(In case you are interested, information about the textbook that C. J. Skender and I wrote and which is the basis for this course and this blog, just go to: http://www.flatworldknowledge.com/printed-book/1638. It is written entirely in a Socratic Method format which I think will aid student reading and understanding.)
In 1991, after I had taught for 18 years, I became disenchanted with the effectiveness of my teaching. When my students prepared for class, they became actively involved in their education and seemed able to understand the points I wanted to make no matter how complex. When they were not prepared, they fell into the role of stenographers and were forced to rely on memorization. Even small points were beyond their understanding. I came to believe, as I still do, that student preparation was the primary key to a higher level of student learning.
But how could I get my students to prepare consistently? Not just skim the chapter but actually think about the material in advance. When I give teaching presentations around the country, I ask that question of the audience and am surprised by how little educators think about the importance of that one aspect of the learning process.
In my own classes, I noticed that when students felt they would be called on they were much more likely to prepare. They didn’t want to look dumb in front of the teacher and the other students. Students are gamblers: If they were 50 percent certain that they would not be called on, they would not prepare. So, I decided to guarantee that they would be called on. That one decision changed my teaching life. Almost overnight, I switched to an entirely Socratic method class and I have kept at it for all of the years since 1991. One book (One L) and one movie (The Paper Chase) had a lot to do with that decision.
This semester I have two classes of Intermediate Accounting II with a total of 59 students and one class of Financial Accounting with 26 students. I will call on each of those students at least once (more likely 2-4 times) at every class. That’s a promise. The students know, when they arrive each day, that I will call on them; I will question them; I will expect them to be prepared to respond in a sensible manner.
At the start of every class, I give a handout that lists 4-10 “conversation starters” for the next class. So, they have the basic questions in their hands and 48 hours to get ready. For example, I might write out an opening question such as: “I was looking at the financial statements of Jones Corporation last night and, on its balance sheet, it lists an asset titled “Accounts receivable, net” with a balance of $19 million. What information does that convey to an outside decision-maker?”
In class the conversation might go as follows.
Teacher: Mr. A, when Jones reports $19 million for its accounts receivable, net, what does that reflect?
Mr. A: That is the net realizable value of the accounts receivable.
Teacher: Ms. B, what does Mr. A mean by the term net realizable value?
Ms. B: Net realizable value is the amount of cash that the company expects to collect from an asset such as accounts receivable.
Teacher: Mr. C, how did Jones determine the $19 million figure?
Mr. C: It has to be an estimate. They certainly do not know for certain how much money they will collect.
Teacher: Ms. D, how do they make that estimate?
Ms. D: They should use historical data updated for any changes in the environment or in the company.
Teacher: Mr. E, what kind of changes is Ms. D talking about?
Mr. E: Well, we are in a recession at the current time so that might mean that the company will collect less from its receivables than in the past. Or, the company might loosen up its credit policies to generate more sales and, thus, again, expect more bad accounts.
We can string together this type of question and walk right through the entire topic in a logical manner.
Notice how we started with a conversation starter (what does the $19 million figure reflect) and then had a discussion about the entire reporting process of this asset. And, I didn’t ask any question that the students (with some thought) could not have answered. They learned about the topic in reasonable increments. By the questions and the sequencing of those questions, I helped guide their understanding. Good questions and proper sequencing – you are talking about the essential building blocks of understanding.
Okay, it doesn’t always go that smoothly in my classes and I do get dumb answers on occasion. But, the students enjoy the give and take of the class. Within a couple of classes, students will start telling me that they actually look forward to the "discussion." Last semester, several students told me that they wanted to be called on more often.
That is how I do it. However, keep in mind that the key is student preparation that leads to student engagement. You have to decide what works for you. Experiment. Try lots of different things. But keep your eye on what you are trying to accomplish: getting your students to prepare so that they can be an active part of their own learning.
Here are the Day One conversation starters that my Financial Accounting students received from me about ten days ago and will be expected to answer this coming Monday at 1:30. This is actually a little short. My classes are only 50 minutes in length and taking the roll on the first day and covering the course outline will take some of our time.
DAY ONE QUESTIONS – FINANCIAL ACCOUNTING
(a) – I start every class by giving you a handout like this one. It contains the questions that we will talk about in the following class. I never lecture. We just have a conversation. However, you cannot hold up your end of that conversation unless you have prepared for class. I am not much interested in what you can throw out off the top of your head. I realize you have done that in the past in high school and (possibly) in college but you need to stop it. You are an adult now; I need for you to be prepared. I am very much interested in what you have spent time thinking about and considering. I believe that is how people succeed in life—being prepared.
(1) - I have sent you the first chapter for a textbook that I am writing with C. J. Skender of UNC (well, it is finished now and we will have the finished version in a couple of weeks). Read that first chapter—since I wrote it, it ought to tie really well into what I want you to understand.
As you read, think about a couple of things: what do you see that you already know, what do you see that you have heard of but don’t quite know and understand, what is completely unknown and how much of it is interesting and how much of it seems boring (“all of it seems boring” is probably a bad answer)?
Instead of underlining or highlighting stuff in the book, take each separate page and write down the 10-15 words that seem most important. I like the idea that you are making a decision about what is important. The process of evaluating is good for you. Plus, I think it is very helpful to force yourself to keep your notes short. You have to understand stuff to be able to make it concise. When I was in college, I once bought a used textbook that had every line in the first 120 pages underlined – what benefit was that?
(2) – Assume that one of your parents or one of your friends or someone you know makes the following comment: “I just received $400.00 cash as a present. So, I took the $400.00 and went to ETrade.com and invested it in shares of Ford Motor Company. I had looked at Intel, Pepsi, Microsoft, Google, and Ford but I put the $400.00 into Ford.”
--What is meant by “shares of Ford Motor Company?” What is it? How many “shares” does a company have?
--Other than buying shares of a company, what other types of investments are possible? What are their advantages over the ownership of shares and what are their disadvantages?
--Financial accounting information is information that can be stated in monetary terms (dollars) and is relatively objective (it is not a wild speculation). What might have been one piece of financial accounting information that I could have discovered that made me say “wow, I better go out and buy some shares of Ford right now!!!”
--Why would anyone put $400.00 “into Ford?” Why would anyone do such a thing? What do they expect to get out of that? (This is a really important question that we will come back to throughout the semester.)
--Why would anyone choose to put $400.00 into Ford rather than Intel, Pepsi, Google, or Microsoft? I had a chance for all of those last year but I chose Ford. (I also chose Bank of America, General Electric, and CapitalOne.)
--Based on your answers to the above questions, what has to be the ultimate purpose of the financial information that companies produce and distribute to help investors and potential investors?
(4) – Go to www.kroger.com
--At the bottom of the opening page, click on “Investor Relations.”
--On the left side of the page, click on “reports and statements.”
--In the middle of the page, you should see a short paragraph about the annual report. Click on “view.”
--After it downloads, scroll down to pages A-33, A-34, and A-35. Find 3 or 4 things on those pages where you can say “oh, I know what that means.” Find 1 thing that seems interesting but you do not know what it means. By the end of the semester, I would hope that every single thing on those pages you could look at and go “oh, I know what that means.”