A Summary of John Ribezzo, Professor of Business Administration |
| A joint project of the American Accounting Association (AAA), American Institute of CPAs (AICPA), Institute of Management Accountants (IMA), and the Big 5 professional service firms, Accounting Education: Charting the Course through a Perilous Future, may well turn out to be a landmark work on the future of accounting education. The report was co-written by W. Steve Albrecht, of Brigham Young University, and Robert J. Sack, of the University of Virginia. The authors believe that for accounting education to survive, accounting programs must not change “just to be better,” but must be transformed so that they become relevant and add value to our students and the community. They were charged with writing a “high-level thought piece, backed by empirical evidence where possible, that would motivate serious change in accounting education.” I would like to summarize, on a chapter-by-chapter basis, the findings and conclusions of the authors. The first chapter is entitled, “Why Accounting Education May Not Survive in the Future.” It begins with the following quote by the authors:
This statement is motivated by the fact that accounting education faces many serious problems, and if they are not addressed, then accounting education, as we know it, will cease to exist. Three factors that hammer home these concerns are as follows:
Although there have been previous warnings about the problems faced by accounting education, including studies, by the IMA, the AICPA’s Vision Report, the AAA’s Bedford Committee, the Big 8’s (now the Big 5) White Paper, and the creation of the Accounting Education Change Commission, there has been a serious lack of response on the part of accounting educators. The authors do commend those schools that have made significant changes in their accounting programs; however, they feel that these changes have not been significant or pervasive enough. A final thought provided by the authors gives hope that “with quick and definitive action we can save accounting education.” Chapter 2 is entitled, “Changes in the Business Environment.” The business environment has changed dramatically due to three major developments:
These three key drivers of change in the business environment have resulted in (1) inexpensive information and (2) an increased level of competition among organizations. As a result, the following business developments have occurred:
The authors point out that accounting associations and professionals are responding to these changes, but because of the bureaucratic nature of higher education, change has been slow to come. Accounting curriculums today are educating students to perform functions that are being replaced by technology. Consequently, those students are having a hard time finding employment. The result is that students who traditionally majored in accounting are now taking more popular and highly compensated majors like information systems, finance, logistics/supply chain management, e-commerce, and strategy. These students are taking positions that were previously filled by accounting students. Finally, even though accounting education has many positive aspects, and public accounting and industry sees value in it, accounting educators must become aware of the types of work assignments their students will be performing in the future so that they can make the necessary changes to their programs. A survey that the authors conducted identified the following as growth opportunities (known as high-value chain activities) for future accounting graduates:
Of course, a major overhaul of the accounting curriculum needs to be made to prepare students for these types of opportunities. Chapter 3 is entitled, “Fewer and Less Qualified Students are Choosing Accounting as a Major.” A multitude of empirical evidence provided in this chapter substantiates the anecdotal warnings that the supply and quality of accounting students has decreased over the past several years. For example, the percentage of college students majoring in accounting has dropped from 4 percent in 1990 to 2 percent in 2000. Also, the percentage of high school students who intend to major in accounting has decreased from 2 percent in 1990 to 1 percent in 2000. Data suggests that a shift is taking place in the classroom from fewer accounting majors to more nonaccounting majors. However, what is more alarming is that there is a perceived drop in the quality of students majoring in accounting, whereas the quality of nonaccounting majors is staying the same. The approach the authors take to address this dilemma is to ask two important questions: 1. Why are the decreases occurring?
2. What do these decreases mean for the future of accounting education? As accounting enrollments decline, accounting departments are, to a greater extent, performing as a service function for the other business school majors. Accounting educators have to make revisions to the curriculum to “be more responsive to the students.” Chapter 4 is entitled, “Why Accounting Practitioners and Educators Would Not Major in Accounting Again.” From their research, the authors have determined that there are two reasons why accounting educators and practitioners would not major in accounting again: 1. The business world has changed dramatically, while accounting education has not. Accounting education is perceived as being too narrow and backward looking and too costly for the benefits received. Other disciplines, like finance and information systems, have been found to be better suited to providing the education to develop the knowledge, skills, and abilities needed to perform in the ever changing business world. 2. The idea of a career in accounting has lost favor because of technological and competitive changes. Business people who want an interesting and rewarding career are looking elsewhere. If the authors’ conclusions are correct, then who will serve as role models for potential future accounting students? Chapter 5, entitled, “Improving Accounting Education,” focuses on problems in the following areas:
The authors begin the chapter by making three general observations about accounting education: 1. Some schools have changed, however, the changes have not been pervasive or substantive enough. 2. Competition has arrived. Other business and nonbusiness majors are becoming more attractive to recruiters. Also, for-profit universities and distance-learning programs are proliferating. 3. The most critical element in a student’s successful classroom experience is an inspiring professor. The remainder of the chapter focuses on the problem areas listed above. The authors conclude by noting that previous warnings of danger have not been heeded. However, they feel that “With the right direction and work, accounting education has a bright future.” Chapter 6 is the final chapter and is entitled, “Summary and Recommendations.” In this chapter the authors make several suggestions for improving accounting education. The suggestions are based on the following three observations: 1. Each school or department should decide which is the best approach for them to follow to achieve the goal of improving accounting education. 2. Each department should develop a strategic plan supported by qualified and committed faculty, adequate resources, and a reasonable time horizon. 3. Each faculty member should establish a strategic plan for his or her careers. The remainder of the chapter discusses the following issues that should be considered when conducting a strategic-planning process:
The authors conclude by pointing out that corporate and public accounting firms have made strides to transform themselves into finance professionals and professional service firms. Accounting education must take the necessary steps to “increase our relevance and open new opportunities for accounting education.” The remainder of the book consists of an appendix, which discusses the authors’ research methodology, and a section that provides references and resources. Conclusion Reference Back to Two-Year College Home Page |