Impact of Computer Technology in Accounting System and Its Effects on Employment: A Case Study of Armco, Melbourne

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Impact of Computer Technology in Accounting System and Its Effects on Employment: A
Case Study of Armco, Melbourne.
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EXECUTIVE SUMMARY
Technological advancements have led to the transformation of most of the companies across
all sectors, more so in the accounting sector. The significant changes include the automation
of audit tasks through the use of audit software which has replaced IT for labor and
transformed the framework of audit groups. The lead time required by the accountants to
prepare and present financial information to the executive and shareholders has been reduced
through the IT networks and computer systems. The objective of this study is to examine the
impact of computer technology on the accounting system and its effects on employment with
a particular focus on Armco Company in Melbourne, Australia. This paper aims at examining
the specific impacts of computer technology on the accounting system, the impacts of
computer technology on employment in the accounting profession, and the factors that limit
the implementation of computer technology in the accounting profession. To accomplish the
study objective, this study will adopt a descriptive survey. Also, a mixed approach will be
used to collect data from across section of the target population. The researcher will use a
case study approach to acquire a comprehensive insight. The target population for the study
will be 130 employees in the finance department. The sample size will be 100 employees.
Stratified sampling technique is to be used to determine the sample and random sampling to
be used to select samples from each group. The study is to collect both primary and
secondary data. Structured questionnaires are to be used to collect primary data, and the
responses measured using a Likert scale. Secondary data is to be obtained from literature
review and relevant company documents. Data is to be run in SPSS and analyzed using both
descriptive and inferential statistics.

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Table of Contents
CHAPTER ONE: INTRODUCTION........................................................................................5
1.1 Background Information..................................................................................................5
1.2 Amcor Company..............................................................................................................6
1.3 Structure of the Proposal..................................................................................................6
CHAPTER TWO: RESEARCH PROBLEM AND RESEARCH OBJECTIVES....................8
2.1 Research Problem.............................................................................................................8
2.2 Research Objective...........................................................................................................8
2.3 Research Question............................................................................................................9
CHAPTER THREE: LITERATURE REVIEW......................................................................10
3.1 Introduction....................................................................................................................10
3.2 Definition of information technology.............................................................................10
3.2.1 Information Technology..........................................................................................10
3.2.2 Computer Technology.............................................................................................10
3.3 Impact of IT on an accounting system...........................................................................11
3.3.1 Competitive Advantage...........................................................................................11
3.3.2 Accounting software................................................................................................11
3.3.3 Security....................................................................................................................11
3.3.4 Efficiency.................................................................................................................12
3.3.5 Speed........................................................................................................................12
3.3.6 Accuracy..................................................................................................................12
3.3.7 Enhanced internal and external reporting................................................................12
3.3.8 Flexibility.................................................................................................................13
3.4 Impact of computer technology on employment in the field of accounting...................13
3.4.1 Efficient and More Connected Workforce in the World.........................................13
3.4.2 Accessibility to resources........................................................................................13
3.4.3 Improved Social Association...................................................................................14

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3.4.4 Enhanced Comprehension of Market Conditions, Planning, and Risks..................14
3.4.5 Easy of Payment Systems........................................................................................14
3.4.6 Reduced Risks..........................................................................................................15
3.5 Factors limiting the use of technology in the accounting field......................................15
3.5.1 Technology, Organization, and Environment (TOE) Model...................................15
SFigure 3.1 Conceptual Framework of the TOE Model..........................................................17
CHAPTER FOUR: RESEARCH DESIGN AND METHODOLOGY...................................18
4.1 Introduction....................................................................................................................18
4.2 Research Design.............................................................................................................18
4.3 Target Population...........................................................................................................18
4.4 Sampling Design and Sample Size.................................................................................18
4.5 Data Collection Methods................................................................................................19
4.5.1Primary Data.............................................................................................................20
4.5.2 Secondary Data........................................................................................................20
4.6 Procedure of Data Collection.........................................................................................20
4.7 Data Analysis and Presentation......................................................................................21
4.8 Ethical Issues..................................................................................................................21
References................................................................................................................................22
Appendices...............................................................................................................................28
Appendix 1: Ethical Approval Form....................................................................................28

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CHAPTER ONE: INTRODUCTION
1.1 Background Information
Accounting is the system an organization uses to measure its financial performance by
recording and grouping all the transactions such as assets, liabilities, purchases, and sales in
accordance to the accepted standard layouts (Zimmerman and Yahya-Zadeh, 2011). It assists
in assessing a firm’s past performance, current condition, and future expectations.
Accounting can formally be defined as the art of recording, classifying, and summarizing
essential transactions and activities which are to some extent monetary and inferring the
outcomes thereof (Weygandt et al., 2010). Technological advancements have led to the
transformation of most of the companies in professional services sectors, especially those in
the public accounting sector. The significant changes include the automation of audit tasks
through the use of audit software which has replaced IT for labor and transformed the
framework of audit groups (Cordella and Iannacci, 2010).
Business operations have generally been transformed by computers, the internet, wireless,
servers and individual technical devices. The software packages have also advanced the
conventional business activities. The general paper ledgers and accounting records have been
automated through the use of accounting software. Information technology has brought
critical advantages for accounting departments. The lead time required by the accountants to
prepare and present financial information to the executive and shareholders has been reduced
through the IT networks and computer systems. Additionally, it has enhanced the general
efficiency and accuracy of the submitted information. The most significant impact of IT on
accounting is the ability of firms to cultivate and use computerized systems to trail and note
financial transactions. Manual spreadsheets, paper ledgers, financial statements in hard copy
have all been transformed into computer systems that can show personal sales and financial
reports.

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1.2 Amcor Company
Amcor is a global leader in developing and producing the best quality, ethical packaging for
multiple types of food, beverage, pharmacological, and other products. The organization has
35,000 employees distributed in 43 countries. Samuel Ramsden founded Armco in the 1860s.
The company. Armco has an ultra-modern and functional electronic data processing center in
Melbourne city which houses and processes most of the firms’ data. Other computer
terminals are located in each subsidiary. The organization has automated almost all of its
operations. More specifically, the accounting system of the company is fully automated, for
example, the accounts receivable, all ledgers and inventory. There is a payroll system for all
the employees in the Amcor Company in Melbourne city which is computerized. Computer
application has also been used in inventory, billing, and registration of shares (Amcor, no
date).
1.3 Structure of the Proposal
For clarity, orderliness and useful flow, reading and understanding of the research project,
this study have been structured and sectioned into four chapters with each addressing specific
elements of the topic under investigation. The first chapter comprises of the project proposal
and background information regarding the research. It includes the overall introduction and
background knowledge of the study, and overview of the client organization. Chapter two
involves the research problem, research objectives, and research questions. Section three
provides a review of literature relevant to the study topic with the aim of placing the study
within existing studies and searches existing knowledge in the area of study. Chapter four
presents a detailed plan of research methodology and design. The chapter shows the type of
research and research approach to be undertaken in the actual research. It also describes the
type of data to be used and the procedure of data collection. The proposed sample, sampling
frame, methods and approach to be used in addition to the characteristics of the sample and