Book Review / Compte Rendu de LivreEditor / R^acteur: Jean Bedard

Universite Laval

Gardner, EJ . , ed. Cases in Financial Accounting: Fundamentals, 160 pages,and Cases in Financial Accounting: Intermediate and Advanced. John Wiley &Sons. 1990.233 pages.

Reproduced in this two-volume set are cases from the first Accounting CaseWriting Competition held in 1988 under the auspices of the AccountingEducation Resource Centre, Faculty of Management, University ofLethbridge. There are 13 introductory and 12 intermediate/advanced caseswritten by authors from Canada, Ireland, the United Kingdom, and the UnitedStates. Of the five competition winners listed in the casebooks' prefaces, onlythe first prize winner, "City Autoparts Distributors Limited," is included inthese volumes.!

With one or two exceptions, the cases are not simply word problems dis-guised as cases. Instead, the majority of material represents situations basedon real companies as indicated by the company names or actual case out-comes provided in the Teaching Notes. Even cases that are fictional possess adepth of detail and description, making them more realistic than cases con-tained in most textbooks. While many of the cases emphasize small businessesand their problems, several cases address larger corporations (e.g., "Rolls-Royce Privatization") and the public accounting issues that arise in such set-tings. Including exhibits and tables, the cases range from 3 to 30 pages with anaverage length between 10 and 15 pages.

Because the material supplied in each case differs, the decisions that stu-dents are asked to make also vary. Some cases have explicit information andrequirements that allow the decision making to be narrowly focused and per-haps makes these cases easier to digest for students who are unfamiliar withthe case method of learning. Other cases are less structured, both in contentand requirements, and provide more reality-based settings, in which extrane-ous information must be sifted through by students. One drawback to suchdiversity is the potential start-up costs that may be imposed on students asthey switch between types of cases. However, the instructors should be able tominimize these costs, if they choose, by providing guidance.

In a review of instructional material, two issues should be addressed. One

Contemporary Accounting Research Vol. 10 No. 1 (Fall 1993) pp 351-354 ®CAAA

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issue is the quality of the case material, and the second is the quality of the sup-porting material, in this instance the Teaching Notes. The overall quality of theindividual cases ranges from average to excellent. Average cases are defined asthose that tell a story but boil down to having the students calculate numberswithout the necessity of making judgments or assumptions, or discarding extra-neous data. Also, average cases are ones in which the writing style is repetitiveand cumbersome. In general, only a few cases might be classified as "average."Excellent cases are those that are both condsely written and offer a challengeto the students and instructors by providing broader contexts in which toexplore accounting decisions. In addition to the first prize winner ("CityAutoparts Distributors Limited" by D. Bateman), examples of some excellentcases include the topics of the auditor's role ("The Confederation Life Case"by A. Richardson), a small business investment decision ("L.A. Law" by A.Dimnik), an investment in equity shares ("Petrosar" by C. Robinson), a busi-ness valuation ("Aetna Steel" by H. Mann), and the uses of financial state-ments ("The University and the Faculty Association" by J. Amernic).

Several other cases are also noteworthy. One case, "Good Age: TheMagazine for Mature Canadians" (by D. Smith), requires the use of a spread-sheet program to assess how changing assumptions alter outcomes. "ForwardThinking Company" (by A. Temple and A. Johnson) and "Personal StyleKitchens Limited" (by N. Bristow) might be used as capstone cases in eitheran introductory or intermediate accounting course.

Some casebook users might encounter problems with the topic coverage. Inother casebooks, such as Conrod and Dilworth's (1989) Canadian Cases inFinancial Accounting and Hoskins and Hughes' (1988) Financial AccountingCases, an instructor is provided with specific case coverage of the full spec-trum of introductory or intermediate accounting topics. In the Gardner editedvolumes, the cases were provided independently by a variety of authors; con-sequently, not all of the topics that are normally covered in introductory orintermediate accounting courses are represented. For example, no cases dealexclusively with the accounting issues pertaining to inventory or fixed assetdepreciation. To assist course instructors in determining where the caseswould be most useful, the authors should have been encouraged to identifythe specific topics covered in their cases.

