Strategic Possibility Report Los Angeles County. Accounting. Center of Excellence for Los Angeles

Transcription

1 Strategic Possibility Report Los Angeles County Accounting Center of Excellence for Los Angeles Hosted at the Los Angeles Community College District September 2007

2 Strategic Possibility Summary for Los Angeles Community Colleges Accounting September 2007 Prepared By: Center of Excellence, EWD Region 7 Los Angeles County Los Angeles Community College District 770 Wilshire Blvd., Los Angeles, CA Phone: (213) Fax: (213) In collaboration with: 2541 State Street, Suite 108, Carlsbad, CA p: f: The Business and Workforce Performance Improvement Initiative is funded in part by the Chancellor s Office, California Community Colleges, Economic and Workforce Development Program. The total grant amount (grant number for $205,000) represents compensation for multiple documents or written reports through the Centers of Excellence. Our mission is to strengthen California s workforce and advance economic growth through education, training and job development.

3 Table of Contents Executive Summary... 4 What is a Strategic Possibility?... 6 Strategic Possibility Description... 6 Overview of the Industry... 7 Qualifying the Strategic Possibility... 8 Employment Size and Growth... 8 Economic Impact Leveraging and Relevance Opportunities/Implications for Community Colleges Summary References APPENDIX A: How to Utilize this Report APPENDIX B: Industry Associations Chancellor s Office, California Community Colleges 3

4 EMPLOYMENT OPPORTUNITIES FOR ACCOUNTANTS, AUDITORS AND RELATED ACCOUNTING PROFESSIONALS IS PROJECTED TO INCREASE 26 PERCENT FROM IN LOS ANGELES COUNTY, PRODUCING A TOTAL OF 37,330 JOB OPENINGS. Source: California Employment Development Department, Labor Market Information. Executive Summary In Los Angeles County, the projected need for accountants and auditors will be an estimated 13,880 total job openings (new jobs plus net replacements) between 2004 and This indicates that 34 percent of the 2004 workforce will need to be replaced or recruited for new job openings over the ten year period. The projected job openings include over 6,000 new jobs as well as 7,660 openings due to separations. Multiple factors are contributing to the increasing need for professionals in this industry. One major contributor is the recent legislation passed in 2002 in response to corporate accounting scandals The Sarbanes-Oxley Act (SOX). This legislation required companies to adhere to more detailed accounting procedures and controls, and conduct diligence in reporting and certification. Therefore, it has had major ramifications for the accounting industry. Among these has been the increased need for both experienced and entry-level accounting professionals. The Securities and Exchange Commission (SEC) approved revisions to SOX in May of 2007 in an effort to allow companies to focus their efforts on issues that pose the greatest risk to financial reporting rather than across the board. These revisions are not expected to significantly impact current data forecasts. Additional factors of rapid technological change and baby-boomer retirements are also contributing to a significant staffing and experience shortage within the industry. Furthermore, research on the accounting industry in Los Angeles County reveals: Industries that hire the bulk of accounting professionals, such as the professional, technical, and scientific services industry, the finance and insurance industry, and the wholesale trade industry, are expected to grow substantially over the next ten years; Growth in the accounting industry (NAICS 5412) has been very robust since 2002, including over a six percent growth rate during the past two years; Growth in the accounting industry within Los Angeles County in the first quarter of 2007 is nearly three times higher than originally forecasted by Economy.com, providing additional evidence for the upward trend in new job creation; Strong demand for occupations in accounting-related fields is projected through 2014 in Los Angeles, matching projections for the state overall. Over 37,000 total job openings are predicted between 2004 and 2014 a 26 percent increase over 2004 employment levels fueled by both new growth (8%) and replacements (18%) over the ten year period; and, New job growth is concentrated in the relatively higher paying jobs in accountingrelated occupations; in particular, 6,220 new positions will be created for accountants 2007 Chancellor s Office, California Community Colleges 4

