The Effects of Presentation Formats on Understanding Financial Accounting: An Experimental Study

Most financial accounting presentations consist of graphs and tables with subtle variations in the way that the associated text is presented. While alternative presentations of tables versus graphs have been widely researched, the impact of text proximity to a graph or table has received little attention. This study experimentally examines the effects of two instructional design formats on student’s understanding of financial accounting. Graphical presentation effectiveness was operationalised as accuracy and mental effort in answering questions of different levels of complexity. Using financial accounting instructional material presented either as a graph and separate text or text embedded in the graph, participants responded to recall and transfer questions. The results of an experiment suggest a strong relation between presentation format and understanding of financial accounting. Accounting students understand an integrated graph more than a separate graph and text. We conclude that there is value accruing from close proximity of text to the graph, but suggest additional benefits may be reaped from presenting text and diagrams in an integrated form.