The relevant information technology knowledge and skills...

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The relevant information technology knowledge and skills

for accounting graduates in New Zealand

Thomas Tam School of Accounting and Management

Faculty of Business Manukau Institute of Technology

Private Bag 94006 Manukau 2241 New Zealand

Email: [email protected] Tel: +64(9)9688000 extn 7252

Fax: +64(9)9687709

Abstract

This is the first part of a research on the information technology knowledge and skills required by New Zealand accounting graduates. The methodology for this part of the research is based on the Delphi method where participants are asked to answer a questionnaire for multiple rounds until a consensus is reached. The list of information technology knowledge and skills recommended by the New Zealand Institute of Chartered Accountants, the International Federation of Accountants and a number of other studies were used as the basis for the questionnaire. Six expert individuals, including five working in the industry as accounting practitioners and one accounting academic, were asked to rate the importance of information technology knowledge and skills from the questionnaire. The results were collated showing the mean score and standard deviation of each question. The participants were asked to rate each question again taking the first round results into consideration. The scores from the second round resulted in nine topic areas rated as “essential” and another nine rated as “important”. The results from the second round of the Delphi method will be used as the basis for further research. It is the aim of this research to contribute to the body of knowledge in accounting education by providing a model for information technology content in accounting major programmes in New Zealand.

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1 Introduction

Rapid advances in information technology (IT) have produced major changes to the ways in which businesses operate. Almost all businesses today use computers of some form in their day-to-day operations. With the use of computers, business is conducted in a way quite different from that in which it was conducted in the past. It is important for accountants to possess IT knowledge and skills relevant to their roles to provide competent and professional services. However, the field of IT is wide and not all IT knowledge and skills relate to an accountant’s role. For example, accountants need not know how to code computer programs – this is the job of a computer programmer. Accountants also need not know the technical details of data communications as long as they have a general understanding of how data are transmitted between two computers. This raises the questions: what kind of IT knowledge and skills do accountants need? What are the entry-level IT skills and knowledge that educators should provide? Educators grapple with these issues constantly (Cytron & Tie, 2001). This study attempts to determine the relevant IT knowledge and skills required for New Zealand (NZ) accounting graduates and from the findings provide a model for NZ tertiary education institutions (TEIs) to design their accounting curricula. The definition of “relevant” IT knowledge and skills for accounting graduates for the purpose of this study is:

All IT concepts, knowledge, skills, tools, use of standard office software and specialised software applications to allow an accounting graduate to perform competently in his/her first five years of practice after graduation from an accounting major degree programme.

2 Literature review

2.1 The impact of information technology on the role of the accountant

Accounting academics and practitioners have been voicing the concern of the impact of IT on the accounting profession and have written abundantly on this topic (Caglio, 2003; Joplin, 1966; Scapens, 2003; Seethamraju, 2005). Joplin (1966) proposed that in order to maintain a major role in business, accountants must involve themselves in management information systems (MIS) and extend their skills and techniques to embrace the new systems and technologies. Today, ready-made MIS systems are available under the name of enterprise resource planning systems (ERP) and are being adopted by an increasing number of companies, especially large organisations. ERP systems integrate all aspects of a business and are designed to allow data-entry at source by the users of various departments. This results in the reduction of routine data-entry job for accountants and the diffusion of accounting knowledge throughout the organisation (Caglio, 2003; Scapens, 2003; Seethamraju, 2005). Accountants no longer have a monopoly on accounting knowledge and are not the only ones

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performing traditional accounting activities such as data collection and preparation of reports. Companies are increasingly looking for accountants who can use their expertise in more important activities such as strategic planning, business management, and design and management of IT systems (Caglio, 2003). A new breed of managers coined as the “hybrid” finance/IT manager has emerged and are in great demand ("The new breed," 1998). Practising and new accountants will therefore need to acquire new skills and knowledge in order to survive in the information age. To be able to do this, accountants have to understand and stay current with the latest information technology, otherwise their career could be in jeopardy (Anastas, 1997).

2.2 Issues in accounting education

A strong warning that accounting education may be failing came from Albrecht and Sack (2000; 2001). The authors published the landmark report criticising that accounting education did not meet the needs of the future accounting professional. The report attributed one of the changes in the accounting profession to technology. Similar concerns regarding accounting education were voiced in Canada by Lin and Hunter (1992). They warned that accounting education failed to keep up with the changes in accounting practices caused by technology and students were finding that their school training failed to prepare them for the workplace. The results of a study made in the United Kingdom (UK) showed that accounting education did not equip the students with enough IT skills for their role after graduation in their employment and that a gap existed between IT skills learned in TEIs and what accountants practised in the real world (Ahmed, 2003). Another study in the United States (USA) found that many students graduating from IT courses in accounting programmes were not given training in IT control knowledge which is important for specialised roles such as auditors (O'Donnell & Moore, 2005).

