Comprehensive Literature Review: Factors Influencing Choice Of Accounting As A Major

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1 Comprehensive Literature Review: Factors Influencing Choice Of As A Major Kathleen A. Simons, Bryant College Dana R. Lowe, Bryant College David E. Stout, Youngstown State University Abstract Previous empirical studies have attempted to identify factors related to the choice of accounting as a major. Declining enrollments in accounting programs and uncertainties regarding the 150-hour certification suggest the need to re-examine and update these previous studies. New research in the area may provide clues as to the cause(s) of the decline in accounting as a major and whether factors found previously to be important predictors of accounting as a choice of major continue to be important. This paper provides a comprehensive summary of the published research, principally from accounting, regarding the choice-of-major decision. The paper concludes with a presentation of suggested research opportunities. INTRODUCTION The AICPA reports that between 1995/96 and 1998/99 the number of students enrolling in accounting programs decreased by 23%; 1 more recent reports suggest that this observed decline may not be an anomaly. For example, in November 1991, 7,800 persons sat for the Uniform CPA Exam in Texas; in May 2000 that number fell to 3, The experience in Texas may generalize to other states in the U.S. Recently, the AICPA sponsored a Student and Academic Research Study (Taylor, 2000) to look at the factors associated with the downturn in accounting majors and to make recommendations for addressing this problem. The Taylor study examines the perceptions of the CPA among both high school and college students, ways to encourage students to want to become CPAs, and the decision-making process of students as they make choices of majors/careers. The study concludes (p. 10) that while high school students view CPAs as professional and intelligent, they are generally ignorant of what CPAs do, have misinformation about the profession, and associate CPAs principally with math and numbers. Decreasing enrollments have also prompted researchers to search for answers by examining various aspects of accounting education. The recent monograph by Albrecht and Sack (2000) looks at changes in the business environment, declines in both the quantity and quality of accounting majors, practitioner views regarding the profession, the impact of the 150-hour requirement, and the overall mode of accounting education. These authors conclude (p. vii) that accounting faces a perilous future and that the accounting education environment cries out for action.

2 The negative factors identified in the Taylor study and the Albrecht and Sack monograph that are related to enrollment declines have been exacerbated recently by the negative portrayal of accountants in the business press. Audit failures, questionable accounting practices, internal control breakdowns, and audit-committee oversights have cast accountants and auditors in an unfavorable light. Rarely a day goes by without some negative press of this type reported in the Wall Street Journal. Prior studies have dealt specifically with factors associated with the choice-of-major decision. The current environment (characterized by declining enrollments, uncertainties regarding the 150-hour certification requirement, and negative press) suggests the need for renewed research into the factors affecting the decision to choose accounting as a major. This paper provides a comprehensive review of the published research in business education regarding the choice-of-major decision. We focus on the literature of accounting but, for completeness, include as well a summary of the general business literature related to the issue. The empirical literature in both accounting and business comprises 21 studies, which are summarized in Table 1. Some of these studies focus on the effects of a single factor, such as the effect of a specific course or a professor, on the choice-of-major decision. Other studies have attempted to identify the relative importance of a set of factors. For each study summarized in Table 1, we include information regarding sample size, sampling frame, research method, underlying theory (if applicable), factors found to be important, and--to the extent possible-- inherent limitations of the research. Eight studies in accounting have examined the relative importance of factors related to the decision to major in accounting. In this paper, we classify these factors under the following headings: earnings; career opportunities; career characteristics; characteristics of the major; student background; important referents; and, cost of education. Table 2 presents information regarding the importance of these factors, as reported in the eight accounting studies published to date. PRIOR STUDIES IN ACCOUNTING Studies in accounting regarding factors influencing choice of major can be grouped into the following, non-mutually-exclusive, categories: those based on psychological theory; those assessing the relative importance of selected factors used in the decision-making process (including those looking at student expectations and student background variables); those considering the timing of the choice-of-major decision; those considering the effect of the 150- hour requirement; and those examining gender effects. Theory-Based Studies As indicated in Table 1, three theory-based studies investigate the choice of accounting as a major/career: Felton, Dimnik, & Northey (1995); Kaynama & Smith (1996); and Cohen & Hanno (1993). Felton et al. and Kaynama et al. use versions of the theory of reasoned action (TRA), which specifies relationships among beliefs, attitudes, and behavior (Ajzen and Fishbein, 1980). TRA posits that a person s behavior is a function of the individual s attitude toward the behavior and his/her perception of social pressure to do that behavior. Attitude is the belief that a behavior will lead to certain outcomes, weighted by the importance of those outcomes. Social pressure is the belief that specific individuals or groups approve or disapprove of the behavior.

