Some Virginia colleges and universities are creating ways for accounting students to get the data analysis skills they need to succeed in the workplace.
By Chip Knighton
The random sample isn’t necessarily going away, but it’s no longer the absolute standard for audits. Big Four firms and others with massive resources have the ability to look at entire populations.
“We all grew up in random sampling, representative sampling, looking for anomalies in the population by selecting things,” Dan Hudgens, CPA, a partner at Deloitte in Richmond, said at the VSCPA’s Top Firms Roundtable in 2017. “With data analytics, being able to look at 100 percent populations, we’re able to focus our audits much more.”
However, having the tools to look at a 100 percent population doesn’t do any good without CPAs trained in analyzing it. Some Virginia colleges and universities are looking to fill that need through data analytics courses in accounting curricula, and one has created an entire new master’s program with a generous assist from a Big Four firm.
Virginia Tech is currently preparing to welcome the first students in its new KPMG Master of Accounting With Data and Analytics Program (MADA), offered through the university’s Pamplin College of Business. The one-year program begins in earnest this fall with its first Accounting Analytics cohort including five KPMG-sponsored students, who will receive full tuition, room and board in exchange for agreeing to work for KPMG for three years.
Virginia Tech was one of seven universities that joined the program in 2017, with nine schools currently taking part. The program, which began at the Ohio State University Max M. Fisher College of Business and the Villanova School of Business, enrolls 135 students across the nine schools each year. Students go through a busy-season internship with KPMG, graduate with the extra 30 credit hours needed to sit for the CPA Exam and start out at KPMG as an advanced associate. However, the benefits to Virginia Tech go far beyond those five students.
“Our faculty have undergone training with the KPMG methodologies and tools, and KPMG is making some proprietary and open-source tools available in the cloud for all master’s students in the program to utilize,” said Jack Maher, head of Virginia Tech’s Department of Accounting & Information Systems. “That was very important with us — to be able to integrate this with our other students.”
The MADA program was a natural outgrowth of Virginia Tech’s focus on technology in its accounting program. The need for technology-driven accounting professionals is growing more acute as audits evolve to encompass much larger data sets, and the university aims to prepare its students to use the tools available to analyze that data. KPMG signed a two-year deal with Virginia Tech to partner on the MADA program, and Maher expects the partnership to continue beyond that time.
“We’ve tried to always incorporate information systems into our classes, and I think we’ve been very successful with that over the years,” Maher said. “Employers have told us continuously over many years that our students are usually a bit ahead of students from other universities in terms of their technology skills. We’ve always had this information technology approach to the accounting classes, but this is putting a little more refined edge on it and getting us additional tools that we hadn’t utilized as extensively before.”
Other Virginia universities are putting more resources into analytics training. Chris Maurer, an assistant professor at the University of Virginia’s (U.Va.) McIntire School of Commerce, teaches a master’s-level course called “Data Management and Analytics for Accountants,” focused on training future CPAs on business analytics and database design.
“The premise is that accountants, much like any other professional, come across large amounts of data. To do their job, they have to be able to sift through large data sets, huge Excel files, etc.,” he said. “We stress the importance of harnessing the power of data to use it as a tool to be able to do your job more effectively. That begins with being able to structure and organize data.”
The course grew out of a growing demand from the accounting industry to expose students to more analytics topics, as well as a request from another McIntire School professor, VSCPA member Eric Negangard, CPA, who noticed that he was spending a lot of time teaching data analysis concepts in his forensic accounting class.
It was from that idea that the data analytics class was born. (The McIntire School also offers an undergraduate-level data analysis class aimed at information technology (IT) students, which focuses more on database creation.) The masters-level class trains students on database design and the use of analytic tools in gleaning insight from large data sets.
The course is taught by IT professors, not accountants, although Maurer spent two years working in KPMG’s advisory practice before going back to academia. He and his fellow professors consulted with numerous accounting professors in developing the course. But a major portion of the course involves helping accounting students understand what data scientists do.
“They do a project where they have to build a database from scratch,” Maurer said. “They have to pick a problem, preferably one that has some kind of accounting or financial overtones, and they have to figure out what kind of data is out there that is important to be able to capture for this problem, and they have to design and build a database completely on their own.”
The use of Standard Querying Language (SQL), a programming language used in storing, manipulating and retrieving data from databases, is another key part of the course. The idea is that students understand how to work with data sets and find the data that’s most applicable to the particular problem they’re investigating. Later, they learn to use Tableau, an analytics and visualization tool that connects to a database, pulls data and creates visualizations.
Maurer has fine-tuned the course through feedback from students, professors and, perhaps most importantly, accounting firms that offer insight into what skills they are looking for from future CPAs. Other Virginia universities are also ramping up their own data analytics offerings based on the needs of accounting firms and students.
Virginia Commonwealth University offers a Master of Accountancy degree with a concentration in data analytics, while Old Dominion University (ODU) and the College of William & Mary offer data analytics concentrations outside of their accounting curricula. Christopher Newport University (CNU) is in the same boat, offering an introductory analytics course through its business school that’s required for several concentrations, but not accounting.
CNU also offers two one-credit lab courses focused on advanced Excel and Access applications for business. CNU accounting professor Gabriele Lingenfelter, CPA, a member of the VSCPA Board of Directors, encourages her students to take all three courses and says that 80 percent of CNU accounting students have taken at least one of the labs.
“The employers are demanding it,” she said. “They want students who have advanced Excel capabilities and data analytics backgrounds. This is just a start, but we would like to introduce data analytics in all our disciplines. But you have to have the people who teach it and make room in the curriculum for it.”
Lingenfelter has also worked to incorporate analytics into her own courses and would like to make the analytics course a requirement for accounting students, but says that accounting information systems takes priority over analytics because of its presence on the CPA Exam. She has encouraged students with a particular interest in the field to take the courses at ODU and William & Mary, but would prefer to see the course integrated into the accounting curriculum rather than on its own.
“If you look at the curriculum, it looks all really great, but I wouldn’t say that it’s going to be for a student that’s just going out and needs it for an auditing engagement,” Lingenfelter said. “William & Mary does have a master’s in data analytics, which I think is great, but it’s not integrated with the discipline itself.
“They don’t have the auditing class that incorporates data analytics. It’s a whole program on data analytics. It would be overkill. I look at those courses and I don’t know what my students would do with it.”
CNU is working hard to encourage accounting students to take the analytics course as an elective. Virginia Tech offers an entire program on analytics concepts. At U.Va., the next step is to incorporate more relevant data in its training.
“If you’re familiar with database management and SQL, it doesn’t matter what the data looks like, what it is. You can equally apply it to any context,” Maurer said. “We’re giving the skills right now. What I think we can do a better job at doing is giving the skills in that context that the students will see when they’re working professionals and licensed CPAs.”
Finding the sweet spot in the depth of knowledge accounting students need is a tricky balance for accounting programs to strike.
“Accountants are generally not going to be data scientists. They’re not going to need the real, real deep analytics knowledge to actually create all the models from scratch,” Maurer said. “But they do need to know what goes into analytical modeling and creating prediction models and all these analytical techniques, because they’re going to be asked to audit them. They’re going to be asked to interact with the data scientists and the people within their clients who are engaging in this.”
Or, as Virginia Tech’s Maher puts it, “Firms indicate that the audit of the future is going to be much more data-driven and will require accountants who have these data analytics skills to be able to handle very large data sets. The tools and software are designed to be able to handle hundreds, thousands, millions of records. Everything we hear from the firms is that more and more accountants must have an understanding of utilizing large data analytic techniques to be able to perform in the workplace.”