Cambridge Business Publishers

What is the Spreadsheet Approach to Learning Accounting?

The EMBA and MBA markets tend to be more analytical and decision-focused than the undergraduate market, where more emphasis is placed on financial statement preparation and bookkeeping. Unlike undergraduate textbooks in accounting that use the classic debit and credit paradigm to explain key concepts, this textbook uses a more intuitive spreadsheet approach to explain the fundamentals of accounting. Specifically, it demonstrates how accounting data is
processed and how financial statements are constructed. Not only is this approach more user-friendly (because, most managers routinely use spreadsheets in their daily professional lives), but it is also far less labor- and time-intensive than the classic debit/credit paradigm. The spreadsheet approach to recording transactions emphasizes user analysis and deemphasizes bookkeeping. Following is an example of the spreadsheet approach used in the context of long-term financing:

Decision-Relevant Focus

A key skill set for all investment professionals, lenders, managers, analysts, and shareholders is the ability to use accounting information for decision-making purposes. In this book, we link the discussion of topics to the following two business decisions:

1. Should I extend credit, and at what terms, to this company?
2. Should I invest in this company, and if so, at what price?

Thus, the analysis of fi nancial statements is a key organizational theme that extends throughout the book.

"I believe that the concise and clear writing is a major strength of this book. The authors
should also be complimented on being able to use a good number of examples while still
keeping the chapters concise."
— Charles Leflar, University of Arkansas

Grounded in the Context of Corporate Decisions

Accounting information is an integral part of decision-making at every level in business. Consequently, the book’s discussion of important accounting concepts is grounded in the context of actual corporate decisions. To this end, the book contains an abundance of excerpts and illustrations from actual corporate fi nancial reports and disclosures that highlight the role and impact of accounting information, and fi nancial statements specifi cally, in business decisionmaking.
Following is one example in the context of accounting for options:

Does the Book Reflect Contemporary Knowledge?

In our experience, EMBAs and MBAs frequently seem interested in exploring empirical questions such as: “How do the capital markets respond to accounting policy changes?” and “Which EPS measure—Basic EPS or Diluted EPS—is used by the capital market to value a company’s stock?” Where appropriate, we have made reference to, and discussion of, the existing research in accounting to address some of these empirically-based questions. By doing so, we enable the interested reader to further her/his knowledge of these questions.

Important Pedagogical Elements

The book applies several pedagogical elements to help readers further understand the ramifi cations of accounting for business.

Global Perspective boxed inserts emphasize the similarity of U.S. GAAP and IFRS, but they also identify key differences. Exposure to similarities and differences is important as the pressure mounts to harmonize and accept accounting standards globally.

Ethics Perspective boxed inserts emphasize ethical decision making, as well as the importance of ethics in accounting. In today’s post Sarbanes-Oxley world, this information is pertinent to business students and accounting students alike.

Business Perspective boxed inserts illustrate key chapter topics using real-world examples and financial statements.

In Practice boxed inserts help bridge the gap between the classroom and what students encounter in the real world. "In Practice" illustrations document situations a reader is likely to encounter and present the choices that companies make in reporting financial results.

Tools that Reinforce Reader Comprehension

Each chapter includes many tools that reinforce an understanding of the chapter contents. These tool include:

• Review Problem, with solution
• Executive Summary
• Key Concepts and Terms, with page references
• Discussion Questions
• Exercises
• Problems
• Corporate Analysis
• Check figures to accompany select exercises and problems, denoted by the checkmark icon

“The discussion questions are great for an Executive MBA or MBA audience because they
are targeted at a more sophisticated student than the typical introductory financial accounting text. They should help a professor stimulate interesting discussions in the classroom.”
— Jeffrey Wong, University of Nevada, Reno