2.3 The accounting major curriculum in NZ TEIs

The New Zealand Institute of Chartered Accountants (NZICA) has issued a document entitled “Statements of Learning Outcomes” (SLOs). The purpose of this document is to provide a benchmark for evaluating courses for use in tertiary reviews of approved tertiary education institutions (ATEIs), and to convey the Institute’s expectations of learning outcomes for each of the topic areas at the advanced level (NZICA, 2006a). TEIs seeking accreditation from NZICA have to observe the SLOs in their accounting curriculum. Table 2.1 shows all SLOs and Table 2.2 shows the details of SLO-5 “Accounting Information Systems”.

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Table 2.1 NZICA SLOs

SLO Topic area

SLO-1 Advanced Financial Accounting

SLO-2 Advanced Management Accounting

SLO-3 Auditing

SLO-4 Taxation

SLO-5 Accounting Information Systems

SLO-6 Business Finance/Treasury

SLO-7 Economics

SLO-8 Organisational Management

SLO-9 Statistics

SLO-10 Commercial Law

Source: (NZICA, 2006a) Table 2.2 SLO-5

Learning outcomes Details

Internal control in accounting/business systems

Select factors that must be considered when developing controls for information systems

Describe the control environment and plan to meet control objectives

Identify and compare general controls and application controls for information systems

Assess the effectiveness and efficiency of control compliance monitoring

Evaluate and design internal control systems Demonstrate an understanding of the contribution that

internal controls make to achieving organisational objectives, that is, their value-adding role

Development standards and practices for accounting/business systems

Describe database management systems and identify the advantages of different types of database systems

Define the requirements of a database accounting system

Describe the process and documentation requirements of the systems development life cycle (SDLC)

Describe the system verification and validation process

Explain how emerging technologies influence the design of accounting information systems

Management of IT adoption, implementation, and use

Discuss strategic considerations involved in planning information systems, including an appreciation of the importance of project management

Demonstrate an awareness of security, back-up, and recovery procedures

Evaluate development acquisition alternatives

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Discuss systems maintenance and control policies Discuss the importance of ensuring end user support Explain the principles of managing change

Evaluation of computer-based accounting/business systems

Describe the impact of legal, ethical, and auditing influences on AIS

Describe evaluation objectives, methods, and techniques

Document a system using flow charts and a control matrix

Discuss the effects of rapid change on evaluation of existing systems

The practical use of technology Demonstrate the theoretical application of information systems technology e.g. database design or project management implementation of AIS

Apply information systems/technology to solving business/accounting problems

Source: (NZICA, 2006b) In a typical accounting major programme, IT knowledge and skills are taught or are expected to be learned by students in more than one course. For example, word processing is required in most courses in submitting assignments. The use of spreadsheets is expected in management accounting and finance courses in developing budgets and finance models. An inspection of the NZICA SLOs shows that apart from SLO-5, no mention of IT knowledge and skills are made in any other SLOs. However, NZICA has not specified that an SLO has to be taught in one course and this means that TEIs can teach relevant parts of SLO-5 in different courses. Figure 2.1 shows a possible implementation of SLO-5.

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Figure 2.1 Possible SLO-5 implementation

SL

O-1

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d M

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Tax

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ount

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Info

rmat

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tem

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tist

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SLO-5

Source: Developed for this research

2.4 The International Federation of Accountants

The International Federation of Accountants (IFAC) is a global organisation for the accounting profession. It works with 163 member organisations in 120 countries to encourage high quality practices by the world’s accountants (IFAC, 2006a). The IFAC Education Committee issued International Education Guideline No. 11, Information Technology and the Accounting Curriculum (IEG-11) in December 1995 followed by two revisions, one in June 1998 and one in December 2002 (IFAC, 2003). The purpose of the guideline is to assist member bodies to prepare professional accountants to work in the information technology environment (IFAC, 2003). The guideline details the recommendations for IT education for accounting students and was developed with the aim of aiding and encouraging the implementation of the recommendations in the USA and with the belief that the guideline will be applicable universally (Heales, 2005). In August 2006, IFAC issued an Exposure Draft (IFAC, 2006b) for the proposed International Education Practice Statement 2.1 (IEPS 2.1) with the intention to replace IEG-11. In 2007, IEPS 2.1 officially replaced IEG-11 (IFAC, 2007). An inspection of IEPS 2.1 revealed few differences from IEG-11 except for the addition of one subject area and a clearer definition of the roles of a professional account. Table 2.3 shows the number of main topic coverage recommended by IEPS 2.1.

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Table 2.3 Number of main topic coverage of IEPS 2.1

No. of main

topic coverage

IT strategy 8

IT architecture 46

IT as a business enabler 7

Systems acquisition and development process 26

Management of IT 26

Communication and IT 4

IT control knowledge 24

IT control competencies 12

IT knowledge required as a manager of IT 7

IT knowledge required as an evaluator of IT 3

IT knowledge required as a designer of IT 7

IT knowledge required as an audit professional 4

IT knowledge required as a user of IT 14

Total 188

Source: IFAC (2007) IEPS 2.1, apart from being extensive, includes some topics that are highly technical. Some examples of these technical topics are object-oriented languages, unified modelling language, seven layers of the OSI model, common object request broker architecture, etc. Due to the long list of recommendations and the presence of some highly technical topics, it is difficult for accounting major programmes to follow the guideline.

