CPA stands for Certified Public Accountant. These are the professionals that certify financial statements and documents that we all depend on for financial decisions. They are critical to the transparency and disclosures of all public traded documents including interim reports 10Ks, 10Qs, and annual reports.
Every person who invests in or investigates a Fortune 1000 or public traded company, for example, relies on a CPA’s signature (s) to warrant that what’s being reported and stated is truthful. CPAs perform what are called audits on public companies, which are overseen and managed by mostly large accountancy firms such as PWC (PricewaterhouseCoopers) KPMG, Deloitte, and Ernst and Young. There are literally hundreds of smaller firms that employ CPAs to audit smaller companies.
To obtain a CPA license, individuals must complete all the requirements from a board of accountancy. The American Institute of Certified Public Accountants has over 420,000 members in 143 countries. It prides itself on promoting the highest professional standards, ethics and the latest knowledge for its members.
LIES BY OMMISSION
Every financial document put out by public traded companies is lying or at best misleading; and CPAs and their audit firms certify the information as being accurate and true. It’s what’s known in legal terms as lies of omission—leaving out essential information that covers up the truth—and costs.
THE BURIED TRUTH:
- All companies have environmental impacts. They exploit, interact, or depend upon the environment—earth or oceans— in some way that’s calculable. The price of mining ore, extracting oil and gas, harvesting food, or growing cotton for clothes, for example, is stated in financial terms. We can read a financial record, a 10K, or 10Q or annual report and get a clear picture of calculated costs; and the difference between calculated costs of goods/items and sales is stated as gross profit. The greater the gross profit, the better for the company’s valuation, or stock price.
- The real cost of the environmental impact, however, is buried, missing from financials, and avoided by CPAs, hence the lies by omission.
- Economists refer to negative environmental impacts and their costs as ‘negative externalities’; the real damage and costs caused by extracting oil and gas, mining, growing food, or cotton for apparel, for example, is not recorded in the price, or the profit and loss statement. The real price—cost to the environment—is excluded.
- For example, growing cotton for apparel manufacturing requires high use of water, pesticides, fertilizers and high carbon footprint getting to market. If the real costs were factored in—the negative externalities— it would be unaffordable or unprofitable or both. Companies that produce ‘fast-fashion’, H&M, for example, love their CPA auditors who do their bidding—–they are lying about the true cost to the environment—from field to customer.
- Negative externalities are troublesome for companies, almost all hide the true costs of their negative impact, which is ultimately paid for by the public in cleanup efforts—-for example, storage of gas tanks that leak and then are remediated via Superfunds; or dye dumping from coloring garments into waterways, or burning excess supply by fashion companies like Burberry, the only costs recorded are write downs of merchandise, NOT THE ENVIRONMENTAL COSTS.
WHAT TO DO:
- Write CPA accountancy firms and tell them to stop lying and state real costs;
- Buy 1 share of a company’s stock and attend shareholder meetings and complain; bring friends;
- Start a movement #real costs real prices
- Start a movement #don’t buy fast fashion; dump H&M; Zara; Forever 21; and any of the other major polluters;
- Call the American Institute of Certified Public Accountants and tell them to require disclosure of negative externalities—-real costs: Global Engagement Center: 888-777-7077