Impact of Retention Policies in Accountancy Programs

Accountancy maybe one of the most difficult courses offered to all students nowadays. It needs a great skill of analyzation and courage to stay in the program. It is also one of the demanded jobs that’s why many incoming freshmen take BSA program. It all started more than 7000 years ago when the earliest accounting records was found in ancient Babylon, Assyria, Sumeria. Then in 1494, Luca Pacioli described the system double entry bookkeeping in his Summa de Arithmeca, Geometria, ProportionietProportionalita that was used by Venetian merchants.

He was the first person describe the system debits and credits use in journals and ledgers today.

Accountancy course is offered by almost all schools here in the Philippines. In the University of the East wayback in 1946, CPA review classes were conducted in two rented rooms in Dasmarinas St. Manila where 110 students were enrolled. Four of them made to the top in CPA board exam in 1947. In the past years this university has made history in CPA board exams because of countless topnotchers coming from this school.

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But unfortunately it stopped and to bring its past glory, it applies the retention policy that was also conducted in different schools. To study accountancy, it takes a great discipline in all aspects of the students and because of that retention policy existed. The following are the retention policy in the University of the East wayback in 1993:

First year - GPA of 3.

50.| A student must obtain a GPA of 3.50 and not failed on 4 subjects to qualify for enrolment on 2nd semester| Second year – GPA of 3.00| A student must obtain a GPA of 3.00 and pass all accounting subject with an average of 2.75| Third year – GPA of 2.75| A student must obtain a GPA of 2.75 and an average of 2.75 in all accounting subjects.| Fourth year – GPA of 2.75| Fourth year – GPA of 2.75|

Then on October 2006, the percentage of board passer became lower than the previous years. Due to this, the department implemented a new retention policy. It states that if a student has 2 failing grade in accounting, he must leave the program. Many revisionswere made on this policy as years pass by. At present the retention policy was: (refer to next page)

The purpose of this research is to know the effects of this policy to the school, professors and specially students. It is for us to know if it’s really effective, increases the quality of education in accounting and improves the results of board examiners of this university. The impact is to whether remove it or enhance the policy for example by giving some consideration especially on lower years that are only starting their life as a college. Those students who are adjusting from their life in highschool to college must give consideration by removing its 2.5 retention policy.We want to prove the effects of this policy and if the retention has a great effect on students. Maybe they are learning not because they want to but because of the pressure of that retention policy.

Statement of the Problem

It specifically aims to answer the following:

* What is the retention policy of the BSA program in University of the East? * What are the advantages and disadvantages of this retention policy to students? * How effective is this policy?

Objectives
The following objectives are formed from the study:

* To be able to know the retention policy in University of the East. * To be able to determine the advantages & disadvantages, and effectiveness of this policy. * To be able to assess the effectiveness of this policy

Assumptions

What is the retention policy of the BSA program in University of the East? 1.) A minimum grade which the Accountancy students must maintain. 2.) A policy to increase the academic standards of the University of the East Manila What are the advantages and disadvantages of this retention policy to students? 1.) That the retention policy aims to encourage the students to perform well and excel academically. 2.) That the retenteion policy serves as a motivation for the students. 3.) That the retention policy will determine the student’s preparedness for the CPA board examination. 4.) That the retention policy is a burden for some students. 5.) That because of the retention policy most of the students have sacrificed most of their time in order to focus on the subject. How effective is this policy?

1.) That the retention policy increased the passing rate of the University of the East in the CPA board examination. 2.) That the retention policy improved the performance of students in the CPA board examination.

Significance of the Study
This study is significant to the following:

To students who will use the results as a way to provide them an evaluative study on the retention policy for BSA students in the University of the East and how this retention can affect them in taking the CPA board examination; To professors who may find this study useful in understanding their student’s concerns regarding the retention policy; To parents who will know the policy being implemented in the university and the corresponding effects of this to their children; To school administrators who will identify the good and bad effects of this policy and whether to improve or implement another policy regarding the retention; To researchers who may use this as a reference for their further findings.

Scope and Delimitation of the Study

This study did not include all BSA students enrolled in the University of the East. It is limited to 150 randomly BSA students who are enrolled in second year first semester because it is the period when the highest retention grade should be achieved.

Conceptual framework

The researchers decided to use the Stacked Venn diagram to show the relationship between each factor and how it is related to reach the bigger circle which is to the number of board passers. At the core of the circle is the study habit of students to be used as the main measurement in this research. The researchers aim to effectively record the number of hours spent by students every week, depending on subjects, stress and other factors such as adequacy of teaching approach, students’ personal problems and their adaption process towards the program. Next to the core of the circle is the grade requirement which under the Retention Policy states that BSA Students shall maintain a grade requirement of 2.00 and above during their sophomore years.

On the latter part of their junior year, comprehensive exam will be given as their final test which they are necessary to obtain 65% and above in able to pass.

As the end result, high passing rate in the CPA Board Exam are expected. As of October 2011 – 58.70%

As of October 2012 – 62.42%

The data above prove that the Retention Policy of the BSA program could be a better way of improving the passing rate in the CPA board exams since percentage of passers increased by 3.72% from October 2011 to October 2012.

Definition of Terms

Accountancy - is the process of communicating financial information about a business entity to users such as shareholders and managers. It is the process by which financial information about a business is recorded, classified, summarized, interpreted, and communicated. Luca Bartolomeo de Pacioli - was an Italian mathematician, Franciscan friar, collaborator with Leonardo da Vinci, and seminal contributor to the field now known as accounting. A double-entry bookkeeping system- a set of rules for recording financial information in a financial accounting system in which every transaction or event changes at least two different nominal ledger accounts. Journal - a daily record of events or business; a private journal is usually referred to as a diary Debit - an accounting entry which results in either an increase in assets or a decrease in liabilities or net worth.

