ractice than this old law which now prevails in the District of Columbia.

Basically, my bill would seek to change the present law with espect to the residence requirements, educational requirements, and xperience requirements for admission to practice certified public ccounting. It would require periodic registration of certified public ccountants which the present law does not require.

This bill, H.R. 7624, as it was introduced, would be effective nmediately. It has been suggested, as a technical amendment, that might be wiser to have an effective date 60 days after enactment. The bill also provides a 1-year transition period with respect to ducation and experience requirements, so that those who had been bout to apply for certification and qualify for practice would not be aught unaware. They would have a year. Pending applications ould be processed under the existing law.

I might say just one other thing, Mr. Chairman. There is nothing n this bill which interferes in any way with the practice of accounting n the District of Columbia. The only thing it seeks to do is to deal with those who would hold themselves out to the public as certified ublic accountants, but anyone may practice accounting undisturbed by any provision of this law. It is only if they hold themselves out as ertified public accountants that they are affected.

Who certifies?

Mr. ABERNETHY. What is meant by "certified"? Mr. FRASER. Mr. Chairman, that is what this law involves, certification; that is, by law a procedure is established whereby certain minimum requirements are established to be able to attain that lesignation. There is a board provided for in the law. There is one oday. They set up further regulations and rules, but basically this aw sets the standards, just as laws generally set standards for dmission to the bar in the practice of law.

What we are dealing with is the substantive provisions which entitle omeone to acquire that status of a certified public accountant under he laws of the District of Columbia.

Mr. ABERNETHY. There are places where there is no regulation of he practice at all and they still refer to themselves as certified public ccountants?

Mr. FRASER. That is a particular designation. The general pracice of accounting is one thing. It is another thing to hold yourself ut as a certified public accountant. To do that you must meet tandards prescribed under the present law or the new standards in his bill.

This is my understanding, Mr. Chairman.

Mr. ABERNETHY. I think you are right. I wanted to clear the

ecord.

Mr. FRASER. I am sure the witnesses will straighten out any nisstatements I might have made.

I will introduce the witnesses briefly. First let me say there will e four certified public accountants testifying, all of whom have een presidents of the District of Columbia Institute of Certified Public Accountants. The first one, Mr. Robert Bernstein, is the urrent president; Mr. Benjamin Regardie is past president; William Barnes is past president; Millard Charlton is past president. They will testify in that order.

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performing specific accounting engagements in the District of Columbia on p fessional business incident to regular practice outside the District of Columb Provided, That such temporary practice is conducted in conformity with the ru of professional conduct promulgated by the Commissioners.

SEC. 17. Any person who violates any provision of section 3 of this Act shall guilty of a misdemeanor and upon conviction thereof shall be subject to a fine not more than $500 or to imprisonment for not more than one year, or both su fine and imprisonment. Whenever the Commissioners have reason to believe th any person is liable to punishment under this section, it may refer the facts to 1 Corporation Counsel of the District of Columbia, who may cause the proper p ceedings to be brought, if, in his judgment, such is warranted.

SEC. 18. The use, display, or uttering by a person of a letterhead, listing, ca sign, advertisement, directory classification, or other printed, engraved, or writi instrument or device, bearing a person's name in conjunction with the wo "certified public accountant" or "certified pplic accountants" or any abbreviati thereof, shall be prima facie evidence in any action brought under section 17 of t Act that the person whose name is so displayed caused or procured the display uttering of such letterhead, listing, card, sign, advertisement, directory, clas fication, or other printed, engraved, or written instrument or device, and that su person is holding himself out to be a certified public accountant or partnership certified public accountants.

SEC. 19. All statements, records, schedules, working papers, and memorandu made by a certified public accountant or by a partnership of certified pul accountants incident to or in the course of professional service to clents, exc reports submitted to clients, shall be and remain the property of such certif public accountant or partnership in the absence of an expressed agreem between such persons and the client to the contrary. No such statement, reco schedule, working paper, or memorandums shall be sold, transferred, or queathed, without the consent of the client or his personal representative assignee, to anyone other than one or more surviving partners or new partners such persons.

SEC. 20. If any provision of this Act or the application thereof to any person to any circumstances is held invalid, such invalidity shall not affect other pro sions or applications of this Act which can be given effect without the inva provision or application, and to this end the provisions of this Act are declared be severable.