2.5 The Accounting Information Systems course

A course named Accounting Information Systems (AIS) was specifically developed by TEIs in countries including Australia, NZ, the UK and the USA in response to the inability of many students to grasp the fundamental principles of accounting information systems (Van Meer & Adams, 1996). In many institutions, the AIS course is the main avenue for accounting students to receive IT education and training (Chang & Hwang, 2002). This AIS course is different from SLO-5 or IEPS 2.1 in terms of the scope of coverage of IT topics. As discussed earlier, SLO-5 and IEPS 2.1 are guidelines and recommendations and do not necessarily refer to discrete stand-alone courses. The AIS course discussed in Van Meer and Adams (1996), Chang and Hwang (2002) and prevailing AIS literature refers to a specialised course in the accounting curriculum that teaches IT knowledge and concepts related to accounting systems. Although in some cases two AIS courses are required in the curriculum to cover all important topics (Davis & Leitch, 1988), the AIS course is self-contained

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with a specific syllabus. Bagranoff, Simkin and Norman (2008) suggest that accounting information systems stand at the intersection of two disciplines – accounting and information systems. Figure 2.2 shows the position of the AIS course in relation to the accounting and the information systems domains. Figure 2.2 The AIS course Accounting Information Systems Source: (Bagranoff et al., 2008) Despite efforts by different TEIs in developing this unique course, a generally accepted set of topics to be covered in an AIS course does not exist (Wu 1983, cited in Van Meer & Adams, 1996) and the AIS course remains one of the most diverse and least standardised courses in the accounting curriculum (Davis & Leitch, 1988; Groomer & Murthy, 1996; Heagy & McMickle, 1988). Much research has been made on what IT contents should the AIS course cover in an attempt to provide some guidance in standardising the course (Arnold & Sutton, 2007; Badua, 2008; Borthick, 1996; Chang & Hwang, 2002; Daigle, Hayes, & Hughes II, 2007; Davis & Leitch, 1988). Studies have also been made in comparing academics and practitioners’ views on IT contents to be taught to accounting students (Heagy & McMickle, 1988; Heagy & Rakow, 1991; Van Meer & Adams, 1996). Van Meer and Adams (1996) compared the views of accounting academics and practitioners on the IT topics taught in NZ TEIs in an AIS course. The study concluded that in general, academics and practitioners agreed on the importance of IT categories. Heagy and McMickle (1988) compared what academics covered in accounting systems courses with the needs of accounting practitioners. The study found that of the 59 topics in the questionnaire, there were no significant differences on 20 topics but significant differences were found on 39 topics. Heagy and Rakow (1991) surveyed academics and compared if they agree among themselves on the IT topics that should be taught in accounting systems courses. The study found that there was high degree of agreement on 28 topics (47% of the 59 topics) while only 11 topics (19%) had considerable disagreement.

Accounting

Information

Systems

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A wider perspective of the critical IT skills required by accountants was compiled by Wessels (2005) based on a literature review of major publications and studies which included the Institute of Chartered Accountants Australia, Canadian Institute of Chartered Accountants, Institute of Chartered Accountants in England and Wales, American Institute of Certified Public Accountants, South African Institute of Chartered Accountants, Chartered Institute of Management Accountants, Institute of Management Accountants, International Federation of Accountants, Theuri and Gunn (1998), Hostrom and Hunton (1998), Coenenberg, Haller and Marten (1999), Boyse (2004) and Greenstein and McKee (2004). However, this study focused only on skills and did not take IT knowledge into consideration. The lack of a standardised and generally accepted set of contents for the AIS course makes the AIS course more difficult to teach than other accounting courses (Groomer & Murthy, 1996) and that teaching AIS can be an inefficient and frustrating process (Heagy & Rakow, 1991). This research attempts to discover the IT knowledge and skills required by accounting graduates in NZ from an overarching perspective without limiting the study itself with the AIS course. The results of the research should encompass the AIS course requirements as well as those IT knowledge and skills required outside of the AIS domain. Figure 2.3 shows the conceptual framework of this research. Figure 2.3 Conceptual framework of this research Source: Developed for this research

SLO-5

IEPS 2.1

AIS literature

The relevant IT knowledge and

skills for accounting

graduates in NZ

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3 Methodology

3.1 Questionnaire design

This research addresses a “what” question and could easily lend itself to a quantitative approach using a survey questionnaire (Yin, 1994). However, designing the questionnaire for this research is problematic – how many and which IT knowledge and skills should be included in the questionnaire? From the literature, the most comprehensive and detailed list of IT knowledge and skills recommended for accounting students is IEPS 2.1, and this serves as a good basis for the questionnaire. However, IEPS 2.1 contains 188 main topics. If all 188 topics are included in the questionnaire, the response rate will be very low as respondents will not be motivated or may not have the time to complete such a long questionnaire. If a partial list is selected from IEPS 2.1 to be included in the questionnaire, the basis or criteria for the selection becomes an issue. Given these problems, the research methodology recommended for this research comprises of two parts. The first part is to use a method similar to the Delphi method to establish a workable questionnaire for Part II of the research. Part II of the research will use the results from Part I to interview practising accountants.

