It used to be the case that grades were the vehicle by which a professor would communicate his or her evaluation of competency and quality. If the student did well, the professor would reward the student with a high mark. These grades would also provide a signal, admittedly noisy, to prospective employers about the quality of the student in the class.

Unfortunately, the value of grades as an indicator of competency has declined over time. Students feel that they should get good grades for nothing; teachers capitulate so they can spend time on their research; and administrators add pressure to pass unqualified students to avoid confrontations and lawsuits.

I am currently teaching an Introductory Accounting class, and the Financial Accounting portion will have two exams and homework. I recently gave the first exam and had a mean of 73. I announced there would be no curve. Among other reasons, the students are averaging in the mid 90s on their homework. Here is one student's response to the exam and to the announcement about no curve.

"I do not mean to be disrespectful by any means, but I would greatly appreciate an answer to my inquiry. If the average score of the first exam is 73 percent, why would you deem such a low score as acceptable? Many students like myself are required Accounting 211 for our majors and are required a 70 percent. With an average score of 73 percent, many students have obviously scored below a C on this exam. Personally, I studied a tremendous amount of hours only to receive a 72 percent. I feel as if an average score on an exam on such an important class should certainly be above a C-. Furthermore, for there to be no curve at all is a disprespect (sic) to the students in this class. We are all paying a considerable amount of money to attend this University. Therefore, I expect our professors to take in consideration our wellbeing during our duration here. I would appreciate any insight into this situation, and any explaination (sic) as to why you deem a 73 percent average is suitable for this course. Thanks for your time."

This email is delicious. (I have more.) Notice that the student has an opinion on the grading scheme despite his lack of a teaching degree and any teaching experience. He offers nothing more for his credentials other than his status as a student. Other students have also told me what topics I should exclude (everything boring like the accounting cycle and financial statements) and what I should include (such as Enron). I wonder what insights into the profession they have to supply such opinions, and, if they cannot understand simple journal entries, on what basis do they think they are ready to discuss the SPEs at Enron.

I replied that a 95 on the homework and a 73 on each of the two exams would yield a grade of (95+73+73)/3 or 80, which is a B-. I suppose that a B- is insufficient in his eyes, given his work ethic and his financial contributions to the university.

Perhaps I should have added that I don't care that he "studied a tremendous amount of hours only to receive a 72 percent." I realize that many of my colleagues like to reward effort, but I disagree. In addition to the problem of not knowing whether he is telling the truth, I have the problem of knowing whether he understands what hard work is. What he calls hard work may be what I call barely trying. It is possible to spend many hours on a topic without expending much real effort. Besides, I doubt that many employers would reward their employees for hard effort if it yielded poor results.

I also have discovered the self-fulfilling nature of curves. With a curve, the average student doesn't worry about failing and studies less vigorously. The threat of flunking the course, however, creates a fear that necessitates studying longer and harder. The students may hate the course and dislike me, but they have a greater chance of actually learning something. Of course, it is good that I have tenure -- my teaching evaluations take a hit when I enforce a no-curve policy.

The email is fascinating for its assertion of a direct linkage between tuition and grades. Note his comment, "We are all paying a considerable amount of money to attend this University. Therefore, I expect our professors to take in consideration our wellbeing during our duration here." Admittedly he did not state what he meant by the consideration of his well being, but in the context of his demanding an "explaination" for my policy of no curve, his motive and his argument are clear. I wonder when and how our society evolved into this philosophy that paying one's tuition should guarantee a passing mark. Talk about taking the student-as-client metaphor too far!

As the reader will note, the document is not well written, has grammatical errors, and has several errors that any spellchecker would have caught. Accounting education might as well go the way of English composition. Students can't write, so English courses no longer require term papers; in like manner, students cannot account, so let's forget financial reporting.

In the meantime, I wonder how many students really want an education these days. Too bad we as a nation have replaced the goal of getting an education with the goal of getting a diploma. This switch in objectives is bad because too many Americans don't understand the difference. Or care.

This essay reflects the opinion of the author and not necessarily the opinion of The Pennsylvania State University.

Return to The Accounting Cycle

J. EDWARD KETZ is accounting professor at The Pennsylvania State University. Dr. Ketz's teaching and research interests focus on financial accounting, accounting information systems, and accounting ethics. He is the author of Hidden Financial Risk, which explores the causes of recent accounting scandals. He also has edited Accounting Ethics, a four-volume set that explores ethical thought in accounting since the Great Depression and across several countries. He is the co-author of a monograph, Fair Value Measurements: Valuation Principles and Auditing Techniques (with Mark Zyla, Managing Director, Acuitas, Inc.) to be published by BNA.