Financial Accounting
Understanding the Accounting Flexible Core Requirement
The role of accounting is the accumulation, analysis, and presentation of relevant financial data of an enterprise to serve the needs of decision makers. The provision of multiple purpose information to serve the needs of interested parties outside a firm’s management is referred to as financial accounting. The provision of information for internal decision making is referred to as managerial accounting. The objective of the core requirement in accounting is to teach the basic concepts, standards, and practices of financial reporting, leading to the ability to read and understand published financial statements and depending on the course chosen, provide some of the rudiments of managerial accounting.
Three Basic Options for Fulfilling the Accounting Requirement
1. Waive accounting altogether, either by credential or exam.
2. Place into ACCT 7420: Financial Reporting and Business Analysis by credential, or opt into the course after waiving the flexible core requirements by exam.
3. Take one of the full semester flexible core courses (ACCT 6110: Financial Accounting or ACCT 6130: Financial and Managerial Accounting).
A common misinterpretation of the waiver by credential criteria is that students must know accounting at the CPA level in order to waive the accounting core requirement. In fact, many students who do not meet the above criteria may be well qualified to waive the core requirement, or at least to place into ACCT 7420. However, because it is difficult to objectively measure preparation from transcript materials, the department relies on waiver and placement exams when a student’s credentials do not unambiguously meet the criteria.
Waiver and Placement Process
Waiver By Credentials
Waiving the Accounting Core Requirement By Credentials
Waiver of the accounting core requirement without taking the waiver exam is only granted on the basis of credentials where there is no question about a student’s background. Waiving of the accounting core requirement without the exam is allowed only for the following persons: Individuals holding one of two professional certifications in accounting: certified public accountant (CPA) or chartered accountant (CA).
Placing into ACCT 7420 by Credential
Approval to substitute the Accounting flex core requirement will be granted on the basis of credentials where there is no question about a student’s background. In place of taking ACCT 6110 (Financial Accounting) or ACCT 6130 (Financial and Managerial Accounting), students will be allowed to take ACCT 7420 – Financial Reporting and Business Analysis if: 1) they have taken introductory AND intermediate financial accounting (note that intermediate accounting is not managerial accounting, but is an upper level financial accounting course) with a grade of B or better in both courses within the last five years or (2) they are Wharton undergraduates who, within the last five years, received a grade of B or better in Accounting 101.
Students who opt for ACCT 7420 will have two weeks from the start of the course to decide whether they want to drop the class and move into ACCT 6110 or ACCT 6130.
NOTE: ACCT 7420 can be taken during the first or second year of the MBA program.
Documenting Your Credentials
Students interested in placing into ACCT 742 by credential must complete the Waiver Evaluation Module indicating that s/he satisfies the criteria to place by credential.
Work Credentials: Persons holding professional certification (CPA or CA) have to submit a copy of their certification and submit a resume or a copy of their application which includes their recent work history. Passing the CFA (Chartered Financial Analyst) exams is not sufficient to waive or substitute the ACCT core requirement.
Academic Credentials: You must highlight/annotate the courses to be considered for placement by credential on your uploaded transcript, as well as provide supporting documentation (syllabi, textbook information, etc.) for your request to be considered. Failure to do so will result in your request being declined.
Waiver By Exam
In addition to petitioning for a substitution by credential, students also have the option to sign up for the ACCT waiver exam if they would like to to waive ACCT in its entirety.
About the Exams
Waiver Exam – Students with extensive work experience or prior coursework in accounting are encouraged to take the waiver exam. ACCT 6080 (Financial Accounting waiver prep course) is offered beforehand as a refresher of graduate-level financial concepts in preparation for the exam. Students who score sufficiently well on the waiver exam will be granted a full waiver of both versions of the accounting flex core requirement: ACCT 6110 – Financial Accounting and ACCT 6130 – Financial and Managerial Accounting. If a student passes the exam but chooses NOT to waive the requirement, they have the option of taking ACCT 7420 (Financial Reporting and Business Analysis) in place of ACCT 6110 or ACCT 6130. Based on their waiver exam results, some students who do not receive a score high enough to fully waive the accounting core requirement may be given the option to substitute ACCT 7420 for ACCT 6110 or 6130.
Students who opt for ACCT 7420 will have two weeks from the start of the course to decide whether they want to drop the class and move into ACCT 6110 or ACCT 6130.
Exam Preparation
The following optional prep course will be offered online prior to Pre-Term and will help you prepare for the waiver exam, as well as the fall semester. ACCT 6080 is now available on Canvas for students who have registered for the prep course.
ACCT 6080: Financial Accounting – Waiver Prep Course
Upon completion of this review course, the student should be prepared to take the waiver exam. It is designed for students who have had substantial prior exposure to financial accounting but were not able to waive by credentials. It is presumed that the student enrolled in ACCT 6080 has previously studied all of the financial accounting topics covered in ACCT 6110/6130. See the syllabi for these courses for more details, but these topics include provisions for uncollectible accounts, LIFO-FIFO inventories, leases, and deferred income taxes. The course will review these topics and more, emphasizing their implications for analyzing and interpreting financial statements.