Accounting education.

We offer a seminar in accounting topics that's the capstone course for our M.S. in accounting program. Students are required to find a real-world accounting problem at a local business, create a game plan and present the solution before an audience of CPAs and businesspeople from the community. Having to present their solutions in public motivates the students to select a relevant topic, research it effectively and deliver the solution professionally.

Some students have difficulty with an assignment that's open-ended; they would prefer to be assigned a specific research topic rather than have the responsibility of identifying an actual problem in the work place on their own. However, many of our students already have a real-world problem on their minds-- finding the right job after graduation--and this assignment encourages them to reach out to local businesses and network. While library research is essential, each student must interact with businesspeople to identify a pressing problem and work out a solution. (They have 12 weeks to do so, and the time frame is a real-world problem in itself.) Moreover, students find that talking about their projects is an excellent way to break the ice at job interviews-- and demonstrate their problem-solving ability to a potential employer.

One of the most exciting classes I've given in my teaching career is a seminar on corporate accounting policy. Rather than introduce new subject matter, the seminar helps students determine how accounting problems are resolved in the real world. Its objective is to help students go beyond the traditional "correct-solution" mentality and acquire the multidimensional mindset decision makers need when using financial statements.

Much of the discussion focuses on analyzing annual reports--the management discussion and analysis section, the financial statements, the disclosures and the financial analysis--so students understand the nature of the transactions and events involved and the industry at hand. A substantial amount of time is devoted to five seven-page papers that focus on disclosures. Students are encouraged to identify and understand the interests involved in decision making.

Throughout the course, I ask students to look beyond the numbers to the social, economic and political impact of business events on an enterprise in a free market. Students sometimes have difficulty making the transition from a solution-oriented mentality to a decision-making mentality. It's been quite an experience to offer students the opportunity to be creative and assimilate and apply the knowledge they've accumulated about accounting, auditing and taxes to make real-world decisions based on financial reporting.

Not too long ago, the instructional focus was on the procedural aspects of highly technical issues such as measuring deferred income taxes or calculating pension expense. Today, increasing attention is devoted to developing students' understanding of accounting concepts. If tomorrow's accountants are to meet the expectations of their employers and society, they must have a more sophisticated understanding of the economic and behavioral consequences of accounting as well as the role of financial statements in society.

I use real-world case studies to sharpen students' analytical and problem-solving skills. By design, the cases often involve complex situations in which the accounting problem is not readily apparent. Moreover, I require students to work in groups so they improve their communications and interpersonal skills, which are crucial for advancement in today's team-oriented work place.

When researching and preparing case write-ups, students no longer thumb through their accounting standards manuals. Instead, I encourage them to use electronic databases and CD-ROM software; in educating accountants for the 21st century, I focus on teaching students how to learn so they can find answers for themselves in an increasingly complex business world.

Preparing students to find practical solutions to real business problems must be grounded on a thorough understanding of the functional areas of business: accounting, finance, management information systems, marketing and management. Just as important is a thorough understanding of the environment in which an enterprise operates. This requires a knowledge of economics, the financial system, the law and the international sector. With this background, students should be able to understand the concepts, tools and language of business needed to analyze business problems.

I use case studies to prepare students for real-world problem solving. I usually appoint a leader--or "chief executive officer"--for each team. The CEO is responsible for leading, organizing and controlling the destiny of the group as it seeks a solution to the case-study problem. Many students initially do not want to lead; they prefer to follow. But when forced to lead, to organize, to control and to arbitrate interpersonal disputes, students often discover talents they didn't know they had. Even though case studies aren't real, the experience of leading and controlling a group gives students an understanding of how decision makers solve problems in the real world.

California State University at Sacramento has a Center for Small Business that gives students an opportunity to work with local enterprises that need help solving problems of all kinds. A distinct advantage of this program is that students quickly learn how the functional areas of business interrelate.

In teaching undergraduate and graduate courses on government and not-for-profit organization accounting and financial reporting, I try to balance discussions of accounting theory with illustrations of accounting practice. I use many actual examples of facts and circumstances that require decisions in the real world. In the process, I focus on formulating logical and workable solutions rather than memorizing facts.

I ask my students to analyze municipal comprehensive annual financial reports (CAFRs). I encourage them to note and evaluate practices reported in the CAFRs that seem to be at odds with what they've learned from their textbooks. Graduate students participate in hands-on, real-world research projects that evaluate how municipal governments are implementing important new accounting standards as well as the nature and effect of changes in accounting principles on the financial statements of municipalities implementing the standards.

In my classes (size permitting), I emphasize effective written and oral communications because these skills are prerequisites of effective problem solving.