By the Numbers

The 2001 report, The Supply of Accounting Graduates and the Demand for Public Accounting Recruits, documents the demographics of the accounting profession. Anyone will find the report useful. It is available online at www.aicpa.org/members/div/career/edu/sagdpar.htm.

The data are based on an AICPA survey of colleges and universities that offer accounting degrees at the bachelor’s, master’s or PhD level and of public accounting firms and sole practitioners affiliated with the Institute.

SUPPLY DATA FROM COLLEGES AND UNIVERSITIES
In 1999–2000, approximately 37,000 students received bachelor’s degrees in accounting and 8,000 earned master’s degrees. Compared to 1998– 1999, the number of bachelor’s degree recipients decreased 10%; however, the number of master’s degrees awarded increased 19%.

Schools in the Southern and Pacific states held steady compared to previous years while schools in the East and North Central regions awarded fewer bachelor’s degrees.

Considerably more females than males received bachelor’s degrees (58% to 42%), about equal percentages received master’s degrees (51% females to 49% males) while more males than females received PhDs (61% to 39%).

Minorities accounted for 20% of accounting bachelor’s and master’s graduates and for 22% of PhDs.

Approximately one-third of 1999–2000 bachelor’s degree recipients took positions with public accounting firms and about one-fourth began their careers in business and industry. A majority of master’s degree recipients (62%) went into public accounting. These proportions parallel 1998–1999 degree recipients.

Enrollments in accounting bachelor’s programs continued to drop (4.5%) from 1998–1999. However, enrollments in master’s programs increased by 10% and in master’s-in-taxation programs by 20%.

The number of candidates sitting for the CPA exam continued to drop. Exam candidates for 2000 totaled 115,493.

DEMAND DATA FROM PUBLIC ACCOUNTING FIRMS
Firms with 50 to 200 AICPA members and those with fewer than 10 members hired relatively fewer new graduates than in previous years. However, firms employing 10 to 49 members increased their hiring.

Over the years, the Institute has tracked the proportions of new hires working variously in accounting/auditing, taxation and management consulting. In 2000 almost two-thirds of the graduates (65%) accepted accounting or auditing positions, one-fourth took assignments in taxation and 5% began work in management consulting for public accounting firms.

The share of new hires accepting accounting or auditing positions showed the greatest growth—the share of new management consulting hires, the greatest decrease. The percentage of graduates hired into tax positions held steady.

Continuing a trend that began in the early ’90s, females made up the majority (56%) of new graduates hired by public accounting firms.

Twenty percent of new graduate hires were minorities—the same percentage as in the previous year.

Across all firms surveyed the annual turnover rate was 16%, up from 14% during 1999. Turnover rates and firm size were positively correlated.

In 2000 the turnover rate was higher for females than males, especially at the smaller firms.

The largest firms were the most ethnically and racially diverse.

DEMAND PROJECTIONS BY PUBLIC ACCOUNTING FIRMS
Firms predicted hiring trends compared with their actual hiring figures in 2000.* Firms projected the percentage change for 2001, 2003 and 2005. Predictions for 2001 over 2000 ranged from a 0% increase for the largest firms to a 2% increase for firms employing fewer than 10 members as well as for firms employing 50 to 200 members. Firms with 50 to 200 members were the most optimistic in their hiring estimates.

Firms’ estimates of growth in hiring of nonaccounting graduates were more conservative. Firms employing 50 to 200 members were, again, the most optimistic about long-term growth prospects.

*The survey, which was conducted during the second quarter of 2001, did not reflect either the downturn in the economy during the second half of 2001 or the September 11, 2001, terrorist attacks.

Education Innovations

Influenced by the Bedford report—the 1986 study of the gap between what accounting students learned in school and what accountants actually did on the job—Kansas State University (KSU) set out in 1990 to transform its accounting curriculum from the traditional “preparer” perspective to one focused on broader learning objectives that included

Ensuring that students who graduate had the technical and professional knowledge to succeed as accounting professionals.

Seeing that students who graduate had the professional skills necessary to implement their knowledge, including oral and written communication, interpersonal skills and the ability to think critically.

Attracting and retaining high-quality students to the curriculum.

