Automation in Accounting and Finance

This assignment delves into the realm of automation in accounting and finance, covering a wide range of topics from its potential to reduce costs and improve efficiency to its implications for the accounting profession. It presents an overview of existing research, discussing how automation is transforming the way accountants work and highlighting the benefits and challenges associated with this transformation. The assignment also touches upon the emergence of artificial intelligence and blockchain technology in accounting, exploring their potential to revolutionize the field.

Business Research
Proposal

ABSTRACT
Main reason behind conducting research proposal is to identifying the significance of
automation in modern accounting system. For doing this research, different activities have been
completed which is development of research aims and objectives, literature review, research
methodology, data collection and analysis, and conclusion and recommendation. All these are
main activities completed by researcher. Literature review is most important section of research
which have been completed with the help of different authors. In this section, various number of
authors provided their opinion about the impact of automation in accounting system of an
organisation. Advancement in AI and software can help accountants to perform their regular task
have been implemented. For this investigation, different methods have been used such as
research questions, ethical consideration etc. As these will support an investigator to do each
tasks or activities of research in ethical and systematic manner.

Table of Contents
ABSTRACT.....................................................................................................................................2
RESEARCH BACKGROUND.......................................................................................................1
RESEARCH QUESTIONS AND RESEARCH OBJECTIVES.....................................................2
LITERATURE REVIEW................................................................................................................3
RESEARCH DESIGN....................................................................................................................1
ETHICAL CONSIDERATION.......................................................................................................5
REFERENCES................................................................................................................................6

RESEARCH BACKGROUND
The main focus of this research is on changes in way to conduct the accounting and also
its impact on employment because of intelligence system and technology advancement.
Automation refers to operate robotic system and artificial intelligence to deal with the accounting
task such as data entry, updating record and also expedite process on regular basis. Under this,
manual accounting or traditional accounting took more time of accounts that lead to errors as
well as trials (Haughy, 2018). The main issue in manual system is lack of privacy that result in
enhancing data exposure to outsider. Introducing the artificial intelligence technology in
accounting system is helpful in payment, security and also proper analysis of data.
In this, Automation helps in develop the positive effect on the accountants as it enhance
ability and skills. There are various software which developed mainly to help accountants in
auditing, recording and many other works. Main benefit of software and machined in accounting
enhance analytical jobs that reduce expenses of book keeping, account payables and also connect
with large number of consumers. The reliability and accuracy is also an advantage that provided
through machines to help the accountants for taking long term decision. On the other hand,
Artificial Intelligence technology have the ability to handle several accounting functions for an
instance audits, tax preparation and payroll (Oliver, 2016). These all have the abilities to perform
the accounting task efficient and quickly.

RESEARCH QUESTIONS AND RESEARCH OBJECTIVES
Research Questions
 How automation is changing the way of doing accounting?
 Are there positive or negative impact of automation on employment?
 What are the significance of automation in accounting?
 What will be the future of automation in accounting?
Objectives are listed below:
 To find out how accounting system has change from manual to automation.
 To find out the significance of automation in modern accounting system.
 To analyse how advancement in AI and software can help accountants to perform their
regular task.
 To find out that if accountants job are replaced or increased in future due to automation in
accounting.

