No, this post isn’t about the Senate Banking hearing yesterday on credit rating agencies (well, only in part). It’s about a great program offered by the American Accounting Association (AAA) for people interested in becoming Professionally Qualified (PQ) to teach accounting at the college level; and it’s about some recent commentary, like that of Senate Banking Chair Christopher Dodd at a March 4 hearing, reported here, questioning whether some parties were “asleep at the switch” (ZZZ) during the recent credit crisis.
On April 19, AAA held a day-long program to provide information to those interested in becoming Professionally Qualified (PQ) to teach accounting at the college level. We gave some advance info about this program and a related program offered by the Association to Advance Collegiate Schools of Business (AACSB) called the “Bridge” program here, and we noted related comments of former Federal Reserve Board Chairman Paul Volcker on the topic of educating accountants at the March 13 meeting of Treasury’s Advisory Committee on the Auditing Profession (ACAP) here.
AAA’s one-day PQ program and the AACSB’s 5-day Bridge program are geared toward individuals who have significant ‘real-world’ experience in accounting, tax or audit, and are interested in teaching at the college level, but lack a PhD. Generally, holding a Masters degree is preferred but candidates without a Masters may be considered based on experience. The PQ designation is distinct from the “AQ” designation for those who are Academically Qualified to teach by means of holding a PhD.
There are a variety of efforts among academic and professional associations to encourage more PQ professors, in part to help offset the growing shortage of PhDs at a time when accounting student enrollments are growing and professors are retiring, and to add more practical insights to the classroom.
Co-chairs of the AAA’s April 19 PQ program were Kevin Stocks, Director, School of Accountancy and W. Steve Albrecht Professor of Accounting at Brigham Young University, and Susan Crosson, Professor and Coordinator of Accounting, Santa Fe Community College, Gainesville, FL. Stocks and Crosson developed the PQ program, and also chaired the inaugural PQ program in Aug. 2007. There were close to 50 attendees at the April 19 PQ program.
Pictured here (L-R) are: Francine Mellors-Rothenstein, Director of Technical Publications and Research Tools, Ernst & Young, with Peggy Capomaggi, Managing Director-Finance, Morgan Stanley, and myself . (I dropped by the April 19 PQ luncheon, having attended the inaugural program in Chicago last August, and having highly recommended it to a number of people, including Mellors-Rothenstein and Capomaggi who I worked with in the Accounting Policy division at The Chase Manhattan Bank, N.A. (now JPMorgan Chase) back in the days of FDICIA (the FDIC Improvement Act of 1991). Attendees had a varied background, many wore name tags from major audit firms, others work in financial positions in the corporate or nonprofit world.
For information about dates/locations or other information regarding future AAA PQ programs, contact Deirdre Harris, Member Relations and Marketing Manager, at the American Accounting Association (AAA), firstname.lastname@example.org. See also AAA’s Future Accounting Faculty and Programs Projects.
By the way, FEI -the association of senior financial executives - has a special membership category for academics (associate professors and above). By becoming an FEI member, academics (and professionals) benefit by receiving research reports published by the Financial Executives Research Foundation (FERF) - the research affiliate of FEI - at no additional cost. FERF’s practical research may be particularly of interest to academics interested in bridging theory and practice.
In related news, two of the recommendations contained in AACSB’s Feb. 2008 report on the “Impact of Research” recommended that “AACSB should develop mechanisms to strengthen interaction between academics and practicing managers in the production of knowledge in areas of greatest interest,” and that “AACSB should identify and disseminate information about best practices for creating linkages between academic research and practice.”
For academics and financial professionals - FEI member benefits - in addition to FERF research, Financial Executive Magazine, and our weekly e-newsletter, FEI Express - include the opportunity to participate in numerous networking and educational programs at a reduced rate, such as our Summit conference May 4-6 in AZ, our June 5 conference "The World is Moving to IFRS - Are You?” ww.financialexecutives.org/ifrs, and our Current Financial Reporting Issues (CFRI) conference in the fall. For further information contact Nancy Ehlers email@example.com or (973) 765-1099.
