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Developing management accountants.

Alverno College in Milwaukee, Wis., has been a leader in creating innovative ability-based undergraduate education for more than 40 years. Our approach is based on three key principles: (1) Students should be able to apply what they know; (2) abilities are complex--integrating knowledge, dispositions, skills, and self-awareness; and (3) assessment is central to learning--helping students to learn and validating their achievements. As members of the accounting faculty, we asked, "What does ability-based education mean for an advanced-level undergraduate specialization in a program such as accounting?" What emerged is a set of professional outcomes for students majoring in management accounting, an innovative curriculum to prepare them for entry-level accounting careers, and a solid foundation for ongoing professional development.

We believe that the unique features of a liberally educated accountant--an accountant who integrates abilities and knowledge to both think and act--meet the needs of today's agile business organization. Information has become less expensive, and global markets have led to increased competition, so management requires better information more quickly for decision making. These significant environmental changes require a new emphasis in accounting curricula on business strategy, management issues, use of accounting knowledge to support decisions, and skills that management accountants need to be contributing members of the management team. Management accountants had already moved beyond just crunching numbers and were working on cross-functional teams and were actively involved in decision making. For example, planning, budgeting, and forecasting are critical activities for today's management accountant to support the operation and strategy of an organization. Others are communication skills--oral, written, and presentation--the ability to work on a team, analytical skills, and a solid understanding of accounting and how a business functions.

Because Alverno is a liberal arts college, we needed to situate the management accounting major within the broader definition of a liberal arts education. In this context, the Alverno faculty identified eight general areas of ability as essential attributes of the liberally educated individual:

* Communication,

* Analysis,

* Problem Solving,

* Valuing in Decision Making,

* Social Interaction,

* Developing a Global Perspective,

* Effective Citizenship, and

* Aesthetic Engagement.

Alverno's entire faculty work collaboratively, teaching students to develop these abilities and reinforcing their efforts. Members of the accounting faculty emphasize the teaching of communication, analysis, problem solving, social interaction, and valuing as central abilities of the accounting profession, but they also recognize their responsibility to reinforce all the abilities and to help students integrate them in as many contexts as possible. Ultimately, a student's ability to seamlessly integrate these abilities is the mark of a liberally educated individual.

Table 1 illustrates how these eight abilities are incorporated into the management accounting major to provide the framework for students to develop into competent accounting professionals. The development of communication abilities illustrates how this plays out in the accounting curriculum. In the beginning accounting course, students use their communication skills to explain accounting concepts to a general business audience. In later courses, students further develop this ability in more complex settings with more complicated concepts. They explain to owners of a business the financial record adjustments required to bring their financial statements into compliance with Generally Accepted Accounting Principles (GAAP). They also practice their oral communication skills, integrating their accounting knowledge and ability to use technology to a make a professional presentation to a business audience, say, key shareholders of a privately held company.

Table 1: Contextualizing College-Wide Abilities in Management Accounting

Communication: Uses oral and written communication skills to meet the needs of various audiences. In this process the student selects, uses, and integrates appropriate technology and software skills to develop informative, explanatory, and persuasive presentations to a variety of audiences, including external and internal users, business and nonbusiness users.

Analysis: Brings a unique accounting perspective to the analysis of organizational issues through the selection and application of accounting principles and frameworks to support and influence decision making.

Problem Solving: Adapts problem-solving processes and integrates them with accounting frameworks to solve problems and improve processes in an organizational context.

Valuing in Decision Making: Integrates personal values and a professional code of conduct to respond to issues in a managerial context. Analyzes valuing and ethical issues that arise from the perspective of various stakeholders.

Social Interaction: Uses appropriate interpersonal and group theory to deal with interpersonal, team, stakeholder, and professional situations to inform, persuade, and influence.

Developing a Global Perspective: Works effectively with the diversity in the workplace by framing accounting issues in a broader global context, understanding the social and cultural roots of accounting standards, and providing accounting support as part of a global business strategy.