5 and auditors and 3,910 new positions for financial specialists are predicted to open up through The community colleges in Los Angeles are strategically positioned to train new and incumbent workers required for the growing and changing accounting profession. However, challenges do exist. Accounting employers generally have high expectations for formal education attainment in terms of college degrees and often do not consider community colleges as a component of their education and training solution because of this perceived need. Indeed, recent research in the Greater Silicon Valley revealed that over half of employers expected at least a bachelor s degree for successful applicants in all of the occupations examined except for bookkeepers and accounting clerks. However, over half (55%) of accounting employers indicated that they had at least some interest in working with the community colleges for customized training for current accounting employees. Community colleges can collaborate with industry partners and university business departments to align and adapt existing curricula, programs, and services to meet the increased need for skilled accounting workers. In particular, community colleges have the opportunity to collaborate with employers on how to: Work with industry to effectively implement career ladder curricula so that individuals who are currently working in the accounting field can get the education they need for a clear pathway to advancement. Develop and implement an assessment tool or exam that would identify the education and training that would be required for individuals with accounting experience who lack the appropriate certificate or degree. Effectively communicate to current and future accounting students where workforce needs are greatest in the industry and the multiple opportunities available to them when armed with the right repertoire of skills in this area. In addition, community colleges should work with accounting industry partners to: Develop or adapt curricula so that courses expand students knowledge of management practices and more complex business practices, such as internal auditing, forensic accounting, financial statement analysis, and ethics. Develop or adapt curricula that expose students to software applications for the accounting industry. Develop a career ladder model that shows entry-level accounting positions, such as bookkeeping and accounting clerks which pay close to $17 per hour, and how to advance within the industry. Develop internships and work experience with industry partners to gain further education and experience Chancellor s Office, California Community Colleges 5

6 Develop career exploration and awareness about the accounting industry targeted to middle school (7 th and 8 th grade) and high school students. Many K-12 students are either not interested in, or do not find their science and math classes relevant, resulting in very few considering science/math related careers. Students who are interested in accounting or other financial services related careers must begin the process very early in their college careers if not before. Therefore, it is imperative that they are exposed to accounting career options before they graduate from high school. o Spearhead outreach efforts to and recruit from local schools to promote student interest in careers in accounting and related pathway options. o Educate high school and college guidance counselors on accounting careers and career ladders so they, in turn, can educate their students and guide students toward accounting related careers. What is a Strategic Possibility? The California Community Colleges System has charged the Economic & Workforce Development (EWD) Network to strategically identify growing industries and occupations that have partnering potential for college programs. The EWD network aims to best serve our local communities by identifying industry sectors with empirically validated projected growth. Additional criteria to establish the value of a Strategic Possibility includes: relevance (to the community colleges), economic impact, the adaptability of colleges to respond, and the ability to build partnerships with workforce and industry leaders to create career paths and upward mobility. A Strategic Possibility report identifies industries and occupations that meet some, but not all, of the aforementioned criteria. While a response may be appropriate for a specific college, a strategic response from multiple districts is not warranted. A Strategic Possibility that meets all of the stated criteria, thus warranting an organized response from regional community colleges, is then defined as a Strategic Opportunity. A full environmental scan may then be conducted to evaluate and suggest possible actions to ensure market responsiveness. Strategic Possibility Description Accounting reforms enacted under the Sarbanes-Oxley Act of 2002 (SOX) have created staffing and experience shortages in the accounting profession. New regulations enacted under SOX were added on top of the workload of, in many circumstances, already meager accounting departments. Economic growth will also further accelerate the demand for accounting and finance occupations. Because of this demand, employers in the financial and accounting industries will need to step up their efforts to attract skilled employees. Also contributing to the opportunity is the changing face of the workforce. As baby-boomers retire, experienced replacements will increasingly be needed. In fact, Economic Development Department (EDD) data for Los Angeles shows more openings per year for accounting-related occupations due to separations rather than to the creation of new jobs (see Table 3) Chancellor s Office, California Community Colleges 6

