September 2000

Will Accounting Education Survive?

Plenary sessions of the American Accounting Association’s (AAA) annual meeting in Philadelphia on August 13–17 focused on problems that accounting programs across the country are experiencing in attracting and retaining high quality students.

Research reports funded by the AICPA, IMA, AAA, and Big Five indicate at least a 23% drop-off in accounting program enrollments as well as numerous other issues experienced by the accounting profession in attracting and preparing qualified entrants.

In his introduction of W. Steve Albrecht and Robert J. Sack’s report, Accounting Education: Charting the Course through a Perilous Future, Accounting Professor Michael A. Diamond, currently Executive Vice Provost of the University of Southern California, expressed his strong belief that separate schools of accounting, separate accounting accreditation, and the 150 hour requirement “have placed a straight jacket on innovations in accounting education”.

Many of the 2,489 registrants attending the meeting took note that this long-term, influential proponent of these three developments has now changed his position. Diamond, the former president of the AAA, ended his introduction by specifying the problem, “The narrow focus of accounting education has led to trying to fit square pegs into round holes”.

Sack, formerly a partner at Touche Ross and SEC Chief Accountant – Enforcement and retired professor from the Darden School of Management, reported on the results of in-depth interviews with business leaders, focus groups, and an extensive questionnaire returned by 783 accounting academics and practitioners.

One stunning result from the questionnaire revealed that few accounting professors or accounting firm partners would choose to get an accounting degree if starting their education again. Moreover, less than 6% of the accounting practitioners indicated they would pursure a masters degree in accounting. Thirty-six percent indicated a preference for an MBA, 22% for a masters degree in information systems, and 11% for a law degree.

Albrecht, a dean at Brigham Young University and current chair of the AACSB’s Accounting Accreditation Committee, identified two principal reasons why knowledgeable accounting educators and practitioners would not major in accounting again:

• The business world has changed dramatically, while accounting education has not. Accounting education is perceived as being too narrow and backward-looking and to costly for the benefits received.
• 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.

In follow-up sessions Albrecht and Sack expressed their belief that there is no single model to follow to address the issues they raised. Instead, they encouraged their audience of accounting educators to assess each of their programs individually and to innovate for the future rather than rely on past models.