Tami Luhby, in her article, “Bank Regulators: Asleep At The Switch,” quoted Senate Banking Committee chair Christopher Dodd’s statement at a March 4 hearing: "Again and again the question has been asked over the past year as our credit markets have grown increasingly impaired: Where were the regulators?...Why didn't they do more? Were they asleep at the switch? And when the alarm went off, did they merely hit the snooze button?" She noted, “Dodd said he will hold another hearing within 60 days to learn what measures regulators are putting into place to address the industry's current problems.” Since March 4, Dodd has held six hearings (including tomorrow’s hearing on the role of sovereign investments) on the “Turmoil in the Credit Markets.” Yesterday’s hearing was on the role of credit rating agencies.
Some would challenge any reference to parties being ‘asleep at the switch’ during the subprime crisis and related market turmoil by saying numerous conditions combined to create a perfect storm of sorts, including subprime interest rate resets, the allegedly looser standards by which some subprime loans were approved, a historic decline in the housing market, with a new light shone on illiquid transactions by new accounting standards (FAS 157) and related guidance of the Center for Audit Quality (CAQ).
In addition to any legislative action that may arise from Dodd’s Senate Banking Committee (or from the House Financial Services Committee chaired by Barney Frank) in response to the credit crisis, immediate action has been called for by the G-7 Finance Ministers, endorsing the report of the Financial Services Forum (FSF), calling for certain actions to be taken by regulators, standard-setters, and the private sector in the next 100 days, as we previously noted in our post: “G-7, Endorsing FSF Report, Asks IASB, Other Standard-Setters Take Action Within 100 Days on Off-Balance Sheet, Valuation.”
Going forward, some are questioning what they perceive to be a deregulatory tint to some aspects of the U.S. Treasury’s ‘Blueprint for a Modernized Financial Regulatory Structure’ (summarized in this Executive Summary (public link to WSJ) and this Treasury Department Fact Sheet.)
James Surowiecki of The New Yorker, in his article, “Parsing Paulson,” wrote: “As the press has noted, [Paulson’s] plan would consolidate our myriad and overlapping regulators into fewer, bigger ones. But the most interesting thing about it is something subtler: a push to move from our current system of regulation—often known as “rules-based”—toward a “principles-based” approach.” He explains, “In practice, of course, these distinctions aren’t quite so neat: regulators in a rules-based system still have to interpret the rules, and principles-based systems are hardly rule-free.”
Analogizing a principles-based system to soccer, and a rules-based system to football, Surowiecki said, “Wall Streeters must be soccer fans at heart, because they are huge supporters of the principles-based approach." He warned, "That should, perhaps, make us skeptical: when the fox applauds ideas for henhouse security, watch out. Yet the European experience suggests that a principles-based system has real virtues. It can make life easier for honest corporations, since they have to spend less time complying with overly complex rules, and also thwart dishonest ones, since regulators can spend more time looking at the substance, rather than the minutiae, of corporate bad behavior.”
“So what’s the catch?” asks Surowiecki. “Only this: a principles-based system relies on dedicated, well-funded regulators who are interested in regulating. And, lately, it’s been hard to find those in Washington.”
A more upbeat comment came from House Financial Services Chair Barney Frank on the day the Blueprint was released (March 29): “Secretary Paulson’s plan fundamentally to improve our ability to regulate the financial system is a very constructive step forward in this important debate. He recognizes that the far-reaching innovations that have transformed financial activity have outstripped our ability to preserve economic stability and that both our regulatory institutions and the rules they apply must be significantly enhanced.”
Frank added, “We have not yet analyzed the proposals in detail, and I have disagreements with some specifics... But given the fact that is a contribution to a profound national discussion that cannot be concluded in the months before the election, Secretary Paulson has performed an important service. By rejecting the argument for the status quo; by making it clear that new regulation done properly enhances the function of the market rather than detracts from it; and by explicitly including consumer protection among the core functions of the system he proposes, he has narrowed, albeit by no means removed, the differences between his position and that of many Democrats.”
Regarding the SEC, see “Paulson Blueprint: An Orphaned Public Company Regulatory Function” by Dave Lynn posted earlier this week in TheCorporateCounsel.net blog.
See also Securities Mosaic’s Spotlight on “Paulson’s Proposal” and “Hedge Fund Industry Reports”
Print this post