7 Accounting is particularly relevant to local community colleges. Most business divisions already have core courses to prepare students for entry-level positions, such as bookkeeping and accounting clerks. The colleges can easily and effectively introduce students to the field of accounting, careers within the profession, and the career ladders for advancement and promotion. Overview of the Industry Accounting occupations are found throughout the economy and in almost every industry. Most firms with at least 250 employees will hire their own accounting departments and smaller firms will often have bookkeepers, accounting clerks, and/or accountants on staff. For example, the accounting industry itself (NAICS 5412) only employs about 40 percent 1 of all accountants and auditors in Los Angeles County. The industries that comprise the majority of accounting employment include: Professional, technical and scientific services (NAICS 5400), 26% of employment in 2005, which includes: o Accounting, tax preparation, bookkeeping, and payroll services (NAICS 5412), which falls under the larger category of professional, technical and scientific services), 19% of accounting employment in 2005; Finance and insurance (NAICS 5200), 18% of employment in 2005; Wholesale (NAICS 4200), 10% of employment in 2005; and Management of companies and enterprises (NAICS 5500), 6% of employment in According to the economic forecast for Los Angeles County put together by Economy.com, all of the largest industry employers of accounting occupations are expected to increase employment substantially. The largest projected gains occur in the professional, technical, and scientific services industry. The NAICS codes listed above are defined below. 1 This is derived from the 2005 NAICS and SOC crosswalk for the Los Angeles MSA, developed by the Employment Development Department Chancellor s Office, California Community Colleges 7

8 Professional, technical and scientific services (NAICS 5400) includes legal, accounting, architectural, engineering and computer design services as well as management and technical consulting, market research, scientific research and development services. This industry also includes the specific accounting industry, Accounting, tax preparation, bookkeeping, and payroll services (NAICS 5412). Finance and insurance (NAICS 5200) includes banks, credit unions, saving institutions, mortgage companies, consumer lending firms, investment brokerages, insurance agencies and carriers, as well as firms that handle trusts, funds, and estates. Wholesale (NAICS 4200) comprises establishments engaged in wholesaling merchandise and rendering services incidental to the sale of merchandise. The merchandise described in this sector includes the outputs of agriculture, mining, manufacturing, and certain information industries, such as publishing. Management of Companies and Enterprises (NAICS 5500) comprises (1) establishments that hold the securities of (or other equity interests in) companies and enterprises for the purpose of owning a controlling interest or influencing management decisions or (2) establishments (except government establishments) that administer, oversee, and manage establishments of the company or enterprise and that normally undertake the strategic or organizational planning and decision making role of the company or enterprise. Qualifying the Strategic Possibility In determining the extent of this opportunity, several critical factors were evaluated. The following sections outline the accounting industry s present size, its capacity for growth, its relevance to community colleges focus, the economic impact of its jobs, and opportunities for leveraging with community partners. Employment Size and Growth The projected new job growth patterns of industries that employ the majority of accounting related professionals both statewide and in Los Angeles County, all show moderate to strong increases through For example, employment in the accounting, tax preparation, bookkeeping, and payroll services industry (NAICS 5412) will increase by 25 percent from 2004 to 2014 in California. Only the professional, technical, and scientific services industry (NAICS 5400), which includes the accounting industry, demonstrates a higher projected growth rate over the same time period (26.6%). These projections are substantially higher than the overall projected growth rate for non-farm employment in California (17.7%) Chancellor s Office, California Community Colleges 8

