University of Mississippi eGrove Electronic Theses and Dissertations Graduate School 2010 The Accounting Profession Goes to War: Accounting Contributions to World War II Mark Ernest Jobe Follow this and additional works at: https://egrove.olemiss.edu/etd Part of the Accounting Commons Recommended Citation Jobe, Mark Ernest, "The Accounting Profession Goes to War: Accounting Contributions to World War II" (2010). Electronic Theses and Dissertations. 151. https://egrove.olemiss.edu/etd/151 This Dissertation is brought to you for free and open access by the Graduate School at eGrove. It has been accepted for inclusion in Electronic Theses and Dissertations by an authorized administrator of eGrove. For more information, please contact [email protected]. To the Graduate Council: I am submitting herewith a dissertation written by Mark Jobe entitled “The Accounting Profession Goes to War: Accounting Contributions to World War II.” I have examined the final copy of this dissertation for form and content and recommend that it be accepted in partial fulfillment of the requirements for the degree of Doctor of Philosophy, with a major in Accountancy. ______________________________ Dr. Dale L. Flesher (Chair) Associate Dean and Professor of Accountancy E. H. Patterson School of Accountancy We have read this dissertation and recommend its acceptance: _____________________________________ Dr. Royce Kurtz Reference Bibliographer and Associate Professor J. D. Williams Library _____________________________________ Dr. Judith Cassidy Associate Professor of Accountancy E. H. Patterson School of Accountancy _____________________________________ Dr. J. Riley Shaw Associate Professor of Accountancy E. H. Patterson School of Accountancy Accepted for the Council: ____________________________ Dean of the Graduate School The Accounting Profession Goes to War: Accounting Contributions to World War II A Dissertation Presented in Partial Fulfillment of the Requirements For the Degree of Doctor of Philosophy In the School of Accountancy The University of Mississippi Mark Ernest Jobe December 3, 2010 Copyright © 2010 by Mark Jobe All rights reserved ii ABSTRACT The World War II era ushered in a period of dynamic upheaval in American society. To safely navigate the stormy seas of commerce and governance, men of integrity, ability, and leadership were essential. Time and again, the nation turned to accountants to chart the proper course. And the accounting profession responded to the war and all its concomitant demands in a most splendid fashion. While the accounting profession was actively engaged in promoting the war effort, the war was exerting its own influences by shaping the duties, demands, and prestige of the accounting profession. The profession responded to the war by yielding its young men to the armed services, while older, seasoned accountants served in a host of critical capacities within the War Department, war industries, and governmental agencies. Whether in uniformed service or in civilian advisory capacities accountants advanced the nation’s war aims, and augmented the rising tide of the profession’s prestige. In addition to the efforts of individual accountants, the accounting societies through their leadership, committees, and publications went to great lengths to facilitate the smooth running of the nations’ war-time economy. The leaders, through both word and deed, allayed fears, provided direction and inspiration, and constantly prodded accountants to greater service. Societal committees provided timely information and advice to governmental agencies, to congressional committees, and to accountants plagued by a host of new accounting complexities brought on by the war. Finally, through their publications, the accounting societies informed, guided, and honored accountants in their service to the nation. iii The war led to many changes in the accounting profession. Those in public practice were forced to reevaluate long-held notions of who could be an accountant, and of how auditing work should be preformed. Through the G.I. Bill, the accounting profession received a flood of new talent in the postwar years. The war also enlarged avenues of opportunity for the profession in tax, consulting, auditing, and governmental fields in which accountants demonstrated their talent, dexterity, and wisdom in support of their nation. Their success in these areas significantly expanded the accounting profession’s influence and prestige in America. iv TABLE OF CONTENTS LIST OF ABBREVIATIONS xi LIST OF APPENDICES xii CHAPTER I. INTRODUCTION 1 Purpose of the Study 7 Need for Historical Research 8 Contributions 11 Methodology 14 Scope and Limitations 18 Organization of the Dissertation 19 II. HISTORICAL BACKGROUND 21 State of the Accounting