THE REVISED CURRICULUM
In place today, the curriculum is a five-year program in which students graduate with a bachelor’s degree at the end of four years but are expected to stay and complete a master’s-in-accountancy degree. The five-year approach was chosen because the faculty realized a fifth year was necessary to achieve its objectives and not to comply with the advent of the 150-hour requirement.

The curriculum revision was based on two criteria: that students should understand simple topics before more complex topics and content would be based on how students learn, using Bloom’s taxonomy of cognitive skills. (Bloom’s hierarchy begins with knowledge and comprehension, followed by application and analysis, synthesis and evaluation.) In contrast a traditional curriculum schedules courses based on the order topics appear on the balance sheet; the result is that the first course is intermediate accounting, which many consider the most difficult in terms of content. In the revised curriculum, therefore, topics were sequenced so students did not have to apply a higher skill level than their learning background supported. In addition integrated into every course were activities that promoted the skills the profession demands:

Group projects, which promote interpersonal skills.

Written assignments and presentations, which promote communication skills.

Research projects, which promote critical-thinking skills and learning how to think independently.

The curriculum also uses five levels:

Introductory-level courses have a “user” vs. a “preparer” perspective (because most students are not accounting majors), and also, these courses lend themselves to the recruitment effort described later. They focus on how the accounting system captures events and how accounting information is used for planning and evaluating.

Foundation-level courses provide the basis for all subsequent courses. They detail how the accounting system works and the theory and history of accounting standards.

Content-level courses introduce students to how various users employ data from the accounting system to meet their information needs.

Research-level courses are case-based, team-taught courses that cover tax, financial accounting and auditing and teach students how to use research tools to resolve ambiguous problems.

Graduate-level courses provide students with the opportunity to design a course of study with either a tax, financial, managerial or systems emphasis. An in-depth look at the curriculum is available at www.cba.ksu.edu/cba/grads/macc/curriculum.htm.

THE RECRUITING PROGRAM
Rather than use the “build it and they will come” approach, KSU said an objective of the new curriculum was to attract and retain the best possible students. As a result, the department developed an extensive program.

Two faculty members and the Accounting Advocates, a group of 10 to 12 graduate and undergraduate students, administer it. The Accounting Advocates are an essential component; they act as ambassadors for the department by making presentations to high schools, talking to visiting high school students and meeting with visiting dignitaries. Accounting students apply to be advocates in their junior year and serve throughout their graduate program.

The recruiting program targets high school teachers, counselors and students and undecided college freshmen and sophomores. Every school district in the state receives a recruiting video created by the accounting department. The recruiting program reaches

High school teachers and counselors. The schools-to-careers conference educates high school teachers about the opportunities an accounting career offers. It is a collaborative effort of the College of Business and the business education department of the College of Education.

High school students. The high school careers conference brings together high school students who are nominated by their teachers to attend. Students visit with young accounting professionals and go through team-building exercises and go to a tailgate party and football game. Students see positive accounting role models, learn about the career flexibility an accounting career has to offer and have fun.

College students. The professional accounting careers exploration dinner offers an opportunity to the best students in the introductory courses to meet with young professionals from public accounting and industry and an advocate to learn about careers.

SUCCESS
Compared to 1989, there are now 35% more accounting majors and the quality of students (as measured by ACT, SAT and GPA) has increased. Enrollment in the master’s program increased 500% over the same time period. This increase occurred in spite of the fact that the GPA required for admission to the accounting major was significantly increased.

—Dan Deines, CPA, Kansas State University, Manhattan, Kansas

Teaching the Teacher

The teacher internship program (TIP) educates high school teachers about the accounting profession. Through TIP, state CPA societies connect teachers with firms and businesses in summer internships to provide them with “real world” business and accounting experience. Providing educators with professional business experience that can be incorporated into their classroom curriculum and learning activities results in well-educated students, which benefits business and the workforce as a whole.

The AICPA Foundation provided seed money to help develop a training program for state societies and to assist firms in paying for internships. In the summer of 2001 the Indiana state society piloted the TIP with great success. Heather Bunning, the society’s communications and public relations manager, worked with the IRS and Ernst & Young to provide internships respectively to Paulette Lewis, a high school business-education teacher, and Charlene King, a high school mathematics teacher.