9 While growth expectations for these specific industries in Los Angeles County are slightly lower than the growth expectations statewide, the overall pattern of growth is very similar. The specific accounting industry (NAICS 5412) is projected to grow by nearly 26 percent. Recent data from 2007, however, indicates that current projections may be underestimating the strength of the accounting industry. The specific accounting industry has continued its strong growth through the first quarter of Utilizing a factor to adjust for higher first quarter employment (using 2006 data to create the proportion), expected employment in 2007 was calculated (after decreasing the employment counts from first quarter levels). The analysis shows that the accounting industry is expected to expand by nearly eight percent from 2006 to 2007, nearly five percent higher than industry projection data. California Occupational Outlook In California, the employment opportunities for accounting and related fields during show strong projections with 158,100 total job openings (of which 67,700 are new jobs and 90,400 are replacements). This represents a 32 percent change over 2004 employment levels fueled by both new growth (14%) and replacements (18%) over the ten year period (please see Table 1 for a breakdown of the data presented in the section). The openings are concentrated in three main areas: Accounting and Auditing; Bookkeeping, Accounting and Auditing Clerks; Financial Specialists. California is estimated to have a projected need for 53,300 Accountants and Auditors during the period of This represents a 42 percent change over 2004 employment levels for the ten year period, with an average of 29,500 new jobs being created (23% growth). Approximately 23,800 openings will be created, on average, due to separations (19% replacements) from the workforce. In addition, there is a projected need in California for 61,200 General Bookkeeping, Accounting and Auditing Clerks between 2004 and 2014, a 27 percent change over 2004 employment levels. Projections indicate that, on average, 17,900 of these openings will be new jobs (8% growth) and 43,300 openings are projected to be created due to separations from the workforce (19% replacements). The broader area of finance includes not only bookkeeping and accounting positions, but also the category of Financial Specialists. This expanded view and opportunity includes Budget Analysts, Credit and Financial Analysts; Personal Financial Advisors; Insurance Underwriters; and Loan Officers and Counselors, all of which are projected to experience double-digit percentages of new job growth in California from 2004 to These job categories will produce 43,600 Financial Specialists between 2004 and 2014, a 31 percent change over 2004 employment levels. Over 20,300 new Financial Specialist jobs 2007 Chancellor s Office, California Community Colleges 9

10 will be created in California over the ten-year period (14.3% new growth) with an additional 23,300 jobs created when separations are included (16.4% replacements). Los Angeles Occupational Outlook Job growth also looks strong for Los Angeles. Projected regional openings are at similar levels anticipated for the entire state. The employment growth for accounting and related fields is a healthy 37,330 total job openings between 2004 and This represents a 26 percent change over 2004 employment levels fueled by both new growth (8%) and replacements (18%) over the ten year period (see Table 3 for a breakdown of the data presented in the section). For Accountants and Auditors there will be an estimated 13,880 total job openings (new jobs plus net replacements) between 2004 and 2014 a 34 percent change over 2004 employment levels. When separated out, projections indicate 6,220 new jobs (15% growth) and 7,660 openings due to separations (19% replacements). In fact, the projected number of new job openings for accountants and auditors ranks 20 th among all occupations in Los Angeles County. Similarly, the projected need for General Bookkeeping, Accounting and Auditing Clerks in Los Angeles County totals 13,570 job openings during the same time period. This represents a 21 percent change over 2004 employment levels for this occupation. Most of these new job openings (90%), however, are due to separations from the workforce with relatively few new jobs being created in this job classification (21% change= 2% growth and 19% replacements). Because these are entry-level positions, these employees may be moving up the career ladder as they gain more experience in the accounting and financial services field. Lastly, projections show that the total openings in Los Angeles County for Financial Specialists will reach nearly 10,000, a 27 percent change over 2004 employment levels during the ten year period. Less than half (3,910) will comprise of new job openings, while the remaining 5,970 will replace workers moving out of the position (27% change= 10.5% growth and 16.1% replacements). The following tables summarize the job growth and replacement projections outlined above: 2007 Chancellor s Office, California Community Colleges 10

11 Table 1: California Occupational Employment Projections from SOC Code Occupational Title Annual Average Employment Employment Change Numeric Percent Accountants & Auditors 126, ,600 29, Bookkeeping, Accounting and Auditing Clerks 231, ,200 17, , 2041, 2051, 2052, 2053, 2071, 2072, Financial Specialists 142, ,400 20, , 2082, 2099 Total 499, ,200 67, SOC Code Occupational Title Total Job Openings New Replacements Totals Percent Accountants & Auditors 29,500 23,800 53, , 2041, 2051, 2052, 2053, 2071, 2072, 2081, 2082, 2099 Bookkeeping, Accounting and Auditing Clerks 17,900 43,300 61, Financial Specialists 20,300 23,300 43, Total 67,700 90, , Source: California Employment Development Department Table 2 below shows the wage ranges for accounting-related professionals in the state of California. Table 2: California 2007 First Quarter Wages Entry-Level Median Experienced SOC Code Occupational Title Wage Wage Wage 25 th Percentile 50 th Percentile 75 th Percentile Accountants & Auditors $22.28 $28.48 $ Bookkeeping, Accounting and Auditing Clerks $13.88 $17.17 $ , 2041, 2051, 2052, 2053, 2071, 2072, Financial Specialists $22.77 $30.45 $ , 2082, All Occupations Statewide $10.47 $16.79 $27.42 Source: California Employment Development Department 2007 Chancellor s Office, California Community Colleges 11

