Accounting/Finance vs. Economics/Finance

I know this question has been asked before, but I was wondering which double major is preferable for students attending a low-end semi-target, like William & Mary.

To be clear, this question is different from the one I asked in the last thread I started. I'm specifically asking about double majors, as opposed to the superiority of economics or finance as a single major.

Comments (32)

Jul 24, 2015

To my knowledge, most economics programs fall under arts and sciences, while accounting and finance fall under business.

I've heard some say that accounting is of no use to an investment banker, while others have said that it is extremely useful. Which is actually true?

Jul 24, 2015

I'm just a lowly intern, but accounting is definitely useful in Investment Banking. Knowing the reasoning behind values on an income statement, B/S, and CF is extremely useful and complements finance courses very well. With that said, it's not like not taking accounting will leave you in the dust. Accounting is very intuitive...but then again so is Econ I guess

Why get your own coffee when you can get an intern to do it for you?

Jul 24, 2015

I don't think it really matters. As the person above me said, accounting is intuitive and the accounting knowledge necessary for IB can be learned within 3 months. Go with whatever you prefer. Just my $0.02.

Jul 24, 2015

Personally I'd choose accounting, as the specialization is more applicable to the work you do in IBD. In all honesty though, a double major wouldn't necessarily get you further up on the list of potential candidates. Also, if you do major in accounting be ready for more thorough technicals during an interview.

Jul 24, 2015

This is easy, accounting.

Accounting is extremely important when structuring a transaction, I can't imagine anyone working in finance saying that a strong accounting knowledge isn't useful.

Jul 24, 2015

S&T: Econ. It's more quantitative

IBD: Doesn't really matter. Aside from an Intro to Financial Accounting course, there's really nothing else that's necessary on the job. Go with the one you like more.

Jul 24, 2015

What SU said, except that if you do IBD I highly recommend that you take an intermediate accounting course as well.

Jul 24, 2015

As long as you take intermediate accounting you could go either way...

Jul 24, 2015

It depends how strong your school's econ program is. At Minnesota or Berkeley, it's a bit of a no-brainer. Take Econ.

Illinois, BYU, and UT-Austin, for instance, have much stronger Accy programs than Econ programs- in fact they rank better than Wharton at it. In a situation like that, you want to pick Accy over Econ. Accy is a very strong fallback to have and a good program is going to give you a lot of insights about the market beyond just tax/audit.

Math + Finance at a state school is also a good choice if you want to go into trading. But I am just not convinced that every state school econ program has the same quantitative rigor as one at say UPenn. Everyone knows what Accy means regardless of which school you went to. Everyone knows what Engineering means regardless of what school you went to. Everyone knows what Math means regardless of what school you went to. For top 100 schools at least, everyone knows what Physics or Chemistry means. But when it comes to Econ, every school does it differently and nobody knows what the heck is entailed in getting an Econ degree, even at a lot of target schools.

Just do math and get a 3.7 GPA. Or maybe Accy and get a 3.85 if you like to hedge your bets.

Jul 24, 2015

I doubled in Finance and Accounting at a target, and a bunch of my friends went the Econ route.

In my opinion, Accounting is the least useful of the three for what you want, no matter where you go to school. Between Finance / Econ, I'd say then you look to which of those is stronger at your school. I know a lot of Booth kids going into IB had Econ degrees. That's anecdotal, so take it with a grain of salt. Or just double in Finance / Econ, as you suggested. But if you pick one, I'd lean toward Econ.

Jul 24, 2015

Hey guys thanks a lot for your input. I was already leaning towards Econ and your comments only reinforced my decision to take that route.
I appreciate your time!

Jul 24, 2015

As an econ major I can say that accounting would have been more useful, but I don't mean that in a way that econ is somehow sub-par. I just know half the econ classes I took were basically repeats of themselves or something I'd already covered in finance or one of the micro/macro classes. Ie. I did a senior econ course on strategic behavior (can't remember the exact name), and it was basically the exact same thing as my 3rd year microecon class, only with more calculus thrown in (something I'd say isn't particularly useful for us unless you want to go academic)

If I were you I would go for finance & accounting with the math minor, and any electives should be filled with a mix of micro and macro economics.

Jul 24, 2015

As someone who majored in finance, if I had to do it all over again, I would pick accounting and then major in something that is enriching intellectually (I would have picked philosophy, but a math major, or something more quantitative can work as well if that's where one's interests lie). I seriously don't think my finance degree taught me anything that is a hard skill/trade (accounting does) or anything very intellectually stimulating that changes the way you look at the world (philosophy).

I went to a non-target and schools will obviously differ in how they teach things/how in-depth they go, but aside from my Stern/Wharton friends who went to schools known for being rigorous when it comes to UG finance, all of my friends at solid state schools (UT, Michigan, UNC, etc.) felt the same way as I do. Accounting is useful even in finance and it gives you a hard skill that can't be easily picked up by reading "Investment Banking" by Rosenbaum or visiting macabacus.com

That's just my experinece, however. Others I know loved their finance classes.

Jul 24, 2015

That's not half bad advice either. All finance taught me was how to do TVM functions, which sure it takes a bit of practice to wrap your mind around it (ordinary vs due, interest rates, etc) but its nothing you don't learn for the first CFA exam.

Jul 24, 2015

Finance & Accounting

Jul 24, 2015

Thanks for the responses - sounds like I'm sticking to Finance and Accounting. I would like to hear more from you guys though, specifically what subsets within the financial services industry I should look into/would enjoy.

