This case pertained to the uncertainty surrounding the future of Collier College’s undergraduate accounting program. Accounting is Collier’s largest major and, due to various audit engagements, membership with the American Institute of Certified Public Accountants (AICPA) is required. Collier has just received notice that AICPA is adding an additional 30 credit hour requirement to maintain their accreditation. The underlying problem is that, due to Collier’s small size, it is heavily dependent upon revenue generated from tuition. With approximately 25% of their graduates being accounting majors, having to drop the AICPA accounting program would severely hurt the college’s financial position and local reputation. The dean of Collier’s School of Business, Dr. Peter Leonard, has contemplated some solutions to the issue. Among these solutions are waiting to see what develops, adding 30 undergraduate credits to the existing curriculum, establishing an “articulation agreement” with another local school, and packaging the students’ fifth year with a graduate degree. He is uncertain, however, of how much support these options will have among the students, and whether or not the college has the ability or resources to successfully implement them. Since the new AICPA requirements will go into effect in six years and will directly affect the incoming class two years from the present date, this case ultimately calls for a high-risk strategic decision.
Task 1: List and explain all possible alternatives you considered
- Lobby against the new AICPA requirement
- Wait to see if the new AICPA requirement actually develops
- Add a 5th year to the undergraduate accounting program
- Form an articulation agreement with another local college
- Package a 5th year with a graduate program (receive Bachelors and Graduate degree at end of 5th year)
- Merge some classes together and allow them to count for more credit hours
- Have students take an additional accounting lab each semester to cover the new requirements.
Top 3 Alternatives for Development / Explanation:
- Package a 5th year with a graduate program – This alternative would require all undergraduate accounting majors to complete their Bachelor’s degree in five years instead of the traditional four years. However, with this program these students would be receiving two degrees simultaneously, as they would earn a Masters of Accounting upon completion of their 5th year. To make this alternative possible, the additional 30 undergraduate credits required by the AICPA would be met with rigorous, graduate level courses that are comparable to the curriculum of schools offering a Masters of Accounting. Thus, the course learning objectives that pertain to the 30 extra credits would be developed to satisfy AICPA’s requirements, as well as the caliber of graduate level coursework.
- Form an articulation agreement with another local college – This alternative would involve setting up a transfer program with a local college that offers courses satisfying AICPA’s additional 30 credits. If this alternative was implemented, undergraduate accounting students from Collier College would have to take a 5th year of courses at the partnered institution, or would have to double up on classes and take heavy course loads at both Collier and the school with the articulation agreement. In either case, all of the additional 30 credits for the AICPA accreditation would be taken at an institution other than Collier College.
- Merge some classes together and allow them to count for more credit hours – This alternative suggests that Collier College will combine the learning objectives of several courses and allow students to take a few, all-encompassing, courses. Doing so will allow a student to earn more credits by taking the same amount of classes that he/she usually takes. By merging similar classes and awarding more credit hours, these class sessions will have to be offered for a longer period of time. For example, these classes may have to meet 2-3 times a week for 2.5 – 3 hours at a time, rather than 2-3 times a week for 1 – 1.5 hours at a time. In implementing this alternative, it is likely that Collier College will have to hire professors holding a PhD since most graduate level courses are taught by instructors with this level of education.
Task 2: Indicate all possible consequences of each alternative
|5th Year Grad Program||· Meets the AICPA requirements
· Students can earn a graduate degree in 1 year (their 5th year) as opposed to the traditional 2 years offered at other institutions.
|· Collier College will experience an increase in expenses with the hiring of professors holding PhDs.
· With more classes being taught, capacity and scheduling become problems (may need more classrooms and more time slots for classes to be offered).
· In order to be competitive and offer a valid Masters’ Degree, Collier may have to obtain accreditation for their graduate program.