12 Table 3: Los Angeles Occupational Employment Projections from SOC Code Occupational Title Annual Average Employment Employment Change Numeric Percent Accountants & Auditors 40,580 46,800 6, Bookkeeping, Accounting and Auditing Clerks 64,910 66,320 1, , 2041, 2051, 2052, 2053, 2071, 2072, 2081, 2082, 2099 Financial Specialists 37,150 41,060 3, Total 142, ,180 11, SOC Code Occupational Title Total Job Openings New Replacements Totals Percent Accountants & Auditors 6,220 7,660 13, Bookkeeping, Accounting and Auditing Clerks 1,410 12,160 13, , 2041, 2051, 2052, 2053, 2071, 2072, Financial Specialists 3,910 5,970 9, , 2082, 2099 Total 11,540 25,790 37, Source: California Employment Development Department Table 4 below shows the wage ranges for accounting-related occupations in Los Angeles County. With the exception of the experienced wage for clerks, the entry, median, and experienced wages for accounting-related professionals are higher than the wages across occupations in the county. Table 4: Los Angeles 2007 First Quarter Wages Entry-Level Median Experienced SOC Code Occupational Title Wage Wage Wage 25 th Percentile 50 th Percentile 75 th Percentile Accountants & Auditors $21.35 $27.73 $ Bookkeeping, Accounting and Auditing Clerks $13.44 $16.85 $ , 2041, 2051, 2052, 2053, 2071, 2072, Financial Specialists $23.61 $30.23 $ , 2082, All Occupations in LA $10.08 $16.12 $26.55 Source: California Employment Development Department 2007 Chancellor s Office, California Community Colleges 12

13 Economic Impact In addition to major reforms instituted by the Sarbanes-Oxley Act of 2002 (SOX), other major trends such as globalization, retiring baby boomers, and economic growth should create more jobs for accountants and auditors. As the economy grows, the number of business establishments will also increase. This, in turn, will require more accountants and auditors to set up books, prepare taxes, and provide management advice. Furthermore, the volume and complexity of information developed by accountants and auditors regarding costs, expenditures, and taxes will increase as well. More complex requirements for accountants and auditors also arise from changes in legislation related to taxes, financial reporting standards, business investments, mergers, and other financial matters. Businesses will also increasingly need quick, accurate, and individually tailored financial information due to the demands of growing international competition. The changing role of accountants and auditors will also spur job growth. Rather than simply reporting financial data, accountants and auditors in today s market will need to offer more management and consulting services as they take on a greater advisory role and develop more sophisticated and flexible accounting systems. By focusing more on analyzing operations rather than just providing financial data, accountants will help to increase the demand for their services. Also, internal auditors will increasingly be needed to discover and eliminate waste and fraud. Jobs within accounting are high-wage, high-skill jobs and promote stability in the region and the local economy. These employees generate high tax revenue, spend their income in the regional economy on goods and services, and support local schools and community institutions. Leveraging and Relevance Strong growth in the accounting industry provides the community colleges an opportunity to partner with employers as well as local agencies such as the Workforce Investment Boards (WIB) located in Los Angeles County. 2 The Los Angeles Community Colleges can be instrumental in creating partnerships between public agencies, business and industry, educational institutions, trade associations, and unions. The partnerships will provide workers, students, and jobseekers with access to the skills and training they need to acquire high-demand, well-paying jobs in the new economy. A more comprehensive discussion should occur between educators and employers in need of accounting professionals in order to develop solutions to address the workforce challenges in the coming decade. This collaboration could tackle issues such as: How to effectively implement career ladder curricula so that individuals who are currently working in the accounting field can get the education they need to move up the career ladder; 2 The following Workforce Investment Boards (WIB) are located in Los Angeles County: Carson/Lomita/Torrance WIB, City of Long Beach WIB, Foothill WIB, Los Angeles City WIB, Los Angeles County WIB, South Bay WIB, Southeast Los Angeles County WIB, and the Verdugo Consortium Chancellor s Office, California Community Colleges 13

