Publication Date


Document Type


First Advisor

Kieso, Donald E.

Degree Name

M.S. (Master of Science)

Legacy Department

Department of Accountancy




Since the post World War II expansion of management advisory services in public accounting, the restrictions and inadequacies of the rules and opinions embodied within the present code of professional conduct have been increasingly evident relative to advisory activities. This study is an attempt to evaluate in depth the limitations imposed by rules concerning advertising, soliciting, competitive bidding, referrals, and fee sharing on the provision and performance of management services by public accounting firms. In this study, the historical development of these rules of conduct are related to significant events which affected the scope of management services in an effort to determine the relationship between historical perspective and ethical implication. The data in this study was obtained primarily from interviews with partners from public accounting firms and small practitioners. In addition, supplementary information was obtained from the chairman and various members of the American Institute of Certified Public Accountants and Illinois Society of Certified Public Accountants ethics committees. Periodical literature and doctoral dissertations were reviewed for significant contributions by practitioners and academicians versed in professional ethics and management services. Working on the hypothesis that a degree of obsolescence exists in the present code relative to the performance of management services, an evaluation of alternative courses of action by the accounting profession resulted in the formulation of the following conclusions: 1. The scope of management advisory services should be United to the management information system. When advising in this area, the accountant is more familiar with his client's policies and operations. Furthermore, a more limited scope would alleviate the possibility of a confrontation between professional accountants, general management consultants, and the Securities and Exchange Commission. 2. Standards of competence and field work are needed as supplementary guidelines in order to improve the effectiveness of the present code. Competence criteria are concerned with determination of qualifications for advising others. This study concluded that qualifications for the performance of management services by public accounting firms should be permitted only by personnel who have displayed competence by examination and training. Standards of field work are submitted for the guidance of supervisors and specialists in the conduct of a management services engagement.


Includes bibliographical references.


117 pages




Northern Illinois University

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