2024 Annual Report

The primary motivation for Jon Pyzoha’s summer grant project was to significantly enhance the learning experience for students taking Accounting and Business Ethics (ACC 480/580). During this summer’s curriculum project, Pyzoha overhauled and innovated the course content with the goal of modernizing the course materials with newly-identified and/or created ethical cases and discussion forums, including the ethics around innovations in the industry such as Generative AI, ESG, and data ethics. Additionally, he is now able to include broader and more in-depth ethical discussions after writing, developing, and shooting brand-new video lectures. Pyzoha also revamped all of the quizzes and exam assessments based on these significant changes. Taken together, this ethics curriculum project will help to improve students’ learning of complex ethical theories and frameworks within the context of accounting and business innovations, industry shifts, and modern ethical dilemmas. He is looking forward to utilizing these new materials in class.

Professors Jonathan Grenier and William Brink worked on a project that helps students see the connections between financial, managerial, and tax accounting concepts. In intermediate accounting, they developed course materials (lecture notes, assignments, etc.) where students gain an appreciation of the managerial and tax implications of various elements of the financial statements. In managerial accounting, students learn the financial statement and tax implications of the managerial accounting decisions that they are analyzing. In tax, key tax decisions are evaluated in financial and managerial contexts.

Eric Marinich worked on developing a new case-based ACC 333 course for the Spring 2025 semester. ACC 333, Accounting for Managerial Decision-Making, is a new, case-based, decision-making-focused managerial accounting course that emphasizes how managers can use accounting to improve their short-run and long-run decisions. The course emphasizes the importance of accounting from the beginning of the operating cycle to the end. Students will assume the role of managers who make strategic decisions for their business unit during an operating cycle. At the beginning of the course, cases that emphasize the planning role of managerial accounting are used, focusing on short-run decisions, where the short-run is defined as a period over which capacity costs are not controllable. Later in the course, cases that focus on long-run decisions like capital budgeting decisions are used, where long-run is defined as a period over which capacity costs are controllable. Marinich has recorded 32 concept videos students can use in addition to the case studies to learn (or refresh their memory about) the concepts discussed in class. 

Tim V. Eaton, Arthur Andersen Alumni Professor and EY Teaching Scholar, continued a partnership with colleagues Natalie Churyk, Editor of Journal of Accounting Education, and Linda Matuszweski, both professors at Northern Illinois University. During the summer of 2024, the team examined all the accounting education literature published during the last year in the five major pedagogical journals of the accounting profession. The goal was to provide a compiled summary of approximately 100 publications and provide a discussion to assist educators in the best practices in accounting education. The work of Churyk, Eaton, and Matuszweski from the prior year (2023) was presented to the Miami University Department of Accountancy and recently published in the Journal of Accounting Education.  This work will be continuing into the Fall semester.

Po-Chang Chen’s summer grant research examined the equity risk implications of bank holding companies’ (BHCs’) significant holdings of over-the-counter (OTC) derivative instruments. While many nonfinancial companies use derivatives to hedge risks, BHCs use these instruments for hedging and trading purposes. As a result, the use of OTC financial derivatives may play a role in determining the overall risk for individual BHCs. This research project was motivated by the dominance of OTC derivatives in the derivatives market and the unique design, trading practice, and valuation of those derivatives. First, the portfolios of OTC financial derivatives held by the top 25 U.S. BHCs consist of $229 trillion of notional values at the end of 2023. Second, all trades in OTC derivatives are carried out behind closed doors between dealers and brokers, and each OTC derivatives contract is customized and self-tailored to fit the interests of the parties to the contract. Third, trading prices of OTC derivatives are not publicly observable or available, which indicates the lack of transparency in the OTC derivatives market. Fourth, BHCs use the most subjective inputs, i.e., Level 3, of the fair value hierarchy, to value their OTC portfolios. Using data from Federal Reserve-regulated filings and multivariate regression analysis, our preliminary results show a positive association between the magnitude/credit exposure of OTC derivatives and the equity risk of bank holding companies.

Professors Dan Heitger and Dale Stoel are working on a project that identifies research and curriculum development opportunities at the intersection of enterprise risk management (ERM) and data analytics (DA). The project began by conducting a series of interviews with experts involved in ERM and DA. While these interviews suggest a wide variance in the types of DA performed across ERM tasks, prior research has not systematically examined this intersection. Therefore, the project then embarked on a large-scale research survey of ERM professionals with the goal of linking DA tasks to particular ERM activities. In addition to academic publication, the results are expected to enhance Miami University’s ERM- and DA-related accounting curriculum at both the undergraduate graduate levels.