African American students and the CPA exam: mentoring, internships and scholarship programs can draw students into the profession.EXECUTIVE SUMMARY * DESPITE DECADES OF EFFORT by organizations such as the AICPA AICPA See American Institute of Certified Public Accountants (AICPA). and NASBA NASBA National Association of State Boards of Accountancy NASBA Nucleic Acid Sequence-Based Amplification (assay used to detect HIV viral load in blood plasma) to bring more minority candidates into the profession, the numbers are still small. Still, there were 5,731 African American African American Multiculture A person having origins in any of the black racial groups of Africa. See Race. candidates for the CPA (Computer Press Association, Landing, NJ) An earlier membership organization founded in 1983 that promoted excellence in computer journalism. Its annual awards honored outstanding examples in print, broadcast and electronic media. The CPA disbanded in 2000. exam in 2002--the largest for any year since 1997. * THE DATA SUGGEST A SEVERE SHORTAGE of African American males under age 25 holding graduate degrees. * SINCE MANY STUDENTS DECIDE TO major in accounting as early as high school, employers should begin to build relationships with high school juniors and seniors through summer job opportunities. * THE VAST MAJORITY OF CANDIDATES are concentrated in 10 states. Employers in other states need to be more creative in finding and hiring CPAs. * PROGRESS IS BEING MADE. Much of the success can likely be attributed to mentoring, internship internship /in·tern·ship/ (in´tern-ship) the position or term of service of an intern in a hospital. internship, n the course work or practicum conducted in a professional dental clinic. and co-op programs, and scholarship programs at the undergraduate, master's mas·ter's n. A master's degree. and doctoral levels. ********** The news is good--more African Americans than ever are taking the CPA exam. But it could be better--the profession has a long way to go before it is fully integrated. This article highlights the performance of African Americans on the Uniform CPA Examinations for 2000, 2001 and 2002, using data extracted from candidate-supplied questionnaires collected by the National Association of State Boards of Accountancy For the technique in nucleic acid amplification, see . The National Association of State Boards of Accountancy (NASBA) is an umbrella group for the 55 state boards that regulate the accountancy profession in the United States of America. (NASBA). We'll we'll Contraction of we will. we'll we will or we shall we'll will ~shall look at the number of African Americans sitting for and passing the exam to help determine how best to attract minority students to the profession, and provide commentary on the research results to help employers, accounting educators and candidates adapt to the new computerized computerized adapted for analysis, storage and retrieval on a computer. computerized axial tomography see computed tomography. exam format. THE NUMBERS There's very little hard evidence about the numbers of African Americans who are CPAs, even after decades of effort by the AICPA (see "AICPA Diversity Initiatives," page 63) and NASBA to bring more minorities into the accounting profession. African Americans in 2000 made up 12% of the U.S. population, but only 5% of CPA exam candidates. Fortunately the statistics for CPA candidates are better-documented. An average of 2,598 African Americans--653 first-time and 1,945 repeat candidates--sat for each exam between 2000 and 2002 (see exhibit 1, page 61). The data for 2000, 2001 and 2002 show no consistent trend for first-time candidates. Comparing them with the 1997-1999 exams does reveal a decline, however. The number of first-time African American candidates fell sharply from 2000 to 2002--a worrisome trend. But the total number of candidates rose steadily from 1997 to 2002, hitting a new high of 5,731. Commentary. About half the states that enacted the 150-hour education requirement made it effective between 2000 and 2002; several of those states had significant numbers of African American candidates. This may explain the decline in first-time candidates. States typically have a bulge Bulge A slang term used to describe a rapid advance in prices within the commodities market. Notes: A bulge is similar to a rally on equity exchanges. See also: At The Market, Bear, Break, Bull, Buoyant, Congestion, Rally Bulge in the first-time category before their 150-hour rule takes effect, since sitting prior to the effective date allows candidates to be grandfathered in grandfathered in adj. refers to continued use of property as it was when restrictions or zoning ordinances were adopted. under pre- pre- word element [L.], before (in time or space). pre- pref. 1. Earlier; before; prior to: prenatal. 2. 150-hour rules. A CLOSER LOON loon, common name for migratory aquatic birds found in fresh- and saltwater in the colder parts of the Northern Hemisphere. Its strange, laughing call carries for great distances. Like the grebes, loons float low in the water and their legs are placed far back. AT THE CANDIDATES Sex. A majority of African American candidates--between 62% and 65%--were female. While the percentage of males did increase in November November: see month. 