The Global Coordination of Accounting Education

1
The Global Coordination of Accounting
Education

• Presented By
• Belverd E. Needles, Jr., Ph.D, CPA
• Past-President-IAAER
• Ernst Young Distinguished Professor of
  Accounting
• DePaul University

2
Objectives of Presentation

• To show the need for global coordination of
  accounting education
• to summarize efforts of organizations globally to
  achieve this objective
• to highlight the work of IAAER in coordinating
  accounting education globally
• to propose a plan for achieving coordination by
  focusing on education of accounting professors in
  International Education Standards (IES)

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Importance of Infrastructure

• While the accounting standards used must be high
  quality, they also must be supported by an
  infrastructure that ensures that the standards
  are rigorously interpreted and applied, and that
  issues and problematic practices are identified
  and resolved in a timely fashion. (SEC, 2000, p
  2, emphasis added)

4
Elements of a Global Infrastructure

• Effective, Independent and High-Quality
  Accounting and Auditing Standard Setters
• High-Quality Auditing Standards
• Audit Firms with Effective Quality Controls
  Worldwide
• Profession-Wide Quality Assurance
• Active Regulatory Oversight (SEC,2000 p2)

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• WHERE IS
• ACCOUNTING EDUCATION
• IN THIS STRUCTURE?

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Accounting Education and Professional Accountants

• Factors Affecting the Judgment of Professional
  Accountants
• Factors Affecting the Qualifications of
  Professional Accountants
• Global Coordination of Accounting Education

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Factors Affecting Judgment in the Application of
International Auditing Standards
Experience
International Accounting/Auditing Standards
Education
Culture
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Factors Influencing the Qualifications of
Professional Accountants
Academics
Regulation
Qualifications
Professional Alliances
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Global Coordination of Accounting Education
National
Academic Coordination
Regional
International
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Global Forces for Change

• Unrelenting Competitive Pressure
• Impact of Information and Communication
  Technologies
• Globalization of Business
• Focus on Value Accounting
• Demand for New Knowledge and Skills
• Demand for improvements in corporate governance
  and ethics
• (Source Karraman, 2004)

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Global Assumptions

• A Professions Only Real Capital is its Human
  Capital
• Nationally-Based Education Systems Must Reflect
  the Global Dimension
• The Modern Professional Needs Both Broad
  Knowledge and Specialized Skills
• Professionals Must Continually Acquire New
  Knowledge and Skills
• Future Accountants Need Training in Ethics and
  Objectivity
• (Source Karreman, 2004)

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Emerging Economies - Students

• Entering Students are not Adequately Prepared
• Accounting Students do not Always Reflect
  Diversity of the Population
• Economic and Health Issues among Students

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Emerging Economies Prequalification Education

• The Quality of Academic Education for
  Pre-qualification Needs to be Improved
• Too Much Emphasis on Bookkeeping in the
  Accounting Curriculum
• Instructors Lack Knowledge of International
  Standards and Practices
• Lack of Adequate Resources for Higher Education
• Professional Ethics is not Taught as a Separate
  Subject

14
Emerging Economies Post Graduate

• Professional Examinations do not Always Represent
  Good International Practice
• Practice Training Requirements do not Always
  Exist
• Continuing Education Requirements do not Always
  Exist

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The Value Chain of Accounting Education--Tradition
al View
STAGES

• I II III
  IV V VI
• Economic Data Transformation
  Information Analysis Decisions
• Events and Data Base

Low value skills
High value skills
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The Value Chain of Accounting Education--Future
View
STAGES

• I II III
  IV V VI
• Economic Data Transformation
  Information Analysis Decisions
• Events and Data Base

Increasingly performed by technology
Emphasis of Accounting Education
17
Global Movements in Accounting Education
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UNCTAD

• United Nations Conference on Trade and
  Development
• Guidelines on National Requirement for
  Qualification of Professional Accountants
• Global Curriculum
• Draws heavily on IFAC International Education
  Guidelines and Standards
• Benchmark for Qualifications for Professional
  Organizations
• Assist with Mutual Recognition of Qualifications

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Global Accountancy Education Network (GAEN)