3.2 The Delphi method

The approach for Part I of this research borrows from the Delphi method. The Delphi method was developed in 1953 by Norman Dalkey of the RAND Corporation and Olaf Helmer of the Institute of the Future (Vázquez-Ramos, Leahy, & Hernández, 2007). It has been used in a number of higher education research studies and is recommended by Boberg and Morris-Khoo (1992) as a preliminary step in the evaluation of higher education programmes. The method seeks to elicit agreement or consensus on perceptions and judgements from experts in a specialised area (Boberg & Morris-Khoo, 1992). It usually consists of a series of mailed questionnaires addressed to individuals who are considered as experts in the field (Vázquez-Ramos et al., 2007). The returned responses, which are usually anonymous, are analysed and summarised by the researcher and then returned to the experts for further consideration and response. The number of rounds varies and is usually between three to five. Some of the advantages of the Delphi method are anonymity of response, multiple iterations and convergence of answers (Judd, 1972).

3.3 Part I of the research

The literature review conducted has identified a number of recommendations that can be used as the basis for the questionnaire. The most comprehensive list is IEPS 2.1 published by IFAC (2007). There are also other important recommendations including SLO-5 published by NZICA (2006b), the list of IT topics identified by Bain, Blankley and Smith (2002) and the list of IT skills by Wessels (2005). Bain, Blankley and Smith (2002) examined 12 current AIS textbooks and summarised the topics covered

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in these 12 textbooks into 30 topics. These 30 topics provide a good source of questions to be included in the questionnaire. Wessels (2005) conducted a literature review on important IT skills required by professional accountants which included recommendations from IFAC and a number of professional bodies, Theuri and Gunn (1998) and Greenstein and McKee (2004). The inclusion of the IT knowledge and skills contained in the above mentioned sources in the Delphi questionnaire is believed to provide a comprehensive set of questions for the survey. Nine questions have also been developed for this research. In total, there are 266 questions for the Delphi questionnaire. There is some duplication of questions because similar questions exist in different sources but this is not regarded as a hindrance but as a means to ascertain the validity of the responses. Table 3.1 shows the breakdown of the topics by source. Table 3.1 Number of questions in Delphi questionnaire

Source Number of questions

IFAC IEPS 2.1 188

NZICA SLO-5 5

Bain, Blankley & Smith (2002) 30

Wessels (2005) 34

Developed for this research 9

Total 266

Source: Developed for this research Six individuals were invited to be the panel for the Delphi phase. They were a partner from a small accounting firm (coded as D01), an accounting information systems academic from a university (D02), an accountant from a government agency (D03), a chief accountant from a small commercial firm (D04), a treasury accountant from a large commercial firm (D05) and a business advisory consultant from a large accounting firm (D06). Each of the participants was asked to rate each of the 266 questions from a scale of 1 to 6 on their opinion on the importance of IT knowledge and skills required by accountants in their first five years of practice. The scales are “1” = not relevant/not required, “2” = awareness only, “3” = minimum understanding, “4” = good understanding, “5” = full understanding and “6” = able to use and apply. The results from the first round were collated and the mean score and standard deviation of each question computed. The participants were asked to rate each question again in a second round taking into consideration the mean score, the standard deviation and the scores of the other five participants. However, they were not obliged to change their ratings if they believed the rating of a particular question given in the first round best

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reflected their opinion. The results from the second round were collated and compared with the scores from the first round. A third round was not carried out as the results from the two rounds were considered to be robust. To facilitate the analysis of the data to be collected, all 266 questions are classified into two dimensions. Using the guidelines from IEPS 2.1, the first dimension classifies a particular question into the different roles of an accountant who is required to possess that knowledge or be able to use that particular skill referred to in the question. The roles are auditor “A”, designer “D”, manager “M”, user “U” and general “G”. Auditors would require knowledge areas such as internal control, security, evaluation of systems, and use of software to help them in these tasks. Designers are those who are involved in the design, development and management of IT projects. Managers are those who are responsible for the overall management of the IT department, systems, assets or infrastructure. A question is classified as “user” role if it relates to the use of computers or computer software by an accountant as a user. Where a particular question relates to general knowledge or skills required by all roles, it is classified as “general”. The second dimension relates to whether the particular question is about knowledge or skill. “K” is used to denote knowledge and “S” is used to denote skill. Questions that have the keywords “apply”, “use” or are referring to a software product will be regarded as a practical skill requirement. Those that refer to concepts, ideas, processes or procedures are regarded as knowledge. The use of these two dimensions in the analysis will allow the distribution of knowledge versus skills and the distribution of different roles to be shown. Table 3.2 shows examples of the classification. Table 3.2 Examples of classification of “role” and “knowledge / skill”