3 Table 1: Research (Business Literature) on Students' Choice of Academic Majors Research Method/Theory Author(s) Source Year Subjects Sample Size Statistical Tests Key Variables Primary Results Recommendations Limitations Rask & Bailey Boone & Coe Nelson, Vendrzyk, Quirin & Allen Journal of Economic Issues in Issues in 2002 Transcript analysis graduating n=8,167 students Multinomial logit students model 2002 Archival data; Quasi-experiment # of Under-graduate accounting degrees awarded, by state 2002 Self-designed survey; comparison of year 2000 results to 1995 results Graduate and senior 1995: 1,352 accounting majors at students; 2000: 22 FSA schools 1,475 students Human capital, individual characteristics, faculty, grades n=348 observations OLS regression % of accounting degrees awarded (to total degrees awarded), 150-hour states versus non-150-hour states Chi-square Factors influencing students' decisions to choose accounting as a major and the timing of such decisions Grade specific gpa and sats largest influence on major choice. Suggest that faculty gender and race influence female ~38% d iof the it total l decline ti f in accounting j graduates that occurred during the 1990s is associated with the 150-hour requirement Support for affirmative action programs among faculty. Eliminating 150 hours would not be enough to increase enrollments. Need to look for other reasons for the decline in enrollments. Addressing these issues is especially important in the current environment. Decline in percentage of accounting majors N/A (information reported in article is who seriously considered majoring in descriptive in nature) accounting while in high school (45% vs. 40%). Relatively fewer students actually decided to major in accounting while in high school (26% versus 32% in 1995); sophomore year represents the most common year for actually selecting the major. Reasons for choosing accounting as a major are changing: "availability of jobs" is still the most important reason; however, "money/good salaries" and "interesting/exciting profession" also relatively important Single college with the highest probablility for role model effects. Strasser, Ozgur & Schroeder Mid- American Journal of Business 2002 Survey; Analytic hierarchy process (AHP) Sophomore and senior business majors 63 sophomores and 49 seniors Correlations, independent sample t - tests Choice-of-major is a function of: Interest, Influence, and Career. Career is a function of money, job availability and growth, and job requirements. Job requirements are a function of computer usage and interpersonal skills. Students value the interest they have in the To retain accounting majors, important to major as far more important than the career explain early on what accountants do benefits of a major or someone else's influence on them to choose a particular major. Within career, the most important elements were money/compensation and job availability/growth. Students will choose a career that fits their interpersonal skills rather than a career based on the amount of computer usage they believe will be required on the job. Overall classification accuracy of the AHP model (predicting actual choice of major): 88%. Decision inconsistency much more prevelant for sophomore, as compared to senior, students. No hold-out sample used to test model; small sample size and sampling frame (one institution) Leppel, Williams & Waldauer Journal of Family and Economic Issues 2001 Survey conducted by the National Center for Statistics 1990 Beginning postsecondary students n=4161 Multinomial logit analysis Gender, race, ability, need for financial stability, and parental occupation Professional father has more influence on female students than professional mother. Opposite is true for males. High socioeconomic women less likely to major in business, opposite for males. Students' with desire to be well off financially more likely to major in business. Changes in the profile of students' family and socioeconomic status can be used to predict increases/ decreases in certain majors. Hardin, O'Bryan & Quirin Advances in Geiger & Ogilby Journal of Mauldin, Crain & Mounce Journal of for Business 2000 Self-developed survey based on literature published to date 2000 Self-developed pre- and post-course questionnaires High school educators Students in introductory accounting courses (taught by eight different instructors) 2000 Survey Students in first and second introductory accounting courses and intermediate accounting 128 high-school teachers from 40 states 331 students from two different institutions (mostly first-semester sophomores) 166 undergraduate students (mostly accounting majors) from a total of three institutions One-way ANOVAs ANCOVA, t -tests N/A (only percent response information given) Perceptions of engineering, law, medicine, and accounting careers vis-à-vis 24 attributes High school educators have a relatively low opinion of accounting as a career option for high school students. (For example, accounting was rated statistically lower that the other three professions on 13 of the 24 attributes.) Student perceptions of first accounting Changes in student perceptions during the course and the relationship between these first accounting course, as well as the perceptions, final grades, and instsructors on decision to major in accounting, are the decision to major in accounting. instructor-related. End-of-term selection of accounting as a major depends also on beginning-of-semester intentions to major in accounting and on performance in the Influence of principles of accounting Factors influencing major decision: career instructor on decision to major in accounting; timing of the decision to choose a particular major opportunities, interest in subject, teacher, money, parents. Of these, the accounting principles instructor viewed as the most influential. Decision to major in accounting often made in first accounting course. Recruiting efforts need to address the negative perceptions high school educators hold of accounting. Localized efforts between colleges, firms, and high schools likely to be most effective. Selective choice of instructors for introductory accounting courses Recruit majors in first accounting course and also target mailings to high school teachers and counselors. Not clear whether respondents were actually influential in helping HS students with their career decision. Also, response rate was relatively low (~25%). Traditional lecture-discussion method used in all sections invovled in this research. Will results hold under other teaching approaches? Analysis not theory driven (no underlying model of decision-choice provided by the authors)

