IIM-A students stumped during accounting exam, asked to prepare P&L of Vadra’s companies for 07-10

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What should have been just another exam in the litany of surprise quizzes, exams, cold-calling, assignments and projects that first year management students of IIM-A are subjected to in preparation for the rigours of corporate life turned into a veritable nightmare for the denizens of India’s premier management institution.

Students taking the first term course, MANAC I (Managerial Accounting), were asked to reconcile the figures submitted by Shri Vadra to the Registrar of Companies, with the subsequent statement of DLF that its transactions with Shri Vadra were completely transparent and ethical along with a different set of figures, for the end term exam by Professor Sheela Bhatt, and then prepare a P&L statement for Shri Vadra’s companies. The problem statement read like this:

Shri Robert Vadra, the son-in-law of a powerful political faimly, set up five companies with a paid-up capital of Rs. 50 Lakh in 2007, according to the Registrar of Companies. Shri Robert Vadra then whiled away his time playing golf and body building, earning no income from any legitimate business activity, except by way of interest on bank-balances which can be considered negligible… (Read the rest of the problem statement here)

Minutes into the exam, a few students threw up. One student, frustrated at his failure to reconcile the irreconcilable and rationalize the nonsensical, tore up his answer sheet and tried to walk out of the class. A potential I-scholar, Sridhar Chirovolu, was close to tears, devastated by the fact that for the first time in his life, he was confronted with an ‘uncrackable’ problem.

A few others began to bang their heads in frustration. Wailed Rahul Rangarajan, “Yaar, as it is I’m struggling with Accounting and I’m asked to solve this. Looks like I’m gonna flunk IIM-A and repeat a term. Boo hoo.”

Finally, the students gheraoed the office of the Dean of Academic Affairs and demanded that the examination be re-conducted since they had all flunked it. Matters came to such a boil that the HRD ministry had to intervene on behalf of the student community. Speaking over the telephone to the Dean of academic affairs, an irate HRD Minister Kapil Sibal barked, “These are IIM-A boys. You think they will take up jobs with Shri Vadra’s company or marry some political heavyweight? Then why expose them to such murky business problems and kill their idealism? Please re-conduct the exam with a more conventional accounting case study. Just because IIMA was established by Pt. Nehru, you don’t have to expose the idealistic students to the shenanigans of his great-grand-daughter’s husband.”

Professor Sheela Bhatt has profusely apologized and promised not to repeat her folly. “The students had just mastered the concepts of preparing balance sheets and P&Ls. In IIM-A, we follow case based pedagogy where they are exposed to real life business problems during exams and class discussions. So I thought why not push them a bit by challenging them to prepare a P&L for Shri Vadra’s companies based on news of the last few days. In hindsight, it was not a good idea to subject them to unacceptable levels of stress for which I apologize. I’ll give them a simpler problem instead, like making a P&L of Lehman Brothers before it went bust or Enron’s accounting gimmicks,” said Dr. Bhatt.

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