Profession 22 National Organization 22 Initial CPA Legislation 24 State Organizations 26 Education 28 Rival Organizations 31 Reorganization 34 A House Divided 35 Reunification 36 Other Organizations 40 v The Great War (World War I) 41 AIA and the War to End All Wars 44 Members 45 Meetings 47 Committees 50 Publications 53 Rising International Tension 55 America’s Build-up to War 58 Neutrality Acts 59 War Years & Escalation of Effort 62 III. SERVICES BY ACCOUNTANTS IN UNIFORM 68 Accountants at Headquarters 72 Major General Arthur Hazelton Carter 72 Rear Admiral Norman Loyall McLaren 89 Accountants in Harm’s Way 107 Ensign Walter S. Savage 107 Lieutenant Colonel Howard Hinman 107 Captain Charles Beasley 110 Colonel Andrew Barr 114 Lieutenant Myron Moore, Jr. 126 Staff Sergeant Winson Jones 131 Quarter Master 1 st Class Robert F. Painter 140 Commander Charles F. Printz 144 vi Private 1 st Class Robert L. Lipson 149 Captain Arthur Greenspan 155 Conclusion 162 Table 1: Summary of Uniformed Service 163 IV. SERVICES BY ADVISORS ON THE HOME-FRONT 164 Committee on National Defense 164 George Percival Auld 164 C. Oliver Wellington 170 Office of Production Management 173 War Production Board 174 Office of Price Administration 176 Herbert F. Taggart 179 Maurice E. Peloubet 182 Hall of Fame 187 Carman G. Blough 187 Eric L. Kohler 190 Paul Franklin Grady 192 Other Leading Accountants 199 Saul Levy 199 Ernest Seatree 200 James Hall 201 Conclusion 202 Table 2: Summary of Advisory Service 203 vii V. SERVICES TO DEFENSE CONTRACTORS 203 Aviation 206 Magnesium 208 Renegotiation 214 One War Won 218 VI. THE SOCIETIES AT WAR 221 Professional Unity 221 Leadership 224 Committees 241 AIA Committees 243 NYSSCPA Committees 251 Publications 262 The Journal of Accountancy 264 The New York Certified Public Accountant 285 The NACA Year Book 298 The Woman C.P.A. 306 The Texas Accountant 308 Advertising for War 315 Authors 323 VII. THE PROFESSION RESPONDS TO WAR-TIME TAXATION 332 Introduction 332 War-Time Tax Legislation 333 The Revenue Act of 1941 334 viii The Revenue Act of 1942 335 The Revenue and the Current Tax Payment Acts of 1943 336 The Individual Income Tax Act of 1944 338 A Sea of Complexity 339 The Profession Responds 343 Filing Extensions 343 Legislative Recommendations 345 Education 348 Tax Simplification 350 Jerry Lane 356 Conclusions 360 VIII. THE IMPACT OF WWII ON POSTWAR ACCOUNTANCY 362 Introduction 362 Staff Shortages 363 Dire Straits 368 Replacement Personnel 370 Redistribution Efforts 378 Natural Business Year 378 Interim Audit Work 385 Extensions 388 Management Consulting 392 Governmental Demand 395 T. Coleman Andrews 397 ix Educational Front 402 G.I. Bill 403 Continuing Education 405 Prestige and Influence 408 IX. SUMMARY AND CONCLUSIONS 411 Introduction-The End of War 411 Summary of Service 412 Postwar Impact 417 Purpose of the Study 420 Conclusions 423 Future Research 425 BIBLIOGRAPHY 427 BIOGRAPHY 509 x LIST OF ABBREVIATIONS AAA American Accounting Association AAF Army Air Forces AAPA American Association of Public Accountants AGF Army Ground Forces AIA American Institute of Accountants ASF Army Service Forces ASCPA American Society of Certified Public Accountants ASWA American Society of Women Accountants AWSCPA American Woman’s Society of Certified Public Accountants CAP Committee on Accounting Procedure CPA Certified Public Accountant NACA National Association of Cost Accountants NACPA National Association of Certified Public Accountants NYSSCPA New York State Society of CPAs OCS Officer Candidate School OPA Office of Price Administration OPM Office of Production Management SEC Securities and Exchange Commission TSCPA Texas Society of Certified Public Accountants WPB War Production Board xi LIST OF APPENDICES APPENDIX A MEMBERS OF THE ACCOUNTING HALL OF FAME 458 APPENDIX B Sample Freedom of Information Act Request 462 APPENDIX C AIA Special Committee on National Defense 463 APPENDIX D Members of the AIA engaged in Defense Activities 464 APPENDIX E THE CHANGING OF THE GUARD 494 APPENDIX F Honor Roll of TSCPA Members on Active Duty (May 1942 - January 1943) 495 APPENDIX G Members of the TSCPA in Military Service 497 APPENDIX H NYSSCPA: Members in Government Service 500 APPENDIX I Accountants in Uniform: A Compilation of Service from the State Societies 502 APPENDIX J Interview Questions 506 xii CHAPTER I INTRODUCTION America has suffered through a depression, audit failures, and an unprovoked attack, which propelled the country into war. The auditing profession has been weighed in the balance and found lacking. New rules for audit practice are now in place. The United States is committed to a war with no clear ending in sight. Its soldiers are in distant lands fighting against fanatical opposition. Although the preceding