Factors

FULL-BLOWN RESEARCH PROPOSAL

I. BASIC INFORMATION 1. Project/Project Title:

Factors that Affect the Performance of Accounting Graduates of Eastern Samar State University (ESSU) – Borongan Campus in the CPA Licensure Examination

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II. TECHNICAL DESCRIPTION 1. Introduction a. Nature and Significance/Justification of the Study One of the difficult examinations administered by the Professional Regulation Commission (PRC) is the Certified Public Accountant (CPA) Licensure Examination. According to Dr. John S. Bala (2008), the Vice Chairman of the Board of Accountancy as cited by Ballado-Tan (2014), that of all the professional examination administered by Professional Regulation Commission (PRC), CPA Licensure Examination marked one of the professions with the lowest passing percentage for every examination period. The licensure examination is a proof of one’s assessment of educational standard of the graduates and even the quality of education that the university undertakes. According to PRC, a licensure examination qualification allows people to develop into a certified professional with personal integrity and moral values to become globally competitive. Passing the licensure examination for CPA is not an easy. It entails determination, perseverance, dedication and hard work. You must try to live with it and overcome it. Performance during the licensure examination is one of the indicators of the quality of education the university partakes to their graduates. The Accountancy program of the university has been in an erratic condition in licensure examination. It has a fluctuating passing percentage over examination period. It is sometimes above the national passing percentage but more often below the national passing percentage. It is by this study that the researcher would like to determine the factors that can affect the performance of the graduates in the licensure examination. The demand for accountants in the business environment is increasing. It is highly regarded by the university that it can contribute caliber graduates that are globally competitive with other graduates of different universities. It is a merit of the Page 2 of 16

university to determine the factors that can affect the performance in the CPA licensure examination for the reason that it can assess the effectiveness of its policies on faculty development, provision for facilities, and other administrative support affecting the accountancy program which can also be helpful in future policymaking decisions of the administrators. The faculty of the accountancy department can use the results of this study by incorporating them in their teaching methods or strategies and in the formulation of the admission and retention policies in their goal of improving the performance of its graduates in the CPA licensure examination. The results of the study can also be used by accountancy students in planning for taking the licensure exam through proper management of the factors cited in this study which are within their control considering their effect in passing the CPA licensure exam. Moreover, the objective of the study is to determine what factors affect the performance of the accountancy graduates of Eastern Samar State University in the CPA Licensure examination.

b. Research Questions/Objective of the Study The study will specifically answer the following questions:

1. What are the perceived factors that correlate with the performance of accountancy graduates in the CPA licensure examination in terms of: a. personal related factor i.

academic performance

ii.

academic competence

iii.

study habit and study strategies

iv.

attitude towards accounting Page 3 of 16

b. environmental factor i.

instruction

ii.

school facilities and resources

iii.

review classes

iv.

test competence

2. What is the respondents’ performance in the CPA Licensure Exam? 3. Which of the perceived factors can affect the performance in the CPA licensure examination?

c. Definition of Terms The following terms are defined operationally in the study: Environmental factors – it refers to external factors that may cause to affect the performance in the licensure examination Personal related factors – it refers to the preference of the graduates which they think might affect their performance in the licensure examination

2. Review of Literature Ballado – Tan in her study draws to a very large measure from Heider’s attribution theory which was later refined and advanced by Orvis, Cummingham and Kelly together with Deci. According to the attribution theory, as cited by Mateo (1998), occurrence of events is attributed to two factors- personal forces and environmental forces. Central to Heider’s theory is the assertion that man perceives events of critical importance for the interpretation of human work; such causes could be traced to factors located within the person and those that are drawn from the environment of the person. In the context of this assessment, it can mean that the accountancy graduates’ performance in the CPA licensure examination is interplay of

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certain attributes inherent in the person and the forces of the environment which he or she is a part of – the institution which provided his training. Sabas (2001) cited Siegel and Jane’s study that a physically comfortable and stimulating environment most likely would serve to enhance performance or emergence of positive responses which are manifested by high organismic activation bringing about or high level of performance. Another factors that can contribute to the success of the examinees are (1) time lapse; (2) personal study plan; (3) self confidence; (4) study habits; (5) school facility; (6) group study; (7) faculty; (8) environment; (9) language; (10) age; and (11) gender. These factors have a significant effect on the performance in the board exam. (Baun, S., Carreon, N. Dizon, J. et.al) Brahmasrene and Whitten (2001) surveyed candidates in the state of Indiana to examine the factors that may affect the probability of passing the CPA exam. Using a logit model they test the probability of passing the exam in relation to variables such as undergraduate grade point average (GPA), credit hours, high school GPA, high school class size, age, high school rank, educational level, type of preparation for the CPA exam, nature of work experience, gender and race. The result of the study showed that both models indicate that the factors that significantly influence the probability of passing the exam are undergraduate GPA, age, private accounting experience and gender. Males seem to be more successful than women in passing the exam. The authors suggest that a possible explanation is the format of the exam but further research is recommended in this regard. Older candidates perform better, specifically those participating in live CPA reviews. Participating in a review course, regardless of the type, seems to be better than having no review course at all, although live reviews seem to be better than other types. Having private sector experience seems to help in achieving a successful outcome in the exam.

