“Free, fair and full reports of industrial organizations,” the January 12, 1901, issue of Commerce, Accounts & Finance said, “ should be founded upon thorough, independent audits of accounts by disinterested certified public accountants, whose signed certificates, to be published with the report, are a more nearly perfect guarantee of reliability than any other yet to be discovered.” By then, income tax provided 58 percent of federal revenues, and the experts who handled income taxes found their skills in great demand. Under his direction, the column advised accountants of the requirements of income tax, preparing the profession for the impact of World War I, when federal spending rose from $742 million in 1916 to $18.9 billion in 1919. 'Hundreds of men who have never seen the necessity for a correct system of accounting,' the Journal continued, 'now find themselves compelled to prepare statements of income and expenditure and the work in nine cases out of ten will fall upon the shoulders of the public accountants of the several states.' The Journal was so convinced of the demands of the new legislation that it added a tax column-and asked Niven to be the editor. But, as the Journal of Accountancy noted that year, it was 'indubitable that the income tax law is to have a more far-reaching effect upon public accountants than upon any other profession or business in the country. Compared with modern levels, the 1913 rate of 1 percent on taxable incomes over $3,000, rising to 7 percent on taxable incomes over $500,000, may seem low. That same year, the 16th Amendment to the Constitution allowed income tax to be levied on Americans for the first time. In 1913, Niven opened the organization's first branch offices in Minneapolis and Chicago. But a new area of accounting was soon to generate enormous demand for accounting professionals-the era of the income tax. At the time, fewer than 500 CPAs practiced in the United States.

John Ballantine Niven established the offices of Touche Niven alongside Haskins & Sells in the Johnston Building at 30 Broad Street in 1900 in New York. Two years later, he followed the flow of British capital to the United States, establishing the first US office of Touche, Niven & Company. Touche, a Scotsman, established a London-based accounting company in 1898 to help meet that demand. The boom in joint stock companies created demand for people skilled at understanding and solving complex business problems. This recommendation was gradually implemented in England, but 84 years passed before the United States adopted the practice. The experience was so valuable that GWR directors recommended compulsory independent oversight. The Great Western Railway (GWR) was one of the most famous of these early 'joint stock companies.' When its stock price slumped in 1849, GWR turned to an independent public accountant, William Welch Deloitte, to audit the company. In England, the Industrial Revolution spawned a new type of enterprise that raised capital by selling equity to the public. In time, Haskins & Sells opened successful offices in Chicago and London and helped lead a young profession to maturity.ĭeloitte, Touche and the development of modern accounting On March 4, 1895, the two opened offices in New York City offering accounting services to the public. Altogether, their recommendations saved the government $600,000 a year while improving work quality. Department by department, they found ways to simplify work and increase efficiency. During the next two years, Sells and Haskins transformed how the US government did business. Dockery (R-MO) appointed two accountants to investigate: Charles Haskins and Elijah Watt Sells. In 1893, with the United States in an economic decline, government inefficiency became a target of public concern. Haskins, Sells and the Dockery Commission

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