AT THE IRS
Lewis saw many facets of the IRS at the Indianapolis office, including exams, appeals, advocate services, and taxpayer and practitioner education and communication. She learned about resources available to the public and to educators she could use in her classroom. She plans to open a volunteer income tax assistance site at her school to assist taxpayers during filing season. And conversely, Lewis provided the IRS with a fresh perspective on the materials needed by educators. According to IRS manager Ken Williams, the experience was invaluable: “Through Ms. Lewis’ experience, we hope to reach high school students so they view the IRS as a source of information and are better prepared when it comes time for filing returns.”

WORKING AT ERNST AND YOUNG
King’s internship was with the tax compliance group at E&Y. She attended both E&Y’s tax analyst training and firmwide orientation programs. In the tax compliance group, King worked on tax returns for individuals, non-U.S. residents, not-for-profit agencies and trusts. She expanded her technical skills and her knowledge of databases and computer software. She also learned of the many job opportunities available in the accounting and tax field. King said she had had a great experience at E&Y and was especially excited to be able to apply math topics using real-world examples for her students.

A resource guide was published to assist states or firms interested in implementing the program. To receive it, download a copy from www.aicpa.org/members/div/career/edu/index.htm.

It’s Career Day Again—Resource List

MATERIALS AVAILABLE—CPA iPACK
The AICPA offers the CPA Information Package (CPA iPACK). Its highlights are the “Takin’ Care of Business” video, education handbook and career guides. The 15-minute video features five young, successful CPAs in exciting careers ranging from an FBI special agent to the controller of the New York Jets. Combining animation with real-life profiles, this entertaining video also discusses CPA career opportunities. The handbook contains 15 lesson plans, with objectives and instruction procedures, topic overviews, student-learning activities and solution sets. The iPACK also contains 25 career guides that discuss services CPAs provide and the industries they work in, as well as earnings potential and the requirements for becoming a CPA. Enclosed also is a Presenter’s Guide, with topics of discussion and an order guide for purchasing additional CPA iPACKs or its components, a list of state CPA society contacts, a poster and a questionnaire/ evaluation form.

Orders for the iPACK or its individual components can be placed through CPA2Biz at 888-777-7077. The iPACK product number is 872530 and the cost is $20 plus shipping and handling.

TEACHER EDUCATION
To help teachers use the iPACK materials, the AICPA created the high school educator symposium concept. The symposium is an all-day conference (approximately 8:30 a.m. to 2:30 p.m.) that can be held at various locations, including a state society’s facility, a college campus or a hotel. Teachers specializing in mathematics, economics and business education as well as career advisers, principals and administrators from targeted high schools are invited to attend. Guidance counselors and career advisers from colleges and universities in the area are invited as well. A resource guide is available to assist states or firms interested in implementing the program. To obtain a copy, download it from www.aicpa.org/members/div/career/edu/index.htm.

WORKING WITH BETA ALPHA PSI
Student recruiting with Beta Alpha Psi (BAP) is a program that educates and informs high school students of the career opportunities in accounting. Working through the state CPA societies, a CPA teams up with a BAP student to make presentations to high school audiences. The AICPA has prepared a resource guide for this program with guidelines and suggestions for implementing it. To obtain it, download a copy from www.aicpa.org/members/div/career/edu/index.htm.

"COOL" STUDENT WE SITES:
www.cpazone.org—Created by the Pennsylvania state society, the site contains interactive games, career information and prizes.

www.tomorrowscpa.org—The Maryland society’s site contains information for students about the accounting profession.

www.incpas.org/Students/index.htm—Using a nautical theme, the Indiana society’s Web page helps students “guide their way” to becoming a CPA.

www.calcpa.org/community/careers/index.html—The California society’s student Web page contains excellent profiles of young CPAs. The site also offers to tailor articles based on your needs.

www.futurecpa.org—The Illinois society’s Web site is full of fun and important information.

CPA2Be.org—Web site of the Kansas state society, a comprehensive site for students.

National CPA Student Recruitment Campaign

Want an exciting business career? Interested in working with high-level people in diverse industries such as entertainment, sports and fashion? Want a career in a people-oriented profession? Then pursue an accounting degree and become a CPA. These are among the messages being delivered to millions of high school and college students nationwide as part of the AICPA’s new student recruitment campaign, “Start Here, Go Places.”

