Understanding how to analyze and communicate financial information is a vital skill for aspiring business leaders. That’s why experts advise B-school applicants to look for a school with a strong accounting curriculum that includes courses that teach students how to prepare and interpret financial documents, such as balance sheets, tax filings and audits.
“Accounting touches all business disciplines and accounting knowledge is important for business planning and decision making,” said Michael Clement, an accounting professor with the McCombs School of Business at the University of Texas–Austin, via email. “It is often referred to as the language of business. Indeed, you will often hear senior executives speaking the language of accounting when they talk about revenues, expenses, profits, profit margins and the strength of their balance sheets. Employers frequently tell our students to take as much accounting as possible.”
[See: 10 MBA Programs That Lead to High-Paying Finance and Accounting Jobs.]
Stephen A. Karolyi, assistant professor of finance and accounting at Carnegie Mellon University’s Tepper School of Business, says that MBA-level accounting training is applicable in a variety of business professions, including accounting positions and other financial careers.
“High-quality accounting MBA programs intend to produce alumni that not only have accounting expertise, but also an appreciation for the connections between accounting principles and the broader corporate information environment,” Karolyi wrote in an email. “Alumni with these qualities can excel in fields beyond public accounting, because they understand the crucial role for accounting in decision-making, both at the internal corporate level and external investment level.”
What’s more, MBA graduates who have taken multiple accounting courses tend to be competitive for jobs as investment bankers, Clement says. “They tend to secure the best investment banking jobs,” he wrote. “Alumni often return and tell the students to take additional accounting courses because they have been so beneficial to their future work.”
[Read: Find the Right B-School for an Investment Career.]
But before they submit their applications, accounting-oriented business school candidates must decide whether they want to pursue an accounting master’s degree or an MBA degree.
Lindsay Badeaux, an MBA admissions counselor at IvyWise admissions consulting firm in New York City and a former senior assistant dean of admissions at the University of Chicago’s Booth School of Business, says a master’s in accounting tends to be specialized.
“If you are certain that you want to advance in the accounting field and become a CPA, then pursuing a specialized master’s in accounting may be a better choice for you,” Badeaux wrote via email. “If you are uncertain of your exact career goals, or prefer to have more flexibility to shift into different industries or function areas, an MBA may be the best path, due to the breadth of knowledge and exposure to different industries you will gain.”
According to experts, here are three telltale signs that a B-school offers high-quality accounting courses.
A variety of courses, including ones that focus on strategy and technology. “In my opinion, courses that delve into the strategic aspects of accounting are the most valuable,” Karolyi said via email. “I am always impressed when students are able to articulate how accounting choices affect information production, and how this information could affect interactions not only with investors, but also across divisions within the firm or with competitors, customers, suppliers, divisions, and regulators.”
Alex Dontoh, an accounting professor and director of the master of science in accounting program at New York University’s Stern School of Business, says that a first-rate, graduate-level accounting curriculum should include technological training.
He says that lessons on data tools like Python, XBRL and SQL are vital. He also says that knowledge of digital ledger technology, the global accounting network that allows for the transaction of digital currencies like bitcoin, commonly known as blockchain, is necessary.
“Our graduate accounting offerings have incorporated aspects of these technologies in the curriculum to better prepare our MBA and M.S. in Accounting students,” Dontoh said via email.
Clement, who teaches at the No. 1-rated B-school for accounting in the U.S. News Best Business School s rankings, says that solid graduate accounting programs tend to offer electives in niche accounting specialties, such as wealth management and bookkeeping for the oil and gas industry. He adds that prospective finance MBA students will want to have the option to enroll in both an intermediate and advanced accounting class. They should also look for a course on financial statement analysis, he says.
A high proportion of the school’s faculty in the accounting discipline. “The proportion of accounting faculty at a business school should inform students about the relative demand for accounting courses taught at the school,” Karolyi wrote.
Karolyi says that B-schools with a heavy representation of accounting faculty tend to offer a greater number and variety of accounting courses. He notes that accounting skills are useful for “prospective corporate managers, investors or consultants” who need to be able to process an enormous amount of financial information. If these individuals can interpret financial data better than their competitors, they will have an edge, Karolyi emphasizes.
“Without a deep knowledge of accounting, it is difficult to truly understand the reported performance or state of a company,” he wrote. “These are crucial inputs to competitive analysis and capital raising.”
[Read: Learn About Financial Technology in Business School.]
Popular courses among MBA students who have not committed to accounting careers. Karolyi suggests that when there are numerous MBA students who are not in an accounting track who are taking advanced elective accounting courses after they have finished required coursework in financial and managerial accounting, that is a positive sign. “The number of students that end up with ties to the accounting program relative to those that begin with an accounting focus should inform prospective students about the strength of the faculty,” Karolyi said via email. “Persuading students to take more accounting courses is challenging, especially for students with no pre-identified interest in accounting, so this signal tends to be informative about the quality and entertainment value of faculty instruction.”
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How to Find the Best MBA or Specialized Master’s Program for Accounting originally appeared on usnews.com