SEC. 21. The Commissioners are authorized and empowered, after pul hearing, to establish, abolish, increase, or decrease, from time to time, fees a charges necessary to defray the approximate cost of administering the provisi of this Act. All funds derived from fees and charges collected relevant to administration of this Act shall be paid into the Treasury of the United States the credit of the District of Columbia.

SEC. 22. There is hereby authorized to be appropriated out of revenues of District of Columbia such funds as may be necessary to pay the expenses administering and carrying out the purpose of this Act.

SEC. 23. The Act entitled "An Act to create a board of accountancy for District of Columbia, and for other purposes", approved February 17, 1923 Stat. 1261), as amended, is hereby repealed. This Act shall take effect up enactment.

Mr. ABERNETHY. We have Mr. Fraser with us.

Mr. Fraser, we would be pleased to have the benefit of your view STATEMENT OF HON. DONALD M. FRASER, REPRESENTATI IN CONGRESS FROM THE STATE OF MINNESOTA

Mr. FRASER. Thank you very much, Mr. Chairman. I would li to make a brief statement and introduce those who will testify as primary supporters.

Let me say first of all, Mr. Chairman, that this bill would seek replace a present law which deals with the practice and admission practice of certified public accountants, a law which is now quite o It was passed in 1923. Virtually every State in the Union has h laws which are more modern and more in accordance with the curre

practice than this old law which now prevails in the District of Columbia.

Basically, my bill would seek to change the present law with respect to the residence requirements, educational requirements, and experience requirements for admission to practice certified public accounting. It would require periodic registration of certified public accountants which the present law does not require.

This bill, H.R. 7624, as it was introduced, would be effective immediately. It has been suggested, as a technical amendment, that it might be wiser to have an effective date 60 days after enactment.

The bill also provides a 1-year transition period with respect to education and experience requirements, so that those who had been about to apply for certification and qualify for practice would not be caught unaware. They would have a year. Pending applications could be processed under the existing law.

I might say just one other thing, Mr. Chairman. There is nothing in this bill which interferes in any way with the practice of accounting in the District of Columbia. The only thing it seeks to do is to deal with those who would hold themselves out to the public as certified public accountants, but anyone may practice accounting undisturbed by any provision of this law. It is only if they hold themselves out as certified public accountants that they are affected.

Mr. ABERNETHY. What is meant by "certified"? Who certifies? Mr. FRASER. Mr. Chairman, that is what this law involves, certification; that is, by law a procedure is established whereby certain minimum requirements are established to be able to attain that designation. There is a board provided for in the law. There is one today. They set up further regulations and rules, but basically this law sets the standards, just as laws generally set standards for admission to the bar in the practice of law.

What we are dealing with is the substantive provisions which entitle someone to acquire that status of a certified public accountant under the laws of the District of Columbia.

Mr. ABERNETHY. There are places where there is no regulation of the practice at all and they still refer to themselves as certified public accountants?

Mr. FRASER. That is a particular designation. The general practice of accounting is one thing. It is another thing to hold yourself out as a certified public accountant. To do that you must meet standards prescribed under the present law or the new standards in this bill.

This is my understanding, Mr. Chairman.

Mr. ABERNETHY. I think you are right. I wanted to clear the record.

Mr. FRASER. I am sure the witnesses will straighten out any misstatements I might have made.

I will introduce the witnesses briefly. First let me say there will be four certified public accountants testifying, all of whom have been presidents of the District of Columbia Institute of Certified Public Accountants. The first one, Mr. Robert Bernstein, is the current president; Mr. Benjamin Regardie is past president; William Barnes is past president; Millard Charlton is past president. They will testify in that order.

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Finally, we have Mr. Philip Glick, attorney at law, and cour for the District of Columbia Institute of Certified Public Accounta Mr. Chairman, I think this bill is well drafted. I am not fami in detail with its contents but I have had conversations over a per of months regarding this. There has been many years of work preparing this.

Because of the nature of the District of Columbia there are ot interests and offices here and they will have a point of view to expr This is an important matter and I surely appreciate the opportu to have this bill heard.

Thank you.

Mr. ABERNETHY. We are happy to have you here.
Mr. Sickles?

Mr. SICKLES. I have no questions.

Mr. ABERNETHY. At this point I would like to insert in the rec a statement from Congressman Mathias, who could not be here. morning.