The five-year, $25 million commitment is designed to address the perilous downward trend in students’ interest in accounting careers by specifically targeting generation Y students, ages 16 to 22. The goal is to increase the number of individuals enrolled in accountancy programs nationwide.

Recent AICPA research showed that from 1990 to 2000, the percentage of college students majoring in accounting dropped to 2% from 4%. During this same period the percentage of high school students majoring in accounting dropped to 1% from 4%. In addition, according to the most recent AICPA report, The Supply of Accounting Graduates and the Demand for Public Accounting Recruits—2001 (available online at www.aicpa.org), the number of bachelor’s degree recipients decreased by another 10 % from the 1998–1999 academic year to the 1999–2000 one. “We know that students do not perceive accounting as an exciting career choice, and this is affecting enrollments,” says Jo Ann Golden, CPA, a partner with Demody, Burke & Brown, PC, and the incoming president of the New York state society. “We need to energize student thoughts and perceptions about the profession, particularly students in high school. This campaign is a step in the right direction.”

THE RIGHT MESSAGE
Research conducted by the Taylor Research and Consulting Group showed most high school and college students were ignorant about careers in accounting, had limited knowledge, were misinformed about what CPAs do and possessed negative perceptions of the profession. To address these issues the campaign establishes an ongoing dialogue with high school and college students to encourage enrollment in accountancy programs.

The campaign’s overall message is that the skills acquired while studying business and accounting and obtaining the CPA credential prepare you for any possibility in the world of business—a message that resonated well with students in focus groups.

HOW IT WORKS
The AICPA, working with Wunderman, New York, a direct-marketing agency, designed a campaign that directly involves students in their own environments through the Internet and enables them to experience the kinds of roles CPAs play and the work they do. In March the AICPA launched a Web site, www.StartHereGoPlaces.com.

The Web site features information to assist students in their career decision making by providing tangible resources, such as information on scholarships and internships, tips on getting through college and preparing for and selecting a career. As students move through the stages of their education from high school to their early and late college years, the site delivers more career-relevant information while educating them about the CPA profession and how to get ready for the CPA exam. It also features an online business simulation game, “BizzFun,” that can help students recognize their skills and potential for success as a CPA in business or public accounting.

The campaign to drive students to www.StartHereGoPlaces.com reached 8 million high school students and 1.2 million college students during March and April when it

Delivered posters to more than 8,000 high schools and 45,000 teachers across the nation.

Placed ads in 20 college newspapers in 12 pilot states.

Mailed postcards to 300,000 high school and college students.

Sent e-mails to 400,000 high school juniors and seniors and 1 million college students.

This recruitment campaign is unprecedented in its direct outreach to students. However, these efforts need to be complemented by the active involvement of the profession at all levels. CPA societies also received these materials so they could use them in their own recruitment efforts. And CPAs themselves can help by speaking about the benefits of an accounting career and the flexibility, diversity and potential for career advancement. “The questions I most frequently am asked by students is, ‘What does a CPA do?’” states Dennis Echelbarger, CPA, a partner with Echelbarger, Himebaugh, Tamm & Co. and a past president of the Michigan Association of CPAs. The “Start Here, Go Places” Web site does an excellent job of answering that question in an entertaining and engaging way.”

MEASURING SUCCESS
Students who visit the Web site register and supply demographic information that will be used to develop materials that are appropriate for them at their particular career decision-making stage.

The AICPA developed a database infrastructure to provide the means for measuring audience response to the media used, the creative execution and the game playing and to monitor demographics, top schools’ activity by state and Web site usage and student behavior. These results will assist the AICPA and state societies in refining their recruitment messages to achieve the goal of increasing the number of students pursuing accounting degrees and CPA certification.

How CPAs Can Help No one can better explain to students what CPAs do than CPAs themselves. The recruitment campaign’s success can be greatly enhanced by CPAs who Participate in state society recruitment activities as a classroom speaker, mentor or committee member. Reinforce the positive messages delivered through the campaign. Encourage high school and college students to visit the “Start Here, Go Places” Web site. Include links from your firm’s or other relevant Web sites to www.StartHereGoPlaces.com. Encourage your company or firm to offer student internships.

Finding the Best and Brightest—One Firm’s Experience

Our firm found an excellent resource to identify conscientious workers who provide us with a rewarding and profitable experience: recruiting students from the academy of finance (AOF).