4 Author(s) Source Year Taylor Proprietary Report (AICPA) Research Method/Theory 2000 Focus-group meetings; telephone interviews Subjects Sample Size Statistical Tests Key Variables Primary Results Recommendations Limitations High school and college students Nine focus groups N/A (only percent (40 high school response information students, 427 given) college students); 2,174 telephone interviews (1,000 with high school students, the balance with college students) Student perceptions and systemic barriers (to accounting career); attributes making a career attractive to students Importance of identifying student perceptions and systematic barriers. Students often make career decisions in high school and have misinformation (e.g., "accountants do boring, tedious, and monotonous number-crunching by themselves") about accountants. High school accounting courses may not be offeredt or be remedial in nature. Students impacted by role models, quality of professor, quality of introductory accounting critical. courses, and perceptions of CPAs. Seven attributes important to students: lucrative, rewarding, limitless, creative, multidisciplinary, travel and group work. Students looking for personally rewarding careers, careers where you are able to work with people, and careers that make a contribution to society and maintain a balance of home and work. They don't see accounting as providing these rewards. The licensing exam, 150-hour requirement, and CPE are not viewed as barriers to students. More in-depth learning, better teachers, real life problems, and more computer work would make introductory accounting courses better. At high school level, a plan to address student perceptions (ignorance, misinformation, and negative perceptions) as well as both the availability and the type/quality of accounting course offerings is needed. In this regard, early intervention is deemed Multivariate analysis lacking Saemann & Crooker Journal of 1999 Surveys (Gough's [1979] Creative Personality Scale and a self-constructed instrument for measuring perceptions of the accounting profession) Three large sections of introductory accounting students n=196 Multiple regression; t - tests Relationship between students' inherent creativity and perceptions of the accounting profession ("structure," "precision,'" "solitary," and "interest") on the decision to major in accounting; extent to which experience in a lecture-based introductory accounting course changes student perceptions and choices in major Students were much more likely to choose an accounting major when they considered accounting to be interesting. Students are more likely to find the accounting profession interesting when they do not preceive it to be highly structured, ruleoriented, or solitary. Greater efforts at the high school level are needed to convince students that the profession does not require as much precision as it may seem. Stice, Swain & Worsham Journal of for Business 1997 Survey and course performance data Introductory accounting students who have met a minimum grade point average (two large sections taught each semester over a twoterm period by each of two instructors) n=389 (162 of whom Multiple regression; t- were deemed tests "unqualified" based on average performance on two mid-term exams in the introductory accounting course, and 227 who were considered "qualified" using the same criterion) Performance in introductory accounting course and intention to major in For the set of pre-screened students (i.e., those meeting a minimum GPA) better classroom performance in introductory accounting courses did not influence students' decisions to major in accounting. That is, qualified students may conclude that a demonstrated mastery of the mechanics is not sufficient and rely on other factors in the decision to major in accounting. Use introductory accounting courses as both a "screening and a recruiting device." Future research should focus on identifying those "classroom" factors that affect the decision to major (e.g. changes in the accounting curriculum), and nonclassroom related factors (e.g., communication skills, intellectual skills, and interpersonal skills). Data collected from only a single institution that is likely not representative of accounting programs in general. Lowe & Simons : An International Journal Kaynama & Smith Felton, Dimnik, & Northey Journal of Marketing for Higher Journal of 1997 Survey Sophomore business students (acounting, finance, management, and marketing majors) 1996 Pre-business undergraduates Theory = Fishbein Behavioral Intent (FBI); same as (TRA) n = Survey Graduating business n = 897 students from seven Canadian institutions Theory = Theory of Reasoned Action (TRA) n=551 Non-parametric ANOVAs (including separate ANOVAs by gender), discriminant analysis (10-item function) Rank-order correlations, t -tests t -tests (CA students versus non-ca students) Importance ratings of 13 potentially influential criteria; based on Paollillo & Estes (P&E) Four influences on major selection, 3 business majors, TRA and AHP decision tool, student comfort. Career selection (CA versus non-ca) as a function of: beliefs regarding CA-career outcomes (e.g., good long-term earnings) and importance of these outcomes in choosing a career; ratio of beliefs regarding benefits and costs of CA career option majors distinctive in placing most emphasis on future earnings and career options. Marketing majors placed more emphasis on nature of the subject matter, management majors influenced by self employment opportunities, and finance majors most like accounting majors. Discriminant analysis supported the differential emphasis on 10 of the 13 criteria by the majors. Theory of reasoned behavior and AHP showed similar ability to predict major selection. Job satisfaction and interest in subject most important influences to each major. Beliefs of the major to deliver those factors differed. Tested the Theory of Reasoned Action (TRA) to model the decision to enter chartered accountancy (CA). CA and non- CA students indicated little difference in the importance of 10 career outcomes but significant difference in the likelihood of a career in CA providing those outcomes. Rework the content and pedagogy of accounting principles courses consistent with the research findings and the profession's recommended changes. Use of these models helps students with the decision freeing professors to provide more individualized service to their students. Modification of behavioral attitudes may be the key to attracting more students to the profession. Policy makers can communicate the benefits of a CA career, such as excellent long-term earnings, advancement opportunities, variety of work, chance to make a contribution, and flexibility of career options. Introductory accounting courses should sieze the opportunity to extol the benefits of the CA career. Because of similar profiles, policy makers should focus their promotional efforts on finance majors rather than nonfinance majors. Data collected from a single institution; no theoretical framework/decision model. Exclusion of nonbusiness students (e.g., engineering, liberal arts) from the analysis; no sensitivity analysis conducted to isolate the potential importance of contextual effects associated with the introductory accounting course. Thus, the authors state that "Perhaps the most important conclusion drawn from our study is the need for further research using the TRA model. Further TRA studies of the career decisions of business students should be conducted in the context of the required introductory financial accounting course."

