Obstacles to the perception of the traditional accounting cycle in the learning process

Abstract

Purpose – The aim of this study is to investigate how students of entrepreneurship perceive the traditional accounting cycle in the learning process. While the evidence of the benefits of using spreadsheet models in accounting education has been studied, the use of the traditional accounting cycle from the process perspective is under-researched.

Design/methodology/approach – Action research is a quest for knowledge about how to improve. This study consists of two parts: theoretical underpinnings and systematic observations (2002-2012) with a special focus on the use of the traditional accounting cycle in a local setting. I teach entrepreneurship students to use two technologies (manual and computerized) and two models (traditional accounting cycle and spreadsheet model) and then ask them to reflect on how they perceive the different accounting processes. Observing students and their computerized home assignments, and gathering feedback serve as the sources of data that provide insight into my entrepreneurship students’ thinking.

Findings – Research evidence identifies obstacles and adjustments to procedural knowledge of the traditional accounting cycle that will be needed to successfully integrate spreadsheet models. The conceptual accounting information system (AIS) develops the understanding of the effect of data (business activities) on knowledge (financial statements) so the accounting activities inside the conceptual AIS are visible to entrepreneurship students.

Research limitations/implications – This study is limited to procedural knowledge and skills of the traditional accounting cycle in a local setting.

Practical implications – The results indicate that abandoning outdated and irrelevant procedural knowledge of the traditional accounting cycle may foster the perception of interaction between entrepreneurial and accounting processes. Teachers become more effective when encouraged to assess both entrepreneurship students’ needs and their own work and make evidence-based decisions for working differently.

Originality/value – The conceptual AIS enables to store data, process data into information and convert information into knowledge. Once the students understand the accounting process behind the financial statements, using different accounting software to facilitate their completion makes sense. Technology skills for data mining are important because it is physically impossible to observe business activities in their entirety.