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Titard and Russell (1989) examined relatively recent success rates for both first-time candidates and repeat candidates on a national basis (prior to the computerized version of the exam), and consider some factors that might explain the reasons for success. The data examined was provided by NASBA for the four examinations conducted during 1985 and 1986. The study examines passing rates by subject matter for first-time and repeat candidates. The factors considered are grade-point average (GPA), advanced degree, public accounting experience and supplementary study such as a CPA review course. The authors find that a candidate’s GPA and having advanced degrees seems to improve the passing rates on all four parts of the CPA exam. The years of experience in public accounting improve the pass rate on the parts formerly known as Auditing and Practice but do not improve the pass rate on the remaining two parts known as Law and Theory. In addition, the results obtained suggest that supplementary study such as CPA review course had a positive effect on the exam’s pass rate. In contrast, Ashbaugh and Thompson (1993) studied the factors associated with passing the four parts of the CPA exam on the first attempt but using other variables. They collect data from 234 candidates for the years 1989 and 1990 from a medium-size Midwestern university. The authors use discriminant analysis to compare two groups: those passing the exam at the first attempt and those who have not. They use four independent variables: high school class size, high school class rank, combined ACT score and grade in a CPA review course taught at the university. The results show that the factors that significantly contributed to the success or failure on the exam were high school class size, high school class rank and grade in the CPA review course. The larger the high school attended by the candidate and the higher he or she ranked in the class, the higher the probability of passing and achieving outstanding performance. Regarding the CPA review course, those students who earned an A or a B in the course and have the above Page 6 of 16

characteristics have a higher probability of passing the exam. The authors suggest that input variables have a strong influence on a candidate’s performance in the CPA exam. Ballado-Tan concluded in her study entitled, “Performance in the Accountancy Licensure Examination of the University of Eastern Philippines: A Look at Curriculum and Instruction,” that provision on instruction are found out to have a significant relationship to performance in the CPA licensure examination. Inasmuch as the respondents found it to be present, there are some defects in the area of instruction. There is a need therefore to implement the learning assistance program of the university to cater the slow learners through coaching, peer teaching and remedial classes. This denotes that extensive implementations of provisions related to instruction such as proper observance on provisions related to syllabus, instruction-enriching activities, evaluation of student achievement, and others, should be done to improve the performance of UEP in the CPA licensure examination. Moreover, in terms of school’s physical resources and facilities, teaching and learning process is affected of library collection and holdings, classrooms which are free from distraction and other facilities like consistent standby power in case of brown-out, sufficient classrooms and accessible fire and safety devices. These provisions although, found to have no significant effect on performance, still need to be improved and maintained to facilitate an effective teaching and learning process. Performance in the licensure examination can be attributable to academic performance, students’ aspirations, attitudes and study habits. The students of the program have high hopes of becoming successful in the future. This could be implicated that the Accountancy program is viewed as a stepping stone for them to achieve the desires that they want to attain. Hence, despite the difficulty posed by the accounting subjects, they still have favorable attitude towards it. The favorable attitude can also be attributed to the approach they employed in studying their Page 7 of 16

subjects. The achievement of the CPA license is generally dependent on persistence in working towards that goal, specifically through studying hard while in college, coupled with positive attitude and behavior towards accounting. The positive attitude towards accounting paired with effective study habits might lead to higher academic performance and therefore higher chance of passing the board exam. To be able to graduate in the program and later on pass the board examination, there is a need for the prospective freshmen to have a passion for the field they are entering into because no matter how effective the other factors would be, at the end of the day, what will make them really successful is their love for the field that will make them conquer all adversities that they may face. In the contrary, Garcia in his study entitled, “Academic Performance as Determinant to Pass the Licensure Examination for Teachers,” concluded that the correlation coefficient between examinee’s academic performance and licensure examination rating is very high in the Field of Specialization subjects, weak positive correlation in the Professional Education subjects. However, correlation in examinees academic and Licensure Examination for Teachers rating in general is moderately significant. Academic performance (grade average) of examinees gives no assurance (not a determinant) on passing PRC (LET) examination. Mendezabal (2013) allude to the result of her study that the participants do not have favorable study habits and attitudes. Among the noted unfavorable study habits were inefficient time management, lack of planning and concentration in their studies, poor skills in reading, ineffective test taking techniques, and failure to inform their teachers of their difficulties with school work and ask for their help. The participants also demonstrated unfavorable attitudes toward teachers’ classroom behavior and methods. It was further revealed that their performance in licensure examinations was quite low. Significant relationship between study habits and attitudes and performance in licensure examination were clearly shown in this study. Page 8 of 16