5 Author(s) Source Year Lowe, Lowe & Simons Adams, Pryor & Adams Felton, Buhr, & Northey New Accountant Issues in Issues in Research Method/Theory 1995 Survey Sophomore business students 1994 Survey, archival data analysis; longitutdinal analysis Subjects Sample Size Statistical Tests Key Variables Primary Results Recommendations Limitations Introductory n = 238 accounting students (eight sections taught by one instructor during the academic year) 1994 Survey Fourth year business students at seven Ontario institutions t -tests ANOVAs, t-tests, regressions n = 897 Factor analysis, t - tests, discriminant analysis Choice of business major as a function of gender and 13 selection criteria (from P&E, and Gul) AICPA Aptitude Test scores, 11 factors associated with the major-selection decision Career choice (decision to choose a career as a chartered accountant) and: (1) importance of intrinsic rewards, financial rewards, and job market; (2) perception of chartered accountancy (CA); and (3) exposure to high school accounting. majors place more weight on financial factors in selecting majors. Female accounting majors placed relatively higher value on the inherent nature of the subject matter being challenging and interesting. Good job opportunities, high earnings potential, and genuine interest in the field are the most important major-selection factors (of 11 listed factors). High aptitude nonaccounting majors placed most significance on genuine interest in the area and less influence on monetary and/or job availability. Students are not selecting majors based on perceived difficulty of the curriculum. Conclusion was that the profile of accounting majors deviates from the stereotype. Need to convince students, perhaps in Relatively small sample from a single, the first accounting course, of the large institution availability of job opportunities in accounting and the earnings potential of successful practitioners. Also, incorporate modules in the principles courses that portray accounting careers as exciting and meaningful. Students choosing CA, compared to other organizations should intensify business majors: (1) place less importance their public relations programs to improve on intrinsic factors and initial earnings; (2) the profession's image among business more heavily emphasize long-term graduates. Academics should increase earnings and both short-term (e.g., their efforts to inform students about the immediate job availability) and long-term benefits of an accounting career and the (e.g., job security, career flexibility) job opportunities it affords. Professional market conditions; (3) perceive a higher organizations and college educators benefit/cost ratio to being a CA; and (4) should institute closer relationships with have had more exposure to HS accounting. high schools. The discrminant function had a 69.3% classification accuracy rate.the most iimportant factor was (3)--perceptions regarding the benefit/cost ratio to being a CA. The importance placed on internal factors was the second most important disciminating factor. The importance of internal factors and the importance placed on long-term earnings were the least important explanatory factors. Cohen & Hanno Issues in Graves, Nelson & Deines Gul, Andrew, Leong & Ismail Journal of and Finance Paolillo & Estes The Review 1993 Survey; Theory = Theory of Planned Behavior 1993 Self-designed survey, plus two scales: the Attitude Scale (AAS), and the Locus of Learning Motivation Scale (LLMS) Sophomores and seniors from five separate institutions n = 287 Graduate and senior n = 1,622 accounting majors from 26 FSA schools 1989 Survey First-year students in medicine, law, engineering and accounting 1982 Survey Professionals: doctors, lawyers, accountants, engineers Multiple-correlation analysis (model validity), independent sample t-tests (differences between accounting and nonaccounting majors), discriminant function (predictive ability of the model) N/A (only percent response information given) The authors rely on the theory of planned behavior to develop a predictive model regarding student choice-of-major. The model includes three constructs: differential attitude (attitude toward choosing accounting as a major/attitude toward choosing a business major other than accounting); differential subjective norm (subjective norm All three constructs made significant contributions to the prediction of choice of major. Students not choosing accounting may believe that accounting is too number- be radically changed. Need to alter the oriented and boring. Choice of major is also rules-based, quantitative approach in the affected by what students believe important courses. In terms of image, the referents thought they should choose as a importance of communications with major. Success in accounting courses, referent groups such as parents, high related to choosing accounting and choosing skills and background in math, and the a business major other than accounting); workload in accounting courses were also and, differential perceived control (i.e., how identified as factors that facilitated or each of seven different factors affected a hindered the choice of accounting as a st dent's abilit either to choose acco nting major Some differences bet een senior How and when students decide to major in accounting Little change from 1991 survey results: 42% seriously considered a career in accounting while in high school; 30% actually decided on an accounting career while in high school; of individuals, after "self" (39%) parents/other relative (22%) played most important role in career choice; top two factors affecting accounting career choice = availability of jobs, and money/good salaries To attract top students, the image of the profession and the content of the introductory accounting courses need to school teachers, and so forth, needs to be recognized. N/A (information reported in article is descriptive in nature) n = 367 (90%) Discriminant Analysis 11 factors, from Paolillo & Estes (1982) students more distinctive profile Profession's recruitment efforts should of medicine, engineering, and law. emphasize the five important factors, Earnings, aptitude, employment, and years especially the remuneration prospects. of education most important to accounting students. Job satisfaction important to all. Need to communicate the diverse and interesting functions of accountants. The discriminant function correctly classified 47% of the subjects into their chosen career. n = 694 (28%) Discriminant Analysis Career choice as a function of 12 influencing factors: earnings potential, association with others in field, parents, cost of education, social status, job satisfaction, years of education, aptitude, teachers, peers, work experience, and job availability The most important factors influencing the selection of accounting as the chosen profession were: aptitude for the subject matter, job satisfaction level, and earnings potential.they also found teacher influence to be more important than parental influence or peer influence. Discriminant function correctly classified 53% of subjects into their chosen field of study. Decision to enter nonaccounting professions (engineering and medicine) made at the high school level. To attract these students recruitment efforts should be directed at the highschool level. Also found that fewer years of schooling was an advantage to choosing accounting over other professions. Perceived aptitude for the subject important so greater use of aptitude test appropriate. Teacher importance underscores need for motivated, enthusiastic accounting professors, and emphasis on earnings potential. Sampling frame confined to students from one part of the country (Northeast) and to business students; statistical comparisons made only between accounting and "nonaccounting business" students (not, for example, accounting versus finance). No theoretical model offered as basis for the research No theoretical model offered as basis for the research

