Wily Types – Column Marc Schweppe

“An accountant used to be somebody who checked people for possible involvement in financial malpractices. Nowadays, accountants are mostly wily people who devise tricks in an obscurely illuminated twilight zone. On the edge of the cliff bloom the most beautiful flowers.”

A quote by Youp van ‘t Hek in his column on the last page of the Saturday edition of the NRC Handelsblad, early September 2017. Regarding this picture: the role of the accountant as confidential agent of social traffic, as independent controller, as the person who provides assurance with (financial) data, is far from reality in Youp’s opinion. Is the comedian alone in his view? Unfortunately not. In the same week that this opinion was published, several members of the Dutch House of Representatives railed against the Minister of Finance about accountants. “When I think of accountants, I think of scandals”, stated Renske Leijten, MP for the Socialistic Party. As an example, she enumerated a series of fraud scandals which involved accountants. Pieter Couwenbergh, columnist for the Financieel Dagblad, described failing audits as “rituals associated with daily life.”

In most cases, accountants perform excellent, their clients are satisfied, they deliver demonstrable added value for companies and add certainty to financial information. And that year after year. They are appreciated for their expert judgment, their independent view and their knowledge of figures and organizations. But one case of fraud mentioned in the Financial Times or the Guardian, with an accountant of the Big Four who did not do enough to prevent it, and the goose is cooked. Then, accountants are ‘wily types’.

And we can’t but confess honestly that too much went wrong in recent years. If too many incidents occur, we may speak of a structural problem. Interests were too big, bills were too high and clients were suddenly named ‘blue chip clients’. Auditing firms became service providers and provided non-stop shopping. The accountant was more and more seen as a flexible account manager, who had to guide his advising colleagues inside. Sometimes, audits were deliberately sold with a loss. The consultancy revenues would compensate for this loss. ‘Applause for the audit team that brought the prestigious assignment in this way!’ Yes, eventually this will go wrong. The basis for the problems that the profession still has to deal with, originates in the two decades before the Enron Scandal in 2001. Which does not mean that everything went well after that.

Audit firms are currently working hard to improve the audit quality. The measures from the sector improvement plan (the report ‘In the public interest’ from the Institute of Chartered Accountants) are neatly implemented. But according to the latest analysis, the core of the problem is deeper: lack of knowledge of the rules and regulations, too tight deadlines, partners who are not sufficiently involved, unbalanced teams, lack of a professional-critical attitude. Unruly problems, which require a real change of culture. That is a lot harder than installing a decent board of directors or taking an oath. But this has to be; change has to come from within.

“You can’t present junk as a gem, even if you present it bright.”

It’s due to communication, claim some accountants, if they feel that society does not understand them. But communication cannot justify things that are crooked. You can’t present junk as a gem, even if you present it bright. Doing your job well, that works.

The good news is that the youngest professionals has been raised with these issues from day one. That they grow in a profession which changes its focus from commerce to quality. So now, accountants sometimes make the headlines because they refuse to sign for a client. ‘No, I do not sign, because it is not alright.’ One can hope that we will read similar stories in the future. Trust can be earned back with proven quality. Then, that reputation will eventually be okay. Be good and tell it – in that order.