Normally when you create a user account in Windows 10, the first thing asked is How will this person sign in?" This identifies whether the account is a local account or a Microsoft account. Today as I was developing some course material for user accounts in Windows 10, this screen was missing from my laptop. Instead, it went directly in to asking for account information for a local user account.
After much searching around, I finally figured out that my laptop had no network connectivity. I had just installed a Windows Insider build and the new build killed WiFi on my laptop. Once the WiFi connectivity was restored the new account wizard behaved as expected.
I expect you would see the same behaviour in Windows 8.1 when disconnected from the network.