Question Brief description Role Knowledge /

skill

1.6 Align future IT strategy with business strategy M K

2.5 Nature and types of information G K

4.7 System analysis / design tools and techniques D K

5.16 IT cost controls A K

5.21 Office software (spreadsheet) U S

9.10 Demonstrate understanding of business and accounting systems

U K

10.1 Managing an entity’s IT strategy M S

12.2 Applying project management methods D S

13.3 Evaluating financial accounting and reporting systems

A S


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Table 3.3 shows the 266 questions classified into the “role” and “knowledge / skill” in a two-dimension table. The number of questions relating to roles is spread quite evenly among the five classifications, around 20% each. The percentage of the number of questions relating to “knowledge” is 71% and to “skills” 29%. Table 3.3 Number of questions classified into “role” and “knowledge / skill”

Roles Knowledge Skills Total % of total

General 61 0 61 23%

Manager 46 7 53 20%

Designer 37 16 53 20%

Auditor 36 15 51 19%

User 10 38 48 18%

Total 190 76 266 100%

% of total 71% 29% 100%

Source: Developed for this research Data collected will be classified into five score categories – “essential”, “important”, “understanding”, “awareness” and “not relevant” based on their mean scores. Table 3.4 shows the proposed categories. Table 3.4 Proposed categories for IT topic ratings

Mean score Category

5 or above Essential

4 to 4.9 Important

3 to 3.9 Understanding

2 to 2.9 Awareness

Below 2 Not relevant


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4 Analysis of data collected from the Delphi phase

Table 4.1 shows the mean scores from the first and second round of the Delphi phase. In the first round, 16 questions out of 266 (6%) were rated as “essential”, 46 questions (17%) were rated as “important”. In the second round, the number of questions rated as “essential” and “important” was 22 (8%) and 42 (16%) respectively. The number of questions in the “essential” category increased by six while the number of questions in the “important” category decreased by four. In total, 64 questions out of 266 were rated as “essential” and “important” in the second round. Table 4.1 Mean scores from the first and second round Mean score

Score category No. of questions

in first round No. of questions in second round

Change

5 or above Essential 16(6%) 22(8%) +6

4 to 4.9 Important 46(17%) 42(16%) -4

3 to 3.9 Understanding 90(34%) 91(34%) +1

2 to 2.9 Awareness 100(38%) 94(35%) -6

Below 2 Not relevant 14(5%) 17(7%) +3

Total 266(100%) 266(100%)

Source: Developed for this research Table 4.2 shows the changes made by individual participants. The participant who made the most number of changes (78) was D03 (accountant from a government agency). Of these 78 changes, 69 were increases from the first round. It could be due to the low ratings given in the first round by D03 resulting in an urge to increase the ratings to try to conform to what the others have rated. D02 (accounting lecturer) made 40 changes and most of these changes were decreases (31). This may mean that D02 rated more questions higher than practitioners in the first round. D04 (accountant from a small commercial firm) and D05 (accountant from a large commercial firm) made the least number of changes. D04 and D05 were both accountants of a commercial firm. They may have made the most appropriate ratings in the first round and therefore requiring the least number of changes in the second round. However, it is difficult to draw conclusions because different individuals have different acceptance levels on conformity and that has an effect on how willing was the individual in changing the first round ratings.

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Table 4.2 Changes made by Delphi panellists

D01 D02 D03 D04 D05 D06 Total

Number of changes with increased rating

12 9 69 16 6 36

Number of changes with decreased rating

9 31 9 1 10 12

Total number of changes 21 40 78 17 16 48 220

Percentage of questions 8% 15% 29% 6% 6% 18%

Aggregate

total*

Number of changes with increased mean rating

101

Number of changes with decreased mean rating

43

144

* Aggregate total does not equal the sum of number of changes made by the panellists due to some overlaps and some changes balancing each other out.

Source: Developed for this research An analysis of the changes made by the panellists based on the mean score from the first round is shown in Table 4.3. The number of changes made in the “essential” category relative to the number of questions is low (4/16=25%) showing a high degree of agreement among the panellists in this score category. The “not relevant” category also showed good agreement (5/14=36%) followed by the “important” category (29/46=63%). The number of changes made in the “awareness” category was 88 (88%) and for the “understanding” category 94 (104%). This shows that the panellists were indecisive in these two categories. Table 4.3 Changes made to first round score categories First round mean score

Score category

No. of questions

D01 D02 D03 D04 D05 D06 Total

5 or above Essential 16 0 0 0 0 4 0 4

4 to 4.9 Important 46 2 8 4 1 2 12 29

3 to 3.9 Understanding 90 14 15 32 5 1 27 94

2 to 2.9 Awareness 100 5 17 42 11 4 9 88

Below 2 Not relevant 14 0 0 0 0 5 0 5

Total 266 21 40 78 17 16 48 220


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The mean scores of each question from the second round are analysed and tabulated in the “role” and “knowledge / skill” classifications. The distribution of the questions by mean score based on the “role” classification is shown in Table 4.4 and Figures 4.1 to 4.5. The “user” role has the highest number of questions rated as “essential” (31%) and “important” (44%). The “manager” role has the lowest number of questions rated as “essential” (0%) and “important” (2%). Table 4.4 Distribution of “role” classification