14 How to develop and implement an assessment tool or exam that would identify the education and training that would be required for individuals with accounting experience who lack the appropriate certificate or degree; Strategies to effectively communicate to current and future accounting students where workforce needs are greatest in the industry; and, A systematic method to continuously identify the educational programs that are in demand by employers. Similar strategies have been implemented among educators, healthcare employers, and healthcare training providers in Orange County. Based on labor market information funded by the Orange County Workforce Investment Board (OCWIB), the Orange County Health Care Collaborative was created in order to coordinate existing programs to address current and future workforce needs. Models such as these could be explored for the accounting industry Chancellor s Office, California Community Colleges 14

15 Opportunities/Implications for Community Colleges Colleges can easily build upon their existing infrastructure of accounting courses within their business divisions to meet the increased demand for skilled workers in the accounting industry. Courses can be developed or adapted and offered for credit, non-credit, and via customized training programs. The following paragraphs discuss ways that community colleges in Los Angeles can meet the increased need for skilled accounting workers. Develop and Adapt Curricula to Meet More Complex Demands Because of technological advances in computer software as well as more complex accounting demands to meet the stringent requirements imposed by recent legislation, accounting professionals are being asked to perform tasks above and beyond simple accounting and budgetary tasks. Not only are accounting professionals being asked to provide internal audits, but they are also becoming more involved in analyzing a company s management practices as well as a company s financial and operational systems and processes. Furthermore, these new responsibilities have greatly increased the workload of accounting professionals in recent years, taking away time from their more traditional tasks. Therefore, it is imperative that students seeking a career in the field are well-versed in accounting and business software that can increase their efficiency and help them hit the ground running. The community colleges can assist by developing or adapting current curricula so that: Courses expand students knowledge of management practices and more complex business practices in order to comply with new SOX requirements. New offerings would include internal auditing, forensic accounting, financial statement analysis, and ethics. Students are exposed to and have experience with software applications commonly used by accounting professionals. Students have access to courses that offer a thorough understanding of a company s operations from a financial, operational, and organizational perspective. Create Industry Partnerships In order to keep up with the projected demand for accounting professionals, employers and educators must foster open communication about industry needs as well as identify possible gaps in workforce training. Communication with employers can assist in the following: Developing a career ladder model that shows entry-level accounting positions, such as bookkeeping and accounting clerks which pay close to $17 per hour, and how to advance within the industry. Establishing internships with industry partners to gain further education, experience and potential connections Chancellor s Office, California Community Colleges 15

