While critical thinking is necessary for accountants in today’s business world, cultivating students’ critical thinking skills in an accounting classroom can be a challenge. The extant literature suggests that debate is a well-established pedagogical tool for enhancing student critical thinking skills, yet debate is not often used effectively in accounting classrooms. We provide suggestions for developing debates for use in the accounting classroom and two examples of debates used by the authors. The first requires students to argue for or against the extension of tax provisions currently being deliberated by Congress. The second requires students to examine the provisions of Sarbanes-Oxley and propose amendments to the bill.

SYNOPSIS: We contend that tax-related information, which has not yet been considered by extant research, can significantly improve bankruptcy prediction. We investigate the association between abnormal changes in book-tax differences (BTDs) and bankruptcy using a hazard model and out-of-sample testing as in Shumway (2001). We find that information regarding abnormal changes in BTDs significantly increases our ability to ex ante identify firms that have an increased likelihood of going bankrupt in the coming five-year period. The information provided by BTDs significantly adds information to traditional models for predicting bankruptcy, such as that proposed by Ohlson (1980), and also expands the prediction window beyond the traditional two-year time frame.

No abstract

This article describes the details of a mentorship program implemented by one university to train accounting doctoral candidates as educators, thus responding to calls by the Pathways Commission (2012), prior research (Gribbin, Sobery, and Braswell 2002; Brink, Glasscock, and Wier 2012), and the AACSB (2013) for thoughtful training of our future teacher-scholars. The two-semester program enables doctoral program directors to meet each doctoral candidate at his/her point of need, includes recommendations for supporting international doctoral candidates, and advocates for an appreciation of the synergies between research and teaching. As such, this study should be of interest to doctoral program directors, doctoral candidates, and administrators.

The broker-dealer (BD) industry is facing increasing scrutiny because of the recent financial crisis and well-publicized scandals. As is often the case for public companies, a root cause of the problems underlying scandals in the BD sector is ineffective internal controls. This paper describes the current regulatory environment for auditors of BDs, focusing on Congressional actions taken, as well as guidance for auditors in preparing their reports on clients' internal controls and compliance with regulations as required by the SEC. We describe aspects of current attestation standards contributing to uncertainty with respect to the level of assurance that auditors should obtain when evaluating their clients' internal controls for purposes of SEC reporting, and evidence from regulators on the variability in audit quality. Then, we describe the SEC's proposed changes to BD reporting and the PCAOB's proposal for related attestation standards. We conclude with some thoughts about the implications of these proposals for auditing and reporting in this important industry sector.