Effective Citizenship: Understands corporate social responsibility within organizational contexts and the social role and impact of accounting information. Integrates personal, professional, and community values in a decision-making context as a member of an organizational management team.

Aesthetic Engagement: Combines abilities developed in the liberal arts (a heightened aesthetic sensibility, a way of seeing beneath the surface of things, and a desire to engage texts intensely and personally) with business principles to understand broader social and organizational issues and create a personal world view that influences interactions and actions.

Combining a strong liberal arts background and an emphasis on affective and qualitative abilities is in line with the skills all accountants need to be effective in their field. This integration of abilities with discipline and Content--such as accounting, finance, economics, marketing, organizational theory, technology, business policy, and strategy--helps students develop as self-aware, independent, lifelong learners. Being reflective practitioners is at the heart of being professional management accountants in the 21st Century workplace.

Professional Outcomes for the Management Accounting Major

In 1994, management accounting was introduced as a specialization within the School of Business. It built on existing courses and introduced two new accounting courses to provide a program that established a competitive edge by targeting students interested in a career in industry rather than public accounting. The program was so popular that Alverno established a major in management accounting in 1999. Table 2 identifies the professional outcomes for the management accounting major and represents what our students should be able to do with what they know when they graduate.

Table 2: Professional Outcomes for the Management Accounting Major

1. Analytical Thinking and Action

The student integrates principles from accounting and management theory with liberal arts, learning to interpret and analyze business situations and to communicate effectively with others in a variety of contexts.

2. Cooperative Organizational Thinking and Action

The student uses accounting frameworks to initiate and implement problem solving and process improvement in organizational contexts.

3. Perspective Taking and Working with Other

The student uses management theory to interact effectively in professional contexts that require leadership of groups or other types of interpersonal interactions.

4. Developing Self and Acting with Integrity

The student responds to management and accounting issues in a manner consistent with personal and professional codes of conduct.

These outcomes serve as a learning map for students and a curriculum plan for faculty as they create courses, learning experiences, and assessments that help students achieve these outcomes throughout their studies. Within a course, learning experiences and performance assessments are designed with criteria related directly to the explicit course outcomes. These professional outcomes guide faculty as they refine course content and assignments.

Creating an Effective Curriculum in Management Accounting

As we began the process of creating the management accounting major, we realized that our graduates weren't integrating their accounting knowledge effectively to address business issues. They tended to address problems from a limited, discrete accounting perspective, which was how accounting courses were taught. This conflicted with our strong belief that our students need to integrate their accounting, management, and liberal arts coursework to meet the needs of the profession and be effective in the workplace.

Drawing on the research cited at the end of this article, we identified a framework to organize a coherent, integrated, and logical set of learning experiences that would help students develop skills the professional management accountant required. This sets the accounting curriculum in a broad business and liberal arts context. It also provides the opportunity to blend traditional accounting topics with emerging topics in a coherent, integrated way.

Table 3 shows the developmental sequence and coordination of the management accounting major and its business and management components.
Table 3: Management Accounting Major and its Business
and Management Components


Foundation Courses * Introduction to * Introduction to
 Accounting Management
 * Accounting * Economic
 Principles Environment
 * Microeconomics

Integrating Accounting Issues: * Managing in
Accounting and Organizations
Supporting Courses
 * New Enterprise * Probability and
 * Reporting and * Marketing
 Management Principles and
 * Growth and * Finance
 * Going Public * Experiential
 Learning Seminar
 * Internship

Capstone Professional * Audit: Internal and * Small Business
Experiences and External Management
Advanced Courses
 * Independent Study * Business Policy and
 for CMA Examination Strategy
 * Electives * Business Enterprise
 * Electives

In "Introduction to Accounting," faculty introduce students to the conceptual framework and qualitative characteristics of accounting information that make it useful to a wide range of internal and external stakeholders, such as owners, managers, creditors, and investors. This stakeholder focus is reinforced in subsequent courses as students explore their knowledge of accounting principles and integrate it with an understanding of and appreciation for a professional code of conduct. Drawing on a framework for valuing in decision making introduced in their general education courses, students consider the multiple perspectives of owners, managers, customers, and employees when addressing financial recording and reporting issues. They must demonstrate their understanding of the responsibilities of the practicing professional accountant and use their accounting knowledge to argue persuasively for the appropriate accounting treatment of business transactions. For example, in their role as accountants for a small business, students draw on their understanding of GAAP and adjusting entries to complete the company's accounting cycle. This results in a reported loss for the period, and students explain through a written report to upper management why the adjustments are required.