Further analysis revealed that study habits (work methods and time management) of the participants were correlated with their success in licensure examination while study attitudes (i.e. attitudes toward teachers and educational acceptance) were not significantly related to success in licensure examination. This connotes that students who have favorable study habits will likely pass the licensure examination. Perez-Pido (2014) noted that interpersonal, stress management, accounting and finance knowledge, communication skills, and review school performance positively and significantly correlated with CPA licensure examination performance while length of time since college graduation negatively yet significantly correlated with the performance in the aforementioned licensure examination. And among these six variables, review school performance proved to have the strongest correlation with the performance in the CPA licensure examination. An article regarding DLSU’s performance and expectations of board exam, Dean Dr. Maria Andrea L. Santiago believes that the review classes in the University offered at the last term for accountancy majors are a beneficial factor that affects a student’s performance in the board exams. Brillante (2000) also added that the respondents' academic achievement however influenced their performance in the CPA licensure exams. The review center they attended to prepare them for the CPA exams did not however influence their performance.

3. Theoretical/Conceptual Framework The literature adopts the Attribution Theory as cited by Mateo. It predicts that there are two factors that associate the performance of a human being; the personal factors and the environmental factors. In this study, personal factors include academic performance, study habit and study strategies and attitude toward accounting. Meanwhile, environmental factors include instruction, school facilities Page 9 of 16

and resources, review classes and test competencies. The diagram below shows the independent and dependent variable of the study. The independent variables are the personal and environmental factors while dependent variable is the factors that affect the performance of the graduates in the CPA licensure examination.

Personal Related Factors  Academic performance  Academic competence  Study habit and study strategies  Attitude towards accounting

Environmental Factors

Factors that affect the Performance in the CPALE

 Instruction  School facilities and resources  Review classes  Test competence

4. Methodology

Research Method The study will use the correlation method of research. It is the aimed of this study to determine the factors that affect the performance in the licensure examination and the performance in the licensure examination from October 2014 to October 2016.

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Research Respondents The respondents of the study are the accountancy graduates of Eastern Samar State University – Borongan Campus who took the CPA Licensure Examination from October 2014 to October 2016.

Sampling Method There are one hundred fifteen (115) accountancy graduates who took the licensure examination for the period covered. To determine the number of sample size, the Research Advisors will be used. Based on the Research Advisors table, the sample size will be eighty (80) respondents.

Research Instrument A self-made survey questionnaire will be administered by the researchers. This questionnaire is to be validated and tested for reliability. A test-retest will be administered to some accountancy graduates or to graduates with board examination courses to assess the reliability of the instrument. If there are any irregularities of the instruments, it will be immediately corrected by the researchers. The questionnaire has two parts. The first part is the profile of the respondents. The respondents will have to put a check the box for their responses. The second part of the questionnaire is the factors that affect the performance of the respondents in the CPA Licensure Examination. It is a Likert-scale type questionnaire with responses as to (5) Strongly Agree, (4) Agree, (3) Neutral, (4) Disagree and (1) Strongly Disagree.

Data Gathering Procedure The questionnaire will be administered by the researchers personally by mail, social networks and through cellular phones since some of the respondents are not Page 11 of 16

within the vicinity of the research locale. In addition, the data on the performance of the graduates in the CPA licensure examination will be obtained from list of examinees issued by the Professional Regulation Commission (PRC).

Data Analysis The study will be use mean to determine the profile of the respondents and to identify the factors affecting the performance in the licensure exam. On the other hand, logistic regression analysis will be use to determine the correlation between the factors affecting the performance in the licensure exam and the performance in the licensure exam itself.

