Does an internship program improve the work readiness of international accounting graduates? Beverley Jackling Riccardo Natoli Asheley Jones

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1 Does an internship program improve the work readiness of international accounting graduates? Beverley Jackling Riccardo Natoli Asheley Jones The authors acknowledge the joint funding of this research by ICAA and CPA Australia Aim of the Study This study investigated the perceptions of internship providers about: the skill acquisition and work readiness of graduates that undertake a Professional Year Program (PYP) that incorporates a 12 week internship 1

2 Motivation for the study: Plight of International accounting graduates Grown substantially in number over past decade Skill shortage in accounting (Phillips and Spinks, 2012) as young, locally trained and with a high degree of acculturation (Hawthorne, 2005) expected to contribute to the economy as skilled migrants BUT Poor employment outcomes (Cappelleto,2010) Skill set expectations Requirement: knowledge professionals with a mix of technical and generic skills (especially communication skills) (Howieson, 2003) Only 18% of employers recruited international graduates (GCA, 2014). Therefore how do international accounting graduates that undertake a Professional Year Program fair in terms of skill set? 2

3 Features of Skilled Migration Internship Program Accounting (SMIPA) a minimum of 44 weeks of training, including a 12-week internship placement with a relevant host company professional development and practical hands-on learning, with an emphasis on workplace preparation: Culture, ethics and expectations recognition as a pathway for 485 graduate visa holders seeking permanent residency under general skilled migration (GSM) Successful completion of SMIPA may attract additional points under the general skilled migration points test. Source: Value added by internships Communities of Practice Framework: Legitimate peripheral participation (LPP). Newcomers carry out low risk but productive tasks that meet the needs of community (employer) Gain a sense of belonging which influences nature and context of learning that builds on engagement with more intensive and productive tasks 3

4 Research Questions What are internship providers perceptions of the level of generic skill development of SMIPA graduates on completion of the internship? How satisfied are internship providers with the SMIPA program as a means of preparing Australian educated international graduates for work in the accounting profession? Research Design Mixed Methods Design 99 questionnaire responses from internship providers about tasks undertaken by interns, skill development of interns and overall level of satisfaction with SMIPA as a work-readiness program 54 written responses to open-ended questions: In what ways, if any, could the SMIPA program be improved? 4

5 Features of the Sample Sample Characteristic Firm Size % Responses SMEs (< 50 employees) 60% Large firms (51 > 200 employees) 40% Main type of business activity* >100% given firms cite more than one main service activity Tax planning and compliance 47% Accounting compliance 43% Corporate and Business Advisory 16% Professional Affiliation CPA Australia 48% ICAA 22% IPA 5% No Affiliation 21% Work Experiences of Interns 80 Most Frequent Activities performed by SMIPA Interns % Recording financial transations Cash reconciliations Financial transactions manually Analysing financial statements Tax returns Budgets Financial investigations (audit) Costing of products 5

6 Research Question 1: Perceptions of Skill Development of Interns Frequencies for Skill Development - Perceptions Intern Providers % Disagree Neutral Agree Work in a Team Knowledge of Australian business environment Written communication skills Speaking and pronunciation Confident handling unfamiliar problems Research Question 2:How satisfied were providers with program as a means of work readiness? 6

7 Suggestions for future development/improvement of SMIPA main themes from open ended responses % Skill set Length of internship No change in program Better information for interns Better information for internship providers English skills Other Responses re skill set Overall work experience developed the skills of graduates Interns needed to be better prepared for the work environment- a focus on workplace behaviour practices (e.g. punctuality, dress code) Our internee lacked even the most basic accounting skills and was reluctant to attempt simple tasks (e.g. account reconciliations, reconciling credit card statements against receipts). I was surprised that our internee had graduated with a degree from a local university given their poor [technical] skills. Some prospective interns do not have the ability to transfer theory to practical application. Some basic practical assessment would benefit the intern and host 7

8 Structure of the Internship program Better information to intern as to what to expect from the program so they do not expect to be the manager on their first day Better orientation to local business environment Maybe a representative could come to the host organisation to see how the intern is going Better communication with employers for assessment The employer should be given a clear assessment of a candidate's abilities and weaknesses, so that their allocated tasks can be tailored to suit the company and also help the candidate to improve where required Overall Conclusions Internships viewed positively by internship providers but: Interns need to be adequately prepared with technical skills and English language skills Structure of the SMIPA program requires consistency across providers 8