Corporate Accounting Firms Became A Tremendous Profit Generator

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From the 1960s to 1970s, large public accounting firms expanded to become consulting services rather than traditional audit and tax services. The consulting field grew so rapidly that it became a tremendous profit generator. New hires in these consulting services usually did not have backgrounds or degrees in accounting. Firms were not requiring new hires to take six weeks of intensive accounting courses and being a CPA was no longer a preference, which was very different than it used to be. The consequences of these changes resulted in people performing consulting services that had little or no understanding of accounting professionalism or ethical codes of conduct. Because of the economic boom that took place in 1980s and 1990s, consulting services became very large profit generators that benefited companies in great profit margins. These consultants helped companies make a lot of money, and gain more partners from the consulting field. Public accounting firms became greatly interested in increasing their revenue by providing consulting services for their clients. In the 1980s, auditing became a “commodity service” inside public accounting firms. The emphasis on hiring switched from hiring experienced, accounting professionals with extensive accounting backgrounds, to hiring those with a different “skillset” that could bring great revenues to the company. What happened was that the large public accounting firms provided both consulting services and auditing services
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