Are accounting graduates favorably recruited for entry-level management positions? A survey of recruiters of business school graduates finds empirical evidence to dispel the common misperceptions that a major in accounting limits students' career opportunities or the type of work they will perform in their jobs

Management Accounting Quarterly, Spring, 2004 by W. Mark Wilder, Morris H. Stocks

EXECUTIVE SUMMARY A major problem facing the accounting profession today is the shrinking pool of accounting graduates from which to recruit. An obstacle accounting educators must overcome in recruiting students is a misguided perception that (1) accounting as a profession offers narrow career opportunities and (2) accounting positions do not offer variety in the type of work performed. While anecdotal evidence exists that an accounting degree provides broad training suitable for a variety of business careers, this proposition has not been well-established empirically. The purpose of our research is to determine whether students majoring in accounting are favorably recruited for general entry-level business positions.

The research resulted in several findings. The most notable was that accounting majors are significantly preferred by recruiters over general business majors for general entry-level management positions. A second result was that students with a Master of Business Administration (MBA) degree were not significantly preferred over those with a Bachelor of Business Administration (BBA) degree. This second result, however, was strongly influenced by the effect of accounting as an undergraduate major. For example, an accounting major with only a BBA received a higher mean recruitment rating than a student with an MBA (having general business as the undergraduate major).

The motivation for our research is the potential to enhance the efforts of attracting students into accounting programs. Our findings provide evidence that selecting accounting for an undergraduate major offers a variety of career alternatives. Not only does this result have positive implications for recruiting students to major in accounting, but it also reinforces the efforts of IMA and the AICPA in promoting accountants as professionals possessing a variety of business skills.

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The accounting profession is in a state of change. Public accountants have broadened their scope of services to include such areas as strategic advising and personal financial planning, and the breadth of responsibility for management accountants has increased to include the areas of finance, Enterprise Resource Planning (ERP), and quality assurance. A major problem facing the profession as this transition occurs is a shrinking pool of quality accounting graduates from which to recruit. This is a critical problem because the success of the profession depends on its ability to recruit quality employees.

One reason for this declining pool of quality graduates has been the decline of enrollment in business schools in general, which, in turn, has resulted in enrollment declines in accounting programs. An edition of The Wall Street Journal noted that only 13% of high school seniors in 1996 said they planned to select business as a major. In 1987, however, business was the most popular major, with 23% of high school seniors indicating it as their preference. (1) Perhaps another reason for the decline in the number of quality students in accounting programs is a perception that an accounting degree offers a narrow career path. Similarly, students may have limited understanding of the variety of work performed in even relatively narrow positions, such as audit positions. In a Gallup Organization survey of high school and college students, only 10% of those surveyed strongly agreed that accounting offers variety in the type of work performed. (2)

The task for employers of accounting graduates, as well as for accounting educators, is to attract quality students into the accounting curriculum. Roger H. Hermanson, et al., found that 91% of the accounting department chairpersons they surveyed felt that it was more difficult to attract top students into accounting today compared to five years ago. (3) Perhaps an obstacle accounting educators must overcome in recruiting quality students is a misguided perception that (1) accounting as a profession offers narrow career opportunities, and (2) accounting positions themselves (such as auditing) do not offer variety in the type of work performed.

The Institute of Management Accountants (IMA) strongly promotes accountants not only for their accounting abilities, but also for their broad-based financial management skills. As evidence of their commitment in promoting accountants as general business strategists, the IMA provides certification programs in management accounting (Certified Management Accountant) and in financial management (Certified Financial Manager). In addition, the American Institute of Certified Public Accountants (AICPA) has embarked on a major program to expand the image of the accounting profession. While the accounting profession is one of the most respected, the general perception is that accountants perform only tax and audit work. In addition, there may be a misconception of what this tax and audit work entails. The goal of the image enhancement program is to promote CPAs not only for their tax and audit work but also for work as general business advisors. One motive of the AICPA in this effort appears to be an attempt to improve the ability of CPAs to compete in the market for other business services. An indirect benefit of the program, however, may be to communicate to the public that an accounting degree offers a broad career path.