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The absence of depreciation accounting in the financial statements of colleges and universities is an issue of relevance to managerial accountants, both professionally and personally. It is of professional relevance not only because of the impact on the financial statements but also because of the impact this has had on management and accounting practices in higher education. It is of personal relevance because of the impact that the adoption of depreciation accounting will have on the cost of higher education to managerial accountants and their families. The convergence of the results of our study of colleges and universities in Virginia, generalized to the United States, and a recent study of deferred maintenance in higher education enforces the conclusion that funded depreciation reserves could have prevented the deferred maintenance problem.

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