Although the SEC governs publicly traded companies, the American Institute of Certified Public Accountants (AICPA) has the responsibility for making sure privately traded companies toe the line.
Through the AICPA’s senior technical committee, the Auditing Standards Board (ASB), the organization is responsible for establishing auditing and attestation standards for nonpublic companies in the United States. The purpose of a financial statement audit is to gather enough evidence about a company’s documents to be able to issue an opinion on whether the financial statements are free of material misstatements.
The ASB has 19 members, most of whom either work for public accounting firms such as KPMG LLP or are university professors, governmental accountants, or other workers in the field of accounting. Members serve one- to three-year terms and are jointly nominated by the director of the AICPA Audit and Attest Standards Staff and the ASB chair. The responsibilities of approving the nominations fall to the AICPA Board of Directors.
A financial accountant provides an attestation service when issuing a report on a subject that is the responsibility of another person or business. For example, a company can hire you to calculate net accounts receivable, which is what customers owe the company, minus an allowance for uncollectible accounts, making sure your figures match the company’s amount showing on the balance sheet.
The AICPA also has a Code of Professional Conduct by which its members must abide.