Planning and delivery of professional

accounting education programs

Accounting Education Community of Practice

Vienna, 15 June 2011

• Review nature of professional accountancy education

programs, and implications for planning

• Planning – structures and progression within programs

• Preparation – to fail to prepare is to prepare to fail

• Delivery – how this is linked to preparation and

evaluation

• Evaluation and promotion of self-directed learning

• Conclusions

Introduction

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• IAESB International Education Standards (IES)

distinguish between IPD and CPD.

• IPD requirements focus on entry, content, assessment,

skills, practical experience and additional requirements

for statutory auditors.

• Professional accountancy education therefore should

be viewed more holistically than “chalk and talk”

• The teachers are universities, professional bodies and

employers.

• As PAOs implement IES they must play key role in

“ToT”

Nature of professional accounting education

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Some teachers need it….?

4

• crawl before walk..

Structure is not flat

5

Full IFRS

Financial Accounting

Cost AccountingBusiness and

regulatory environment

IFRS SME, Core IAS/IFRS

Most PAOs group Bloom’s 6-stage taxonomy of educational outcomes into three levels, to reflect progression. These are illustrated as follows:

• retention and recall of knowledge

• understanding of major accounting and business ideas,

techniques and theories

• use of knowledge and techniques in new but familiar

situations

• recognition of fundamental cause and effect in

accounting.

• Verbs associated with this intellectual level?

• list, define, describe, explain, select, calculate,

identify, compare.

Level 1: Knowledge and comprehension

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• Requires demonstration of analysis of unfamiliar

situations to prepare reports and solve problems

• using relevant concepts and theories

• recognition of subtle or hidden information patterns and

trends within financial and other information, and the

ability to interpret these

• the ability to infer from given information and draw

conclusions

• Verbs associated with this intellectual level: apply,

compare, analyse, compute, derive, reconcile,

prepare, interpret, value, contrast, relate, classify,

solve, implement.

Level 2: Application and analysis

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• demonstration of the following capabilities: creation of

new ideas from, or new insights into, existing knowledge

• generalisation, comparison and discrimination using

complex and unstructured information

• assessment and evaluation of complex information

• use of reasoned argument to infer and make judgements

• presentation and justification of valid recommendations

• Verbs associated include: formulate, modify, re-

arrange, create, compose, design, develop, highlight,

summarise, assess, evaluate, justify, decide, infer,

advise, recommend, discuss, report. Also includes

critical analysis, but advanced skills developed later

(create knowledge)

Level 3: Synthesis and evaluation

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• Book-keeping, financial accounting, financial reporting

and advanced financial reporting. Post qualification

courses/CPD would address banking, insurance and

other industry specific issues

• Book-keeping, internal controls, business law, auditing

systems, auditing tools, ethics, auditing standards and

application and advanced audit and assurance.

• Cost and management accounting, performance

management, strategic management,

• Economics and econometrics, statistical and

mathematical underpinnings, financial and money

markets, financial management techniques,

communications

• See IES-2. For Statutory Auditors IES-8 (EUD 8 /IES)

What is covered and progression?

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• Universities – but their primary focus is on producing

employable graduates. In developed market economies

with established PAOs, progression to membership

represents a “win-win” situation for both Universities and

PAOs

• PAOs – some conduct training through wholly owned

training companies, with training revenue ploughed back

to fund the regulatory activities of the PAO (CAET for

example). Similar aim achieved through outsourcing,

accreditation, licensing or similar arrangements.

• Private firms – CPA review and BPP are the most

recognizable examples, but some accounting firms, or

profit-centres within University sector engaged in

professional training also

Organizations engaged in delivery

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• Time is everything.

• One hour preparation minimum, and with practice, per

hour delivered

• Assume one hour study to one hour teaching.

Encourage more

• This means a 120 hour course requires 60 contact

(teaching) hours

• Contact hours can be supplemented with tutorials

• Exam preparation should be integrated from the

beginning and should be continuous

• Activity within class encourages activity outside class

Planning – one course

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Why is planning important ?

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The best think of having this impact…

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• Teaching plan – budget for how both tutor and students

will spend time within contact hours and at home

• Divides the course into manageable topics, and adds

value to student experience

• Just because they do not read does not mean that they

cannot

• Identifies target learning outcomes for each topic, and

specific performance indicator. They need to know when

they have arrived. Sub-indicators identified and provided.

