seen later on in this paper, we are also debtors to our own profession.

The question of self interest is a vital and persistent subject, and in this Mr. Sterrett would convey the impression that there are conditions that would justify contingent fees; this I cannot endorse, as it is fraught with the danger that this self interest would overbear the professional and judicial attitude which an accountant should always maintain. On the other hand, Mr. Sterrett takes a decided stand, and justly so, against a practitioner speculating for his personal gain upon information obtained in the course of his services to a client.

Under the heading of "Relations to his Professional Brethren "he most admirably treats of the question of character. demonstrates the concern of the accountant to appear well at all times before his clientele, relegating to the background the more important phases of his business and fraternal relations with his confreres as well as his indifference to a high standard for himself. It must be admitted that if a professional man is, at all times, true to himself and actuated by a high ethical standard towards his professional brethren, he cannot help but be true and loyal to the laity whom he professes to serve.

I particularly wish to draw your attention to the distinction made by our learned friend, between upholding and supporting our professional brethren as a general proposition before the public, and the necessity, when occasion arises, for such a beneficent body as this to be in a position to punish and expose anyone -within the fold-who transgresses, or is disregardful of the precepts necessarily established; not only for ourselves, but also as a protection to the business public.

Upon the question of competition again our esteemed friend makes qualifications with which I am unable to agree. It may be that it is in the use of the term, but I take the view that every professional man must be the best judge of the value of his talents, and that, at no time, should he countenance what is generally recognized as competition in this line of service. It may be true that the lay public have the right to employ such means in seeking our help, but the principle should be impressed as fundamental, that the client gets exactly what he pays for.

With these few remarks as a preface, I wish to touch upon (1st) the elemental reasons that justify the claim that this

is a profession in all that the word implies; (2d) the aims and ultimate goal in this service that warrant our so designating ourselves; and, (3d) lay down a few classified and tersely expressed rules that may form a proper basis for the incorporation of some such precepts into our Year Book.

APPLIED ETHICS FOR THE ACCOUNTANT.

In the sense in which we, as public accountants, use the term, a profession is, according to the dictionary :

66

"The calling or occupation which one professes to understand or follow; a vocation in which a professed knowledge of some department of science or learning is "used by its practical application to the affairs of others, either "in advising, guiding or teaching them, or in serving their "interests or welfare in the practice of an art founded on 66 it."

And it is given more concisely as,

66

Professed attainments in special knowledge, as distinguished from mere skill.”

Admitting, then, that we, as a whole, are a recognized profession, it follows that we should, both collectively as a representative society, and individually, promulgate and maintain at all times, and that inflexibly, those rules of conduct which are known to all professional men of lofty instincts as the keystone that upholds the arch of public confidence.

In the abstract the subject may be tersely given in two words, do right; or we may dismiss the topic by referring to the decalogue and the "Sermon on the Mount."

The effluxion of time changes conditions and circumstances which it is impossible to meet with a rigid theory. A blind attachment to principles and rules because they are theoretically long-established, would be absurd, when around us we see the advancement of the applied sciences and the influences of modern means of inter-communication. On the other hand, with a proper and well-balanced conservatism rash innovation and reckless experiment should be discountenanced. Only the dogmatic theorist aims to establish an ethical code of great simplicity; the practitioner sees in such brevity both uncertainty and injustice. Practice is liberalized by theory, and theory restrained and corrected by practice.

There is no profession, not excepting that of the ministry or of the law, in which it is more imperative that the practitioner be governed by the highest code of morality, than that of public accounting. Great as may be the influence which our profession can and does exercise upon business affairs, it is only by strict observance of ethical rules and right conduct that we can hope to pay the debt we all owe to such profession by uplifting and maintaining the highest standard, thereby bequeathing to our successors a calling placed upon a higher plane than when we first embraced it. It rests largely with this generation of the guild, who can, many of them, recall the inception of public auditing and accounting as it is now recognized, to lay the foundation of a noble profession that may justly be called the right hand of the law, or on the other hand, so bear themselves that this proud opportunity will be lost and our term of stewardship wasted.

In the rush and turmoil of our calling, in which every waking hour is our clients', and even our dreams are a ferment of figures and finance, we are too apt to begrudge the brief minute now and then to go back to first principles, or to give ourselves the benefit of a little occasional introspection.