16 Creating customized training and/or certificate programs (e.g., tax preparation), for accounting employers. College programs that incorporate work experience and internships into their design will provide graduates with easier access to employment and advancement potential. The following table shows the career ladder from entry-level to mid-level to top-level advancement in the accounting profession, based on education and experience: Table 3: Career Ladder for the Accounting and Auditing Industry Entry Level Positions Mid Level Advancement Top Level Advancement Advancement Requirements Bookkeepers or Accounting Clerks (Certificate or Associate Degree) Staff Accountant or Full Charge Bookkeeper, or Accounts Receivable Coordinator Sr. Accountant or Accounting Manager B.S. degree in Accounting or related field; experience in the industry. Cost Accounting Clerk (Certificate or Associate Degree) Cost Accountant or Fiscal Analyst Sr. Cost Accountant or Sr. Financial Analyst or Account Manager B.S. degree in Accounting or Finance, plus several years experience. MA preferred for Sr. Analysts & Sr. Cost Accountants Tax Preparer (Certificate, Associate, or Bachelor s Degree Tax Accountant Tax Manager or Director B.S. degree in Accounting or Finance. CPA required for higher level positions. Certified Enrolled Agent can be required for advancement Junior Auditor or Entry-Level Auditor (Associate or Bachelor s Degree) Auditor or Internal Auditor Sr. Auditor or Internal Controller Source: SP Report: Accounting, Greater Silicon Valley Center of Excellence B.S. degree in Accounting. Work experience with a CPA firm or with a big 4 firm. CPA required for higher level positions and MA preferred. Colleges should also ensure that their articulation agreements are designed to provide smooth transfer to 4-year institutions for students who want to continue their education beyond the Associate level, particularly since many of these jobs eventually require B.S. degrees for advancement. Develop Outreach Programs Lastly, community colleges can address the growing demand for accounting professionals by developing outreach programs that encourage students to consider accounting and finance as careers. Accounting may not naturally stand out as a primary career choice for students and 2007 Chancellor s Office, California Community Colleges 16

17 colleges should be proactive in providing information about the profession. Among other options, local community colleges can play a leadership role by: Developing career exploration and awareness about the accounting industry targeted to middle School (7 th and 8 th grade) and high school students. Many K-12 students are either not interested in, or do not find their science and math classes relevant resulting in very few considering science/math related careers. Students who are interested in accounting or other financial services related careers should begin the process early in their college careers if not before. Therefore, it is imperative that they are exposed to accounting career options before they graduate from high school. Summary o Spearheading outreach efforts and recruiting from local schools to promote student interest in careers in accounting. These promotions can take the form of presentations, workshops, volunteer days, and career fairs. o Educating guidance counselors on accounting careers and career ladders so they, in turn, can educate their students and guide students toward accounting related careers. The projected need for accountants and auditors in Los Angeles County is estimated at 13,880 total job openings (new jobs plus net replacements) between 2004 and This represents a 34 percent increase over the ten year period. These projected job openings include over 6,000 new jobs as well as 7,660 openings due to separations. Multiple factors are affecting growth in this industry. The Sarbanes-Oxley Act of 2002 (SOX) has created more stringent accounting procedures and controls for companies. Implementing these will impact workforce needs. Although revisions to the Act were made in May, 2007 easing some of the strain upon the industry, the revisions are not expected to affect workforce projections. This legislation, along with rapid changes in technology, and looming retirements are all contributing to the staffing and experience shortages within the industry. The community colleges are strategically positioned to train new and incumbent workers required for the growing and changing accounting profession. Most colleges presently offer accounting courses through their business divisions. These courses can be adapted to better serve the evolving industry. Community colleges also have an opportunity to collaborate with industry partners and university business departments to align and adapt existing curricula, programs, and services to meet the increased need for skilled accounting workers. Specifically, in partnership with employers, colleges can inform students where the accounting industry has the greatest need for workers and the skills necessary to be successful. They can also create and implement career ladder curricula to better guide students through their professional development. An assessment tool could be helpful to individuals who have some accounting experience but lack the necessary certificate or degree. In addition to partnering with employers, community colleges can begin to look at existing offerings to: 2007 Chancellor s Office, California Community Colleges 17

18 Develop or adapt curricula so that courses expand students knowledge of management practices and more complex business practices, such as internal auditing, forensic accounting, financial statement analysis, and ethics. Develop or adapt curricula that expose students to software applications for the accounting industry. Develop a career ladder model that shows entry-level accounting positions, such as bookkeeping and accounting clerks which pay close to $17 per hour, and how to advance within the industry. Develop internships and work experience with industry partners to gain further education and experience. Develop career exploration and awareness about the accounting industry targeted to middle school (7th and 8th grade) and high school students. Educate high school and college guidance counselors on accounting careers and career ladders so they, in turn, can educate their students and guide students toward accounting related careers. Ensure that articulation agreements are designed to provide smooth transfer to 4-year institutions for students pursuing advanced degrees. While recent research in the Greater Silicon Valley showed that over half of employers expected at least a bachelor s degree for successful applicants in all of the occupations examined except for bookkeepers and accounting clerks, the same study revealed that over half (55%) of accounting employers expressed interest in working with the community colleges for customized training for current accounting employees. The colleges can capitalize on this interest to begin to create strategic partnerships with the industry that will better serve students interested in entering this industry, as well as those working within the industry looking to advance their careers. A deeper look into the workforce needs of the Accounting Industry can be seen in the recent study titled, Environmental Scan Report, Greater Silicon Valley Region, Accounting Industry, Center of Excellence Hosted at West Valley College, September The study may be accessed at Chancellor s Office, California Community Colleges 18

