Thumpango,
I think generally in flying schools where instructors use the gold bars on their epaulettes, it's more to display the ranking of the instructor.
I believe my school uses the following system
4 bars = CFI
3 bars = senior instructor
2 bars = regular instructor
1 bar = tea / coffee boy & general dog's body.
I might be a little out with my definition of the job titles but that's the general gist.