Mean score General Manager Designer Auditor User Total

5 or above Essential

4(7%) 0(0%) 0(0%) 3(6%) 15(31%) 22

4 to 4.9 Important

9(15%) 1(2%) 4(8%) 7(14%) 21(44%) 42

3 to 3.9 Understanding

23(37%) 18(34%) 12(23%) 27(53%) 11(23%) 91

2 to 2.9 Awareness

18(30%) 32(60%) 30(56%) 13(25%) 1(2%) 94

Below 2 Not relevant

7(11%) 2(4%) 7(13%) 1(2%) 0(0%) 17

Total 61(100%) 53(100%) 53(100%) 51(100%) 48(100%) 266


Figure 4.1 Distribution of “General” role

General

Awareness

30%

Essential

7%Not relevant

11%

Important

15%

Understanding

37%


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Figure 4.2 Distribution of “Manager” role

Manager

Awareness

60%

Essential

0%Not relevant

4%

Important

2%

Understanding

34%

Source: Developed for this research Figure 4.3 Distribution of “Designer” role

Designer Essential

0%

Awareness

56%

Not relevant

13%

Important

8%

Understanding

23%

Source: Developed for this research Figure 4.4 Distribution of “Auditor” role

Auditor

Awareness

25%

Essential

6%

Not relevant

2%

Important

14%

Understanding

53%


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Figure 4.5 Distribution of “User” role

User

Essential

31%

Awareness

2%Not relevant

0%

Important

44%

Understanding

23%

Source: Developed for this research The distribution of the questions by mean score based on the “knowledge / skill” classification is shown in Table 4.5 and Figures 4.6 and 4.7. Seventeen percent of the questions in the “skill” classification were rated as “essential” and 30% were rated as “important”. In the “knowledge” classification, only 5% of the questions were rated as “essential” and 10% as “important”. Table 4.5 Distribution of “knowledge / skill” classification

Mean score Knowledge Skill Total

5 or above Essential 9(5%) 13(17%) 22

4 to 4.9 Important 19(10%) 23(30%) 42

3 to 3.9 Understanding 74(39%) 17(22%) 91

2 to 2.9 Awareness 71(37%) 23(31%) 94

Below 2 Not relevant 17(9%) 0(0%) 17

Total 190(100%) 76(100%) 266


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Figure 4.6 Distribution of “Knowledge”

Knowledge Essential

5%

Awareness

37%

Not relevant

9%Important

10%

Understanding

39%

Source: Developed for this research Figure 4.7 Distribution of “Skills”

SkillsEssential

17%

Understanding

22%

Important

30%

Not relevant

0%

Awareness

31%

Source: Developed for this research Tables 4.6 and 4.7 show further breakdowns of the questions with mean scores of more than 5 (essential) and mean scores between 4.0 and 4.9 (important) into two dimension classifications based on “role” and “knowledge / skill”. Twelve questions out of 22 (54%) that were regarded as “essential” by the Delphi panellists fall under the “user-skill” classification. This is followed by “general-knowledge” (18%), “user-knowledge” (14%), “auditor-knowledge” (9%) and “auditor-skill” (5%).

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Table 4.6 Number of questions with mean score ≥ 5.0

Knowledge Skills Total

General 4(18%) 0 4

Manager 0 0 0

Designer 0 0 0

Auditor 2(9%) 1(5%) 3

User 3(14%) 12(54%) 15

Total 9 13 22(100%)

Source: Developed for this research Of the 42 questions that scored between 4.0 and 4.9, 18 (43%) belong to the “user-skill” classification, followed by “general-knowledge” (22%), “auditor-knowledge” (14%), “designer-skill” (10%), “user-knowledge” (7%), “auditor-skill” (2%) and “manager-knowledge” (2%). From this analysis, it shows that the panellists placed high emphasis on practical user IT skills for accounting graduates. Table 4.7 Number of questions with mean score of 4.0 to 4.9

Knowledge Skills Total

General 9(22%) 0 9

Manager 1(2%) 0 1

Designer 0 4(10%) 4

Auditor 6(14%) 1(2%) 7

User 3(7%) 18(43%) 21

Total 19 23 42(100%)

Source: Developed for this research The descriptions of the top 22 questions that scored 5.0 or above are categorised into topic areas and are listed in Table 4.8. The top 22 questions fall under nine topics – spreadsheet, word processor, accounting software, accounting systems, Internet tools, data security, database software, IT controls and values.