19 Center of Excellence for Greater Silicon Valley References Strategic Possibility Summary for Community Colleges in the Greater Silicon Valley Region: Accounting Industry. June Environmental Scan Report, Greater Silicon Valley Region, Accounting Industry, Center of Excellence Hosted at West Valley College, May California State EDD LMID Moody s Economy.com, Los Angeles, CA, 4-digit NAICS Industry Employment & Output Forecast U.S. Census Bureau, Chancellor s Office, California Community Colleges 19

20 About Us - Description of BWPI APPENDIX A: How to Utilize this Report The Business and Workforce Performance Improvement (BWPI) initiative is focused on building the capacity of the colleges in the area of economic and workforce development to enhance their ability to deliver education and training services to businesses and workers in high growth industries, new technologies, and other clusters of opportunities. The Centers of Excellence (COE) within BWPI provide information regarding workforce trends, increasing awareness and visibility about the colleges economic and workforce development programs and services, and building partnerships with business and industry. The difference this will make to the colleges is that it will position them as THE workforce partners of choice to business and industry and ensure that college programs are current and responsive. This will contribute to the overall economic vitality of the communities in which they serve. How to Use This Strategic Possibility Report The Centers of Excellence within the Business and Workforce Performance Improvement Initiative of the California Community College Economic and Workforce Development Program have undertaken Industry Scanning to provide targeted and valuable information to community colleges on high growth industries and occupations. This report, while not a full industry scan, is intended to assist the decision-making process of California community college administrators and planners in addressing local and regional workforce needs and emerging job opportunities in the workplace as they relate to college programs. The information contained in this report can be used to guide program offerings, strengthen grant applications, and support other economic and workforce development efforts. This report is designed to provide current industry data that will: Define potential strategic opportunities relative to an industry s emerging trends and workforce needs; Influence and inform local college program planning and resource development; and Promote a future-oriented and market responsive way of thinking among stakeholders. This Industry Scan included a review of the California Regional Economies Project reports and Employment Development Department (EDD) Labor Market Information (LMID) projections that cover the communities in this region, as well as many other sources as listed. Important Disclaimer: All representations included in this Strategic Possibility report have been produced from a secondary review of publicly and/or privately available data and/or research reports. Efforts have been made to qualify and validate the accuracy of the data and the reported findings. The purpose of the Strategic Report is to assist the California Community Colleges to respond to emerging market needs for workforce performance improvement. However, neither the Business and Workforce Performance Improvement Centers of Excellence, COE host college or California Community Colleges Chancellor s Office are responsible for applications or decisions made by recipient community colleges or their representatives based upon this study including components or recommendations Chancellor s Office, California Community Colleges 20

21 AAA American Accounting Association APPENDIX B: Industry Associations Academy of Accounting Historians Encourages research, publication, teaching and personal interchanges in all phases of accounting history ACAUS Association of Chartered Accountants in the United States AICPA American Institute of Certified Public Accountants ASWA American Society of Women Accountants Beta Alpha Psi An international honorary organization for Financial Information students and professionals FEI Financial Executives International FSA Federation of Schools of Accountancy IFAC International Federation of Accountants IIA Institute of Internal Auditors IMA Institute of Management Accountants NALGA National Association of Local Government Accountants National Society of Accountants NSA and its affiliates represent more than 30,000 independent practitioners. PASA.org The Professional Accounting Society of America 2007 Chancellor s Office, California Community Colleges 21