A Study of Factors That Influences Accounting Students’ Soft Skills

A STUDY OF FACTORS THAT INFLUENCES ACCOUNTING STUDENTS’ SOFT SKILLS

CHAPTER 1: INTRODUCTION

1.0 Introduction

Nowadays, the increasing rate of unemployment rates among accounting graduates in Malaysia is become worrying. The issue caught the attention of many parties, especially the graduating students who are no longer guaranteed with choices of jobs after a degree. In general, the job market get more competitive where only the graduates with extra qualities and characteristics will be selected by the employers to fill up the vacancies offered.

The dramatic changes in the workforce lead to higher employers’ expectations on accounting graduates. The globalization and rapid development in technology are considered as two major factors for the changes in the business environment. Globalization is one of the key factors that has forced companies to compete in a more liberal and borderless market (Albrecht and Sack, 2001; Blair and Hitchcock, 2001). They further argues that they emergence of Information and Communication Technology (ICT) has made the preparation and dissemination of information quicker, easier and cheaper.

Accounting graduates should be exposed to the challenges of globalization and technologies advancement to meet the demands of the accounting profession. Recently in Malaysia, the Malaysian Institute of Accountants (MIA) has addressed the issue of declining quality of accounting graduates. If the issue is left unresolved, our country will not be able to produce a number of quality multi-skilled accountants in both public and private sector.

Anyone can be an accountant when he or she is provided with the right software emerged from the technology development. However, the accountants need to equip themselves with high qualities, since the accountants’ tasks have broadened from bookkeeping and providing data to decision-making, planning and analyzing. According to Siegel and Sorensen (1999), accountants can no longer be regarded as “bean counters” or “number crunchers” as they are expected to involve in decision support and business strategic planning. To be value-added and to survive in a competitive business environment, graduating accounting students must be exposed to the challenges they might face once they join any firms or industries.

Beyond the technical competencies, they must be urged to possess some qualities such as communication skills, interpersonal skills and problem solving. As proposed by Siegel and Sorensen (1999), management accountants have to acquire various skills, which comprise communication, analytical and team skills, as well as an in-depth understanding of accounting and how a business functions.

The previous researches show that there are differences in the views of employers and potential employees relating the qualities needed in order to serve as the best accountant. Besides, the university faculties are not able to recognize the non-technical qualities sought by the employers in selecting the multi-skilled accountants. Nelson (1995) states that the current system focuses too much on providing technical skills, thus graduates are not able to meet the needs of the changing business environment.

1.1 Problem Statement

The Asian Economic crisis in 1997 resulted in decreased opportunities in the job market. Even now the situation has not come back to the state before 1997, workers, especially new graduates realize that finding job is very difficult. Recruiters on the other hand face with an influx of potential employees. Thus, accounting graduates who possess better knowledge and skills will be selected to hold the position offered.

Graduating accounting students from universities and colleges in Malaysia should better equip themselves with a range of skills for the job market and must be prepared to got the extra mile, the roles of accountants that have expanded demand them to possess a number os skills and broader knowledge to adapt to the needs of complex changing business environment. Employers tend to hire candidates who are not only good in accounting knowledge, but also good in a wide range of inter-related knowledge and skills.

Unfortunately, candidates are normally academically proficient but lacking in skills such as communication as well as verbal and numerical reasoning. The lack of non-technical skills among the future accountants will boost the statistics of unemployment problem among accounting graduates in Malaysia. As stated by Inman, Wenzler and Wicker (1989), accounting graduates are deficient in non-technical skills such as communication skills, interpersonal skills, critical thinking skills and problem-solving skills. This is further greed by Usoff and Feldman (1984) who stated that many accounting students did not appreciate the value that employers placed on communication skills.

The inequality between demand and supply also affects accounting graduates. With less job opening in the industry, more accounting graduates turn to Public Accounting Firms to seek employment. Accounting graduates tend to think they have greater chance of being employed in Public Accounting Firms as compared to the industry. Probably, industries usually necessitate stringent requirements such as relevant work experience as compared to Public Accounting Firms, especially small firms. This can be seen from job advertisements in daily newspapers.

Insight into what qualities Public Accounting Firms seek in potential employees is very important especially for accounting students and also for accounting educators and university administrators. A study carried out by McMillan, Ryan and Salter (cited by Cook & Finch, 1994) report that both recruiters and students view accounting educators as the most credible source of information in the recruiting process.

However, some of the previous studies have shown that there are discrepancies in views between Public Accounting Firms, educators and students regarding the qualities that accounting firms seek from their potential employees. This gap should be identified and actions should be taken in order to make accounting graduated aware of and possess the characteristics required from them. thus, this study attempts to identified the factors that influence the accounting students’ soft skills. It may help the graduating students to demonstrate those qualities in their resumes or during interviews and finally increase their chances of being employed.