· Student housing may pose a problem for 5th year students.
|Articulation Agreement||· Meets requirements of the AICPA
· Don’t need to hire more professors
· Partnering with another college may result in more opportunities or more awareness for Collier
· Don’t need to increase class room capacity or change class scheduling for the additional 30 credits
|· Students may not want to go to another college
· If Collier can’t offer the new courses at their campus, some students may apply elsewhere for undergrad too.
· Collier’s reputation may decline
|Merging Classes||· Meets requirements for the AICPA
· No 5th year is needed
|· Classes are weighted heavier for your degree, so if you get a bad grade it has a lot of impact on your GPA.
· Tuition will increase to cover the addition of new material and learning
· May have to hire professors that can teach the new requirements for AICPA
· May have conflict with room scheduling
· Class time would have to be longer for the merged courses
Task 3: Indicate why you selected to pursue your chosen alternative
We have chosen to pursue the alternative of packaging a 5th year with a graduate program. We selected this option for a few different reasons. Primarily, we feel that this choice is the most appealing and beneficial to the students. Collier students are unlikely to favor a five year Bachelor’s program because they may feel as though they are falling behind of other students who are receiving a graduate degree by that point. Furthermore, students who are at Collier and really love the college may not want to take courses at another institution, or transfer out. Although these students will have to pay tuition for a 5th year, it is probable that the cost for the extra year will not amount to the expense these students would incur if they received their Masters of Accounting in two years at another institution. The option we chose is also one of the most feasible for Collier College. Prospective accounting students looking at Collier may decide not to apply if they can earn a Bachelor’s degree in four years at another institution. Although packaging a 5th year with a Masters of Accounting may be expensive for Collier (increase in faculty, classroom capacity, accreditation expense, etc), it will help to draw in more students. With accounting being the largest major at Collier, the college cannot afford to lose out on this pool of applicants and the revenue from their tuition. Being able to earn two degrees in just five years will increase the competitiveness of Collier College, and give it an advantage over other institutions that offer a Masters of Accounting in two years instead of one. Thus, it is likely that adding a 5th year graduate program in accounting will bring more prestige and recognition to Collier College.
Task 4: Explain the steps you will take to develop the selected alternative
- Increase Collier’s faculty by hiring teachers with a PhD that can teach graduate level accounting courses.
- Add the new courses required by AICPA and ensure that their learning objectives are rigorous enough to equate the class to an introductory graduate level course.
- Increase accounting students’ 5th year of tuition to account for increase in expenses and graduate degree. Contact alumni and look for more scholarships or grants to offer students with their financial aid packages.
- Research accreditations for graduate colleges offering a Masters of Accounting. Apply for prestigious accreditations if Collier’s curriculum meets the requirements.
- Meet with staff and faculty representing all of Collier’s majors to organize an evening schedule that can accommodate the new accounting courses.
- Accept outside applicants to the new graduate program if their undergraduate curriculum has been deemed comparable to Collier College’s, their overall GPA for accounting courses has been a 3.2 or better, and they performed acceptably on any graduate school entrance exams (i.e. CPA exam, GRE, GMAT, etc).
- Allow Collier’s current undergraduate accounting students into this new program if their overall GPA for accounting courses is a 3.2 or better, and their all-encompassing GPA is a 3.0 or better.
Task 5: Forecast what you expect the selected alternative to accomplish in five years
Although five years is a short period of time, with successful implementation we expect the new program to:
- Have provided at least one graduating class holding both a Bachelors of Accounting and a Masters of Accounting.
- Have provided Collier College with an increase in enrollment and tuition dollars.
- Encourage prospective accounting students to look closer at applying to Collier due to the time efficiency and benefits offered by the 5th year graduate program.
- Have increased the number of faculty at Collier that hold doctorate degrees.
- Offer more scheduling flexibility for students taking the new courses. This is likely to result from an increase in faculty applying for positions at Collier, and from the working out of initial program kinks.
- Have built up the college’s reputation and prestige to the point where more guest speakers are asking to visit the campus, and more organizations are offering Collier’s accounting students internships / positions.
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