"Introduction to Management" provides a bridge from the liberal arts to the business and management curriculum. Students are introduced to a brief history of American business to put what they are learning into a broader social context. Then they're introduced to a variety of models, such as the stakeholder model, the balanced scorecard, and the four principal management functions of planning, organizing, leading, and controlling. The application of these models is reinforced throughout their coursework. In subsequent courses, students use the stakeholder model in addition to their accounting knowledge to recommend management actions to improve organizational performance while acknowledging the impact on stakeholders such as creditors.

We create integrated learning for students by designing performance-based assignments that put accounting problems in an organizational context and require a response that combines the ability to communicate effectively and think critically with the subject matter knowledge that's unique to accounting. In completing an in-basket exercise, students are assigned the role of controller for a small manufacturing business and address a variety of business and accounting problems. In one situation they complete a cost-volume-profit analysis to evaluate the impact of a new product on operating income, identify the sales required to meet the income targets, and justify a pricing recommendation. In another situation, students use their knowledge of costing and budgeting to respond to a comanager's concern about the strain the introduction of this new product will put on production facilities currently operating at capacity. Students develop a revised production plan that maximizes resource utilization and operating profits.

Integrating Accounting Courses and Intermediate Support Courses

As mentioned earlier, we grew increasingly dissatisfied with an accounting curriculum expressed as a series of discrete introductory, intermediate, and advanced courses that focused on financial and managerial accounting issues separately. We were also concerned that such a curriculum addressed neither the career paths of the majority of our students nor the accounting and business knowledge needed by students who intended to work as management accountants rather than public accountants.

Table 4 (see pages 58-59) shows the integrated accounting courses, supported by intermediate business and management courses, that provide our students with the knowledge and skills they need to take a strategic, integrated, and broad stakeholder approach to management accounting issues. In designing these integrated accounting courses, faculty focused on the stages and issues a business faces from inception to going public.
Table 4: Integrated Accounting Courses


MGA 275 1. Analytical Thinking and
New Enterprise Accounting Issues * Implement a balanced
 scorecard approach to
 organizational performance
 measurement and evaluation.

In this course, students use their 2. Cooperative Organizational
critical-thinking and Thinking and Action
problem-solving abilities to address
accounting and financial management
issues for a small business. These
include using accounting information
for strategic planning, supporting
decisions, and performance
measurement and understanding the
environment in which the company
 * Use cost behavior concepts to
 analyze operating costs to
 identify their impact on
 planning, decision making, and
 financial reporting.

 * Apply cost behavior concepts
 and cost-volume-profit analysis
 to influence and support
 strategic and operating
 decisions facing a new

 * Use planning and budgeting
 processes to support strategic
 and operating decisions that
 reflect a variety of
 stakeholder concerns and

 * Use income tax principles and
 regulations to address basic
 income tax accounting issues
 facing a small business.

 * Identify, critically
 evaluate, and select
 appropriate working capital
 management strategies to
 respond to a variety of
 stakeholder needs.
 3. Perspective Taking and
 Working with Others

 * Use interpersonal and
 task-oriented models to work
 effectively with others to
 address accounting issues.

 4. Developing Self and Acting
 with Integrity

 * Identify the relationship
 between Generally Accepted
 Accounting Principles and a
 professional code of conduct to
 address planning and earnings
 management issues.

 * Critically evaluate the
 regulatory and operating
 environments to ensure
 compliance with laws and GAAP
 to promote organizational
 social responsibility.

 * Draw upon and reinforce your
 valuing and social interaction
 abilities as you engage in
 independent and collaborative
 problem solving.