The AOF is an elective course of study for high school students exploring the broad world of finance. It is a member program of the National Academy Foundation (NAF), www.naf.org, a nonprofit educational organization based in New York City. The AOF was founded in 1982 by Sanford I. Weill, chairman and CEO of Citigroup, who also serves as the chairman of NAF’s board of directors. Currently there are 275 AOF locations nationally, with some 16,000 enrolled students.

Taking part in the AOF program doesn’t benefit just the practitioner, or your firm; it actually can benefit our entire profession. As it becomes harder to find qualified accounting graduates, practitioners need to reach out to the high schools and show students that accounting is a vibrant, exciting and profitable career.

A major component of the program is a six-week paid student summer internship between the junior and senior years. Our interns always have been bright, energetic and quick learners who sometimes have performed beyond the level of our new hires. They perform bank reconciliations, general ledger posting and analysis, audit fieldwork such as payroll and inventory observations and vouching and have prepared basic individual and corporate tax returns. The students are coached in how to dress for work and how to interact and communicate in a business environment. Based on their performance levels, they are even scheduled outside the office at various audit fieldwork and other on-site client assignments.

What is the cost/benefit? The AOF internship program leaves the rate of pay up to the employer. Typically AOF interns have earned between $2 to $4 per hour below what a typical college intern would make with firms in the same geographic area.

By participating in the AOF internship program, we were able to train a staff member at a much lower cost and are currently reaping the benefit of our investment. One high school intern who worked for us throughout her college career joined our firm. (We were able to out-recruit a national firm to hire her for a permanent position because of her positive experience with us.)

To get involved with the AOF program in your area, contact NAF and offer to act as host in a “job shadowing” or internship program. Or become a member of the program’s local advisory board. As a member you contribute to the program’s success by using your knowledge and resources. I have served as the chairperson of our local advisory board since its inception and have been rewarded by watching the growth and development of both students and the program.

Our advisory board meets about six times a year, usually before normal business hours. In addition the board meets with students during class time once or twice a year as a group, and most members do one formal class presentation a year. The time commitment for the most part is not great and—as you attend the ceremony for the graduates of the academy of finance—you will have a sense of accomplishment, a sense of fulfillment and the knowledge that you have helped provide to the students priceless experiences, as well as a clearer understanding of the unlimited opportunities in the accounting profession.

For more information and a list of local programs in your area, contact NAF at 212-635-2400 and press ext. 257 for Charlie Katz, national director for business partnerships, ckatz@naf.org.

—David Evangelista, CPA, Korn, Rosenbaum, Phillips & Jauntig, LLP, CPAs, Pomona, NY

150-Hour Requirement

Forty-eight states/jurisdictions have changed their laws to require 150 hours of education for CPA certification. The law is currently in effect in 39 states and will be enacted in 45 states by 2004.

Questions have been raised about the impact of the higher education requirement on accounting enrollments and graduates over the past several years. Results of research with students (www.aicpa.org/members/div/career/edu/taylor.htm) provide compelling evidence they are not deterred from pursuing accounting careers because of the education requirement. An overwhelming majority of students believe that 150 hours of education to become a CPA is fair. Other studies show that growing percentages of college freshman plan to attend graduate school.

Academics and practitioners agree the most significant reasons for the decline in accounting students are lower starting salaries in accounting compared with other business majors, the availability of more attractive career alternatives, the willingness of students to choose other majors and the lack of information about what accountants do. The profession is addressing these issues. Changes in the economy the past year appear to be motivating students to consider accounting. The most recent study on the numbers of accounting degrees awarded showed an upturn in those graduating with master’s degrees (www.aicpa.org/members/div/career/edu/sagdpar.htm).

—Bea Sanders, director, academic and career development, AICPA

Diversity Drive at the AICPA

Increasing diversity within the profession remains a priority at the AICPA. The Institute’s 2001 supply-and-demand study revealed that of the CPAs working in public accounting firms, only 7% were minorities. At the same time, according to the latest U.S. census, minorities made up 31% of the population, showing there’s considerable room for improvement in the profession’s demographics.

