As the new school year begins, it’s time for the profession to examine how future CPAs are educated in the United States. It’s no secret that the number one problem facing most accounting firms today is recruiting and retaining talent, and a big part of the reason is the large gap between the skills CPA firms need and the skills colleges and universities are teaching. Firms expect that a CPA candidate coming out of college will have basic understanding of auditing and tax, but in most cases, this is not the case.
The curriculum of most universities is still focused on basic accounting (i.e., debits and credits, T-charts) and too heavily focused on cost accounting, as if it’s still 1960 and most CPA graduates will work for a large manufacturing conglomerate. Almost no technology is taught, neither modern accounting systems such as Quickbooks Online, Xero, Intaact, and Netsuite, nor modern tax software such as CCH’s Prosystems/Axcess and Thompson’s Ultratax/Gosystems. In addition, most undergraduate accounting programs only have one class in taxation. Professors are teaching as if personal computers were never invented, or the United States never transitioned from a manufacturing to a service-based economy.
I graduated from NYU Stern in 2009, which is always ranked as one of the top 10 accounting schools in the country (“Best Undergraduate Accounting Programs,” U.S. News & World Report, http://bit.ly/2HgQa9l), but I learned almost nothing in school that applies to the technical tasks that I do the most, which are primarily in tax and consulting. I had to learn almost everything on the job. Without the right mentorship, I could have easily fallen through the cracks, decided that becoming a CPA wasn’t for me, and transitioned out of the profession, just as many young accountants are doing.
What Changes Are Needed?
The collegiate accounting curriculum needs to be completely overhauled. First, stop teaching accounting with ledger sheets and pen and paper. Classes can spend one day on how things used to be done—as a history lesson—but then needs to move on to spreadsheets and software. Every accounting class taught in college should have a focus on technology. Accounting students need to be taught how to interpret data, understand when things are right and wrong, and discover why things don’t balance. They need to learn how to prepare a tax return, reconcile a Quickbooks file, do a sales tax return, interpret a balance sheet, and advise clients on whether they can hire a new person based on their cash flow.
Second, teach relevant topics for the 21st century and the service economy. Professors need to teach to where the accounting industry is now and where it’s transitioning to, which is consulting and advising. There should be many more tax classes and many more CFO/controllership classes. Cost accounting and government accounting should be made electives; these classes might be important to some, but most of the students are likely never going to see or do this type of work.
Finally, and most importantly, the CPA exam needs to be incorporated into the curriculum, so that when students graduate, they have already taken and passed the exam. So many young people struggle to pass the exam out of college, especially if they are trying to start a career and potentially start a family. Some schools have started to do this, such as Clemson University (http://bit.ly/2Hioa5j), but all schools need to make it a goal.
How can practicing professionals help? Most probably have connections at local universities or colleges where they or their firms recruit. These faculty members need to be pushed to update their curricula. Every interaction with a professor or dean needs to include a discussion of what firms want to see from students and the skills that the college is not teaching them. There also needs to be pressure on the AICPA, NASBA, and state boards to update the CPA requirements to remove the minimum number of hours of cost or government accounting.
The world has changed, and the accounting profession is changing with it. Universities and colleges need to catch up.