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Audit and Assurance Accountants

History

Accounting has roots in the early days of business and trade in ancient Egypt and Babylonia, with the development of writing, counting money, and recording and reviewing transactions. The Romans further developed financial systems. In 1494, Luca Pacioli, an Italian mathematician and Franciscan friar, published the first book on double-entry accounting. This was a system that merchants in Venice were using at that time and Pacioli's book, called The Summa, helped to spread the practice throughout Italy.

Accounting started to take shape as a profession in the 1800s and 1900s in Scotland and England. The growth of corporations during the industrial revolution created more need for accountants. In the late 1800s, the American Association of Public Accountants was established and certification for public accountants was introduced.

In the 1930s, the Great Depression led to the creation of the Securities and Exchange Commission, requiring publicly traded companies to file financial reports. Business practices were watched even more closely after the Financial Accounting Standards Board (FASB) was established in 1973. The FASB, in partnership with the American Institute of Certified Public Accountants, developed the Generally Accepted Accounting Principles (GAAP) for the U.S. accounting industry. It consists of basic accounting principles and guidelines, rules and standards, and generally accepted industry practices.

Congress enacted the Sarbanes-Oxley Act in 2002, on the heels of numerous corporate scandals that had emerged due to fraudulent accounting practices. The act was created to oversee the accounting industry and set standards for audit reports and auditors. Companies large and small must comply.

The accounting industry has expanded since the 1990s to offer a variety of services, from financial and tax reports, management accounting, and forensic accounting, to auditing and assurance. Today, the Big Four accounting firms are Deloitte, PricewaterhouseCoopers (PwC), Ernst & Young (EY), and KPMG.

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