The call for diversity is as much a social issue as a business one. As demographics shift and businesses become more global, those companies with employees who can work with people of different backgrounds and cultures increase their chances for success. The Institute has refined the structure of its diversity programs to focus on individuals from high school through the seasoned stages of their professional careers. The Institute seizes on opportunities to create new alliances, partnerships and programs to promote and support talented minorities focused on business. It has evaluated the effectiveness of these long-running programs and made a number of changes to help ensure that only the best remain. The key programs are as follows:

High school level
Advertising through print media and radio.

College residency programs. (These expose juniors and seniors to accounting and other business disciplines as well as to the excitement of the college campus through a weeklong program with a tailored curriculum.)

Limited scholarships for college-bound seniors.

CPAs in the classrooms who talk to students about the excitement and benefits of the profession.

College and university initiatives
The scholarship for minority accounting students program provides financial aid to talented minorities who show potential to become CPAs. A study revealed that between 24% and 31% of scholarship recipients (prior to recent eligibility changes) had either become certified or passed the Uniform CPA Examination.

An accounting scholars workshop strengthens leadership, team- building, presentation and communication skills of participating students who are graduate-level or are undergraduates entering their senior year.

The minority initiatives committee partners with colleges and universities that graduate large numbers of minority students in business. These outreach efforts include campus visits to interact with students and faculty and to provide information about the Institute, the CPA exam and the profession.

The AICPA fellowship program for minority doctoral students enables more minorities to enter and move ahead in the accounting profession and academia; these are augmented by several programs to increase the number and the skill sets of minority faculty. A professor can have a tremendous impact on a young person’s ultimate career decision; studies show that students view their professors as both role models and mentors.

The Institute currently has 22 PhD candidates receiving fellowships to continue their doctoral studies, the largest number since the program’s inception. Over the past 20 years the program has delivered 35 PhDs into the profession who are currently teaching at universities across the nation.

The Institute’s emerging partnership with the faculty diversity and initiative section of the American Accounting Association will bring more minority professors into a larger arena and increase opportunities for professional development, critical research and networking to help ensure their teaching skills are excellent.

State CPA societies, minority accounting organizations
The AICPA continues its efforts to attract seasoned professionals to committee service at both the Institute and state societies to increase the level of diversity at various policy-making levels throughout the profession.

New and joint programs with historical partners have increased. The Institute is seeking to develop successful mentor programs that will have an impact on students as well as young and seasoned professionals.

In the media
In 2002 two ads featuring CPAs with exciting careers (below) were created and placed in magazines read by students and the people who influence them. Additionally, several radio ads were placed in selected markets across the country. These ad campaigns draw attention to the interesting and exciting careers available to people with accounting backgrounds.

—Daniel Hobson, CPA
manager, minority initiatives, AICPA

Be a Star…Be a CPA

Competencies—The Differential!

What do Accountants On Call, Robert Half and Monster.com have in common? If you answered “competency advertising,” then you are on the right track. Why are competencies the differential? Competencies are the knowledge, skills and attributes a CPA needs to perform successfully in a given position and to solve business issues.

The AICPA developed a competency model to help guide students and CPAs through their career and continuous learning plans. A competency model is a collection of knowledge and skills needed for a particular position. The model covers the following categories:

Personal attributes. The characteristics which enable the finance professional to attract others to well-reasoned and logical points of view and to effectively communicate.

Leadership qualities. The skills that allow the CPA to assume a position of influence by assembling and leveraging a variety of resources that address problems and opportunities throughout an organization.

Broad business perspective. The knowledge that encompasses an understanding of the organization and accounting practices and applicability.

Functional specialty. The technical skills for a particular area (for example, business and industry, audit and assurance, government, tax, PFP).

The AICPA is developing a Web-based competency self-assessment tool —to be launched in October—that students and CPAs can use to assess themselves against a specific model and position (for example, staff accountant or CFO for a Fortune 1000 company) to determine areas of strength and those needing development. In this way students and CPAs can personalize their career development and continuous learning plans at each stage of their career. A CPA who wants to change from one area to another (for example, from business and industry to government) or to specialize in a particular area (for example, personal financial planning, SysTrust, WebTrust, e-commerce, Performance View), can conduct a self-assessment to help focus on the required competencies.

Also under development is a core competency framework to help faculty integrate these competencies into their accounting curricula. This Web-based tool will be available later this fall.

—Kayla Briggs, CPA, competency champion, AICPA