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Table 4.8 Questions with mean score ≥ 5.0 Question number

IT knowledge / skills Mean score

Classification Topic

5.21 Office software (spreadsheet) 6.0 U S Spreadsheet

9.3 Apply appropriate IT systems / tools to business / accounting problems (spreadsheet)

6.0 U S Spreadsheet

16.3 Spreadsheets 5.8 U S Spreadsheet

5.20 Office software (word processor) 5.7 U S Word processor

16.10 Accounting software 5.7 U K Accounting

software

9.2 Apply appropriate IT systems / tools to business / accounting problems (word processor)

5.5 U S Word processor

9.10 Demonstrate understanding of business and accounting systems

5.5 U K Accounting

systems

17.1 Accounting software (MYOB, Great Plains)

5.5 U S Accounting

software

8.10 Appropriate IT systems / tools to business / accounting problems

5.3 A S

Subsumed into spreadsheet,

word processor, and presentation

topics

9.11 Demonstrate understanding of business and accounting systems (ERP, CRM)

5.3 U K Accounting

systems

15.6 GL reporting cycle 5.3 G K Accounting

systems

16.2 Word processing 5.3 U S Word processor

5.19 Office software (Internet tools: email, web browsing)

5.2 U S Internet tools

6.1 General means of communication supported by IT

5.2 G K Internet tools

6.2 Risks in communication supported by IT

5.2 A K Data security

9.5 Apply appropriate IT systems / tools to business / accounting problems (Internet tools)

5.2 U S Internet tools

5.22 Office software (Database management system)

5.0 U S Database software

15.3 Revenue cycle 5.0 G K Accounting

systems

15.20 Internal control 5.0 A K IT controls

15.29 Ethics 5.0 G K Values

16.5 Internet tools 5.0 U S Internet tools

16.9 Database search and retrieval 5.0 U S Database software


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The descriptions of the 42 questions that scored between 4.0 and 4.9 are categorised into topic areas and are listed in Table 4.9. These 42 questions fall under 14 topics – accounting systems, operating systems, general systems knowledge, Internet knowledge, presentation software, accounting software, database software, database concepts, IT controls, IT audit software, research tools, e-commerce, data security and documentation tools. Table 4.9 Questions with mean scores between 4 and 4.9 Question number

IT knowledge / skills Mean score

Classification Topic

2.11 Business documents, accounting records, control / management reports

4.8 G K Accounting systems

9.1 Apply appropriate IT systems / tools to business / accounting problems (Operating systems)

4.8 U S Operating systems

9.8 Apply appropriate IT systems / tools to business / accounting problems (Anti-virus software)


15.1 Introduction to systems 4.8 G K General systems

knowledge

15.22 Communication systems and technology

4.8 G K Internet knowledge

16.4 Presentation software 4.8 U S Presentation software

16.11 Tax return preparation software 4.8 U S Accounting software

17.2 ERP systems (SAP, Oracle) 4.8 U S Accounting software

3.3 Effectiveness of the entity’s business processes

4.7 M K Accounting systems

5.18 Office software (Presentation software)

4.7 U S Presentation software

9.4 Apply appropriate IT systems / tools to business / accounting problems (Database software)

4.7 U S Database software

15.4 Purchasing cycle 4.7 G K Accounting systems

15.7 HR / Payroll cycle 4.7 G K Accounting systems

16.12 Time management and billing systems

4.7 U S Accounting software

16.14 Electronic working papers 4.7 U S Accounting software

17.6 Database concepts 4.7 D S Database concepts

6.3 Benefits of IT to communication 4.5 G K Internet knowledge

8.11 Understanding of business and accounting systems

4.5 A K Accounting systems

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9.7 Apply appropriate IT systems / tools to business / accounting problems (Presentation software)

4.5 U S Presentation software

15.2 Introduction to transaction processing systems

4.5 G K General systems

knowledge

15.16 End user computing 4.5 G K General systems

knowledge

15.21 Computer fraud 4.5 A K IT controls

15.28 IT audit 4.5 A K IT controls

9.14 Apply controls to personal system

4.3 U S IT controls

16.15 Audit software 4.3 A S IT audit software

16.27 Anti-virus software 4.3 U K Operating systems

2.6 Attributes of information 4.2 G K General systems

knowledge

5.25 Computer-assisted audit techniques (CAAT) (Analytical tools)

4.2 U S IT audit software

7.19 Controls over information systems

4.2 A K IT controls

8.12 The application of controls to personal systems

4.2 A K IT controls

16.1 Operating systems 4.2 U S Operating systems

16.6 Research tools 4.2 U S Research tools

16.8 Database software 4.2 U S Database software

16.22 Electronic data interchange 4.2 U S e-commerce

5.23 Computer-assisted audit techniques (CAAT) (Accounting packages and CAAT)

4.0 U S IT audit software

9.9 Apply appropriate IT systems / tools to business / accounting problems (Utility software)


9.13 Demonstrate understanding of business and accounting systems (e-commerce)

4.0 U K e-commerce

16.29 Firewall software / hardware 4.0 A K Internet knowledge

16.32 Back-up and recovery 4.0 U K Data security

17.3 Documentation tools (System flowcharts)

4.0 D S Documentation tools

17.4 Documentation tools (Document flowcharts)


17.5 Documentation tools (Data flow diagrams)



24

The 64 questions that scored 4.0 and above representing IT knowledge and skills that are regarded as “essential” and “important” for accounting graduates are combined into the respective topic areas to arrive at a list that will be used as the basis for Part II of the research. The highest mean score within a topic area will be used to determine whether that topic belongs to the “essential” or “important” score category. Using this method, there are nine topics that fall under the “essential” score category and another nine that fall under the “important” score category. Table 4.10 shows the topics and the number of questions that make up the topics with the highest and lowest mean scores of the questions. Table 4.10 Essential and Important topics