Jul 24, 2015

I'd do economics/accounting, because many of the people who work at BB IBD are economics majors, and the accounting, the hard skill, will help you big time if you ever want to get into private equity or venture capital. Plus with stocks/bonds in general, knowing accounting will help you understand earnings calls etc. on a level deeper than just market sentiment.

Jul 24, 2015

Also you will probably have the chance to cover the basic finance principles in your math and econ programs. I know I had two math courses on financial mathematics and the econs all touched on various pieces

Jul 24, 2015

Given the risk that the math major may decrease your GPA, I would definitely cross that off as a possibility, especially since it's possible to get a minor in it anyways.

With the decision being between accounting and econ, I would probably go with accounting if you're more interested in financial services. Econ is great and interesting, but there will definitely be a lot of overlap with your finance classes and econ doesn't provide any "hard skills" so to speak. Accounting on the other hand can definitely provide some tangible skills and knowledge that will be extremely applicable if you end up working in financial services.

If you're more interested in management consulting than financial services, I would look into doing a second major in liberal arts and/or marketing. A large amount of the consultants in my office did finance/marketing and finance/liberal arts. Personally, I'd look into English (expository writing - not poetry/drama/Shakespeare), statistics, or philosophy.

Jul 24, 2015
Zzari:

Given the risk that the math major may decrease your GPA, I would definitely cross that off as a possibility, especially since it's possible to get a minor in it anyways.

With the decision being between accounting and econ, I would probably go with accounting if you're more interested in financial services. Econ is great and interesting, but there will definitely be a lot of overlap with your finance classes and econ doesn't provide any "hard skills" so to speak. Accounting on the other hand can definitely provide some tangible skills and knowledge that will be extremely applicable if you end up working in financial services.

If you're more interested in management consulting than financial services, I would look into doing a second major in liberal arts and/or marketing. A large amount of the consultants in my office did finance/marketing and finance/liberal arts. Personally, I'd look into English (expository writing - not poetry/drama/Shakespeare), statistics, or philosophy.

On that note, do you think I would be better off with Finance+Accounting (+math minor) or Finance+Statistics

There would be no point in a math minor with a stat major since they're a lot of the same classes

Jul 24, 2015

do math/statistics/physics/CS. Or pick history/phil/econ, and make sure you write a thesis + take multiple statistics courses. here's why:

most finance majors are really cocky since they have internships that pay well at prestigious firms. The problem is they suck at math and they study a psuedo science that is useless right when they walk out of school. Usually finance degrees don't require a thesis and so the entire degree is regurgitating a questionable theory imagined by others. Indeed, you spend your time solving piss easy math problems and memorizing facts.

Taking math or a serious research curriculum will strengthen your problem solving and analytic skills. In my opinion, being able to RATIONALLY explain phenomena, either scientific, historical, or abstract, is the precise skill you need to invest. Some say investing is the ultimate liberal art, as the strength of your theories can be measured by your investing performance.

Understanding the market is one of the toughest things you can do - some of the smartest people in the world have failed to comprehend it! You will need to be very logical, and taking the courses of study I mentioned is how to train yourself.

Look at this SIG trading webpage: http://www.sig.com/decisiontrading.aspx.

You might think you're pretty intelligent but the truth is you're not! There is plenty of science that proves how our intuitions and emotions fool us daily. We have horrible intuitions of probability & risk, and we often see patterns that aren't really there. Logical thinking requires discipline and practice and you're not going to find that anywhere in a finance curriculum. Take your education seriously and learn how intelligent people have explained major phenomena in the past. Figure out why certain theories were more accurate than others, what logical flaws caused them. Understand how to properly conduct research and avoid biases in your explanation.

I've watched so many finance students assume the most outrageous things in statistics. They know what Beta means in CAPM and how to calculate it, but apply it incorrectly in so many ways! Or they know the formula for volatility but have horrible intuitions of how it behaves. Most finance majors are just egotistical monkeys who just repeat what they read on bloomberg, WSO, or some IB recruiting guide.

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Jul 24, 2015

LOL that became a rant;

in short, any of those majors are fine but whatever you do, pick whatever major requires the most analytic or research based coursework. If you can handle it, you should seriously study some of the core material in the hard sciences. Pay EXTREMELY close attention to your statistics class.

Keep in mind you can also major in just finance to free up time for more important subjects that will actually make you smarter...

Jul 24, 2015

If you're planning on getting your CPA, then go for the accounting. As part of the requirements for the license, some states require a number of credit hours in subjects such as audit and taxation, which you'll take as an accounting major.

One louder.

Jul 24, 2015

Sounds to me like you have not been nailing all of the technical questions or there is a fit issue because there is no reason that having an econ background rather than a finance/accounting background would be the only reason to keep you out (especially since you keep making it to final rounds). If you can honestly say that you think you have nailed that part as well as other candidates then I would chalk it up to the fact that hiring is extremely competitive right now especially given the contractions in the industry.

Jul 24, 2015

That's what i initially thought - that some of the others have been better in the interview process, but the most recent final round the guy stated that even though I had nailed all of the technicals and seemed to have a good grasp of accounting, the MDs decided to go with the kid with a finance degree. I guess I was just a bit disheartened because I knew I had been killing it during the interviews and had made a connection with a lot of the people on the team, but just wasn't enough. Sorry, I'm venting, but thanks for the post.

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