2001 and all of 2002, females still clearly dominated the African American candidate pool. Age. The age of the candidate pool has been fairly consistent over the six exams, with about half the candidates less than 30 years of age (exhibit 2, below). Nearly one-third of all candidates were in the 30-39 age group. The under- under- pref. 1. Beneath or below in position: underground. 2. Inferior or subordinate in rank or importance: undersecretary. 3. 25 group, which includes recent college graduates, made up between 19% and 24% of candidates on each exam. Education. Three of every four African American candidates--73% to 80%--held bachelor's bach·e·lor's n. A bachelor's degree. degrees only, though 40% had earned 150 or more semester hours Noun 1. semester hour - a unit of academic credit; one hour a week for an academic semester credit hour course credit, credit - recognition by a college or university that a course of studies has been successfully completed; typically measured in semester hours of college credits. Many candidates completed more accounting hours than the 24 to 30 hours typically required for a bachelor's degree; the majority completed 31 hours or more and about a third completed 37 or more. Decision to study accounting. The data suggest candidates decided to study accounting quite early (see exhibit 3, page 62). More than half (52%) made their decisions by high school and 28% did so during their first two years of undergraduate school. Only 7% to 9% decided to study accounting after obtaining their undergraduate degrees “First degree” redirects here. For the BBC television series, see First Degree. An undergraduate degree (sometimes called a first degree or simply a degree . State origins. The majority of African American candidates are concentrated in 10 states: California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). , Georgia Georgia, country, Asia Georgia (jôr`jə), Georgian Sakartvelo, Rus. Gruziya, officially Republic of Georgia, republic (2005 est. pop. 4,677,000), c.26,900 sq mi (69,700 sq km), in W Transcaucasia. , Illinois Illinois, river, United States Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. , Maryland Maryland (mâr`ələnd), one of the Middle Atlantic states of the United States. It is bounded by Delaware and the Atlantic Ocean (E), the District of Columbia (S), Virginia and West Virginia (S, W), and Pennsylvania (N). , New Jersey, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. , Pennsylvania Pennsylvania (pĕnsəlvā`nyə), one of the Middle Atlantic states of the United States. It is bordered by New Jersey, across the Delaware River (E), Delaware (SE), Maryland (S), West Virginia (SW), Ohio (W), and Lake Erie and New York , Texas and Virginia Virginia, state, United States Virginia, state of the south-central United States. It is bordered by the Atlantic Ocean (E), North Carolina and Tennessee (S), Kentucky and West Virginia (W), and Maryland and the District of Columbia (N and NE). , which account for nearly three-fourths Noun 1. three-fourths - three of four equal parts; "three-fourths of a pound" three-quarters common fraction, simple fraction - the quotient of two integers of all African American candidates (exhibit 4, page 64). Commentary. The data suggest a severe shortage of young (under age 25) African American males holding graduate degrees, though candidates fitting that profile likely would command above-average salaries. Several large CPA firms have been outstanding in attracting new hires without graduate degrees by offering specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. master's degrees master's degree n. An academic degree conferred by a college or university upon those who complete at least one year of prescribed study beyond the bachelor's degree. Noun 1. in conjunction with several major universities; employers should note that offering tuition For tuition fees in the United Kingdom, see . Tuition means instruction, teaching or a fee charged for educational instruction especially at a formal institution of learning or by a private tutor usually in the form of one-to-one tuition. reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. for graduate education helps attract African Americans. Employers also could start to build relationships with would-be African American CPAs as early as high school, when many candidates make their career choices, by offering summer jobs to juniors and seniors who have expressed an interest in accounting. Employers in states other than the 10 where candidates are concentrated may need to be more creative to attract a diverse employee base. PASS RATES Five states allowed first-time candidates to sit for fewer than all four subjects during the years we studied, so not all candidates included in exhibit 5, page 64, completed all the exam subjects. Over the three years studied, a total of 304 first-time candidates passed all subjects attempted. Annual pass rates for first-time candidates ranged from 5% in 2000 to 9% for 2001 and 2002. The number and percentage of repeat candidates passing all parts attempted were significantly better. The number of repeat candidates passing all subjects attempted was 549 in 2000, 570 in 2001, and 753 in 2002 with annual passing rates of 15% to 17%. Pass rates of repeat candidates were almost double--and, in 2000, triple--that of first timers. A total of 2,176 candidates passed all subjects attempted over the three years--an average of 725 candidates per year. Commentary. The computerized CPA exam has shifted much of the attention away from the statistics for passing all four subjects during one exam administration. The exam now is administered