6 Earnings Table 2: Relative Factor Importance-- Choice-of-Major Studies Paollilo & Estes Gul, et al. Cohen & Hanno Felton, et al. Adams, et al. Felton, et al. Lowe & Simons Strasser, et al Earnings Potential ** Earnings ** High earnings/advance ment *** Long-Term Earnings *** High Earnings *** Long term Earnings *** Future Earnings *** Initial earnings Initial Earnings * Initial Earnings * Initial Earnings ** Earnings ** Student Expectations Student Background Career Characteristics Characteristics of the Major Cost Student Background Important Referents Availability of Employment Broad Exposure to business *** Availability ** Limited Job Availability Allows Private Practice ** Job Security Job Market *** Good Job Opportunities *** Plentiful Supply Career Options Job Availability Flexibility of Options ** Self-Employ ment Social Status Prestige Social Status High Status Social Prestige * Prestige Association with others in the field Job Satisfaction Years of Cost of Previous Work Exp. Aptitude for the subject Association with others in the field * Job Satisfaction ** Years of Works with People Works with *** Numbers ** Variety in the Work Intrinsic Factors * Advancement Job Requirements ** Exciting Field *** Structured Career Path Major which is boring Major with difficult courses Major with lots of classwork * Benefit/Cost Ratio Previous Work Exp. ** Aptitude for the subject ** Perceived Ctl. Measure Interest in the field * Ease of earning degree * Ability to maintain high gpa High School Parent Occupation Parents * Parents * Parents *** Parental Pressure Teachers ** Teachers * Professors Faculty reputation Chance to make a Contribution *** Interesting Subject * Intellectual Challenge * Benefit/Cost Ratio ** * Work Experience Parent's * Profession Ability /Aptitude ** ** Interest in Subject *** Parent Advice * Influence of others * High School Teacher Peers * Peers * Classmates * Friends * Friends of Family Business People Importance of Factor (based on statistical significance): * Least **Medium ***Most Friends and Relatives Counselors * *

7 Cohen & Hanno (1993) also use a variation of TRA, the theory of planned behavior, which adds behavioral control as a variable influencing behavior (Ajzen, 1985). Cohen & Hanno report (see Table 1) that all three variables (beliefs about outcomes, social pressure, and behavioral control) in their predictive model made contributions to predicting choice of major and that, overall, 92% of the student subjects in their study were correctly classified by their model. They found (see Table 2) that students selecting accounting ranked high earnings and advancement and having a career in an exciting field as the most important factors affecting choice of accounting as the major. Students not choosing accounting believe that accounting is too numbers oriented and that accounting is a major that is boring. Further, success in accounting courses and mathematical skills were identified by students as behavioral control criteria that hinder or facilitate choice of accounting as a major. Felton et al. use the TRA to model the decision to enter or not enter a career in chartered accountancy (CA). They test only attitudes and do not test the social pressure variable (stating that this variable had not been found to be a significant contributor in the majority of previous studies). Both CA and non-ca majors in their sample ranked long-term earnings as the most important criterion, followed by variety in the work and flexibility of career options. But TRA theory allowed Felton et al. to go beyond having students simply rank-order the importance of various factors, to further examine if students felt the factors identified as important would be met in careers in and out of accounting. The primary findings of this study, then, are that CA and non-ca majors report little difference in the relative importance of 10 career outcomes (e.g. long-term earnings, job security, structured career path; see Table 2) but believe there is substantial difference in the likelihood that a career in CA will provide these outcomes. The TRA, in a version referred to as the Fishbein Behavioral Intention (FBI) Model, was used by Kaynama & Smith (1996). They report that their model can predict major selection with accuracy similar to that provided by the analytic hierarchical process (AHP), another multivariable decision model. As Table 1 reports, Kaynama & Smith include in their model only four factors ( job satisfaction, interest in the subject, availability of jobs, and money ) with job satisfaction and interest in subject being the two most important factors for all students, regardless of their chosen major. However, student beliefs that majoring in accounting would deliver these outcomes differed. Similar to Felton et al., the additional dimension to this study was an attempt to determine if students perceive that the factors they rate as important in choosing a major would be met if they chose to major in accounting. Those who chose accounting felt that a career in accounting would provide them with job satisfaction and interest in subject, while those who chose business majors other than accounting felt that those majors would provide these outcomes. Other studies, without a theoretical framework, focus on identifying the relative importance of criteria used to select academic majors. Often the set of factors is developed from previous research or discussions (formal or informal) with representative participants, for example through the use of focus groups. While these studies lack a formal decision model or underlying theory, the factors in these studies found to be statistically significant in choosing a major are quite similar to those in the theory-based studies, a point made in the following section and reinforced by information presented in Table 2.