MGA 375 1. Analytical Thinking and

Reporting and Management Accounting * Identify and analyze the
Issues links between effective
 management accounting and
 control systems.

As the business grows, the * Integrate accounting and
professional accountant takes on an management knowledge with
even greater role in decision problem-solving abilities to
support and strategic decision identify and effectively
making. In this course, students address stakeholder accounting
apply their individual and issues.
interpersonal skills to deal with
more complex issues. They develop
and use management accounting
information to provide guidance to
management on cost management
systems, variance analysis, capital
budgeting, and performance
evaluation of responsibility

 2. Cooperative Organizational
 Thinking and Action

 * Identify, select, critically
 evaluate, and apply cost
 systems for this type of

 * Identify and explain
 connections between management
 accounting systems and
 financial reporting
 requirements as outlined in

 3. Perspective Taking and
 Working with Others

 * Use interpersonal and
 task-oriented models to work
 effectively with others to
 address accounting issues.

 4. Developing Self and Acting
 with Integrity

 * Identify the relationship
 between management accounting,
 GAAP, and a professional code
 of conduct to address planning

 * Draw upon and reinforce your
 valuing and social interaction
 abilities as you engage in
 independent and collaborative
 problem solving.

MGA 376 1. Analytical Thinking and

Growth and Expansion Accounting * Integrate accounting and
Issues management knowledge with
 problem-solving abilities to
 identify and effectively
 address stakeholder accounting

Students provide the accounting and * Communicate analyses and
financial expertise needed to conclusions to a variety of
support the implementation of global audiences.
business decisions. They add unique
value to the management team by
integrating liberal arts learning
and global perspective taking with
their accounting knowledge and
expand this accounting knowledge to
include international accounting

 2. Cooperative Organizational
 Thinking and Action

 * Research, critically
 evaluate, and apply GAAP to
 financial accounting issues.

 * Identify, explain, and
 critically evaluate connections
 between accounting theory and

 * Master necessary quantitative
 skills to respond to and
 accurately solve financial
 accounting problems.

 3. Perspective Taking and
 Working with Others

 * Using interpersonal and
 task-oriented models to work
 effectively with others to
 address accounting issues.

 4. Developing Self and Acting
 with Integrity

 * Identifying the relationship
 between Generally Accepted
 Accounting Principles and a
 professional code of conduct to
 address ethical dilemmas.

 * Drawing upon and reinforcing
 your valuing and social
 interaction abilities as you
 engage in independent and
 collaborative problem solving.

MGA 475 1. Analytical Thinking and

Going Public Accounting Issues * Selecting and evaluating
 appropriate written and oral
 communication strategies to
 communicate financial
 information to internal and
 external audiences.

Students critically examine the 2. Cooperative Organizational
accounting, managerial, and social Thinking and Action
implications of taking a business
public. They address complex
accounting and reporting issues by
integrating their accounting
knowledge with their citizenship
abilities in an ever-widening circle
of key stakeholders.

 * Integrating management
 accounting code of conduct,
 organizational code of conduct,
 and personal values to respond
 to ethical issues that arise in
 a global enterprise.

 3. Perspective Taking and
 Working with Others

 * Critically evaluating
 accounting implications of the
 strategic choices made by
 management in a global

 * Drawing upon and reinforcing
 your valuing and social
 interaction abilities as you
 engage in independent and
 collaborative problem solving.

 4. Developing Self and Acting
 with Integrity

 * Applying an accounting
 research model to identify and
 critically evaluate financial
 reporting issues facing an
 expanding global enterprise.

 * Mastering necessary
 quantitative skills to respond
 to advanced financial
 accounting problems.