Lord Bacon has said, "Every man is a debtor to his profession from which as men, of course, do receive countenance and profit, so ought they of duty to endeavor themselves by way of amends to be a help and an ornament thereunto." This golden sentence from the great jurist would appear to urge us to do all within our power both in our individual lives and in our collective capacity to demonstrate that we realize the obligations of our stewardship, are at all times intent upon upholding the highest principles of professional ethics, and in giving to the young practitioner some established rules for right conduct in the career before him.

Some may ask, why this striving, why this constant aiming at the ideal? when, if any pronounced characteristics are expected of the public accountant, they are that he shall be matter-of-fact, logical, and practical, with his faculties at all times keenly on edge. in all matters pertaining to economics, finance, and commercial law.

It is because, as the definition gives it, we have "professed attainments in special knowledge as distinguished from mere

skill." Such attainments being applied to the "affairs of others, either in advising, guiding, or serving their interests or welfare," we are not, or rather should never allow ourselves to be influenced by selfish motives.

Such motives are the very essence and incentive of commercial traffic; the merchant or manufacturer must strive in competition to obtain a share of trade; his skill, business acumen and energy are all bent towards outreaching his rivals; buyer and seller are upon opposite sides, and the cautionary term 'caveat emptor" is ever to the fore.

On the other hand, the practitioner is prepared to assist, by application of his special knowledge and accumulated experience, those of the business world who may have met with problems of a difficult or troublesome nature, the solution of which demands qualities beyond such as may have been acquired within the ordinary range of any one line of commercial effort, and it is imperative, the "sine qua non," the very strength and life of such relations, that absolute confidence and frankness prevail between the two. The client is not a customer; there should be no thought of bartering or competition by the client in seeking professional service; and as to the practitioner, whose unrighteous desire and greed of gain inspire him to no higher purpose than to reach out in a competitive, merchandising spirit upon every occasion, that he may measure his office results, like oysters, by the bulk, it is charity to say that he has missed his calling. The interests involved are of a mutual rather than of an opposing nature; facts of the most vital nature have to be confided to the practitioner, who, for the nonce, appears as the confidant and business counsellor. He should do on behalf of the client, and in his stead, all things which he, if possessing sufficient knowledge and skill, might do himself.

Ethics, broadly construed, means principle, and not policy; etiquette as well as moral qualities; fraternity and a common spirit in association.

No one with any practical knowledge of affairs will argue that the mere passing of an examination is a proof of intellectual superiority, and still less that it is a guarantee of judicial temperament, common sense, logical faculty, and professional instincts.

Upon the well-understood rule that the whole is greater than

any of its units, so it is that a profession or society is justified and, in fact, expected by the laity to establish such rules as will set a standard for its members; therefore, it is the purpose to set down in aphorismatic form, so that they may be readily grasped and retained, some applied practical precepts and rules for the student and practitioner, which to the interested public conveys the dictum of this Association and its affiliated State Societies, that anything short of proper professional demeanor and due regard for the principles of this profession subjects its members to discipline.

SERVICE.

1. To certify to statements, exhibits, schedules or other form of accountancy work, the auditing or preparation of which was not carried on entirely under the supervision of himself, a member of his firm, or one of the staff, is wrong.

2. The use of a practitioner's name in professional work by others than partners or employees is wrong in that it implies deception.

3. To perform accountancy work payment for which is by arrangement upon the contingency of the result of litigation or other form of adjustment is unprofessional. 4. The payment of a commission, brokerage or other form of inducement to the laity from professional fees is wrong. 5. The acceptance of any part of the fees of a lawyer or any commercial brokerage, bonus or commission as an incident arising out of a practitioner's service is wrong. 6. Active interest in a commercial enterprise while practicing as a public accountant is to be avoided as incompatible with strict ethical principles.

7. The practitioner should, wherever possible, avoid acting as a trustee of special funds or pools as an incident of his calling.

8. A practitioner should avoid serving as a director in corporations in which he is professionally employed.

CLIENTS.

1. Upon engagement a practitioner is in duty bound to tell his client of all foreknowledge he may have had touching the matter under consideration.

2. Personal responsibility is a fundamental rule of the pro