The article focuses on the Army Audit Agency. The Army Audit Agency of the Office of the Comptroller of the Army, is a unique organization of the U.S. Government. Prior to and during World War II, the auditing functions were carried on in the various services of the Army but shortly after the conclusion of World War II, it became apparent that a consolidation of all audit functions under one head would be desirable. As a natural consequence, the Army Audit Agency became a part of the Office of the Comptroller. A former member of Accounting Systems Division was brought in as Deputy Chief to direct the technical operations. His introduction of streamlined professional auditing has been a boon to industry and a very necessary aid to improved Army management. The progress made in a short period has been most amazing. Although the Army Audit Agency was operating as a professional staff of auditors, the pressure of completing the necessary work in turning out audit reports was so great that little effort was expended on staff training or on-the-job training.

The article discusses generally acceptable objectives formulated to guide the development of course content, instruction, and curricula for the undergraduate program in accounting. These can be checked for validity by applying the test of reasonableness. This is a widely used accounting test, particularly in cost distributions. This same test is used to evaluate the pronouncements of the Research Committees of the American Institute of Accountants. The Standards Rating Committee has proposed a four-year program, while many hold the viewpoint that either five-year courses, or four years of undergraduate work, and one year of graduate work, are necessary for adequate training. The committee apparently favors a five-year program, but at the same time recognizes the inherent difficulty of such at this time. Specialization is necessary but not at the undergraduate level. A broad foundation will enable the student to become a better specialist. The failure to provide a means which will enable the student to integrate the many ideas received in diverse courses is another deficiency.

This article focuses on the responsibility of the internal auditor for procedures. Internal Auditing is the independent appraisal activity within an organization for the review of the accounting, financial, and other operations as a basis for protective and constructive service to management. It is a type of control which functions by measuring and evaluating the effectiveness of other types of control. It deals primarily with accounting and financial matters, but it may also properly deal with matters of an operating nature. The article also says that Internal Auditing should not include responsibilities for procedures which are essentially a part of the regular operations of a complete and adequate system or of a properly organized operating department. If the internal auditor is to do a satisfactory job in the matter of auditing procedures, he is presumed to know as much about the design and installation of procedures as do the systems and procedures experts. This calls for proper relations with the latter.

The article focuses on starting a career in public accounting. To make it worth one's while to enter the field of public accounting, one must have a considerable portion of courage, strong ambition and a full measure of persistence. One must be willing and physically able to work hard. A career in public accounting calls for long hours of high quality work, frequently done under pressure. A man without fortitude should look elsewhere for a career. A successful accountant must have imagination. The public accountant is not a human calculator who arranges data fed into him. He is a man with the ability to visualize the abstract, to see as a finished product a work paper, an audit program, a report, an accounting system before it has ever come into existence. Perhaps the thing that one should do that is of the greatest importance is to provide oneself with a sound formal education. There is a trend toward ever increasing the educational requirements for the certified public accountant.

The need for regular formalized staff training classes as a part of employee training has been fairly widely accepted by public accounting practitioners. In the article, the author presents his experience related to a large scale audit organization in the conduct of short intensive refresher courses for auditors at the in-charge level. Testing of capabilities of auditors in the application of theory to practice have been tabulated and preliminary inferences drawn from these results. The representative in-charge auditor carried into the courses a strong emphasis on voluminous vouching and checking as the prime means of obtaining adequate audit evidence. There was a marked resistance to change by a significant portion of the men even upon demonstration of the patent unsoundness of some of their ideas about audit objectives. This intransigence required early and intensive diversification of teaching techniques. Statistical measurements of progression superficially support the belief that early application of flexible, well-thought-out plans of instruction can aid in achieving significant improvement even as early as the second day of training.

Reviews the book "Economic Accounting," by John P. Powelson.

The article presents comparative rather than absolute limitations, a problem that faces accounting, and deals with purchasing power measurements in accounting. In recent times, two basic economic fears, namely, inflation and deflation have been developed which involve concern about the purchasing power of the dollar, and its lack of monetary stability or shifting of the price level. The general price index, or any one of its broad subdivisions, is admittedly no more than a very general indication of what "package" of goods and services a given quantity of money will buy under certain conditions of time and place. The price index blends indiscriminately the effect of monetary factors with such factors as output, technology, wage bargaining, etc. The problem of inflation may be delimited and treated as involving determination of the cost of goods delivered to customers, determination of the cost of utilization of long-term assets, and measurement for administrative and other purposes of return on capital investment.

Retail selling on the installment plan is a widely accepted practice. Yet few buyers know the interest-rate equivalent of the carrying charges they pay for installment credit. That it is usually relatively high no one denies. This situation has led to suggestions from some quarters that sellers be required to specify on theft sales contracts the interest-rate equivalent of their service charges, so that buyers will be better able to determine whether they are paying "too much" for the privilege of using installment credit. Perhaps one reason why state laws have not required the posting of equivalent annual interest rates is that several methods of computing rates are in use and all are apparently recognized as valid. This creates a confusing situation. This article reviews some of the more commonly used methods of computing equivalent rates and tries to determine whether certain of them should be favored over others. Eight methods of computing the rate equivalent of the service charge in the illustrative problem may be considered. However, relatively few consumers know how to apply even the simplest of these methods, and several of the methods do not provide an accurate measure of the differences between rates. Any method recommended for general use, including use by sellers, should be accurate and as easy as possible to compute.

Reviews the book "Selected Readings in Accounting," by Mary E. Murphy.

In connection with its continuing study of the concrete meaning of "business entity," the Committee on Concepts and Standards of the American Accounting Association has selected the area of consolidated financial statements as one of importance. The basic principles of consolidated financial statements include that firstly, in the absence of special circumstances, consolidated statements are useful representations of financial position and results of operations when a dominant central financial interest in two or more companies exists and is accompanied by administrative control of their activities and resources. Secondly, in so far as practicable, the consolidated data should reflect the underlying assumption that they represent the operations, resources, and equities of a single entity. The first principle is a statement of policy, of objective, defining broadly the entity or area of consolidation, the second principle sets forth a general guide to the procedures of consolidation.