The Accounting Hall of Fame
Paul Franklin Grady
The son of James A. and Myrtle Powless Peterson was born May 19, 1900, in a log cabin in southern Illinois near the village of Creal Springs. His father died when he was quite young and his mother married John J. Grady, whose surname he adopted. He attended Marion High School in Marion, Illinois, graduating in 1918.
For a few months in 1918 he was an apprentice seaman in the U. S. Navy; active military service was terminated by the end of World War I. The next five years he attended the University of Illinois, graduating in 1923, with high scholastic honors. While attending the University he provided all of his expenses by working in a restaurant and in 1921-23 he held one-third ownership of the enterprise. During the 1922-23 school year he was elected to the University of Illinois chapter of Beta Alpha Psi, Beta Gamma Sigma, and Phi Kappa Phi. He received an honorary Doctor of Commercial Science degree from Pace College in 1963. He was certified as a CPA in 1923 (Illinois).
In 1923 he joined Arthur Andersen & Co., becoming a partner in 1932. He resigned in 1942 to become an executive assistant in the Secretary's Office of the U. S. Navy Department, with the responsibilities of organizing and formulating policies of the Cost Inspection Service, covering the audit and authorization procedures for Navy procurement. In recognition of his outstanding contributions in this capacity, he was awarded the Navy Distinguished Civilian Service Medal (1944) and the Presidential Award of Merit (1947). Upon completion of his tour of duty in the Navy Department in 1943, he joined Price Waterhouse & Co in May 1943, becoming a partner of the firm in January 1944; he retired from Price Waterhouse in 1960. He was the director of Technical Accounting Policies of the United States firm and remained a partner of the firm in Florida until 1970.
He was active in professional organizations, serving on many of the committees of the AICPA, for an aggregate of 42 committee years. He chaired its Committees on Public Utility Accounting (1939-41), Auditing Procedure (1944-48), Relations with Bankers (1950-52), Relations with Securities and Exchange Commission (1954-57), Labor Union and Welfare Pension Funds (1957-58), Insurance Trust (1958-60), and Practice Review (1962-63). During his chairmanship of the Committee on Auditing Procedure, generally accepted auditing standards were developed and adopted by the membership; numerous case-studies in auditing were prepared and published, as well as the pioneering pamphlet on internal control entitled Internal Control - Elements of a Coordinated System and Its Importance to Management and the Independent Public Accountant . He was a member of the special committee of the AICPA in 1958 whose report led to the establishment of the APB. He also served as the AICPA's Director of Accounting Research in 1963-64. He was a vice president of the AAA in 1954, and a member of the Florida State Board of Accountancy for the term 1968-72. He was also affiliated with the New York State and Illinois Societies of CPAs. In 1959 he was awarded the AICPA's Gold Medal Award. He received the New York Alumni of Beta Gamma Sigma Honor Award in 1946, and the Alpha Kappa Psi Foundation Accounting Award in 1965.
He wrote numerous articles for professional journals and he authored the AICPA's Accounting Research Study No. 7, "Inventory of Generally Accepted Accounting Principles for Business Enterprises" (1965). It sold more than 300,000 copies and was translated into Spanish and Japanese. He also served as a member of the Project Advisory Committee for the AICPA's accounting research study on broad accounting principles. In addition he authored Memoirs and Accounting Thought of George 0. May, editor (1962) and Audit Procedures - An Outline for Staff Training in 1940/1946. He was a visiting professor of accounting at the University of Florida (fall 1965). He served on the Professional Advisory Board of the Department of Accountancy at the University of Illinois (1975-78) and the School of Accounting at Florida Atlantic University (1978 to 1984).
He was active in government, civic, and community service. He was chairman of the Council on Federal Financial Administration (1946-49), a member of the U.S. Department of Labor's Advisory Council on Employee Welfare and Pension Benefit Plans (1964-65), a member of the Advisory Committee to the Atomic Energy Commission on Nuclear Material Safeguards (1968-70), an advisor to Secretary of the Navy and Secretary of Defense (1944-49). In Greenwich, Connecticut, he was chairman of a Citizens Committees on Town Government (1950-51) and a warden of Christ Church (1955-60). He was a member of the Board of Trustees of Dry Dock Savings Bank (1954-68).
He was a long-time friend of the late President Herbert Hoover. He chaired the Task Force on Government Lending Agencies (1948, 1953-54) for both the first and second Hoover Commissions. He was a member of the Board of Overseers of the Hoover Institution at Stanford University (1960-84) and a member of the Board of The Herbert Hoover Presidential Library Association in West Branch, Iowa (July 6, 1972-84). At the request of the Director of the Library, a collection of Mr. Grady's books and published articles has been deposited in the archives of the Presidential Library.
He married Louese Trevor on November 23, 1921; the had two children. In his leisure time he enjoyed golf, swimming, and social events at local clubs. He died April 21, 1984 at the age of 83.