An increasing number of people are aspiring to become licensed public accountants as demand for accounting experts rises in line with ongoing reforms in accounting and bookkeeping rules.

Public accountants say rules governing their business and certification process need to be reformed so they can catch up with their counterparts in the United States and Europe in both quantity and quality.

The occupation is also receiving growing public attention in the wake of the recent string of accounting scandals at big U.S. firms, which highlight the importance of having corporate financial statements audited by professionals.

To become a certified public accountant in Japan, aspirants must first pass a national exam to become a trainee accountant. The pass rate for the exam is only 8 percent.

Trainees then need to undergo a three-year apprenticeship at an auditing firm.

The number of people who take the annual exam has been growing since 1998. Government officials said the number of successful test takers is likely to surpass 1,000 for the first time this year.

Behind the rise is the introduction of new accounting rules, including the mark-to-market method of accounting in 2000.

Koichi Masuda, vice president of the Japanese Institute of Certified Public Accountants, said ongoing moves by firms to cut the workforce are accelerating the trend.

“The increase in the number of applicants who we are seeing now is partly because people who were fired by firms are taking the accountant exam,” he said.

The number of public accountants in Japan, currently 20,000 including trainees, compares with some 340,000 in the U.S.

The Certified Public Accountant Examination Committee of the Finance Ministry proposed in June 2000 that the government take measures to double the number of people who pass the exam, including increasing the opportunities for working people to take the exam.

Based on the recommendations made by the committee, an advisory panel to the Financial Services Agency is holding discussions on how to reform the exam.

Masuda said that to expand the number of public accountants and upgrade their services, the government must do away with the current infinite joint liability requirements for auditing firms in case an accountant commits an act of fraud.

Japan should introduce a system to permit limited liability of auditing firms, which has already been adopted in the U.S. and in some European countries, he said.

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