The 16th Amendment and the Founding of State CPA Societies

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  In Poster Session: Table 2

Abstract

Throughout this past decade, a number of CPA state societies have been announcing their “Celebratory Century Mark,” as they were founded 100 years ago. This paper looks historically at some of the factors that would cause such an acceleration in the need for accounting societies to come into existence across the United States (US), particularly after the 1913 passage of the 16th amendment.
This paper acknowledges that many states already had a CPA society before 1913. In addition, other new federal laws, such as the implementation of a nationwide corporate tax in 1909, the Federal Reserve System in 1913 and Clayton Antitrust Act in 1914, created additional need for accountants.
With that in mind, the new Federal tax laws (including the 1909 Corporate Tax Act and the 16th amendment) do seems to create a need in all states for accounting societies. Whereas pre-1913 most state societies were founded either in coastal states or states with waterways or large industries, immediately post-1913 foundings of societies were in many smaller states in the interior of the US. There was also a great deal of uncertainty and confusion about accounting measurement in general in the years before and after 1913. This uncertainty certainly would have led to a need for accountants to have avenues for debate and discussion on ambiguous areas. Some of these areas of ambiguity are highlighted.

Author

• Robert J Walsh, University of Dallas