(Congressman Mathias' statement referred to follows:)

STATEMENT BY HON. CHARLES MCC. MATHIAS, Jr., A REP SENTATIVE IN CONGRESS FROM THE STATE OF MARYLAND

Mr. Chairman, I appreciate very much the opportunity to tes this morning in support of my bill, H.R. 9815, and H.R. 7624, in duced by Representative Donald M. Fraser, of Minnesota.

These bills provide for the regulation of the professional practic certified public accountants in the District of Columbia.. By rep ing and replacing present law, which is now 42 years old, they wo bring the procedures and standards for regulating CPA's into with the present practices of the majority of States, and would rem many problems caused by anachronisms and omissions in the pre law.

These bills have been developed by members of the Board of countancy and members of the District of Columbia Institute Certified Public Accountants after more than 8 years of study, are supported by a large majority of the CPA's in the Dist Since the expert witnesses here today will discuss the provision the bills in detail, I would like simply to review the most import features of the legislation.

First, the bills would establish modern standards of education experience for CPA's. At present, despite the great complexitie finance and accounting in this decade, it is theoretically possible an individual without a high school diploma to gain certification the District of Columbia. These low standards may permit o sional abuse, and certainly hinder reciprocity with many Sta The pending bills would raise certification standards to levels w are both realistic and reasonable, while maintaining flexibility offering three combinations of education and experience tota approximately 6 years of work in the field of accounting.

Second, in revising the requirements for experience, the bills, appropriate recognition to service in Federal agencies, by provid that 11⁄2 years of employment as an accountant in Federal ser shall be considered equivalent to 1 year of experience in the offic a CPA. In the District of Columbia, where so many accounts

are engaged in Government work, such a provision is both necessary and fair, and I am glad that it is included in this legislation.

Third, the bills provide for biennial registration of CPA's. At present, no such registration is required, and there is no way to know how many CPA's are practicing here right now. By establishing simple registration procedures, the bills would help both the profession and the public.

Finally, the bills provide for a 1-year transitional period between the time of its enactment and its effective date, in order to lessen any possible hardships.

In summary, I believe that this legislation is sound, practical, and long overdue. The professional services provided by certified public accountants have become increasingly varied and extremely important, and I am convinced that we should take steps to insure that CPA's practicing in the District of Columbia will meet professional standards, and be regulated through procedures which are comparable to those already in force in most of the States.

Mr. ABERNETHY. Mr. Bernstein, and the other four gentlemen may come to the table.

DISTRICT OF COLUMBIA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS, REPRESENTED BY ROBERT BERNSTEIN, PRESIDENT; BENJAMIN F. REGARDIE, PAST PRESIDENT, MEMBER LEGISLATIVE COMMITTEE; WILLIAM T. BARNES, PAST PRESIDENT, MEMBER LEGISLATIVE COMMITTEE; MILLARD T. CHARLTON, PAST PRESIDENT, MEMBER LEGISLATIVE COMMITTEE; AND PHILIP M. GLICK, COUNSEL

Mr. BERNSTEIN. If agreeable to you, sir, we would like to speak individually. Each of us has a particular

Mr. ABERNETHY. You have prepared statements?

Mr. BERNSTEIN. Yes, sir.

Mr. ABERNETHY. Do you have copies of them?
Mr. BERNSTEIN. Yes, sir.

Mr. ABERNETHY. Very well.

STATEMENT OF MR. ROBERT BERNSTEIN

Mr. BERNSTEIN. Mr. Chairman and members of the committee, my name is Robert Bernstein. I have been a certified public accountant of the District of Columbia since 1952, and I am a senior partner of Oscar J. Bernstein & Co. with offices at 1832 M Street NW., Washington, D.C. I am president of the District of Columbia Institute of Certified Public Accountants and was formerly chairman of the legislative committee of that organization.

I am the first of four witnesses appearing on behalf of the District of Columbia Institute of Certified Public Accountants. I shall discuss three phases of the matter under consideration: (1) the legislative position; (2) why CPA standards are important to the public; and 3) the trend in recent legislation in the 50 States.

1. The legislative position: The District of Columbia Institute of Certified Public Accountants supports the enactment into law by the Congress of the companion bills-H. R. 7624 and H.R. 9815-intro