The article presents information on the standards for certified public accountant (CPA) legislation. The wide diversity which still exists among state CPA laws and regulations indicates the need for future changes. Many of these changes will probably come about through regulations established by the state boards of accountancy. Others must of necessity be accomplished by action of state legislatures. There is an especial need to solve the problems of interstate practice, restrictive legislation and education for the profession. It is desirable that improvements be made in other sections also in order that legislative and administrative requirements shall be as uniform as possible at a high standard throughout the United States. Efforts to improve CPA legislation have taken three forms: (1) the expression of approval or disapproval of the state laws in connection with admitting certificate holders to membership in national accounting organizations, (2) the adoption of uniform examinations for candidates and (3) the preparation of model legislation

According to the author accounting profession would be strengthened and the public interest would be better served, if all persons who present themselves as practitioners of public accountancy would be required by law, first to demonstrate their professional abilities and then to act in accordance with recognized standards of practice. Accountancy is not an exact science. There are no set rules or formulae, which can be used as a guide by the untrained. It follows, then, that the public accepts the practitioner pf public accountancy in good faith as one properly qualified to render a specialized service, important to the welfare of business and, consequently to the general public. The present generation should accept this, even though it means that they will encounter the many difficulties concomitant with such a drastic change as the regulation of practice through restrictive legislation. They should work and strive with all the ability they possess and the strength of character, which has been built into their profession to bequeath to the certified public accountants of the future the gracious heritage of a unified profession

The fallacy of the argument in favor of a rate base measured not by original cost but by subsequent purchase price should be apparent to anyone who understands the basic philosophy of the "prudent investment" standard. Under this standard, consumers of public utility service compensate investors for building the plants, not just for buying them from other persons who have already built them and who have already devoted them to the public service. Once these utility properties have been built and have been put into public service, investors who buy them later from their original owners are simply taking over these former owners' claims to a return on the capital devoted to the public service. The very nature of rate regulation precludes the adoption of the transfer price of a utility property, presented under the guise of actual cost to the present accounting company, as a proper measure of the rate base. This is so because public utility properties are necessarily bought and sold at prices reflecting the expectations of the buyers and sellers as to what the properties can be made to earn in the future

The original cost provision for plant accounts, now incorporated in the uniform system of accounts prescribed for most electric utilities, was advanced by certain regulatory authorities as a "requirement of sound accounting practices" and as an "expedient to effective rate regulations." The present program of the Federal Power Commission, as revealed in "original cost" proceedings which followed the initiation of this system of accounts, shows conclusively that this system of accounts, together with the arguments advanced for its adoption, were, to this authority, within the shell of which was concealed an economic philosophy utterly foreign to the American system of private enterprise. Does it not seem that the attempt of this authority to apply this radical economic philosophy to public utilities, as a regulatory policy, may represent the first step in a well-prepared plan to revolutionize the whole American economy and that it may represent the spearhead of an attack on the American system of free enterprise? The distinguishing feature of "original cost" accounting is found in the provisions for the analysis of costs incurred in the acquisition of operating or going concerns, or in the purchase of an earning entity

The article presents information on tax simplification. During the past few months, numerous committees representing various business and professional organizations have been working at the task of suggesting ways of "simplifying" the Federal income tax law. Their purpose is to make recommendations to Congress which, if adopted, will presumably result in a plainly written, easily understandable statute, supplemented (it is hoped) by equally clear regulations. The announced objectives of the tax planners are threefold: (1) simplification; (2) elimination of "inequities" and (3) encouragement of "risk capital." After studying the recommendations, Congress may proceed in one of two ways to bring about the desired reforms: it may repeal the existing Internal Revenue Code and enact a brand-new law, or it may retain the Code in its present form and make such changes as appear to be in order. Despite the apparent advantages of making a clean sweep and starting over, it would probably be impractical to discard the accumulated body of law and precedent; hence "simplification" will likely be accomplished by revising the present Code. To help bring about the maximum "simplification," it is suggested that certain sections be entirely removed from the Code