Preparing accounting students for professional success

Some accounting instructors focus on preparing students to pass exams — classroom tests as well as professional evaluations such as the CPA or CGMA exams. Although these are important milestones in a student’s progression, professional preparation should be equally considered in the mix of learning outcomes. And there is no better tool to prepare students for the world of work than the case study method.

At the heart of most cases are the assessment of problems and the provision of solutions. This focus provides students with the opportunity to develop critical thinking and problem-solving skills — most notably, preparation, judgment, and self-confidence.

Most case studies present a set of case facts that go beyond the personal, professional, and academic experience of participants. Participants make mistakes, but the learning outcomes of these mistakes far outweigh the immediate loss of marks.

A broader discussion of the theories that support the case study method is beyond the scope of this article, but an in-depth discussion of Niagara University’s first business case competition demonstrates the case study method and its properties.

A CASE STUDY CHALLENGE FOR STUDENTS

One of the courses I teach at Niagara is on cost management (ACC 335). Students entering ACC 335 have a variety of introductory and intermediate courses in accounting and finance. This knowledge base provides an excellent background for a case study competition that tests student skills, including preparation and judgment.

We held the first business case study competition for my ACC 335 students on April 27, 2023. The case was based on the U.S. nutraceuticals industry and centered around decisions that management of one company needed to make as they pondered the upcoming year. The case required students to work in groups to provide an oral presentation and a written summary of group recommendations.

Group submissions included a written summary and presentation including:

1. A one-page summary of the challenges facing the subject.
2. A one-page summary of potential solutions to challenges.
3. An analysis of potential solutions with recommendations and an implementation strategy.

The above structured response was used as a means of focusing students on developing a well-rounded response to case facts.

The case, centered around eight challenges, required the use of analytical tools taught during the semester. These included cash budgeting, contribution income statements, linear programming, the use of Porter’s Five Forces model, an analysis of a just-in-time (JIT) inventory system, and an analysis of how total quality management could be used to solve internal quality control issues.

Students were provided the case one month prior to the start of the competition, and they were allowed to ask certain questions about the case. The instructor answered process questions but not questions such as “do we have the right answer?”

A review of submissions found that most groups determined that the case subject faced four to five challenges. The students outlined the need to cover negative cash flows and provided solutions to these needs. In doing so, they demonstrated their ability to generate cash budgets and create contribution income statements. However, when potential costs were presented ambiguously, the students had difficulty discerning how to approach this data.

Groups were split between their recommendations to increase retail pricing on two products, even though the case facts presented compelling evidence that the company should not increase prices given customer power, i.e., the ability of the customer to switch to other alternative products with relative ease and little cost. However, when presenting their findings regarding the potential move away from a JIT inventory system, students were emphatic in their answer: No.

In presenting quantitative and qualitative analyses of the case facts, the students had mixed results. All but one group completed a linear program assessing the need for various labor skill sets. However, the students were challenged to take their analysis deeper and use it to assess whether a proposed new IT system would reduce an internal labor shortage affecting the business. The nexus of this challenge was to take the linear program results and perform a differential analysis.

In essence, the deeper the students were asked to go below the analytical water line, the more challenged they became in their analysis.

UPDATED CASE STUDY SET FOR 2024

Given these observations, a new section is being added to next year’s submission structure, referred to as an analytical assessment of operations.

This section will provide students the opportunity to develop their analytical skills in a more focused manner. The case study discussion questions will provide more focus on the analysis of the proposed quantitative and qualitative aspects of future operations.

The submission structure for the 2024 competition will be:

An analytical assessment of proposed operations;

• A summary of the challenges facing management;
• A summary of potential solutions;
• An analysis of potential solutions; and
• Recommendations and implementation.

This more robust submission structure will be augmented by an expansion of judges to include industry professionals. Next year’s panel will include three academics and two industry panelists. In addition, the panel will be asked to provide feedback on employability using the following questions:

1.Given this team’s submission, would you hire this group?

1 being the lowest and 10 being the highest.

2. Assuming that this team is currently employed by your organization, would you promote the team to a much more challenging project?

1 being the lowest and 10 being the highest.

3. Assuming that this team is currently employed by your organization, would you nominate the members of this group to lead a project?

1 being the lowest and 10 being the highest.

Preparing students for structured professional exams remains an important function of teaching accounting. However, as teaching professionals we need to reinforce traditional teaching methods with preparation for the broader professional world. A case study competition can test and hone students’ abilities and prepare them for the professional world, wherein making sound, self-confident judgments is a constant.

Note: If you would like a copy of the case study, email the author at pomeara@niagara.edu.

Pat O’Meara, CMA, CPA (Canada), CFP, RRC is an assistant professor of accounting at Niagara University.