MGA 487 1. Analytical Thinking and

Audit: Internal and External * Independently selecting,
 evaluating, and applying
 appropriate information quality
 assurance and internal control
 concepts to improve the
 relevance and reliability of
 information for decision

This course examines how * Using appropriate oral and
management, as a user and a source written communication skills to
of information, uses independent effectively communicate
assurance services, auditors, analyses and recommendations
internal consultants, and internal that will assist management to
control to inform themselves and better inform themselves,
other stakeholders. To effectively inform other stakeholders, and
manage the accounting environment, comply with laws, regulations,
management accountants need a clear and external reporting
understanding of information requirements.
quality, risk management, and the
controls that ensure the integrity
of information used for planning,
decision making, and financial
reporting. In this course, students
develop that understanding, examine
the management accountant's
responsibilities and professional
standards, and explore issues
related to information quality.

 2. Cooperative Organizational
 Thinking and Action

 * Identifying and applying
 decision models that use
 financial and nonfinancial
 information to add value for
 management and the business as
 a whole.

 * Identifying and applying
 appropriate information quality
 assurance and internal control
 concepts to ensure decisions
 are based on relevant and
 reliable information, assets
 are protected, and progress
 toward goals is monitored

 * Understanding and effectively
 communicating the role of
 information systems and
 assurance services in the
 organizational and external
 environments in order to
 respond to emerging issues.

 3. Perspective Taking and
 Working with Others

 * Independently identifying and
 applying appropriate
 interpersonal and team skills
 to gather, synthesize, and
 report information for decision

 * Acting in a manner consistent
 with the professional code of

 4. Developing Self and Acting
 with Integrity

 * Using a professional code of
 conduct to identify and resolve
 ethical and professional

Students make a critical transition as they progress through this curriculum: They focus less on learning and applying discrete abilities and move to the more integrated performances described in the professional outcomes for the management accounting major. Let's take a look at how accounting issues that affect one group of stakeholders--owners--evolves through this course sequence.

In "New Enterprise Accounting Issues," students are introduced to various forms of business organizations and are asked to do a comparative tax analysis to evaluate the impact of a Subchapter S election and recommend a strategy to minimize taxes. In this role of consultant to the business, students help the small business owner understand the role of accounting in strategic decision making, performance measurement, and control.

As they move on to "Reporting and Management Accounting Issues," they independently select and evaluate the use of accounting models to solve less-structured problems related to cost management systems and performance evaluation. Finally, in "Growth and Expansion Accounting Issues" and "Going Public Accounting Issues," they integrate their abilities with their knowledge of accounting standards to deal effectively with ill-defined, complex employee pension accounting and reporting issues, thus providing support to management. Students are guided in this progressive integration of knowledge and abilities by the articulation of each major outcome and the abilities inherent in them into developmental levels that make learning transparent to both students and faculty. Table 5 (see page 60) illustrates the increasingly complex nature of their problem-solving ability across courses.

Table 5: Problem-Solving Ability


Identifies and defines problems in structured, discipline-specific situations.


Independently selects and evaluates problem-solving strategies in a variety of discipline-specific situations.


Integrates a variety of discipline perspectives to collaboratively develop solutions to multifaceted organizational problems.


Uses accounting frameworks to initiate and implement problem solving and process improvement in organizational contexts.

Capstone Professional Experiences and Advanced Courses

At this level, students integrate their management accounting major with their advanced-level coursework in business and management. The nature of the learning experiences provides an opportunity for majors to apply their accounting knowledge in broader disciplinary contexts. For example, in "Small Business Management," students independently develop a business plan for their own business idea and integrate accounting information into their decision making to a greater degree. They are expected to develop pro forma financial statements and cash budgets to make sound business decisions supported by financial data and information.

The capstone accounting course, "Audit: Internal and External," is designed to expose students to a broad range of management issues from an accounting perspective. Students investigate the roles and responsibilities of management with regard to the preparation and reporting of financial information. Through case studies, they critically evaluate management's responsibility for financial information, the role of assurance services in mitigating risk, and the application of internal control concepts to implement an effective control environment to ensure the integrity of accounting information. This means that they identify important accounting and business issues in these cases, use their accounting and business knowledge to weigh alternative policy and operating decisions, and provide sound recommendations based on data and information.