LITERATURE REVIEW
Accounting system has change from manual to automation
As per the view point of Patrick Villanova (2019) Accounting system is explained as
system that employed in an organization for organize the financial information in a systemic
manner. The traditional accounting system has been some manually by year 1980. Main reason
behind using the accounting system is to track income, expenses and some other activities. On
the other hand, automation is related to employing the artificial intelligence software and the
robotic system that mechanism different processes of business. The organizations mainly start
their business from manual accounting system because it requires less investment. The manual
system consists writing each transactions in accounting book and then escalate all the numbers
on manual basis (Romano, 2013). It takes more time in doing the financial activities and also
record the financial statements. In addition to this, manual accounting system is time consuming
and and lead to errors which impact on accuracy of data. On contrary, Automation technology
aids in minimum cash flow crisis, data security, integration of the financial organization,
accurate outcomes and payments. It develops the positive affect on accountants as it aids in
enhance their knowledge and skills so that they can able to do the financial statements in a better
manner. Machines have capability to automate transaction task effectively to make the better
strategic decision. In this, automation in the accounting is beneficial in monitoring performance
level as well as update records on real time basis by using the robotic system and artificial
intelligence. It is helpful in automation the particular tasks for an instance payroll process,
updating records and data entry. In regards to this, using software for automate accounting aids
in maintain the accounting records receivable with less error, easy data entry and also expedite
process. Configure in software assess in keep the financial records with developed accounting
principles (Adamyk, Adamyk and Khorunzhak, 2018).
Significance of automation in modern accounting system
According to the opinion of Kapil Rana (2019), Finance and Accounting is a vital
department of the organization which require the use of latest technology and gradual
development of the experiences in order to exploit the new experiences and conduct better bay of
doing the work. There are various type of the large organization that starve for some type of
automation in the technology driven trend. As per the futuristic approach it is vital for the
organization to improve its accounting system cater the need of upcoming generations. Initially,

such automated tool were not available to be assessed by the organization but with the advance
technology and immense data have intensify the efficient functioning of whole financial
processes. Now the accountant too prefer the use of sophisticated data so that they can mage the
data and take out relevant information out of it. One of the most common issue with the storage
of information is privacy breach or cyber attack that affect the confidentiality of the firm and can
also hamper its image. So one of the foremost reason to deal with such situation is using advance
approaches that even help to maintain the security of data. Additionally, Automation is one of
the most successful ways which help to eradicate the issue of data disaster. Apart from this in
comparison to the tradition data which lack in terms of speed as well as accuracy due to which it
cannot be further used in the present times. So the multinational and large technology driven
company uses advance automation technique to take the crucial steps and enhance the
functioning of business. Therefore, Automation in the field of accounting is the faster and
efficient step that improve the system and sort all the issues significantly.
Advancement in AI and software can help accountants to perform their regular task
As per view point of KELLY CHERNIWCHAN (2019) Artificial intelligence is machine
that able to mundane tasks and complete repetitive at fraction of time that takes the human with
high accuracy. It helps in handle several accounting functions like audits preparation and
payrolls (Arntz, Gregory and Zierahn, 2017). Artificial intelligence and software are helpful for
the accountant to perform regular task in an effective manner. It helps the accountant to make
improvement in services. It will improving accuracy of data entry and reduce liability risk for
accountants. Automated data entry and data categorization assess accountants analyses quickly
the board financial trends. In addition to this, artificial intelligence is transform accounting sector
with the advancements that reduce tasks and also free time for the financial staff to give the
priority that effect on responsibilities. This technology is capable for handling several standard
accounting tasks in more efficient manner to enhance capabilities over the period of time.
On the other hand, accounting software results in accuracy, reliability, cost effectiveness
and automation of data effectively. It aids in access information securely and keep the data
private. The automation accounting revolutionize how a company is useful in monitoring
performance and also update records on real time basis for make the effective strategic decisions
(Bates, Filippini and Chiarini, 2012). The accounting software is helpful for the accountant to
handle time consuming activities that focus on necessary aspect to run business. Different

software which accountants can use in performing the regular tasks are NetSuite ERP, Zoho
Invoice, Online Invoices, Gusto, FreshBooks and many others.
Accountants job are replaced or increased in future due to automation in accounting
According to view point of DENNIS NAJJAR (2019) Automation will not replace the
accountants in future to make the decisions. The job of accountant is more involved than
subtracting and adding. Ist makes impossible to be automate whole things. In automation era,
where the tasks and activities are automated to enhance development as well as effectiveness of
business. It aids in data generation with few clicks, easy access of email, sharing scree and many
others (Caballero, Farhi and Gourinchas, 2017). The automation technology assess in minimizing
business operations and also cost. Through automation in the accounting, the chances of human
error will be reduced, it aids the accountant to easy access of information, cost- efficient, time
saving and many others. On the other hand, automated technology is more useful in assuring the
clean audit compliance and minimizing the repetitive transaction for high growth. In future,
automated technology provides different benefits to accountants that lead to accurate as well as
reliable data for taking the effective business decisions. It assess in viewing accounts in different
charts and formats to analyses or measure information. With the automation, work load of
accountants will be reduced in future and they are able to perform the activities quickly for
getting the positive outcomes (Christiaanse and Hulstijn, 2012).