Initially, this broad focus may seem to be a drawback to using these case-books. However, these cases address management advisory service (MAS)issues as often as finandal accounting issues. Taken in light of accounting cur-riculum proposals, such as the one by the University of Chicago GraduateSchool of Business funded by the Accounting Education Change Commission,this casebook may refiect future trends in case material. In particular, when the"objectives of the curriculum are to present accounting in a decision-makingcontext, as part of the general managerial function, and to create sophisticatedusers of internal and external accounting reports" (American AccountingAssociation 1991, 1), cases that better refiect diverse management and eco-nomic settings are more valuable to both students and instructors.

Book Review / Compte rendu de livre 353

An evaluation of the Teaching Notes indicates that these are generallyhelpful and complete. However, instructors may want to proceed with cau-tion. In the Teaching Notes' prefaces, the cases are labeled as being simple,moderate, or complex with simple and moderate cases defined as "those witha narrower focus" and complex cases defined as having "a broader focus andsufficient detail to provide students with a rich teaming opportunity" (iii). Ofthe 13 cases in the fundamental volume, 7 are designated as simple and 6 asmoderate. In the intermediate/advanced volume, one case is listed as simple,six as moderate, and five as complex. For instructors trying to determinewhether these cases are suitable for their classes, a specific list of criteria usedto determine the simple to complex rating would be helpful because these rat-ings often seem arbitrary.

Another instance for which having the decision criteria would be helpfulconcerns the division of the cases between the two volumes. For example,"Petrosar" is included in the fundamentals volume, but the author in histeaching note indicates that the case is most appropriate for the end of anintermediate course or an advanced course. A potential user will need todecide where this case should be included in the accounting curriculum.

In addition, a problem arises in deciding where to use individual cases froma specific volume. For example, the suggested case-use table indicates that 7of the 13 fundamental cases be used with the first three or four chapters ofintroductory accounting texts. However, instructors should read the TeachingNotes before assigning the cases because they may decide that the cases arebetter utilized later in their courses. Additionally, the authors of the "ForwardThinking Company," one of the cases listed for use with the early textbookchapters, note that they ordinarily use it at the end of their introductorycourse.

A useful guideline overlooked in the Teaching Notes is the estimated timeallotment both for student preparation and required discussion time. A fewauthors include this information, but the majority do not. This situation isunfortunate because instructors who are unfamiliar with the case method mayseriously underestimate the time requirements.

A final cautionary note involves some of the solutions contained in theTeaching Notes. In particular, the case solution for "The Nabu NetworkCorporation" is not as detailed as expected given the information provided inthe case. Another case, "Forward Thinking Company," that contains numeri-cal information has a teaching note that provides a thorough write-up on whatthe case issues are and how the case should be used but no suggested numericalsolutions. If instructors want examples of the numerical solutions, they mustwrite the authors. A different problem arises with the case solution for"Commercial Design Inc." This teaching note indicates that the case had notbeen class tested when the solution was written. It is unfortunate that betweenthe 1988 competition date and the 1990 publication date a class-tested solutionwas not provided for the Teaching Notes. The failure to class test the solutionmeans that the author has not provided any suggested numerical solutions.

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An issue that perhaps should be addressed is how well these case volumeswill appeal to an international market. The case situations facing the peopleand businesses are universal and should be useful in a variety of national con-texts. Thus, while a few cases require specific reference to U.S. or Canadiangenerally accepted accounting principles, most could be adapted easily toother countries' accounting principles, especially those based on theBritish-North American traditions.

Finding good case material is difficult and time consuming. These twoGardner edited volumes provide an assortment of cases that could be utilizedin a broad spectrum of financial accounting courses. The benefit of the major-ity of these cases is their reliance on realistic economic settings and the needto assess individual managers' personalities and styles to make financialaccounting decisions. This strength should help instructors illustrate howfinancial accounting information is employed and why it is a valuable tool—alesson many students parrot but fail to truly comprehend.

Endnote1 The other four prize winners are included in two managedal casebooks, which are

also edited by Professor Gardner and are available from John Wiley & Sons.

ReferencesAmedcan Accounting Assodation. "Chicago Focuses on Sophisticated Users."

Accounting Education News (Spedal Issue, June 1991).Conrod, J.E.D., and CE. Dilworth. Canadian Cases in Financial Accotmting. Richard

D. Irwin, 1989.Hoskins, R.E., and J.S. Hughes. Finaru:ial Accounting Cases. Dryden Press, 1988.

Irene M. GordonSimon Fraser University