Accounting Students Learn the Language of Business
January 21, 2021 | By Stephen Caldwell
Note:This is part of a series of articles that examine what students learn by pursuing different undergraduate degree options at the Sam M. Walton College of Business at the University of Arkansas.
When I began this series on what students learn by pursuing different degree paths in business, I figured accounting would be one of the easiest to write.
It seems self-explanatory, right? The word accountant suggests these professionals account for things, and so obviously they learn to count those things and make sure everything adds up just as it should. After all, everyone knows there are only three types of accountants: Those who can add and those who can’t.
If you are a student trying to decide on a major and that lame joke immediately made sense, then accounting might just be for you. Ironically, that’s because it indicates you can think beyond the “counting” that’s involved in accounting.
After spending time researching the field and speaking with a few professors, I realized there’s much more to accounting than I thought. Accounting is less about high-level mathematics, for instance, and more about giving structure to unstructured situations by learning and speaking the language of business.
Being an all-out math geek, in other words, isn’t a prerequisite for earning a degree in accounting (like it might be for, say, engineering). Students who pursue an accounting major need to be comfortable with the basics of math, of course, but the more applicable aspect of math, one professor told me, is geometry, which is about how things work and fit together within the big picture rather than knowing models for complex fractional equations.
So, if accounting is about giving structure to unstructured situations by using the language of business, what do students learn that allows them to do those things?
The language. Perhaps you’ve heard business leaders talk about the importance of knowing how to read financial statements. That’s because reading financial statements isn’t like reading a Harry Potter novel. However, they do tell important stories, but they use specific words and phrases about things like revenues, expenses, debt, taxation, receivables, payables and the like.
Accounting students learn what these terms mean and, more importantly, how to use them to the benefit their organization or client. In other words, students learn to tell the story about what the organization looks like, what the organization has done and what it might do in the future.
The structure. Businesses are built around transactions. Someone is compensated for their work. That’s a transaction. Someone buys a product. That’s a transaction. Someone provides a service for a fee. That’s a transaction. Someone orders a thousand widgets to go into a hundred whatchamacallits. That’s a transaction.
By themselves, those transactions are a small aspect of what’s happening in a business. But even small businesses are a combination of a great many interrelated transactions that quickly create complexity.
Accountants learn to give structure to these transactions so that they have meaning and usefulness to the business. The structure, for instance, can answer questions like what revenue will be created by the transactions, what resources are needed to make the transactions possible, what expenses are associated the transaction, or how are the transactions being misused.
A CPA might create public disclosure documents for a Fortune 500 company. A forensic accountant might use these skills to investigate financial fraud. And a management accountant might evaluate budget goals to help plan the future of the business.
Accounting, in a sense, is about seeing the forest, not just the trees, and using logical thought processes to understand how to keep that forest healthy.
All the things students learn point them toward licensure, which is a decades-old mark of credibility that verifies financial knowledge and accounting skills. The William Dillard Department of Accounting at the University of Arkansas, for instance, offers a five-year program that allows students to earn both a bachelor’s and a master's degree in a five-year period so that they finish with enough hours to qualify to take the CPA exam.
In the modern work environment, accounting majors take what they learn and apply it as trusted advisers in a variety of areas. Some enter public accounting where they do things like audits and taxes. Some work in industry doing corporate accounting. Others work in government, in non-profits or in entrepreneurial companies.
This allows them to use their skills in areas where they have passions – such as working for a professional sports team, a symphony, a retailer, a real estate investment firm, a university, a church or with law enforcement.
Most accounting roles involve finances, of course, but accountants give structure to just about anything in a business that needs to be measured and reported. For instance, accountants might examine a business’s sustainability efforts or the effectiveness of equality and diversity programs.
Top programs like the one at the Walton College provide opportunities for internships and mentoring that help prepare students for the job market, while also providing assistance in landing jobs. When they graduate, these students actually qualify as three types of accountants – those who speak the language of business, those who give structure to the unstructured and those who don’t have to move back home with their parents.
And that adds up to a bright future.