data Security and Compliance.
What is the AICPA?
The AICPA (American Institute of Certified Public Accountants) is the US’s organization of Professional CPAs (Certified Public Accountants). The AICPA is the founder and originator of the SOC reporting standard and audit. Furthermore, the AICPA is a very influential body of professional accountants, and they combine the skills and expertise of the American Institute of CPAs (AICPA) and The Chartered Institute of Management Accountants (CIMA). The result of this is 689k members, students, and professionals that partake in public and management accounting.
The mission of the AICPA is to “drive a dynamic accounting profession ready to meet the demands of a constantly changing, disruptive world”.
The AICPA was founded over 120 years ago, and represents the professional and standard setting of CPAs. As an organization, the AICPA acts as an advocate before respective regulatory bodies, public interest groups, and professionals.
What is a Certified Public Accountant (CPA)?
A CPA is a type of accountant. It is important to differentiate between them, and be aware that not all accountants are CPAs. In order to achieve CPA status, there are prerequisites including specific educational work, work requirements, and passing the CPA exam.
Regarding the CPA exam, the actual exam is graded by the AICPA, but licensing thereafter is done by the district and county Board of Accountancy. The exam consists of four main topics , which are: Auditing and Attestation (AUD), Business Environment and Concepts (BEC), Financial Accounting and Reporting (FAR), and Regulation (REG). A passing score of 75 or more must be achieved in each section of the Uniform CPA Examination in order to achieve an overall test pass. It is important to note that although a US standard, international candidates are also able to obtain CPA certification, and follow the same process as US citizens.
What is the purpose of the AICPA?
Simply put, the AICPA is the gold standard, and sets the benchmark in FS (Financial statement) auditing, financial planning, business valuation, and business ethics. The body is responsible for maintaining their stringent standards and takes disciplinary action against any CPAs that contravene the rules and ethics of the body.
As the organization responsible for establishing the SOC audit standard and auditing process, any organization required to complete a SOC audit process will in some way or another make use of the AICPA. This may not be directly through the AICPA, but it can be by means of using an audit firm that has registered CPAs.
Brief history of the AICPA
The origin of the AICPA dates back to the year of 1887. At this time, the American Association of Public Accountants (AAPA) was formed. In 1916, the AAPA was succeeded by the Institute of Public Accountants. Prior to the start time of 1887, there were committee meetings that began, with the first one held in December 1886. In this first meeting, the first Bylaws of the AAPA in 1897 established three committees: Finance and Audit Committee; Committee on Elections, Qualifications and Examinations; and the Committee on Bylaws.