8 Studies Examining the Relative Importance of Various Factors Several factors have been proposed, in both the theory-based and non theory-based studies, as influencing student choice of accounting as a major. These factors can be grouped, broadly, as those that consider the expectations of students and those that focus on the importance of student background/experience. Principal factors in the area of student expectations (see Table 2) include: Earnings (including future earnings, long-term earnings, initial earnings, high earnings, and earnings ) Career Opportunities (including availability of employment, job market conditions, limited job opportunity, plentiful supply of jobs, job availability, broad exposure to business, intrinsic factors, job satisfaction, self-employment opportunities, flexibility of career options, and allows private practice ) Career Characteristics (including structured career path, social status attainment, prestige, job requirements, variety in the work, works with numbers, and advancement opportunities ) Characteristics of the Major (including years of education required, exciting field, interest in the field, interest in the subject, ease of earning a degree, and major with difficult courses ) Other choice-of-major studies that examined the relative importance of multiple factors looked at the relationship between various student background/experience factors and choice of major. 3 Some background factors include previous work experience, high school accounting, and ability/aptitude for the subject. The influence of important referents such as parents, friends, counselor, and teacher is often assessed in these studies. The importance of college professors has been addressed in separate studies that did not examine or attempt to rank multiple factors. The results of studies attempting to identify the relative importance of factors affecting choice of major are mixed and somewhat difficult to compare because different studies used different factors, or different names for what appear to be the same or similar factors. Table 2 allows for a comparison of the relative factor importance based on studies reported thus far in the literature. 4 As the table shows, earnings usually ranks as the first or second most important factor. Availability of employment and some version of interesting /exciting work are often found to be important. As indicated in Table 2, these results have remained fairly consistent across time, and in theory-based as well as non-theory-based studies. As noted in the previous section, however, the theory-based studies have the added dimension of examining whether students believe that majoring in specific disciplines would lead to the fulfillment of their preferred outcomes. Studies looking at the importance of referent input as regards the choice-of-major decision have not provided consistent results. With the exception of Cohen & Hanno (1993), the influence of parents, counselors, or friends has not generally been found to be important to the

9 decision. 5 However, some individuals (e.g., Geiger & Ogilby, 2000; Mauldin et al., 2000; Albrecht & Sack, 2000; and Taylor, 2000) have suggested the importance of college professors in affecting the choice-of-accounting-as-a-major decision. Timing of the Choice-of-Major Decision Several studies have examined the timing of the choice-of-major decision. Nelson et al. (2002) found that the sophomore year of college showed the highest percent of responses to the question, At what point did you make the decision to majoring in accounting? The next highest percentage response was during high school. These results seem consistent with those reported previously in the literature. For example, Graves et al. (1993) found that one-third of the students majoring in accounting made this decision while still in high school. Paolillo and Estes (1982) found that 23% chose it in high school, while 40% made this decision in their freshman or sophomore year of college. Both Mauldin et al. (2000) and Geiger & Ogilby (2000) found that the decision to major in accounting was made in the first accounting course. None of these studies followed the students to see if they actually remained in accounting, nor did any of these studies look at students who initially chose to major in a field other than accounting but later changed their major to accounting. Impact of the 150-hour Requirement Not tested thus far in studies examining the relative importance of individual factors on the decision to major in accounting is the effect of the 150-hour requirement. Various sources have, however, speculated that this requirement may be a deterrent to selecting accounting as a major. For example, Albrecht & Sack (2000, 23) state that the 150-hour rule has increased the opportunity costs to become a CPA, and prospective students perceive (this certification) as being too narrow and non-value-added. Relatedly, Barsky and Catanach (2001) state that uncertainty associated with the AICPA s 150-hour requirement concerns many students. A few recent empirical studies have, however, tried to assess the impact of the 150-hour requirement on the decision to major in accounting. Boone & Coe (2002) examine archival data and find that the requirement for 150 hours is partially responsible for the recent decline in majors. They report a 38% correlation between the two, and go on to say that eliminating the 150-hour requirement would not, by itself, make up for the recently-observed decline in accounting majors. The Taylor report (2000) says, on the basis of student surveys and telephone interview evidence, that the 150-hour requirement is not perceived per se as a barrier to majoring in accounting. Nelson et al. (2002) report that master s students at FSA (Federation of Schools of Accountancy) member institutions had a very high level of support for the CPA requirement of five or more years of college education. In 1982, Paolillo & Estes found that years of study was more important to accounting majors than to majors in other professions, but that was presumably a reason for them to choose accounting, which at the time generally required fewer years of study, as compared to engineering, law, or medicine--the other three professions examined in their study. It is noteworthy that none of these studies looked specifically at the effect of the 150-hour requirement on accounting enrollments; rather, this examination was made in conjunction with an assessment of a larger set of issues and factors.