RESEARCH DESIGN
It is the structure of scientific work that provides methods and techniques chosen by
researchers to combine various components of research in the logical manner. This is termed as a
blueprint within which research is conducted (Coyne and McMickle, 2017). This helps in
validating research by providing accurate and true conclusion. A research can be designed in
following types:
Explanatory research design- In this form of research design a researcher uses own
imagination and ideas to conduct research. Personal experience and individual judgements
becomes basis for obtaining information from all the sources that are available. An unexplored
situation or issue is brought in the eyes general public.
Descriptive research design- In this form of research design a particular situation is
elaborated and all the research will be based on the issue involved. This form of research is done
for the purpose of obtaining solutions to a particular situation. Under this research design each
and every aspect of a particular is identified.
Experimental research design- This type of research is used in natural science as human
behaviour can be differ in same situation as per time. It deals with determining cause and effect
relationship (Dai and Vasarhelyi, 2017).
In the current scenario where issue involved is for automation in accounting descriptive
form of research designing is selected. As this form provides information and data that is
required for research in the described manner. Information can be analysed effectively and non-
qualified issues can be avoided.
Type of Research: It is defined as the systematic investigation as well as the study of sources
and material so that while using facts of the given information conclusion can be made. There
are two types of research methods that are as follows-
Qualitative research method- When research is conducted for social science and data
collected works with non-numerical data to bring meaning full information then it is termed as
qualitative research. This type of research is conducted to have better understanding regarding
personal feelings and thoughts of an individual (Dimitriu and Matei, 2015).

Quantitative research method- In this method of research information is collected
through investigation and gathering data in numerical form. The whole data can be processed
and a decision on the basis of figures are provided. This type of research can be done through
statistical and mathematical methods (Drum and Pulvermacher, 2016).
Qualitative method of research will be used to research about effect of automation in
accounting as personal feelings of an individual for this change will be considered. It helps in
understanding diverse area with the information that is presented through personal experience.
Research approach: It is defined as a plan or procedure that consists of the steps of broad
assumptions in the method of data collection, analysis and interpretation. There are two methods
through which research is approached that are as follows-
Deductive Research approach- A deductive approach usually begins with hypothesis that
are commonly associated with quantitative research. In this method a top-down approach is used
that helps in moving reasoning from general to particular results. Data collected in this theory are
used to identify whether they belongs to some existing theory.
Inductive Research approach- In this for of research approach researchers starts with
collecting data that is relevant for conducting research. All the collected data is processed and
they form part of the theory in some specific or general manner. It starts with observations and
with these observations theories are proposed at the end of research (Guthrie and Parker, 2016).
In this research investigation method, inductive approach is used to bring the best output
from the available information. Qualitative information when used with inductive approach the
most reliable theory is developed. With the use of inductive research approach most reliable
information is used to develop an opinion that is required to make a decision for research.
Types of Data: There are variety of data types available and while making research
understanding of types of data is important for doing Exploratory Data Research (Hopper, 2013).
A right type of data is used to choose right visualization method. There are two main types of
data that are as follows-
Categorical data- This for of data represents characteristics that helps in representing
things like gender, language etc. In categorical data statistical data consisting of categorical
variables of data has been covered into this form.
Numerical data- Numerical value represents discrete units and are used to liable
variables that have no quantitative value. One of the most important feature of this data is that it

