Critics' use of satire against Critics' use

of satire
the auditing profession: a short
historical note
Roy A. Chandler 129
Cardiff Business School, Cardiff, UK
Keywords Accounting history, Auditing, Humour
Abstract At a time when the auditing profession faces mounting criticism in the wake of
corporate and professional scandals, it is not unusual to read caustic commentary in the press.
This is not a new phenomenon. The nineteenth century auditing profession had to face similar
criticism from the media, but practitioners then had to deal with a weapon more effective than
mere prose, satire. This short historical note captures some of the more amusing yet hard-hitting
attacks on the profession. We can only hope that this form of critical writing makes a come-back.

Introduction
The accounting profession today is under pressure. Criticism in public and
political circles has been scathing in the wake of various auditing ``failures''.
The accounting bodies and practitioners face the threat of increased
government intervention. There may even be a risk that the independent
accounting profession is doomed. However, these conditions are not new; a
similar environment existed at the end of the nineteenth century and yet the
profession, and its problems, have endured.
This is not a novel observation. Others have remarked on the longevity of
some of the issues facing the modern accounting profession (see, for example,
Humphrey et al., 1992; Sikka et al, 1992; Chandler and Edwards, 1996). In
particular these writers make the point that the so-called ``expectations gap'' is
by no means a new phenomenon. Public expectations, it would appear, have
always exceeded professional performance. The extent of the Victorian public's
disappointment with the nascent auditing profession can be gauged from
contemporary newspaper commentary during the 1880s and 1890s. In an era
identified by Brief (1975, p. 296) as the ``golden age'' of accountancy, numerous
critical items appeared in the general press.
The most severe criticism often appeared in the aftermath of corporate
scandals, fraud or collapse. In total, newspaper coverage on the subject of
auditing ran to many thousands of words. Hundreds of pages were devoted to
auditing issues in The Accountant, which valiantly attempted to rebuff the
assaults on the profession. On purely factual or technical matters The
Accountant's defence of the profession may have been adequate, but it could
produce nothing to match the more creative of the critics who turned to the use of
satire (particularly effective when in the form of verse) to attack the profession. Accounting Auditing &
In this short piece, I have reproduced a few items from the late nineteenth Accountability Journal,
Vol. 12 No. 1, 1999, pp. 129-133.
century, which may inspire contemporary writers to consider this form of # MCB University Press, 0951-3574
AAAJ writing. The items reproduced demonstrate how irony can be a pithy form of
12,1 attack, and one which is more likely to produce longer-lasting images than even
the most skilfully written prose.

Early examples of satire

Vanity Fair, a weekly journal, often targeted the accountancy profession for its
130 critical and sometimes humorous treatment, beginning in late 1883 with the
claim that audits were ``a delusion and a snare'', a description which became
popular with the profession's critics (see an item reproduced in The
Accountant, October 13, 1883 p. 6). The following ditty (reproduced in The
Accountant, November 3, 1883, p. 12) reflected concern that much of the audit
process was delegated to clerks rather than having been performed personally
by the accountant who signed the audit report:
Quod facit per alium facit per see
Is the rule of an Auditor ± as to the fee
But, when the accounts are not up to the mark,
Then it was not the Auditor ± only his clerk.

The inspiration for the first line is the legal maxim Qui facit per alium facit per
se, meaning ``he who acts through another is himself responsible'', i.e. one
cannot delegate responsibility, which of course is the opposite of the impression
given by the last line.
In another issue of Vanity Fair, the conduct of an audit was again the target
of some criticism (reproduced in The Accountant, 10 November, 1883, pp. 8-9):
The Audit of the Bundelcund Banking Company
Dedicated (without permission) to the Institute of Chartered Accountants
(To be set to a well-known and popular air)
I'm an articled clerk in Accountant-cy,
And I ``do the audit'' of the BBC,
For though I'm scarcely out of school, you see,
I know how to value a securi-ty

My duties are as simple as simple can be:

I go to the bank in Janua-ry
I say ``How d'ye do?'' to the Secreta-ry,
And then begin the audit of the BBC.

First I ``tick off'' the lists that are handed to me,

Then the ``certified accounts'' from a far coun-tree,
Though I know next to nothing about a ru-pee ±
That matters very little to the Guv'nor or me.

The ``printed accounts'' for the year eighty three

Being ``found with the books to duly agree,''
I bid farewell to the Secreta-ry,
And then hie me back through Lothbu-ry[1].

My Guv'nor, a man of seventy-and-three,

Whose office is not far from the Old Jew-ry[2],
 Has his hands so full in Janua-ry Critics' use
That he cannot give much time to the BBC.
of satire
He looks at the printed accounts just to see
That we have not omitted the ± Auditor's fee;
Then signing the print, he hands it to me,
And thus completes the audit of the BBC.

The Accountant (20 October, 1883, p. 6) attempted to educate its 131

contemporaries by pointing out some of the difficulties which auditors faced:
. auditors were not in continuous attendance but only periodically;
. the time allowed was insufficient for a proper audit;
. shareholders were impatient to complete the business at general
meetings;
. fees were often inadequate to permit a proper audit;
. the control of the company frequently lay with the board of directors.
Vanity Fair (reproduced in The Accountant, 10 November, 1883, p. 8) turned
these points back on the profession with the following irreverent version of an
auditor's report:
We having been allowed to audit not from month to month but only once a year; having had
too little time to make an exhaustive report, because the documents are required for the
printer; knowing that shareholders are generally impatient to get through the business: being
paid a fee out of all proportion to the work required to be done; and being aware that the
voting power is in the absolute control of the Board ± certify that, so far as we, under these
difficulties, can ascertain and dare disclose the facts, it is all right.

