Minorities in the Accounting Profession
Much Remains to Be Done

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The U.S. Census Bureau estimates that, with 100 million ethnic minorities in the United States, about one in three residents is a minority. By 2050, minorities will account for nearly half of the U.S. population, according to the U.S. Bureau of Statistics. Diversity in the workplace is not only a business issue, it is also a social issue. If a third of the faces walking down the street are reflected in only 8% of a profession, that profession fails the clientele it serves and its own staffing needs. As the population becomes more diverse and multicultural, professions must mirror those changes. New ideas and perspectives do not thrive in a vacuum of homogenous groups.

The NYSSCPA first touched upon the need to increase minority recruitment in 2000, by suggesting the statewide expansion of our Career Opportunities in the Accounting Profession (COAP) program. This five-day summer program, now held at college campuses throughout New York State, is focused on minority groups historically underrepresented in the CPA profession. Now in its 20th year, COAP has 10 programs across the state, with 375 students participating every summer.

In my September 2003 column, I used the book A White-Collar Profession: African-American Certified Public Accountants since 1921, by Theresa Hammond (University of North Carolina Press, 2002), to open a discussion on the profession’s track record in reaching out to the African-American community. Our focus then was on a 1965 survey which revealed that fewer than 150 CPAs nationwide were African American. Since that column, the accounting profession has made strides. Today, according to the National Association of Black Accountants, more than 200,000 African Americans are participating in the field of accounting, with more than 5,000 CPAs.

According to the American Medical Association, the American Bar Association, and the AICPA, minorities make up 14%, 10%, and 8% of their respective professions. Parity exists among the three professions; however, each has failed in truly reflecting the changing landscape.

Twenty-two percent of accounting graduates are minorities (including African American, Asian/Pacific Islander, and Hispanic or Latino). This was not true previously, signifying these students are now finding jobs and would not be gravitating toward the profession if it were not the case. According to U.S. News & World Report, City University of New York’s Baruch College has been the country’s largest and most diverse business school accredited by the Association to Advance Collegiate Schools of Business (AACSB) for the last nine years. More than 600 accounting students graduated in 2007. African American and Hispanic students made up 25% of the class.

Paralleling the percentage of accounting graduates, new hires by CPA firms were 23% minority, with 12% Asian/Pacific Islander, 8% Hispanic or Latino, and only 3% African American. Even more discouraging, the professional staff employed by CPA firms at all levels is only 10% minorities, with 5% Asian/Pacific Islander, 2% African American, and 3% Hispanic or Latino. Only 5% of partners or owners are classified as minorities. That includes 2% Asian/Pacific Islander, 1% African American, and 2% Hispanic or Latino.

Since the passing of the Uniform Accountancy Act, 150 hours of college education are required in order to sit for the uniform CPA examination. Some say the mandatory 150 hours is the largest obstacle to the recruitment of minorities. However, the legal profession is drawing more minority recruits despite the three years of additional graduate work it requires. Are we saying that two additional semesters of graduate work is a larger obstacle than three additional years?

To be fair, the legal profession and medical profession profit from being continuously depicted in television and film. When was the last time “Must See TV” focused on the forensic accountant or the diligent tax preparer? In addition to their members’ depictions in the media, the medical and legal communities also have the advantage of routine encounters with the general public. While everyone’s yearly checkups and treatments for colds and fevers act as the perfect recruiting campaign for the medical profession, families without large incomes rarely deal with CPAs.

In November 2007, the New York State Education Department’s Office of Professions held a forum to discuss how professions can reach out to the minority community. The NYSSCPA made a presentation on the success of its COAP program. But this discussion should not be confined to the boundaries of our state or Society. Let’s extend invitations to our neighbors, New Jersey, Connecticut, and Pennsylvania, and come up with a plan.

Traditionally, accounting has been a profession that was a bridge for first-generation immigrants or first-generation college graduates to enter the “professional” business world. The idea held true with the first wave of immigration—Jewish, Irish, and Italian immigrants—but the second wave has not been as well received by the profession. An analysis would reveal that our profession is denying itself the opportunity to grow its human capital, the collective sum of attributes, life experience, knowledge, inventiveness, energy, and enthusiasm that people choose to invest in their work. Although statistics have shown that the accounting profession has improved in its recruitment of minorities, the number of minority accountants falls short in proportion to the general population.

Congratulations are indeed in order for the progress we have made. However, the goal is not to be content with progress to date, but to surpass it.

Louis Grumet
Publisher, The CPA Journal
Executive Director, NYSSCPA
lgrumet@nysscpa.org

©2009 The New York State Society of CPAs. Legal Notices