150 Hours, Graduate Programs Discussed at CPA Journal Forum on Education

How to Attract the Best and Brightest and Prepare Them for Today’s Business Environment

By Anthony Sarmiento

A recent CPA Journal forum on accounting education stimulated discussion between practitioners and educators over the education of the next generation of accountants.

The three-hour event, held on March 20 at the Yale Club in New York City, focused on the 150-hour educational requirement—as originally conceived in 1958, adopted by the American Institute of CPAs in 1988, and variously implemented by the states. The panel, moderated by CPA Journal Editor-in-Chief Robert Colson, included two academics and two practitioners. Panelists presented their position on the 150–hour requirement and graduate education, and engaged in a spirited discussion with the 33 practitioners and educators in attendance.

Panelist Paul Brown, chair of the New York University Department of Accounting, Taxation and Business Law of the Stern School of Business, called the implementation of 150 hours a “a major disappointment.” He expressed his belief that more credit hours do not equal a higher-quality education and said he thought that too much emphasis has been placed on preparing for certification rather than creating well-rounded students.

Brown said he favored teaching a broad base of knowledge, stressing communication and analytical skills. He noted that continuing education programs can now fulfill much of the need for technical information. He also said the Stern School of Business has implemented a revised undergraduate business curriculum that emphasizes communication, leadership skills and “integrative” thinking.

Panelist Brent Inman, head of U.S. recruitment for PricewaterhouseCoopers, said he thought declining accounting enrollments are a major strategic issue that only will be exacerbated by the Enron debacle. Inman said he was surprised at how little, in his personal experience, high school students know about the profession, and he stressed the need to reach out to young people.

“The bottom line is we need more flexibility,” Inman said. The 150-hour requirement not only could be met through another year of school, Inman observed, but also through experience and continuing education.

But panelist Victor Rich, of RSM McGladrey, said the CPA profession deserves more than 120 hours.

“What other profession requires only 120 hours?” Rich asked. Increased starting compensation and increased education “are necessary to regain the profession’s former stature,” he said.

Rich’s comment that incoming CPAs are paid like tradesmen, not professionals, sparked debate among the attendees. Accountants already have become de facto tradesmen because the mainstream media uses the term, an unidentified participant said.

There also was debate over whether today’s accounting students are still the best and the brightest and whether their preparation for becoming businesspeople matches the level of preparation that graduates of 30 years ago received.
Brown said his goal is to create “budding professionals” who grow into their positions.

Panelist G. Peter Wilson, president-elect of the American Accounting Association and professor at Boston College, said he opposes the 150-hour requirement but advised against “throwing out the baby with the bath water.” On the issue of graduate degrees, Wilson suggested two alternatives: an MBA with six or more accounting courses, or a master’s in accounting with an MBA-like concentration.

Wilson argued for the continued teaching of certain high-level skills, such as proficiency in measurement, that are unique to accounting and comprise its comparative advantage over other professions.

Wilson said he thought that the 150-hour requirement has not passed the market test as the cost of additional education has not been realized in starting salaries or audit fees.

“We don’t do a good job with those extra 30 hours,” Wilson said. “There’s not enough value created…or it’s not being realized by firms.”

The forum elicited more comments concerning Enron. Although the fallout from the energy company’s bankruptcy has severely tarnished accountants’ reputation, Wilson said he thought the profession could emerge stronger over the next five years for it. The idea of audits as a commodity is now dead, and audits will only get tougher, he pointed out.

Still, several in attendance expressed their concern that the media and public opinion are driving accounting and auditing reform. Many of the attendees agreed that educating the public is crucial to ensuring the profession’s input in the debate. As conveyed by them, if the public does not trust the profession to participate in the process, there is the real possibility for reform to cause more harm than good.

The proceedings of the forum, for which PricewaterhouseCoopers provided generous support, will be published in an upcoming issue of The CPA Journal.