during four "exam windows" (two-month periods of testing) each year. Most states allow candidates to sit for as few as one subject per window, but once candidates sit for and pass one subject, they must complete all remaining subjects within 18 months. Still, the fact that more and more African American candidates are passing all subjects they attempt is encouraging: 260 more candidates--43% more--passed all subjects in 2002 than in 2000. Average subject pass rates, ranked from highest to lowest, for first-time candidates were: law and professional responsibilities (LPR See LPR/LPD. lpr - Line printer. The Unix print command. This does not actually print files but rather copies (or links) them to a spool area from where a daemon copies them to the printer. ) about 22%, auditing (AUDIT) 18% and then either accounting and reporting (ARE) or financial accounting and reporting (FARE) at about 13% each. For individual exam administration periods, the ARE pass rates exceeded the FARE pass rates for three of the exams; the opposite was true for the other three exams (see exhibit 6, at right). The highest first-time pass rate was on LPR in November 2001, 27%; the lowest was on ARE in November 2000, 7%. Subject pass rates for repeat candidates were much higher than those for first-time candidates (exhibit 7, at right): law and professional responsibilities (LPR) 28%, auditing (AUDIT) 24%, accounting and reporting (FARE) 18% and financial accounting and reporting (FARE) 15%. Pass rates for repeat candidates were consistently in double digits Double Digits was a pricing game on the American television game show, The Price Is Right. Played from April 20, 1973 through May 18, 1973's show, it was played for a car and used small prizes. . The highest repeat candidate pass rate was 31% for LPR in November 2002; the lowest was 13% on ARE in November 2000. Commentary. Educators, employers and students should note that persistence (1) In a CRT, the time a phosphor dot remains illuminated after being energized. Long-persistence phosphors reduce flicker, but generate ghost-like images that linger on screen for a fraction of a second. does pay off--as pass rates for repeat candidates were higher than those for first-time candidates--and that single-subject pass rates were significantly higher than rates for all subjects. This point has strategic significance for candidates who may now select the number of subject areas they attempt during an exam window. Note that subject areas on the computerized exam have been reconstituted and renamed, and new topics--such as a new business environment and concepts subject area--are being tested. THE LIMITS OF THE DATA The primary limitations of this study lie in its data-gathering technique. With the exception of exam scores, data were gathered through questionnaires provided to all African American candidates; numbers therefore were self-reported. Since only questionnaires of candidates who participated were considered, the numbers may not be precise. EMPLOYERS AND CANDIDATES TAKE NOTE This study shows that substantial numbers of African Americans are taking the CPA exam, and participation and success rates are on the rise. As many as 725 per year are passing the exam--significant progress from 1989, when the total number of African American CPAs in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. was just 2,500. While two-thirds of the candidates were female, the number of males is growing. Much of the progress shown in the study can be attributed to mentoring, internships and co-op programs and scholarship programs at the undergraduate, master's and doctoral levels. Still, the profession has a long way to go before it is fully integrated in fact as well as in the ideal.
Exhibit 1: Number of African American Candidates
2000 2001 2002
May First-time 583 (25%) 457 (22%) 609 (22%)
Repeat 1,768 (75%) 1,661 (78%) 2,197 (78%)
Total 2,351 2,118 2,806
November First-time 717 (29%) 865 (30%) 690 (24%)
Repeat 1,770 (71%) 2,037 (70%) 2,235 (76%)
Total 2,487 2,902 2,925
Year First-time 1,300 (27%) 1,322 (26%) 1,299 (23%)
Repeat 3,538 (73%) 3,698 (74%) 4,432 (77%)
Total 4,838 5,020 5,731
Exhibit 2: Age and Degrees Obtained *
2000
May November
Gender: Female 65% 65%
Male 35 36
Age: Under 25 23 23
25-29 28 27
30-39 33 34
40+ 16 16
Education: Doctorate 0.1 --
Master's in accounting 6 6
MBA in accounting 4 3
MBA in other
business subject 6 5
Master's in
nonbusiness subject 1 1
Law 0.04 --
Bachelor's 79 80
No degree 4 5
Total hours: Fewer than 120 2 3
120-130 37 38
131-149 26 25
150-160 16 17
More than 160 18 17
2001
May November
Gender: Female 65% 62%
Male 35 39
Age: Under 25 22 24
25-29 27 26
30-39 34 34
40+ 17 16
Education: Doctorate -- 0.1
Master's in accounting 8 9
MBA in accounting 4 4
MBA in other
business subject 6 6
Master's in
nonbusiness subject 1 1
Law 0.2 0.2
Bachelor's 77 75
No degree 4 5
Total hours: Fewer than 120 3 3
120-130 35 32
131-149 24 22
150-160 20 23
More than 160 19 20
2002
May November
Gender: Female 62% 62%
Male 38 38
Age: Under 25 19 20
25-29 26 26
30-39 37 36
40+ 17 18
Education: Doctorate 0.1 0.2
Master's in accounting 9 10
MBA in accounting 5 4
MBA in other
business subject 7 7
Master's in
nonbusiness subject 1 1
Law 0.2 0.2
Bachelor's 74 73
No degree 4 5
Total hours: Fewer than 120 4 4
120-130 32 30
131-149 22 21
150-160 23 25
More than 160 20 20
* Percentages are based on number of candidates in exhibit 1 who
answered each question. Numbers may not total 100% due to rounding.