is measurable. The information that is provided through numerical data can be analysed on the
basis of numbers that reflects clear situation (Kokina and Davenport, 2017).
Data collection: This is a systematic approach that is used for gathering information from a
variety of sources to get a complete and accurate picture of an area of interest. Through this
methods researchers in the process of making research collects information from all the relevant
sources to find solutions to different issues. This is concerned with the accurate acquisition of
data that will make information provided more reliable. There are certain methods that are used
in the process of collection of data that are as follows-
Primary data collection- Primary research is the process of gathering data directly from
original source. Primary data are collected for the first time for a particular purpose and are
termed as original in nature. Information that is collected for the first time can be acquired as per
specific requirement of the research. General methods used to collect information from primary
sources are observations, questionnaire, survey.
Secondary data collection- Data that is collected by someone else for any other research
and that is used in the current research then it is termed as secondary data. This form of data is
already available in the market. The primary source of secondary data are social media,
government reports and personal reports of various organisations. This form of data collection is
cheap and collected properly (Mancini, Vaassen and Dameri, 2013).
To make research for automation in accounting will required data collected through both
the sources. As for pre analysis secondary data information will be used and for new information
primary data collected through questioner and observations are conducted.
Data analysis: It is defined as the process of cleaning, transforming and modeling data to
recover useful information for business decision making. Through data analysis provided
information will be analysed using statistical tools to discover useful information. Analysing the
available is one of the step that is used to complete the research. All the relevant information is
identified through data analysis and non-relevant information are set aside and not considered for
further decision making.
Research sampling plan: Sampling plan is a term that is widely used in research and provides
an outline on the basis of which research is conducted. Sampling plan guides researchers
regarding which category is to be surveyed and what sample size must be selected to make
research. A detailed information of the measurements to be taken is provided through sampling

plan that consist of measurements to be taken, which material to be considered on what manner.
Types of research sampling plan is as follows-
Probabilistic sampling method: When a sample that is required to make research is
conducted from large size of population on the basis of probability then it is termed as
probabilistic method. In this method each individual is giver a true and fair chance to be selected.
Non- Probabilistic sampling method: In this form of sampling selection of a sample is
made on any odd basis. Sample that is formed on non-probability basis do not provide fair
chance to each individual for selection and leads to error in sampling (Power, 2012).
For completion of research in most appropriate manner Probabilistic sampling and non-
Probabilistic sampling both the methods will be used. When sample is required on probability
basis to meet the accuracy then probabilistic sample method is used. In most of the situation
sample probabilistic method is used as it gives the true and fair chance to all the facts to be part
of sample. A research will be more reliable and valid with the use of sample probabilistic
method. For example – A sample of individuals who wants technology to improve and some are
still use old methods to complete a work. When a sample is conducted on the probability basis
the selection of any individual from sample can be made, this sample with help in reflecting
regarding how society is ready to take technological changes. All the methods, processes that are
used for conducting research will help in achieving desired final results (Arntz, Gregory and
Zierahn, 2017).

ETHICAL CONSIDERATION
Ethics is explained as the principles which govern behaviour of a person to conduct an
activity or tasks. The research ethics mainly deal with analysis of the ethical problems which are
arisen when the people are included as the participants in an investigation. In this, ethical
consideration is most necessary part in conduct an investigation in significant way. Ethics is
considered as the fundamental principles of human conduct (Christiaanse and Hulstijn, 2012). It
is necessary for an investigator to assure about the security of participants so that they can get
involvement in research without any issue. There are some ethical considerations of human
research mention below:
Informed consent- In this, it is necessary that an individual who participating in
evaluation is informed regarding the conducted research, they should have knowledge about
purpose of project, findings etc. Its main purpose is to make informed decisions so that
participants can give their contribution in research effectively.
Confidentiality- It means that identifying information and data is not to accesses through
any person other than the program coordinator. It is a reprehensibility of researcher to keep
information and data of respondents confidential. Without arsing to them, not to share their data
with other person. It can develop the negative impact on research outcomes.
Anonymity- It is strict form of the privacy as comparison to confidentiality. Under this,
respondents are unknown to their research team. It is complex to attain than the confidentiality as
the participants in related to social investigation known to program coordinator.
Human subjects protection- If there is any kind of research conducted on the human
subjects then there should be the minimum harm, autonomy, increase profit and things which
provide the positive outcomes (Dimitriu and Matei, 2015).
Voluntary participation- It means that the people participate in evaluation should be free
from the coercion. They can withdraw participation at any time without involvement in the
future services. There is no pressure placed on those respondents which selected not to be
continue.

