Published August 8, 2022, 11:00 AM

by Dr. Cesar Mansibang

Teaching accounting, an effective approach



We practitioners and educators vividly remember our first lessons in Accounting. We dreaded it because that we thought it was all math of convoluted formulas. True, the accounting equation of debits and credits required mathematical skills to balance the two sides. But it required more critical-mindedness than just technical balancing using accounting principles and standards. Then we immediately grappled to understand accounting jargons and the laborious and confusing mechanistic accounting process of recording, classifying, and summarizing financial transactions.

For most of us, it was no piece of cake for it was so alien at the starting gate. It was a difficult initiation into the world of accounting that we became more fearful, anxious, and confused. Looking back then and now, how I wished accounting was taught differently. Or was there another way? But then, I was training to become an accountant. Howcan I be one if I do not go through that difficult agony as a matter of course?

Years later serendipitously, I became an “accidental” teacher. This “accident” turned out to be the start and evolution of my long career in the academe teaching finance and accounting to graduate business students alongside active business and professional engagements. If I were to become a good finance and accounting teacher, I would not want my students to go through the difficulties and confusion of my accounting student days. Thus, a change in mindset and approach was called for.

Our training then was quintessentially technical-focused and not managerial. So I thought of the process to first focus on the managerial import of accounting before the mechanistic aspects. For by understanding the critical managerial perspective of accounting as a function of management enables the students to develop immediate application and synthesis skills. Such an approach would not make them focus on balancing the accounting equation to start with.

In attempting to make students focus on the managerial perspective, I avoided the traditional “cookbook” approach. In this classic approach, teachers tend to focus on teaching the process flow starting with the journal entries until the preparation of the financial statements. For sure, this has its own advantages because it is a sequential and inductive process. It is the input-process-output sequence.

The disadvantage of this process is that it is laborious and confusing to the beginner student and there is no guaranty he easily understands what it is these pieces put togethermean.The “cookbook” approach is procedurally technical and mechanistic as in preparing a recipe. Following the cookbook would make one an expert cook but his finished recipe may not be palatably appetizing to his client’s taste, so to speak.

The other method, which I found effective especially for beginner students is to reverse the process by starting with understanding the output in the IPO process. Here, the students are immediately presented with the financial statements to understand, particularly actual financial statements of companies. Thus, the students are engaged with real life accounting issues for analysis and immediate problem solving and decision making in the workplace, instead of imaginary and contrived financial information accounting teachers use. This process immediately enhances the application, analysis, evaluation and synthesis skills of the students, envisioning and analyzing the actual financial picture of live companies. I call this approach the framework approach, a big picture view of the financial operations and results of business decisions embodied in the financial statements.

This approach improves the diagnostic and a cause-and-effect analysis skills of student right at the get go. From a managerial perspective, it enhances the process of exception reporting, where material issues and exceptions are given priority attention in problem analysis and solution development.

For example, instead of asking the technical question like what the required accounting entry for recording sales for the period was, the managerial questions of what we sold and how much we made for the period take priority billing. Another example, instead of asking what account should the expense be lodged, the managerial question is why was it spent in the first place or what was the effect of such expense in the bottom line and so forth. Note that the financial statements are the synthesis of what happened during the period or at a given period. Therefore, much information is already available for the managers to ask the right managerial questions.

The same is true with teaching and facilitating the accounting course. The teacher must start with the financial statements. When the student shall have mastered the import of financial information and their critical and synthesizing skills enhanced, then they should be ready for the debit and credit drills without fear.


Dr Cesar A Mansibang is a professional and business practitioner and professor. The views and opinions expressed by the author are his own and do not reflect those of PICPA’s views.