Topic

Number of

questions Contents

Highest mean score

Lowest mean score

ES

SE

NT

IAL

Spreadsheet 3 Use of spreadsheet software 6 5.8

Word processor 3 Use of word processing

software 5.7 5.3

Accounting software

6

Use of MYOB, Great Plains, SAP, Oracle, Tax return

software, Electronic working papers, Time management and

billing systems

5.7 4.7

Accounting systems

9

Understanding business systems, ERP, CRM, GL

reporting cycle, Revenue cycle, Purchasing cycle, HR/payroll

cycle

5.5 4.5

Internet tools 4 Use of Email, web browsing,

SMS 5.2 5

Data security 2 Able to perform backup and

recovery 5.2 4

Values 1 Ethical standards 5 5

Database software 4 Use of database software,

database search and retrieval 5 4.2

IT controls 6 Internal control, computer fraud, IT audit, controls to

personal computers 5 4.2

IMP

OR

TA

NT

Presentation software

3 Use of presentation software 4.8 4.5

General systems knowledge

4 Understanding transaction

processing system, end-user computing

4.8 4.2

Internet knowledge

3 Understanding

communications technologies, firewall software/hardware

4.8 4

Operating systems 5 Use of utility software, anti-

virus software 4.8 4

Database concepts 1 Understanding database

concepts 4.7 4.7

25

IT audit software 3 Use of IT audit software,

CAAT 4.3 4

Research tools 1 Able to use research tools 4.2 4.2

e-commerce 2 Understanding electronic data

interchange, B2B, B2C e-commerce

4.2 4

Documentation tools

3 Understanding System flowcharts, Document

flowcharts, Data flow diagrams 4 4


26

5 Conclusion and further research

The first part of this research has sought the opinions from six individuals regarded as experts in the accounting field in NZ using the Delphi method. They have provided their opinion by rating 266 IT knowledge and skills in a questionnaire in two rounds. Nine essential and nine important IT knowledge and skills topics have been identified. The results will be used in Part II of the research which will be conducted using case studies and semi-structured interviews with accounting practitioners. Part of the semi-structured questions will be based on the results from the Delphi phase. The target number of cases is 10 to 15 and purposeful sampling will be used to recruit the participants. The primary objective of Part II of the research is to understand the IT needs of NZ accountants from an analysis of their day-to-day duties and their involvement and experience in dealing with IT matters. The secondary objective is to establish whether there are gaps and/or agreements between the results from the case studies with the results from Part I of the research.

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List of abbreviations

AIS Accounting Information Systems

ATEIs Approved tertiary education institutions

ERP Enterprise Resource Planning Systems

IEG-11 International Education Guideline No. 11, Information Technology and the Accounting Curriculum

IEPS 2.1 International Education Practice Statement 2.1

IFAC International Federation of Accountants

IT Information Technology

MIS Management Information Systems

NZ New Zealand

NZICA New Zealand Institute of Chartered Accountants

SLOs Statement of learning outcomes

TEIs Tertiary education institutions

UK United Kingdom

USA United States of America

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List of tables

Table 2.1 NZICA SLOs ............................................................................................... 4

Table 2.2 SLO-5 ........................................................................................................... 4

Table 2.3 Number of main topic coverage of IEPS 2.1 ............................................... 7

Table 3.1 Number of questions in Delphi questionnaire ........................................... 11

Table 3.2 Examples of classification of “role” and “knowledge / skill” ................... 12

Table 3.3 Number of questions classified into “role” and “knowledge / skill” ......... 13

Table 3.4 Proposed categories for IT topic ratings .................................................... 13

Table 4.1 Mean scores from the first and second round ............................................ 14

Table 4.2 Changes made by Delphi panellists ........................................................... 15

Table 4.3 Changes made to first round score categories ........................................... 15

Table 4.4 Distribution of “role” classification ........................................................... 16

Table 4.5 Distribution of “knowledge / skill” classification ...................................... 18

Table 4.6 Number of questions with mean score ≥ 5.0 ............................................. 20

Table 4.7 Number of questions with mean score of 4.0 to 4.9 .................................. 20

Table 4.8 Questions with mean score ≥ 5.0 ............................................................... 21

Table 4.9 Questions with mean scores between 4 and 4.9 ......................................... 22

Table 4.10 Essential and Important topics ................................................................. 24

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List of figures

Figure 2.1 Possible SLO-5 implementation ................................................................. 6

Figure 2.2 The AIS course ........................................................................................... 8

Figure 2.3 Conceptual framework of this research ...................................................... 9

Figure 4.1 Distribution of “General” role .................................................................. 16

Figure 4.2 Distribution of “Manager” role ................................................................ 17

Figure 4.3 Distribution of “Designer” role ................................................................ 17

Figure 4.4 Distribution of “Auditor” role .................................................................. 17

Figure 4.5 Distribution of “User” role ....................................................................... 18

Figure 4.6 Distribution of “Knowledge” ................................................................... 19

Figure 4.7 Distribution of “Skills” ............................................................................. 19

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