Skip to:Main Content

Washington and Lee University

Washington and Lee University

New W&L Accounting Courses Teach International Standards


News Contact:
Jeffery G. Hanna
Executive Director of Communications and Public Affairs
jhanna@wlu.edu
(540) 458-8459

Lexington, Virginia • March 10, 2010

For U.S. companies, preparing to adopt international accounting standards is a major headache.

For accounting students at Washington and Lee University, a new curriculum is alleviating some of the pain.

A $50,000 grant from PricewaterhouseCoopers Charitable Foundation has enabled W&L's accounting department to create a series of courses that teach the International Financial Reporting Standards (IFRS) in parallel with the regular accounting classes covering U.S. Generally Accepted Accounting Standards (U.S. GAAP).

According to Elizabeth Oliver, professor of accounting and department head, the initiative employs different approaches for upper-level or introductory classes. In the upper-level classes, once a professor completes a topic in the U.S. GAAP class, students will learn about the same topic using IFRS in the international accounting class. For the introductory classes, students are introduced to the international standards through a stand-alone module developed by W&L accounting professor J. William King.

Oliver said she doesn't know of any other school using this parallel course approach, but that students are already seeing the benefits. "Not only are students understanding IFRS and how and why it is different, it is reinforcing their understanding of the U.S. standards as well."

From left, Elizabeth Oliver, William King and Brandi Wedgeworth, who has introduced the new curriculum in her class this year.

Students will graduate knowing both standards, and Oliver said that will "give them a leg up" when it comes to finding a job. This is especially true with PricewaterhouseCoopers, which has been one of the biggest employers of W&L graduates over the past few years. "They have said it will be part of their recruiting process. If accounting graduates can't talk about IFRS, then the firm is not going to be interested in them. The other major accounting firms haven't made such targeted comments, but it is important to them as well," she said.

The Securities and Exchange Commission (SEC) has already given international companies that file in the United States permission to use IFRS. Meanwhile, U.S. companies have been preparing for the shift to international standards since 2008, when the SEC released its proposed roadmap for the adoption of IFRS in the United States within the next five to seven years.

While the financial crisis may have added some uncertainty to the exact timeline, PricewaterhouseCoopers believes it is inevitable. On its Web site the company stresses the importance of understanding IFRS and its implications, calling it "a business imperative for U.S. companies."

To explain the difference between the two standards, Oliver said that U.S. GAAP is rules-based but IFRS is based on principles. "Principles versus rules is a big argument in accounting," she said, adding that in her opinion both have advantages. "Right now the problem is if you look at a financial statement that uses one set of accounting standards and try to compare it with another that uses different accounting standards, it's very hard to understand what the real differences are. If everyone uses the same standards then we're all better off and the market is better off. But it's painful as we make the change.

"There's been a huge shift with other countries adopting the international standards--Brazil is one country making the change this year--and, as you can imagine, it's causing a lot of difficulty for companies," she said.
According to Oliver, the grant application was a very competitive process. "For us to be included with some of the big research schools that also received grants is very gratifying for us. We're a small school with a very different teaching model," she said.

Eventually, once the IFRS standards have been adopted in the United States, Oliver expects the accounting curriculum to return to one set of courses. "It will eventually come full circle as we return to one primary set of standards--the IFRS."