REFERENCES
Books & Journals
Adamyk, O., Adamyk, B. and Khorunzhak, N., 2018. Auditing of the Software of Computer
Accounting System.
Arntz, M., Gregory, T. and Zierahn, U., 2017. Revisiting the risk of automation. Economics
Letters. 159. pp.157-160.
Bates, K., Filippini, R. and Chiarini, A., 2012. Lean production: mistakes and limitations of
accounting systems inside the SME sector. Journal of Manufacturing Technology
Management.
Caballero, R. J., Farhi, E. and Gourinchas, P. O., 2017. Rents, technical change, and risk premia
accounting for secular trends in interest rates, returns on capital, earning yields, and
factor shares. American Economic Review. 107(5). pp.614-20.
Christiaanse, R. and Hulstijn, J., 2012, June. Control automation to reduce costs of control. In
International Conference on Advanced Information Systems Engineering(pp. 322-336).
Springer, Berlin, Heidelberg.
Coyne, J. G. and McMickle, P. L., 2017. Can blockchains serve an accounting purpose?. Journal
of Emerging Technologies in Accounting. 14(2). pp.101-111.
Dai, J. and Vasarhelyi, M. A., 2017. Toward blockchain-based accounting and assurance.
Journal of Information Systems. 31(3). pp.5-21.
Dimitriu, O. and Matei, M., 2015. Cloud accounting: a new business model in a challenging
context. Procedia Economics and Finance. 32. pp.665-671.
Drum, D. M. and Pulvermacher, A., 2016. Accounting automation and insight at the speed of
thought. Journal of Emerging Technologies in Accounting. 13(1). pp.181-186.
Guthrie, J. and Parker, L. D., 2016. Whither the accounting profession, accountants and
accounting researchers? Commentary and projections. Accounting, Auditing &
Accountability Journal. 29(1). pp.2-10.
Haughy, S., 2018. LIiterature review. Accounting Automation Revolutionizes How Business
approach Finance.
Hopper, T., 2013. Making accounting degrees fit for a university. Critical Perspectives on
Accounting. 24(2). pp.127-135.
Kokina, J. and Davenport, T. H., 2017. The emergence of artificial intelligence: How automation
is changing auditing. Journal of Emerging Technologies in Accounting. 14(1). pp.115-
122.
Mancini, D., Vaassen, E. H. and Dameri, R. P., 2013. Accounting information systems for
decision making.
Oliver, B., 2016. The future of automation in accounting.
P, V., 2019. Why Automation is a Positive Turning Point for Accountants.
Power, M., 2012. Accounting and finance. In The Oxford Handbook of the Sociology of Finance.
Romano, C., 2013. 9 Advantages of Compurterized Accounting.
Online
CHERNIWCHAN, K., 2019. How AI Will Help Transform How Accountants Work.[Online].
Available through: <https://www.firmofthefuture.com/content/how-ai-will-help-
transform-how-accountants-work/>.

NAJJAR, D., 2019. Is Artificial Intelligence (AI) the Future of Accounting?. [Online]. Available
through: <https://www.thebalancesmb.com/is-artificial-intelligence-the-future-of-
accounting-4083182>.
Rana, K., 2019. The Rising Importance of Automation in Finance & Accounting. [Online].
Available through: <https://medium.com/@Ranakapil/the-rising-importance-of-
automation-in-finance-accounting-fad840894d87>.
Villanova, P., 2019. Why automation is a positive turning point for accountants. [Online].
Available through: <https://www.accountingtoday.com/opinion/why-automation-is-a-
positive-turning-point-for-accountants>.

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