III. ATTACHMENTS

Bibliography Bala, J. (2008). “The Naked Truth About the CPA Board Examination”. Graduate Research Journal University of the East. Ballado – Tan, Jade (2014). Academic Performance, Aspirations, Attitudes and Study Habits as Determinants of the Performance in Licensure Examination of Accountancy Graduates. International Journal of Education and Research Vol. 2 No. 12 p. 61 Baun, Sushmita Marie G., Carreon, Norestel C., Dizon, Janessa R., et. al. The Factors Affecting the Result of the CPA Board Examinations of Holy Angel University Students for the Academic Years 2009-2014”. https://prezi.com/d_aii3ocyrxe/the-factors-affecting-the-result-of-the-cpaboard-examinati/ Brahmasrene, T. & Whitten, D. (2001). Assessing Success on the Uniform CPA Exam: a logit approach. Journal of Education for business, 77, 45-50. Brillante, S. T. (2000). Personal and Academic Related Characteristics of Accountancy Graduates of the CSC and their Performance in the CPA Licensure Examination for 1994 – 1998. 0000000866.RTF Cardona, R.J., Castro-Gonzalez, K.C. and Rios-Figueroa, C.B. (2015). An Examination of Factors Affecting the Passing Rates of the CPA Examination. http://www.google.com/rogelio_cardona_informe_final.pdf

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Garcia, G. C. Academic Performance as Determinant to Pass the Licensure Examination for Teachers. International Peer Reviewed Journal JPAIR Institutional Research. http://philair.ph/publication/index.php/irj/article/view/258 Mateo, R. M. (1998). “Determinants of Performance of College Faculty in Teacher Educational Institution in Region I.” Doctoral Dissertation, Mariano Marcos State University, Laoag City. Mendezabal, M.J.N. (2013). Study Habits and Attitudes: The Road to Academic Success. Open Science Repository Education, Online (open-access, e70081928. doi: 10.7392/Edcuation.70081928 Perez-Pido, A. Emotional Intelligence, Core Competencies and Certified Public Accountant Licensure Examination Performance. http://www.spaconline.org/home/2014/04/22/1847/ Sabas, Glorietta B. (2001). “Factors Affecting the Performance of SVD Schools in the Licensure Examination for Teachers.” MA Thesis, Mariano Marcos State University. Titard, P., and Russel, K. (1989). Factors affecting CPA examination success. Accounting Horizons, 3(3). 53-59.

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Republic of the Philippines EASTERN SAMAR STATE UNIVERSITY Borongan City

Dear Respondents: Good day! Please complete this survey questionnaire as accurately and frankly as possible by checking (  ) the box corresponding to your response. Your answer will be used for research proposes in order to determine the factors that affects the performance in the licensure examination. Your answers to this survey will be treated with strictest confidentiality. I. Profile Name: _______________________________ I. Factors that Affect the Performance in the CPA Licensure Examination Please check the box that correspond your response to each statement below.

5 Strongly Agree

Factors A . Academic Competence 1. I am able to manage the academic course of the program. 2. I can easily understand topics/discussion taught. 3. I find the subjects taught interesting and challenging. 4. I am enjoying the classes offered in the curriculum. 5. I always do my best to understand the topics taught. B. Study Habit and Study Strategies 1. While I am studying, I prefer to study in a quiet and peaceful place alone and use my spare time studying the lessons. 2. I plan well in advance for the best way of handling a study subject. 3. I review course material with my classmates while studying for examinations

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4 Agree

3 Neutral

2 Disagree

1 Strongly Disagree

and practice solving accounting problems. 4. I test my knowledge before taking an examination by means of self-test exam or asking questions, etc. 5. While studying, I read lots of books or references and summarize the course material in my own words. D. Attitude toward Accounting 1. I love accounting and I am determined to become a CPA. 2. Accounting is difficult but challenging. 3. I enjoy myself reading, solving accounting problem. 4. I feel sure of myself in accounting. 5. I can see much importance in accounting. E. Instruction 1. Instructors are enthusiastic in delivering their discussion. 2. I learned a lot from my instructors. 3. Instructors discuss lesson in a manner that students can understand easily. 4. Instructors give tips or pointers in dealing with accounting issues and problems. 5. Instructors are approachable and friendly. F. School Facilities and Resources 1. Library holdings are adequate and accessible. 2. Library holdings for major subjects are updated. 3. Classrooms, library and reading rooms are conducive to learning. 4. There is an available standardize facilities such as classrooms, comfort rooms, library and etc. 5. Classrooms and reading Page 15 of 16

rooms are well-ventilated, lighted and spacious. G. Review Classes 1. I attend review classes every day or as scheduled. 2. I answer the hand-outs given by the review center. 3. I am focused with my review classes. 4. I take pre-board examination during review and passed it. 5. I practice solving accounting problem with different resource materials and from different review centers. H. Test Competence 1. I can easily manage the amount of study material taught for an exam. 2. I do not find it difficult to prepare for examinations. 3. I can easily cope with examination tension. 4. I have great difficulty managing the amount of study material for examination. 5. I can manage time to finish the exam accurately.

II. Performance in the CPA Licensure Examination 1. What is your performance in the CPA licensure exam? ______________

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