Report on accounting education: Research project

By Susan T. Sadowski, Ph.D., CPA
Chair, MACPA Members in Education Committee

The American Institute of Certified Public Accountants (AICPA), American Accounting Association (AAA), Institute of Management Accountants (IMA) and the "Big 5" (Arthur Andersen, Deloitte & Touche, Ernst & Young, KPMG and PricewaterhouseCoopers) have jointly sponsored a research project on the future of accounting education. The "Accounting Education: Charting the Course through a Perilous Future" project focused on several areas of critical importance to the future of the accounting profession: the impact of changes in the business environment on accounting education and practice, the profile of students majoring in accounting, and a mandate for the continued improvement of accounting education.

According to two of the most recent AICPA reports on The Supply of Accounting Graduates and the Demand for Public Accounting Recruits, statistics indicate decreases in both the quantity and quality of accounting majors at the undergraduate level. The number of students pursuing Master's in Accountancy degrees has remained constant. Enrollments in Masters in Taxation degrees have decreased by 50 percent. The factors identified for the supply and demand data include starting salaries, career alternatives, risk/rewards, the lack of information or misinformation about accounting, and the opportunity cost of the 150-hour requirement in most jurisdictions.

The most startling research finding was that most accounting practitioners and educators would not get an accounting degree if opting for a program today. Thirty-eight percent and 37 percent of educators and practitioners, respectively, would earn a Master's of Business Administration (MBA) degree; 18 percent and 21 percent of these respondents, respectively, would complete an Information Systems program. Only 12 percent of practitioners would choose either an undergraduate or graduate accounting degree.

This call to action for the accounting profession identifies the business environment drivers of change as technology, globalization, and large institutional investors. It looks at the implications of information as a commodity and increased competition on the future of accounting education. Since most traditional CPA firms have already started to move up the value chain by redefining themselves as professional services firms, there must be attention to the restructuring of rewards, types of services, and level of compensation for business graduates embarking on careers as financial professionals.

Practitioners rank order future accounting services as financial analysis, financial planning, financial reporting, strategic consulting, and systems consulting. Faculty rank order future accounting services as audit, e-commerce consulting, systems consulting, tax consulting, and strategic consulting. Both groups of respondents forecast that business consulting and strategic planning will be the major areas of growth for accounting graduates.

Bob Elliott, KPMG partner and chair, AICPA Board of Directors, defines five stages of the value chain for information as business events, data, information, knowledge, and decisions. Just as the practice community must focus on upper-end services, quality accounting education must also address the preparation of grads to function well at more advanced stages. In lieu of some of the duplication in technical accounting course content, albeit at a more advanced level with increased depth and breadth of coverage through an M.S. in Accounting program, the co-researchers advocate alternatives such as concentrations in accounting within MBA programs and joint accounting /information systems programs.

The transformation of accounting education is critical with the competition from for profit universities and other business and nonbusiness disciplines within academe. Consistent with the needs assessment of accounting practice, the curricula and programs must produce a good business professional through broadening type courses. These changes will require retooling on the part of accounting educators for the coverage of rank-ordered topics through different learning and skills development activities. The emphasis must be on both the acquisition of a content knowledge base and the development of analytical thinking and research skills.

As co-researchers for the project, Albrecht and Sack make several recommendations: 1) a mission-based, strategic approach to program and curricula development; 2) the commitment of resources to qualified, committed faculty; and 3) the development of a strategic planning process for accounting careers.

The AICPA has been proactive with its initiatives including the Vision project, the redesign and computerization of the CPA exam, the development of new technology-related services and specialty designations, the proposal for the Cognitor certification, and its participation in the development of the XLM programming language (XBRL). Through the concerted efforts of the MACPA leaders, our professional association can continue to facilitate the process of change in accounting education to ensure a pipeline of quality business graduates for the future of the accounting profession.

This content has not yet been Rated.

To Rate content, please Login.