10 Gender Effects Turner & Bowen (1999) examined the gender gap in choice of major, specifically, the under-representation of women in the sciences and engineering in the 1990s. They suggest that this phenomenon may by cultural and that gender and socialization skills/expectations may lead males and females to have different career-choice preferences. The Taylor Report (2000) states that compared to college students in general, accounting majors are more likely to be female. To the best of our knowledge, only two studies to date have examined the moderating effect of gender on the choice of business/accounting as a major. Leppel et al. (2001) found that female students are more likely to be influenced in choice of major by a professional father, and that women from high socioeconomic backgrounds are less likely to major in business. Both statements were found to be the opposite for males. Lowe & Simons (1997) found that female accounting majors ranked the inherent nature of the subject matter more important than did male accounting majors; females in their study placed a higher value on the ability to succeed academically in the major, in the major being intellectually challenging, and in coverage of interesting subject matter in their decision to choose a major. This was not true for all female respondents, only those choosing accounting as a major. 6 Research Methods Used As can be seen in Table 1, the primary method for studies in business and accounting published to date has been to apply statistical tests to survey-response data (viz., Hardin et al., 2000; Nelson et al., 2002; Strasser et al., 2002; Leppel et al., 2001; Mauldin et al., 2000; Saemann & Crooker, 1999; Stice et al., 1997; Lowe & Simons, 1997; Felton et al., 1994; Lowe et al., 1994; Felton et al.,1995; Cohen & Hanno, 1993; Graves et al, 1993.; Gul et al., 1989; and Paolillo & Estes, 1982), questionnaires (viz., Geiger & Ogilby, 2000), or to findings from focus groups (viz., The Taylor Group, 2000). Some studies have relied on analysis of student transcripts (Rask & Bailey, 2002) or other archival data (Boone & Coe, 2002; Adams et al., 1994).The statistical methods for data analysis have included multiple regression, t-tests, ANOVA, Chi-square, and factor analysis. OPPORTUNITIES FOR FUTURE RESEARCH The preceding literature review suggests the need for additional research, the results of which will allow us to better understand the decision criteria and process used by students to choose a college major and as such help accounting educators improve the advising process and allow more informed decisions by students. These research opportunities might usefully be grouped as follows: expand previous studies to look more closely at the importance of student demographics (including gender) and accounting program characteristics; vary the methodology and time-frame used to study the issue; find new recommendations/implications from existing studies; and, integrate models from other disciplines, such as marketing or psychology. More specific recommendations for future research, along the preceding lines, are offered in the sections below.

11 Expand Previous Studies An important part of the recommendations made for attracting students back to accounting will be to isolate decision-relevant factors that are controllable or actionable from the standpoint of accounting programs or the accounting profession. Some of the factors examined in previous studies relate to student background, such as previous work experience of the student and the occupations and socioeconomic status of the student s parents. While important from the standpoint of basic scientific knowledge, these factors do not allow for any specific action plan on the part of accounting organizations and educators in attracting students. On the other hand, factors such as parents recommendations and high school counselors/teachers influence are subject to at least some influence on the part of the accounting profession. Still other factors, such as the earnings potential and job security of a career in accounting can be addressed through specific recommendations for communicating, at the relevant time and to the relevant persons, accounting-specific information regarding these factors. The issue regarding the continued importance of these factors in the current environment speaks to the need for additional empirical evidence. Also, results of previous studies could be combined to design a survey instrument aimed at integrating the data. For example, the survey could look beyond whether students want higher salaries and job satisfaction and consider attitudes about accounting, responses to the 150 hour requirement, reaction to the introductory accounting course(s) and faculty, and the process used to integrate these factors into a decision to choose a major. Results of research into the possible moderating effects of gender would add to the body of knowledge in this area. Also, contextual effects of accounting-program type (e.g., traditional vs. innovative curricula) have yet to be studied. Future research may focus on such effects and yield useful information for advising and student-recruitment purposes. Barsky & Catanach (2001) suggest that students are not choosing accounting as a major for the following reasons: stereotypes about accounting being boring vs. other fields, such as information systems, that are seen by students as being exciting ; too much hard work; the 150- hour requirement; and the attractiveness to students of pursuing a double major. They believe that the popularity of double majoring often precludes majoring in accounting due to the number of courses required to complete the accounting major. Future studies could provide evidence regarding the validity of these assertions. Vary the Methodology and Time Frame Future research in accounting could employ methodologies other than the use of surveys, which by and large has been the methodology of choice thus far. Tools such as process mapping could be employed to better understand the college major decision. Also, different modeling techniques, such as the Analytical Hierarchy Process (AHP), used by Strasser et al. (2002) and by Kaynama & Smith (1996), could be utilized to provide insight into the choice-of-major decision-making process. The literature regarding the choice-of-major decision could also be extended to incorporate the use of longitudinal data. Few studies to date (e.g., Cohen & Hanno, 1983) have looked simultaneously at response data from sophomore and senior college students. It would be desirable if future studies looked at the same students over time (e.g., two years after an initial assessment point). While more expensive to conduct, such studies may yield useful insights into