CHAPTER 2
REVIEW OF RELATED LITERATURE AND STUDIES

This chapter presents a review of local and foreign literature and studies to the research study being conducted.

Local Literature and Studies

Accounting is an essential tool used by many in order to provide information about the financial standings of an individual or a business. Many researchers and writers have defined the role of accounting in the lives of many people in our society. The primary purpose of accounting is simply to help people make decisions in terms of their business and finances.

Baysa and Lupisan (2011) defined accounting as a service activity and its main function is to provide quantitative information, primarily financial in nature, about economic entities that is intended to be useful in making economic decisions. They stated that the primary duty of accountants is to render services by providing information about economic entities that is measure in terms of money (p.2).

In another accounting book, Manuel (2011) gave the definition of accounting as a language that communicates essential information for decision making (p.9) .The author also noted that all businesses have one common factor: they all need vital information before making critical decisions. This is where accounting comes in as it plays a vital role in tracking down the activities and resources of a business and reporting back these activities in the form of relevant information (p.2). In another literary work, Abelada (2010) stated in one of his books that accounting is introduced primarily for a business enterprise. He specified that the practice of accounting has evolved in response to the need of business managers for relevant financial information necessary to run a business effectively and to guide them in making short and long term plans or making decisions.(p.2)

For Quesada (1999), students are not the only one to blame. Schools who implement unjust retention policy should also be blame for the failure. They did not evaluate the corresponding consequences of this policy to students. On the other hand, good quality education is being sacrifice because of some professors who teach easily on students to have a good evaluation on their performance. JC Domingo (CPA), a faculty member in UST, said in his book “FinaccasimplengAklatsa Financial Accounting” that strong foundation in undergrad was really helpful on those who will take the exam. Strong foundation means “seryoso at taimtimangpag-aaralngapatnataon” According to Lawag J. Fonacier “every accounting student who will take CPA Board exam with enough knowledge on the possible questions has a great potential to pass the said exam.” There’s a saying “one does not simply pass accounting” meaning that this course needs students who are persistent enough. Students must study hard in order to pass the subject.

Foreign Literature and Studies

From Wikipedia, “Luca Pacioli was one of the greatest men of the Renaissance. He is also one of the least well known. This is surprising, for Luca Pacioli's manuscripts and ideas changed the ways the world worked then, and continue to affect modern daily life.” He is a one of the major contributor of a busy business life nowadays. Without him maybe this world will never know how to calculate finances of each business.

According to Vincent Tinto, Syracuse University “most institutions do not take student retention seriously as a result, most efforts to enhance student retention, though successful to some degree, have had more limited impact than they should or could. To be serious about student retention, institutions would recognize that the roots of attrition lie not only in their students and the situations they face, but also in the very character of the educational settings, now assumed to be natural to higher education, in which they ask students to learn.”

Dr. Robert Jones (April 2008) states that “Student retention refers to the extent to which learners remain within a higher education institution, and complete a programme of study in a predetermined time-period.” For Pascarella, E. and Terenzini, P. (2005) on their book “How College Affects Students: A Third Decade of Research. Volume 2. San Francisco: Jossey-Bass Higher & Adult Education“ This is an extensive review (848 pages) of US literature about the impacts of college on students, and much of it is highly relevant to student retention and success. In this second volume the authors review their earlier findings and then synthesise what has been learned since 1990 about college's influences on students’ learning. The book also discusses the implications of the findings for research, practice, and public policy.

On Harvey, L. and Drew, S., with Smith M., 2006, “The First-Year Experience: A Review of Literature for the Higher Education Academy” focuses on the first year experience, much of which is relevant to student the retention and success. Student retention is one of the more interwoven and intricate issues of modern higher education. One of the primary questions I regularly field regarding student retention is, “How do we get people to care about the issue?” and when asked why student retention is an important issue, my thoughts automatically shift to the fact that retention can affect every aspect of higher education. At its core, the retention of college students is a complex issue, representing an interplay of personal, institutional, and societal factors, with likely associated detrimental costs and implications to all three audiences (Brunsden, 2000).

From the point of view of the students, involuntary withdrawal is one of the bad effects of this policy because of academic failure or inability to cope with the demands of the educational system lowers self-confidence and self-esteem and likely represents a negative lifelong economic impact. These retention policies also have bad effects not only to students but also to school institutions. An article said that, “Attrition also potentially damages the reputation of an institution, creating long-term implications for attracting new students (Ozga, 1998).

Because of this, many students will drop and transfer to other school and this will be a bad effect to the school’s reputation. Other sources said that, “The loss of students returning to campus for another year usually results in greater financial loss and a lower graduation rate for the institution, and might also affect the way that stakeholders, legislators, parents, and students view the institution” (Lau, 2003,Institutional Factors Affecting Student Retention)

“For institutions, attrition represents a direct loss of tuition income and, other things being equal, a failure to accomplish their educational mission” (Bean, 1990, Using Retention Management in Enrollment Management) But as a student, we should not be affected by this retention policy. We should take it as a challenge in order for us to have a better future. An author noted that, “It’s essential to embrace the possibility of failure in order to achieve success. The Reason being that failure should only be seen as temporary setback on your path to a successful career—it should not prevent you from succeeding.” (Student accountant, OCT 2010)