Exhibit 3: Accumulated Hours and Early Interest in Studies *
2000 2001
May November May November
Accounting hours earned:
0-9 3% 3% 3% 3%
10-14 0.8 0.8 1 1
15-23 5 5 5 5
24-30 35 34 32 31
31-36 25 25 26 26
37-42 14 13 12 14
43+ 18 20 21 20
Decision to study accounting:
By high school graduation 53% 55% 53% 50%
First half of college 29 27 29 29
Second half of college 8 9 8 9
Post-undergraduate 7 7 7 9
Other 3 2 3 4
2002
May November
Accounting hours earned:
0-9 3% 4%
10-14 1 1
15-23 5 5
24-30 30 29
31-36 26 25
37-42 13 14
43+ 22 21
Decision to study accounting:
By high school graduation 50% 51%
First half of college 28 27
Second half of college 9 10
Post-undergraduate 8 9
Other 5 4
* Percentages are based on number of candidates in exhibit 1 who
answered each question. Numbers may not total 100% due to rounding.
Exhibit 4: Top 10
States With Average
Percentage of
Three-Year Total
New York 15%
Maryland 10%
Virginia 9%
California 8%
Illinois 8%
Texas 6%
Georgia 5%
North Carolina 5%
Pennsylvania 4%
New Jersey 3%
Exhibit 5: Pass Rates--Passed All Subjects Attempted *
2000 2001 2002
First-time 63/1,300 = 5% 122/1,322 = 9% 119/1,299 = 9%
Repeat 549/3,538 = 16% 570/3,698 = 15% 753/4,432 = 17%
Total 612/4,838 = 13% 692/5,020 = 14% 872/5,731 = 15%
* Passing defined as scoring 75% correct.
Exhibit 6: First-Time Pass Rates by Subject *
2000 2001 2002
May LPR 18% 22% 23%
AUDIT 16 17 19
FARE 11 13 15
ARE 12 12 14
November LPR 13 27 26
AUDIT 12 23 22
ARE 7 17 18
FARE 8 16 17
* Passing defined as scoring 75% correct.
Exhibit 7: Pass Rates by Subjects--Repeat *
2000 2001 2002
May LPR 30% 24% 29%
AUDIT 23 24 27
ARE 19 19 19
FARE 15 15 17
November LPR 27 29 31
AUDIT 22 24 26
ARE 13 20 20
FARE 14 15 14
* Passing defined as scoring 75% correct.