• Promoting Accountancy Reform by Quantitative
  Assessment and Progress Monitoring of
  Professional Associations and Qualifications
  Requirements
• Accountancy Profession as Critical Component for
  Economic Growth
• Accountancy Reform as a Key Factor for Promoting
  Transparency, Accountability, Ethics and
  Professional Values

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DePaul University Center

• Global Accountancy Education Benchmarking
• Quantitative Benchmarking Methodology
• Transferable
• Identifies Gaps
• Measures Improvements
• Facilitates Global Trading in Accountancy Services

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Common Curriculum Project

• Eight European Accountancy Institutes have
  Developed Proposals to Unify Their Respective
  National Professional Entry-Level Qualifications
  while, at the Same Time, Ensuring that those
  Qualifications Remain of High-Quality and Meet
  Changing Expectations.

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Common Curriculum Project

• The Institutes will Agree to a Common Content
  that Covers the Greater Part of the Curricula of
  their National Professional Entry-Level
  Qualifications.
• Common Content will be International.
• Each Institute will Identify a National Content
  for its National Qualification.

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International Accounting Education Standard Board
(IAESB)

• Develops standards and other guidance to
  Strengthen Accountancy Education Worldwide and
  Focuses on
• Prequalification Accounting Education
• Practical Experience and Training
• Assessment and
• Continuing Professional Education Needed by
  Accountants

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IFAC IAESB

• Global Perspective on Education
• Due Process
• Public Interest Oversight

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IAAER Mission
MISSION STATEMENT The mission of the IAAER is to
promote excellence in accounting education and
research on a worldwide basis and to maximize the
contribution of accounting academics to the
development and maintenance of high quality,
globally recognized standards of accounting
practice.
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IAAER History

• 1984 Founded in advance of Kyoto Congress
• 1989 Institutional Membership Grows
• 1992 Representation on the IFAC Education
  Committee
• 1995 Consultancy Group of IASC

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IAAER Coordinating Activities

• World Congresses of Accounting Education
• Accounting Education for the 21st century The
  Global Challenges (Needles/Burns, 1993)
• Regional Conferences on Accounting Education and
  Research
• Institutional Member Meetings
• Cooperative Conferences for Education and
  Research Directors of Professional Associations
• Implementation Guide for IEG No. 9
• Global Code of Ethics of Accounting Educators

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IAAER Structure
Individual Members
Academic Associations
IAAER Structure
Professional Associations
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IAAER Initiatives
Standard Setting Bodies-Research and
Representation
Conferences and Congresses
IAAER Initiatives
Communication
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IAAER Communication
Web Site
COSMOS
IAAER Activities
JIFMA and AEAIJ
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IAAER Conferences/Congresses
World Congresses
Research Conferences
IAAER Conferences
Specialized Conferences
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Future Role of IAAER in Global Accounting
Education

• Voice of Accounting Academics
• Coordination of Accounting Education
• Academic Research on Standards
• Faculty Development

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Major Issues Raised by the Standards

• How to Instill the Characteristics of Lifelong
  Learning in Future Professional Accountants
  through Accounting Education
• How to Design and Implement a Program of
  Accounting Education that Achieves the Objectives
  of the Prequalification Education
• How to Develop Awareness Of The Need for
  Improvement in Accounting Education and Encourage
  the Development of Accounting Education

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Other Issues in Global Accounting Education
Research into

• Specifications of Appropriate Assessment Methods
• Competencies
• Professional Attitudes and Ethics
• Variations in Nationally-Imposed Requirements
• Supply/Demand for Accountants/Auditors who can
  Produce/Audit Transnational Accounts

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How will these issues be addressed?

• IAESB working through member bodies
• IAESB obtaining endorsement by key regulators
• Volunteer self-development on the part faculty
• Focused global efforts of faculty development

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A Proposal IAAER Project Athena

• What is it?
• A Targeted Global Faculty Development Program
• What is its purpose?
• To educate accounting faculty in developing and
  emerging economies in International Education
  Standards (IES) and their implementation

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IAAER Project Athena Quality Control

• Country follow-up and consultancy by
  IAAER-trained educators
• Assessment and Benchmarking
• Periodic Reporting

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Conclusion

• What questions do you have?