12 the dynamic process that might underlie the choice-of-major decision. It may also motivate studies relating to why students change their major from or to accounting, information that should be of interest to those concerned about the decline in accounting enrollments. Find New Recommendations/Implications from Existing Studies Studies looking at the decline in accounting enrollments frequently end with the conclusion that various changes in the introductory accounting course(s) would go a long way toward solving the problem. It is frequently stated that attracting or not attracting students to major in accounting could hinge on the experience of students in the introductory course(s), the first and in many cases only exposure of these students to the field of accountancy. Over the years, the focus of introductory texts has run the gamut from extensive coverage of debits and credits to no mention of them, to somewhere in between. Cohen & Hanno (1993) recommend a change in the content of this course. Saemann & Crooker (1999) find that creative students are not attracted to accounting and recommend a change in students workload in the introductory course(s) to attract creative individuals. Stice et al. (1997) and Lowe & Simons (1997) recommend that the course be used as a recruiting tool for students into the major. Based on the aforementioned problems, these collective calls for changes in the introductory accounting course(s) have not provided a sufficient solution. Thus, it may be informative to reexamine existing studies to determine whether they yield insights beyond those relating to the introductory accounting course sequence. Integrate with Other Business Disciplines As the foundation for studying the choice-of-major decision researchers might look for other models/theories. For example, consumer marketing research looks at decision-making in terms of consumer choices and marketing strategies (see Kaynama & Smith, 1996.) Elements of consumer behavior models would likely apply to choice-of-major studies. The approach to understanding the selection-of-major decision has assumed a homogeneous population of accounting students. As a few studies have shown, males and females use different criteria in selecting accounting. It is therefore possible that there exist other identifiable clusters of accounting majors that could be classified by their individual selection criteria. Research studies might benefit, for example, from the application of market segmentation techniques to determine if such groups exist. This approach might also provide better information for practical ways to target potential accounting majors. Integrate with non-business Disciplines Further, researchers could consider looking beyond the business education research literature. While the research summarized in this paper looked at the factors used in making the decision to major in accounting, and the demographics of the students choosing or not choosing accounting, the business studies to date have not focused on the process used in making the decision. 7 Since predicting behavior is the objective of many research studies in psychology, the theories generated by that body of research could drive future research in accounting and business education. In the space below, we offer potential lines of research that might be borrowed from outside business disciplines.

13 Decision-Process Studies Literature from psychology includes studies that examine decision processes. For example, Galotti (1999) looked at the decision process of students choosing their major and found that, in making the decision, students limit the amount of information they use to a handful of alternatives. Students in their study realized the importance of the choice-of-major decision but found the decision stressful. These students attempted to reduce such ambiguity/stress by reducing the number of alternatives they considered. Future studies in accounting could address the question of whether this finding holds in the business disciplines and, if so, what the implications might be, particularly from an advising/information dissemination standpoint. Dissonance Theory Studies Another body of research, based on dissonance theory, has found that people seek supporting information and avoid conflicting information when making an important decision. Experiments by Jonas et al. (2001) look at availability of information subsequent to making a decision and find that confirming information is chosen while disconfirming information is often overlooked or avoided. This has implications for accounting researchers conclusions as to how to expose students to the benefits of choosing to major in accounting. If it holds, then even positive information (subsequent to making a decision) may not be received. CONCLUSION Investigating the selection of an academic major has produced a stream of research. This paper focuses on the literature related to the choice of accounting as a major. Research in this area has looked at the factors used by students to make the decision, and also the timing of the decision. Research, from both theory-based and non-theory-based studies, suggests that financial rewards, job availability, and interest in the major/career are the most important factors in selecting a major. Theory-based studies suggest that an important moderating variable affecting selection of accounting as a major is whether or not students perceive accounting as providing those outcomes they deem important. Several studies have examined the timing of the decision to major in accounting. The results suggest a decision point somewhere between high school and the first (or second) year of college. However, no studies were found that correlated the timing of the decision and the likelihood of graduating in the major. Other factors such as gender, nature of accounting courses, professors, and the 150-hour requirement on the decision to major in accounting have seen limited study. For example, some evidence suggests that the relevant factors used in making the decision may be weighted differently by gender. Also, several studies report that introductory accounting (or principles ) course(s) can influence the choice of accounting. These studies conclude that the instructor can be influential in the decision. It is not clear at this time whether the 150-hour requirement is a factor in the decision to choose or not choose to major in accounting, or whether the initial evidence we have regarding these other factors would be found to be important under the current environment.

14 The current environment in accounting suggests the need for further study of the choiceof-major decision. It is likely that this decision is influenced by multiple factors. This paper provides a comprehensive literature review of studies related to this decision and, as such, is meant to motivate and facilitate additional research. For example, studies to date might be expanded to include other methodologies (e.g., process mapping, the AHP), longer time frames (i.e., longitudinal analyses), and/or other theoretical frameworks (e.g., theories from psychology or marketing) to better understand how the decision process is internalized by students. Studies looking at gender effects may provide additional information. Cluster analysis may help describe the population characteristics with more detail. Contextual aspects of accounting programs (e.g., traditional vs. innovative courses or curricula) could be incorporated in future studies to determine if they enhance the explanatory power of models employed in this line of research. The cumulative results of this research should be useful for designing recruiting programs, improving the advising process, generating increased interest in the accounting major, and providing for more informed decision-making on the part of our students.

15 ENDNOTES 1 The Supply of Graduates and the Demand for Public Recruits, AICPA (1997; 1999). 2 Where have all the graduates gone? Today s CPA, Jul/Aug (2000). 3 The majority of multi-factor studies chosen for inclusion in Table 2 include a combination of student expectation and student background variables. 4 The determination of relative factor importance is based on the indicated statistical significance of individual factors in a given study. None of the studies reviewed in this paper report effect size information or any other data that would allow for an assessment of the practical significance of individual factors associated with the choice-of-major decision. For a discussion of statistical versus practical significance, within the context of accounting education studies, see Stout and Ruble (1995). 5 But see Kaynama & Smith, 1996, who find parents and advisors more influential than peers or employers. 6 This study looked at majors in the business disciplines: accounting, computer information systems, finance, marketing, and management 7 Hence the recommendation in a previous section of this paper to employ alternative research methodologies, such as process mapping, to gain knowledge of the underlying decision process associated with the choice-of-major decision.

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