At this point, students may elect to do an independent study that will prepare them to sit for the CMA[R] (Certified Management Accountant) exam so they can pursue a professional credential in the field of management accounting. This is one of the unique features of Alverno's management accounting program: When students complete it, they are eligible to take the CMA exam. The CMA exam content was an important framework that guided the design of this accounting program.

Professional Experiences

A number of experiences provide a bridge between academic work and professional practice that enables students to apply their accounting knowledge in a broader organizational context. They include internships, an experiential learning seminar, and a business practicum. As part of a business practicum, students serve as consultants to a small business or not-for-profit. These experiences add to their classroom contributions, bringing a practitioner perspective to issues and problems that enriches the class-room experience for all.

We believe extracurricular activities also provide students a unique opportunity to integrate the knowledge and skills they gained in the classroom, so we systematically design experiences to integrate classroom and extracurricular learning. We encourage management accounting majors to participate in the Alverno College Institute of Management Accountants Student Chapter (AIMASC). Through their involvement in AIMASC, they refine their professional skills, reinforce the habit of life-long professional development, and explore emerging accounting and business issues. Students also are encouraged to attend the monthly meetings of the Greater Milwaukee Chapter of IMA[R] to hear professionals speak on a variety of topics.

Seeing the Big Picture

The management accounting major at Alverno College is unique because it's based on the principles of liberal education and dedicated solely to management accounting. Students (and later their employers) benefit because of their ability to "see the big picture" and the important relationships that exist between accounting and other disciplines (e.g., management). In addition, management accounting students from Alverno College are equipped for lifelong learning, can integrate theory and practice, and can hone their problem-solving skills in situations that simulate the complexities of the business world. When they graduate, they are able to perform the duties of a management accountant their first day on the job.

Regina Grantz and William McEachern developed the management accounting major at Alverno and wrote a large part of Ability-Based Learning Program: Management Accounting Major, a 2001 publication of the Alverno College Institute that describes the program. They used several studies as a guide:

Alverno College Faculty, Analysis and Communication at Alverno: An Approach to Critical Thinking, 1984.

Alverno College Faculty, Valuing in Decision-making: Theory and Practice at Alverno College, 1992.

Gary Siegel and James E. Sorensen, The Institute of Management Accountants and Financial Executives Institute, Joint IMA/FEI Position Statement on the Results of a Survey: What Corporate America Wants in Entry-Level Accountants, 1994. Issued at the annual meeting of the American Accounting Association, New York, N.Y., August 12, 1994.

Gary Siegel and James E. Sorensen, The Practice Analysis of Management Accounting, Institute of Management Accountants, Montvale, N.J., 1996.

Gary Siegel and James E. Sorensen, Counting More, Counting Less, Transformations in the Management Accounting Profession, The 1999 Practice Analysis of Management Accounting, Institute of Management Accountants, Montvale, N.J., 1999.

W. Steve Albrecht and Robert J. Sack, Accounting Education: Charting the Course through a Perilous Future, Accounting Education Series, Volume 16, American Accounting Association, Sarasota, Fla., 2000.

Marcia Mentkowski & Associates, Learning that Lasts, Integrating Learning, Development, and Performance in College and Beyond, Jossey-Bass Publishers, San Francisco, Calif., 2000.

By Regina E. Grantz, CMA; William McEachern, CPA; and Robert Gruber, CMA, CFM, CPA

Regina E. Grantz, CMA, is associate professor and program director, Management Accounting, at Alverno College. She is also a member of IMA's Greater Milwaukee Chapter. You can reach Regina at

William McEachern, CPA, is Professor Emeritus of Business and Management at Alverno College. You can reach him at

Robert Gruber, CMA, CFM, CPA, Ph.D., is professor of accounting at the University of Wisconsin-Whitewater and is a former member of IMA's Greater Milwaukee Chapter. You can reach Robert at
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Title Annotation:EDUCATION
Author:Grantz, Regina E.; McEachern, William; Gruber, Robert
Publication:Strategic Finance
Article Type:Report
Geographic Code:1U3WI
Date:Jun 1, 2012
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