I recently asked a classroom of eight-year-olds how many of themy. thought maths was important. Most of the kids put their hands up – obviously the government propaganda for better numeracy is getting through. ‘And can anyone tell me a job where you need maths?’ Up went the arm of a keen girl at the front. ‘Accountant,’ she beamed.
She was right, of course. But she would also have been right if she had said salesman, doctor, designer, commentator or just about anything else.
When most people think of maths, they think of it as an eight-year-old would. Maths is arithmetic. Accountants cannot avoid the need to have a reasonable ability at sums, but of course this extends to anybody who has to work out their expenses, live within a budget or negotiate a price.
Hence many people rate their ‘mathematical ability’ on how good they are at working out VAT.
But mathematics is a much wider subject than just adding and subtracting numbers (anyone who did a degree in maths will vouch for the fact that mental arithmetic was just about the least important skill they needed).
It includes geometry, algebra, statistics, mechanics, logic and much more besides. The nationwide push towards better maths skills embraces all of this. So, apart from basic numeracy, do accountants need to top up their maths skills?
At first glance, perhaps not. Jackie Alexander, head of graduate recruitment at PricewaterhouseCoopers, likes to emphasise that the firm does not want to recruit mathematics graduates per se. ‘You don’t need a maths or business degree to be successful in professional services. Communication skills and a practical approach are at least as important as mathematical skills in an accountant’s job,’ she says. One might add that the highly abstract nature of much of university mathematics sometimes attracts students who are completely unsuited to the accountancy profession.
But there is another side to this. Mathematics is also a subject that revolves around problem solving. As computers begin to remove much of the drudgery of auditors’ work, the role of the accountant is increasingly that of problem solver. What is this balance sheet telling me? How can we optimise the position for the client? What’s the most efficient way to allocate the tax?
As David Blunkett pushes the country towards greater numeracy, there are (I think) three aspects of mathematics he should emphasise as being essential for a successful career – not just in accountancy but in any professional job.
The first is basic arithmetic skills. Sorry, but there is simply no substitute for knowing that 9 x 8 = 72.
The second is the much undervalued skill of estimating. Most businessmen do not need to know what their sales are to the nearest penny (leave that to the bookkeeper). But they do need to know if turnover will be #1m or #10m: ‘If I’ve sold 98,214 units at #10.36, what’s the revenue?’ – roughly 100,000 x 10, or #1m. OK, maybe a bit more, but who cares? That’s detail.
A far worse error is to have no feel for numbers and put the decimal point in the wrong place.
The third crucial part is to understand probability and statistics. Many people over 40 never even studied the subject at school, yet it is fundamental to good decision making, and anybody aspiring to a place on a company board ignores it at their peril – especially with a recession looming.
Number-crunching is disappearing as an accountancy skill. In its place is a growing need for intelligent, mathematical modelling. That is why accountants should be supporting the campaign for maths in schools.
Rob Eastaway is responsible for the PwC world cricket ratings, and is co-author of Why do buses come in threes?, #12.95 Robson Books
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