• Assignment driven – teaching plan should integrate the

targets

• Assessment feedback – simulated exams and

assignments

Preparation – one course

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Session Topic In-class KPI Self Assessed KPI

1 Cost types and behaviour Short graded questions, strip out MCQs

MCQs

2 CVP – single and multiproduct As above MCQs

3 Marginal Costing – and alternatives

Strip down past exam questions

MCQs

4 Relevant costs for decisionmaking

Exam questions Cases: application in variety of industries

5 Strategic decision making: use of NPV, PI, ARR, IRR

Exam questions Cases: compute and explain

6 Performance management systems – impact on decision making

Exam questions Cases: simplecompute, explain, communicate

Teaching Plan elements

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• Role of teacher (professor, lecturer, tutor, coach) is to

create environment for learning, which takes place

naturally

• Attention – what subject is about, teaching USP

• Interest – why subject is relevant

• Desire – to practice and pass

• Action – self directed research, homework, follow up and

desire to excel evidenced by return questions

• AIDA is a marketing acronym – teachers are a technical,

professional and business sales-force

• Make them want to learn and assist the process, rather

than make them learn

Preparation – nature of effective delivery

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• Question from the ACCA June 2010 Advanced Auditing and

Assurance (International) examination

• Topic is Ethics. You had a presentation from Paul Hurks yesterday

on this topic.

• I will first show a video from Roger CPA review on the nature of the

audit (also demonstrating one style of teaching)

• I will show a review video of a few minutes duration that covers a

summary the Code of Ethics and relevant issues (another style, but

pay attention and prepare to take notes!)

• Then I will ask each table to review the case and develop the bullet

points for the answers

• How many marks can you achieve out of 20 for this question?

Case : Advanced Auditing 2010 exam (ACCA)

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Case 1: Review the presentation

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Case 1: Review the presentation

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Generally 1 mark per comment – maximum of 8 marks

• Advertising not prohibited but must follow ACCA

guidelines

• Cannot be misleading/exaggerated claims

• Exaggerated claim re size

• Unprofessional claim re „most professional‟

• Cannot guarantee improvements/tax saving

• Second opinions

• Introductory fee

• Audit and non-audit services

• Fees not approved by ACCA (they do not do this)

• Improper reference to ACCA

Case study – answer part (a)

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Generally 1 mark per comment – maximum of 5 marks

(Corporate finance element)

• Partner is competent

• Advocacy threat

• Self-review threat

• Identify contingent fee

• Contingent fee not appropriate for audit clients

• Contingent fee allowed for non-audit client with

safeguards

• Safeguards should be in place (examples)

Case study – answer part (a) ii

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Long Association – max of 3 points

• Familiarity threat (½ mark only)

• Threat more significant for senior personnel

• Level of threat depends on various factors

• Lose scepticism

• Code requires partner rotation for listed clients

Compulsory Firm Rotation – max of 4 points

• Eliminates familiarity threat

• Fresh pair of eyes for audit client

• Loss of fee income

• Unwilling to invest – lower quality audit

• Loss of cumulative knowledge – lower quality audit

• Increase in cost and audit fee

• Disruption to client

Case study – answer part (b)

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• Insufficient time management (time out)

• Insufficient knowledge

• Did not follow instructions

• Answered a different question to the one asked

• Lack of sufficient evidence

• Could not respond to the verbs (for example,

repeat a learned definition instead of assess or

evaluate)

• Poor presentation skills

Why students fail professional exams (UK)

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• There is a difference between university and

professional body accountancy education: learn to

learn and learn to do. Note IES applies to PAOs.

• However the distinction has blurred for Levels 1 and

2 with the introduction of highly focused

Bachelor/Master courses, intensity of competition

between Universities, introduction of co-operative

education, and stronger collaboration between

Universities and PAOs.

• Both IES/SAD permit a variety of assessment methods

• Open Book Exams/Integrated Case studies/MCQs

advantages and limitations of each

Too exam focused?

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• Binary qualification – role in identity of profession

• To guide and motivate progression

• To protect the public interest

• Not to artificially restrict supply

• PAOs shifting towards competence based IPD and

CPD, implying a need to focus on PER

• Universities are not PAOs, but provide inputs to them.

Students encouraged, facilitated and provided tools to

develop intellectual skills, broaden their knowledge as

well as deepen it, develop both capacity/interest in

contributing to society

• Ideal environment to foster an early awareness of the

role of individual and corporate ethics

Role of assessment

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Effective delivery not expensive

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– Professional Education Programs comprise IES 1-8

and not just “content” and “exams”

– Universities the leading educator, and they are not

PAOs - they highly complement each other

– Progressive structure of program, and courses

emphasized. Start broadly, apply and provide

specialist options

– Preparation requires clarity, adding value, KPIs and

a focus on outcomes

– Variety of delivery and assessment means available

– Enormous resources now available to support

development of accounting education.

– Why develop capacity in this area? Fiscal stability

and economic development.

Conclusions

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The views expressed in this presentation do not necessarily reflect those of the Executive Directors of The World Bank or the governments they

represent.

Vienna 15 June 2011

Thank you