The need for diversity and inclusion in accounting has long been recognized and, while the profession has made great strides toward inclusive practices, certain challenges remain. The underrepresentation of Hispanic people in finance is one area with room for improvement.
As a longtime advocate of diverse hiring and multilingual offices, SDC CPAs follows the research and discussion surrounding the structural and social barriers preventing minorities from pursuing careers in accountancy.
In an interview with CPA Journal, the chief ethics and diversity officer of the National Association of State Boards of Accountancy (NASBA), Alfonzo Alexander detailed the issues contributing to the underrepresentation of minorities in accounting.
The pipeline into the profession for minorities, particularly African Americans and Hispanics, is limited. There are not enough minority people starting the path because African Americans and Hispanics are traditionally not familiar with the profession. Studies show the profession is a generational profession. Most current CPAs have a family member who is or was a CPA, and that is where the original exposure came from.
In the minority communities, where few have close family members in the profession, most of the exposure to the profession comes from outside of the family. As an example, though my own academic background is in business with an MBA, I did not understand upon graduation what a CPA was. Many folks make career decisions in life having heard about accountants as bookkeepers, but not about CPAs. This is the situation with many in the inner city, where so many minorities live, which is why becoming a CPA is seldom considered.Beyond this exposure gap described by Alexander, lie structural obstacles in the CPA track. The CPA track comes with significant expenses including a bachelor’s degree, postgraduate education, CPA education hour requirements, CPA exam prep courses, and the cost of the exam itself. These costs, with limited funding support, act as a major deterrent for minority students to become CPAs.
Most Hispanic students who graduate with an accounting degree opt to go straight into their careers, rather than take on the expenses of the CPA track. Even if these students go on to pursue the CPA designation later in their careers, it is well documented that individuals with significant gaps between their education and their CPA exam are less likely to pass the exam.
The situation described by Alexander, in which minority populations have little to no exposure to CPAs and careers in finance, illustrates the obstacle that overshadows many others. Structural changes to the CPA track may be important measures to expand opportunities to underrepresented populations, but the impact of those changes would be minimal without initial outreach and exposure to the profession.
Community outreach can be an effective way for accounting firms to begin addressing this issue in their communities. This can include presence at high school career days and local chapters of industry advocacy organizations such as ALPFA. Firm leadership can also work toward addressing representation issues by mentoring junior employees and providing incentives for employees who pursue additional certifications. SDC CPAs uses these in-house practices alongside diverse, multilingual hiring to create opportunities and bolster employees’ careers.