(taken from the Mar/Apr 2005 issue of On Balance magazine)

It all adds up
By Amy Gaeth, Managing Editor
 

 Based on the number of freshmen making it their career choice, accounting is the new no. 1 college major, according to AccountingWeb.com and Job Outlook 2005, a survey by the National Association of Colleges and Employers.

 In fact, the number of accounting degrees awarded nationwide in 2003 jumped 11 percent from the year before, to nearly 50,000. The number of undergraduate accounting degrees awarded nationwide climbed 6 percent, to more than 37,000 for the 2002-03 academic year. The number of graduate accounting degrees rose 30 percent, to 12,655.

 Last year’s totals are well below the peak levels of 1993 and 1994, when enrollments topped 60,000. Leaders at Wisconsin schools offering accounting programs are optimistic, however, with many reporting increases for 2004-05.

 Some academics say national accounting scandals sparked the interest of today’s students. Add to that, new regulations that are the result of the scandals, and the number of jobs, especially for auditors, has skyrocketed.

 Lucretia Mattson, CPA, accounting professor at UW-Eau Claire, said: “Before the scandals if you talked to someone who wasn’t an accounting major they looked at you and said, ‘I really don’t want to talk to you about accounting.’ Now it’s more like, ‘Okay, I’ve read about that in the paper. It sounds like a cool profession. Tell me more about it.’”

 Rita Cheng, CPA, Ph.D. noted an increase in the major and an increase in enrollment at UW-Milwaukee. Thirty students are expected to graduate from the master’s program this spring, compared to 20 students last year. Cheng said students understand that being well-trained is vital to their success: “There will be more pressure for the accounting graduate to be a leader in the business world and to be seen as someone who understands complicated business issues.”

 Other professors are more skeptical. “I guess I’m not ready to step across the bridge and say that the scandals have attracted more people to the field. Certainly, the people that are in it realize their worth now more than before,” said Robert Gruber, CPA, Ph.D., accounting department chairperson at UW-Whitewater.

 Don Giacomino, CPA, Ph.D., accounting professor and the Donald and Beverly Flynn Chair holder at Marquette University, said he sees no link between the scandals and increasing enrollments. New regulations resulting from the scandals have had a big impact on accounting firms, however. “The boards of directors of audit committees want to be better informed,” Giacomino said. “They’re expecting auditors to do more work. There’s going to be an increasing demand for graduates for audit positions.”

 Most Wisconsin universities weave ethics into the accounting curriculum. UW-Madison, for example, recently developed an ethics immersion program for its five-year students. Students participate in an ethics exercise in summer, followed by a fall workshop.

 UW-Madison also has a plan to address the future of accounting education. The first step involves raising funds to build a Center for Excellence in Accounting Education. The project carries a price tag of $10 million, of which about one-third is funded.

 At both UW-Eau Claire and UW-Milwaukee, ethics is integrated into the curriculum. UWEC’s introductory ethics course is designed for the business school and taught by a member of the philosophy department.

 UWM has increased its coverage of business issues and emphasizes the complexities of accounting. The school provides accounting education in finance and financial instruments, as well as in ethics. “We’ve introduced more case material so there’s more critical thinking about the alternatives facing accountants and the ethical issues. We’ve also incorporated into the curriculum the technical knowledge of Sarbanes Oxley,” noted Cheng.

 UW-Whitewater also has a long history of teaching ethics. Immediately following the scandals, the accounting department addressed what happened and why. Since then, background material has been integrated into the curriculum. In 2003, UW-Whitewater created a course in professional ethics and fraud examinations. Marquette University has followed suit, adding a course in fraud detection for 2005.

 Most Wisconsin universities have sponsored ethics lectures and encourage their Beta Alpha Psi chapters and other student groups to invite speakers who focus on ethics and appropriate conduct.

 Professors agree that there will be more emphasis on globalization, international accounting and forensic accounting. However, there’s still controversy about offering accounting courses on line.

 “I think that in the right context, in the right situation, on-line courses can be a really positive learning experience,” explained Cheng. “An on-line course requires a great deal more work by the individual student. If it’s properly designed, an on-line course requires a great amount of thinking and facilitates communication among the students and between the students and the professor.”

 Many of her colleagues disagree. Mattson’s fear is that academia could go overboard with on-line education: “There’s something important about face-to-face contact, learning how to negotiate, working in teams and responding to someone else’s criticisms that you can only get in a face-to-face situation,” she said.

Virtual study is for low-level work, suggested UW-Madison Accounting Professor Larry Rittenberg, CPA: “It’s not good for teaching students the complexities of accounting issues or in developing a well-rounded person who needs to communicate with top management about the economics of transactions and proper accounting.”

“UW-Whitewater will not offer on-line courses in accounting in the foreseeable future. We just aren’t convinced that it can be done successfully,” said Gruber, who stressed that UW-Whitewater follows a traditional teaching model.

Gruber also questioned the security of giving on-line exams: “Given our sensitivity towards internal controls we are really suspect when it comes to giving an on-line exam. How do you know that the person taking the exam is the person who’s supposed to?”

These professors believe many opportunities lie ahead for the profession and CPAs. Restoring confidence in the profession is one opportunity, as is encouraging students to consider careers in accounting.

“You can become just about anything that you want to be,” Mattson said. “You can own your own business. You can be a CEO of a public company or you can be a CFO of a local industry. What do you want to do? Well, your best training ground is to be a CPA.”

 “The one thing that I always tried to impress on my students was whenever you find something you like, go for it. Stick out your neck and go for it,” said Jerry Leer, CPA, retired UWM accounting professor.

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