A Gap in Representation African Americans make up 12% of the U.S. population, but only about 5% of CPA exam candidates. To see the original paper written by Dr. Booker, from which this article was excerpted, go to www.aicpa.org/download/pubs/ jofa/academic2.doc. RELATED ARTICLE: AICPA diversity initiatives. Statistics from the AICPA's 2004 study, The Supply of Accounting Graduates and the Demand for Public Accounting Recruits, confirm Dr. Booker's findings. Even now, only 7% of CPAs employed by accounting firms are minorities. While the problem is easy to observe, finding a solution is much more complex. With a membership base of over 340,000 CPAs, the Institute realizes that it takes 3,400 new CPAs to move the needle one percentage point. We need programs that have a wide and deep impact into all communities of color not of the white race; - commonly meaning, esp. in the United States, of negro blood, pure or mixed. See also: Color . The strategic programs the Institute has put together to address the challenge of diversifying the accounting profession therefore address several fronts, targeting high school and college students as well as educators. Key AICPA programs include: Advertising The "Be A Star in Business" and "Start Here, Go Places" advertising campaigns connect print and interactive advertising developed specifically to expose young people of color Noun 1. people of color - a race with skin pigmentation different from the white race (especially Blacks) people of colour, colour, color race - people who are believed to belong to the same genetic stock; "some biologists doubt that there are important to the accounting profession. (For more information see www.aicpa.org/members/ div/career/mini/be_star_business.htm.) College Residency A duration of stay required by state and local laws that entitles a person to the legal protection and benefits provided by applicable statutes. States have required state residency for a variety of rights, including the right to vote, the right to run for public office, the Programs Weeklong week·long adj. Continuing through the week: a weeklong conference. Adj. 1. weeklong - lasting through a week; "her weeklong vacation" seven-day programs expose minority high school students and their parents to opportunities in accounting and other business careers. Students learn accounting, business, and social skills while living on college campuses. Since the program began in 1997, 25 programs have been funded nationwide; 90% of them are operational today. (See www.aicpa.org/members/div/career/mini/college_residency_program.htm.) Minority Scholarship Program The AICPA has awarded more than $6 million to 1,300 students in the past 10 years. In 2004 students at 107 universities received 157 scholarships totaling $488,000. Judged most likely to become CPAs, these students earned overall and accounting GPAs averaging 3.80. (See www.aicpa.org/ members/div/career/mini/smas.htm.) Accounting Scholars Leadership Workshop Two-day workshops focus on leadership, team-building, communication and presentation skills. They are designed to expose top college minority accounting students to leaders in the profession and reinforce the importance of the CPA designation. Over the past 10 years 800 undergraduate and graduate students have participated. (See www. aicpa.org/members/div/career/mini/ aslw.htm.) The PhD Project This partnership of forward-thinking corporations, led by KPMG KPMG Klynveld Peat Marwick Goerdeler (accounting firm) KPMG Kaiser Permanente Medical Group KPMG Keiner Prüft Mehr Genau (German) KPMG Kommen Prüfen Meckern Gehen , provides a critical support system for PhD candidates during their doctoral programs and creates a pipeline of potential professors of accounting and other business disciplines. The program has doubled the number of minority PhD'S in the classroom--and the number of role models for today's students. Minority Doctoral Fellowships Leveraging the efforts of the PhD project, the fellowships provide financial support to minority PhD candidates studying accounting. Fifty-three recipients of AICPA fellowships completed their PhD programs; 98% are teaching accounting at the university level and 86% are accredited accredited recognition by an appropriate authority that the performance of a particular institution has satisfied a prestated set of criteria. accredited herds cattle herds which have achieved a low level of reactors to, e.g. CPAs. This year there are 18 PhD candidates in the pipeline. (See www.aicpa. org/members/div/career/mini/ fmds.htm.) Strategic Partnerships The AICPA has developed key partnerships with the Association of Latino Professionals in Finance and Accounting (ALPFA ALPFA Association of Latino Professionals in Finance and Accounting ), the National Association of Black Accountants (NABA NABA North American Butterfly Association NABA National Association of Black Accountants NABA National Adult Baseball Association NABA North American Bullriding Association NABA North American Broadcasters Association NABA Namibian Biotechnology Alliance ), the Diversity Pipeline Alliance, INROADS inroads Noun, pl make inroads into to start affecting or reducing: my gambling has made great inroads into my savings inroads npl to make inroads into [+ and the National Academy Foundation to attract and support minority students interested in pursuing a career in accounting. If you are interested in helping bring the message of the AICPA or your local state society to the high school or college classroom, please go to the Academic and Career Development (ACD (Automatic Call Distributor) A computerized phone system that responds to the caller with a voice menu and connects the call to the appropriate agent. It can also distribute calls equally to agents. ) Team Web site at www.aicpa. org/members/div/career/index.htm. To speak with a manager about the programs, contact Daniel Hobson, manager, minority initiatives, at dhobson@aicpa.org or Jodi Ryan, manager, recruiting programs, at jryan@aicpa.org. --Daniel Hobson, manager, minority initiatives, AICPA QUINTON BOOKER, CPA, DBA, is professor and chairman of the department of accounting at Jackson State University Jackson State University, often abridged as Jackson State or by its initials JSU is a historically black university located in Jackson, Mississippi founded in 1877. , Mississippi Mississippi, state, United States Mississippi (mĭs'əsĭp`ē), one of the Deep South states of the United States. It is bordered by Alabama (E), the Gulf of Mexico (S), Arkansas and Louisiana, with most of the border formed by . His e-mail address See Internet address. e-mail address - electronic mail address is qbooker@jsums.edu. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion