Реферат: Accounting Ethics Essay Research Paper Accounting Ethics

study made of CPA firms in Britain in 1985 asserted “the most dramatic

contrast between advertisers and non-advertisers was their size.”

(O’Donohoe p.122) The obvious reason for this anomaly is availability of

resources. Larger firms ha ve, at their disposal, a much larger profit

level; therefore advertising expense is easily included only marginally

affecting bottom line. This implies larger firms to have gained a great

deal more from inclusion of advertising than small firms. Consequ ently,

small firms could be pushed out of the picture entirely in the area of

audit services.

Why? In the area of audit services, small firms have little to

offer to differentiate themselves from their larger counterparts who can

now freely move in and perform the service at a lower price. This,

unfortunately, will be a byproduct of the adverti sing era. Smaller firms

only hope is to emphasize “personalized service” in tax and full service

areas in hope that audit services can result. The major drawback is small

firms are offered little room for growth because of the expense involved.

Adverti sing in public accounting causes perspective clients to become

bottom line oriented meaning the firms with the most available revenue to

dump into advertising, coupled with the resources to offer lowest fees are

the ones which grow. These resources are h eld by Big Six firms and large

regional firms. As a result these firms will grow while small firms

struggle.

The second inference drawn from the model of perfect competition

is some smaller firms being forced to specialize. In order to

differentiate themselves some smaller regionally operated firms have

chosen to specialize. In the March 1990 issue of the CPA

Journal Arvid Mostad, CPA published an article in which he set up “Seven

Marketing Guidelines.” His first guideline was “Create your own special

niche.” (Mostad p.54) He goes on to encourage small firms to establish an