The collapse of a number of banks (and other companies) inspired the City
Press (2 January 1894) to include the following amusing skit intended to be
sung to the tune of Jolly Young Waterman by shareholders at banks' general
meetings:
Did you ever hear tell of our stupid old auditors,
Who into bank ledgers pretended to pry,
And made such a show of accountants' dexterity,
Winning each heart and deceiving each eye?
They looked so neat and they wrote so steadily,
We all of us voted them in so readily,
And they eyed all our clerks with so searching an air,
Oh, these auditors ne'er e'en in want of a chair!

But all this department deceived only shareholders;

Our clerks were too knowing in figures and books;
And Watts, Robson, Pullinger, Redpath, and Durden[3],
Have shown us the folly of trusting to looks.
They took out our money ± as much as they wanted, ±
(God bless them for not taking more than they did!)
And then by a system they call ``double entry'',
Oh, they balanced amounts and our losses they hid!
AAAJ In the meantime our drowsy self-satisfied auditors,
Who into bank ledgers pretended to pry,
12,1 Who'd made such a dazzling show of dexterity,
While pass books were tampered with under their eye,
Still looked as neat and wrote as steadily,
And signed their dear names to the ``balance'' as readily,
And eyed all the clerks with a confident air,
132 Oh, these auditors must be kicked out of the chair!
The Westminster Gazette, another quality London daily, highlighted the
limitations of auditing, through a mock auditor's report:
We have sent to the Company's offices two more or less qualified articled clerks, who are
learning their business at their own expense. They have counted the petty cash, checked the
castings and postings in the books, vouched the cash payments as far as they are able, and
passed the journal entries as far as they understand them. Subject to any errors which have
not been discovered, we hereby certify the books and accounts to be correct (quoted in The
Accountant's Magazine, April 1899, p. 217).
Whether those representing the English accounting profession at the time
appreciated either the wit or the truth of some of the criticisms is not known. It
is unlikely in the view of Stephen Fry, who has written on, and acted the role of,
Oscar Wilde, the greatest Victorian satirist:
The English, who to this day believe themselves quite mistakenly to be possessed of a higher
sense of humour than any other nation on earth, have never understood that a thing
expressed with wit is more, not less, likely to be true than a thing intoned gravely as a solemn
fact. We British, who pride ourselves on our superior sense of irony, have never fully grasped
the idea of fiction ± of ironism (Fry, 1997, p. xiii).
Perhaps Fry is being a little unkind in limiting his remarks to the British for the
professional accounting bodies in other countries have been equally
unappreciative of satirical attacks on their accepted auditing practices.

A more recent example from the USA

McGladrey (1951, pp. 197-8), a practitioner, was to use the same device in
calling for improvements in audit reporting. He referred to the public's dislike
of ``weaseling'' and quoted ``a bit of doggerel'' which he had first heard 20 years
earlier:
The Accountant's Report
We have audited the balance sheet and here is our report:
The cash is overstated, the cashier being short;
The customers' receivables are very much past due,
If there are any good ones they are very, very few;
The inventories are out of date and practically junk,
And the method of their pricing is very largely bunk;
According to our figures the enterprise is wrecked...
But subject to these comments, the balance sheet's correct

Critics of the auditing profession have long regarded the ``subject to''
qualification of the audit opinion as an unwarranted attempt to restrict the
auditors' liability, and the most effective way of illustrating its weakness was
through satire. Despite such concerns, it is worth remembering that the Critics' use
``subject to'' qualification enjoyed a long life and widespread popularity among of satire
practitioners. The ``subject to'' opinion continued in use until 1988 in the USA
and 1993 in the UK.

Conclusion
There is little doubt that many of the criticisms of auditing practice, first voiced 133
before the end of the nineteenth century, remain current today. Victorian
satirists effectively reduced pages of vitriol into a few entertaining paragraphs
or verses. The enduring appeal of the examples given above may inspire
contemporary critics and academic literature can only be the better for it!
Notes
1. City of London streets where a number of accounting firms including Deloitte, Dever
Griffiths, Saffery & Sons, Harding, Whinney & Co, and Cape & Dalgleish, had offices.
2. City of London streets where a number of accounting firms including Deloitte, Dever
Griffiths, Saffery & Sons, Harding, Whinney & Co, and Cape & Dalgleish, had offices.
3. Details of the frauds committed by these and others can be found in Robb (1992).

References
Brief, P. (1975), ``The accountant's responsibility in historical perspective'', The Accounting
Review, Vol. L No. 2, pp. 285-97.
Chandler, R.A. and Edwards, J.R. (1996), ``Recurring issues in auditing: back to the future?'',
Accounting, Auditing & Accountability Journal, Vol. 9, pp. 4-29.
Fry, S. (1997), ``Playing Oscar'' in Oscar Wilde: Nothing . . . Except My Genius, Penguin Books,
London, pp. vii-xxv.
Humphrey, C., Moizer, P. and Turley, S. (1992), ``The audit expectations gap ± plus cËa change,
plus c'est la meÃme chose?'', Critical Perspectives on Accounting, Vol. 3, pp. 137-61.
McGladrey, I.B. (1951), ``The audit report'', The Accounting Review, Vol. 26 No. 2, pp. 197-208.
Robb, G. (1992), White-collar Crime in Modern England: Financial Fraud and Business Morality,
1845-1929, Cambridge University Press, Cambridge.
Sikka, P., Puxty, T., Willmott, H. and Cooper, C. (1992), ``Eliminating the expectations gap?'',
Certified Research Report No. 28, Chartered Association of Certified Accountants, London.