Research: Impact of Accounting Information System on Performance

This research report investigates the impact of Accounting Information Systems (AIS) on organizational performance. The introduction establishes AIS as a technological process for tracking accounting activities, highlighting its role in collecting, storing, and processing financial data. The project aims to evaluate AIS's impact, identify implementation barriers, and recommend strategies for overcoming them. The literature review covers the concept of AIS, its advantages like reliability and effective analysis, and its impact on internal operations, financial data storage, and data accuracy. It also addresses barriers to implementation, such as economic constraints. The report emphasizes the importance of AIS in providing accurate financial data, improving decision-making, and enhancing overall organizational success, while also acknowledging the challenges some organizations face in adopting AIS. The report concludes by summarizing the key findings and implications of the study. This report offers valuable insights into the benefits and challenges of implementing accounting information systems, providing a comprehensive overview of its impact on organizational performance.

Running head: RESEARCH
Research
Name of the Student
Name of the University
Author’s Note

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Table of Contents
1. Introduction:................................................................................................................................2
2. Project Objective:........................................................................................................................3
3. Project scope:...............................................................................................................................3
4. Literature review:.........................................................................................................................4
5. Conclusion:................................................................................................................................11
Reference List:...............................................................................................................................13
Appendix: Timeline of the research proposal................................................................................16

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Research Topic: Impact of accounting information system on organizational performance
1. Introduction:
Accounting information system is the technological procedure of tracking accounting
activities in conjunction with the resources of information technology. This technological
process primarily collect, store and process financial data used by the internal users. With the
gradual economic swing of market and competitive market threat business organizations focus
on developing their internal resources in order to make the entire operation of business more
systematic and dynamic. The emergence of accounting information system has rendered a radical
change on the overall performances of business organization (Laudon & Laudon, 2016).
Accounting information system not only provides an effective overview about the financial
statement. This very specific method plays the role of an analysis tools. For an example, the
database that is created though AIS is able to give vast vista about the profit, loss, or balance of
the business organization.
In quest of maintaining the chronological data of finance the business experts initially
intended to hire large number of human resources within finance department. The
implementation of accounting information system has made the entire business method more
systematic. The data gathered from AIS is not human created. Therefore, the business experts
can get accurate and intact data from AIS. This accuracy of data and information leaves a major
positive impact on the overall success of the organization (Speklé & Verbeeten, 2014). The
organizations do not have to invest large amount of money behind labor force. In addition, the
entire service process of AIS is fast and accurate which resulted a positive impact on
organizational performance. This very specific study has focused to make detailed overview

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about the impact of accounting information system in organizational performance. At the same
time, it is undeniable that some of the business organizations are there, which are still unable to
implement AIS, due to some constraints.
2. Project Objective:
The primary objectives of this specific project are as follows:
 To evaluate the impact of accounting information system in overall organizational
performance
 To identify the factors that create barriers in implementing accounting software system
within organization
 To provide some of the major recommendations on how to overcome those barriers by
implementing effective strategies
3. Project scope:
The primary goal of this project is to evaluate the impact of accounting information
system in overall organizational performance. In order to accomplish this very specific project
the researcher would have to face several constraints in collecting appropriate data and
information from the respondents due to their lack of knowledge in this specific research area.
Still the project is expected to be successful due to its synchronized execution. The budget of the
research would have to be high in terms of data collections and resources. The entire project
timeline should be vaster in order to gather sufficient information from various responses. If the
researcher can maintain an appropriate ethical consideration, while collecting necessary data and
information from the respondents the entire project has enough scope to be successful. Ethical

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consideration implies following data security act, data protection act, keeping up the freedom of
participants and so on.
4. Literature review:
4.1 Overall concept of accounting information system
Accounting information system incorporated within information technology is the tool
that helps the management in controlling the financial areas. Collecting financial data and storing
these data for making the decision of financial executives and auditors are primary function of
accounting information system. Accounting as opined by Franco-Santos et al., (2012), could be
identified among three components including information system, language of business and
source of financial information. Source of financial information is the primary concern for every
single business experts of different organizations. Financial information is transformed to data
and this data is presented in front of the finance heads for making effective decision regarding
the profitability of business. AIS (accounting information system) is the combination of
methodology, accounting technique and technology for IT industry.
Libby (2017) stated that the primary function of this specific method is to track
transactions, provide internal reporting data, external reporting data, financial statements, and
trend analysis capabilities to affect on organizational performance. At the initial stage of business
scenario, the organizations had to face immense challenges in maintaining their financial
statement within accurate data. Based on the financial statement the decision making process of
business experts are highly dependent. As the business experts are not very much focused in
maintaining the advancement of technology they failed to deliver accurate financial data.

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However, implementation of accounting information system has rendered immense accuracy in
financial data, balance sheet and keeping a transaction tracks.
4.2. Necessary advantages of accounting information system
Christensen and Feltham (2012) emphasized in this context that accounting
information system is endowed with numerous advantages based on which the organization can
keep a constant data about their financial record. Accounting information system has made the
entire business process more systematic. The business experts are easily able to keep a
chronological data record by using this information system. As a result, business managers do
not have to face challenges in getting an overview about the financial database. However, most
significant advantages of advantages of accounting information system are as follows:
Reliable:
This particular method is reliable enough for business organizations in maintaining
financial data record. Worrell, Wasko and Johnston (2013) opined that if the business managers
have any doubt about the figure mentioned in the data record the person can verify the data with
proper documentation. This specific method can give a detailed overview on how the data is
calculated. In most of the recognizable accounting department reconciliations within the
accounting system are made in order to assure reliability and accuracy of information.
Effective analysis tool:
Accounting information system not only provides an effective overview about the
financial statement. This very specific method plays the role of an analysis tools. For an
example, the database that is created though AIS is able to give vast vista about the profit, loss,

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or balance of the business organization. Laudon and Laudon (2016) stated that the managers do
not have to be dependent on the exact figure. They event do not have to analyze the data from
their own mind. The entire financial gaps, gross profit, scope of improvement are categorically
mentioned within the method of accounting information system. As a result, it is very much
beneficial for the organization in maintaining detailed evaluation about the business profitability.
As pointed out by Collier (2015), technological devise cannot be the substitute of human
mind. Despite having several benefits of using accounting information system human resource
is the most effective path of evaluating financial data. The decision making process of the
business experts also become very strong and logical. However, Speklé and Verbeeten (2014)
has strongly differed the opinion of previous scholar. Human resource would never be able to
process the entire database within this limited time that an information technology system is able
to do. As a result, business experts are able to make their entire process of business more
dynamic and systematic. Based on the financial data record the organizational managers have to
make their own strategic decision. Caniëls and Bakens (2012) opined that the retail business
industry in the global market is very much dependent on accounting information system in
order to maintain their chronological data record effectively. However, this very specific study
has focused to provided detailed analysis about the impact of accounting software on the overall
performance of business. Woolworths being one of the most prestigious retail brands of Australia
tends to publish their financial statement by using this method of AIS.
4.3 Impact of accounting information system on organizational performances
Numerous eminent scholars have provided their own point of view while evaluating
Impact of accounting information system on organizational performances. Popovič et al.,

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(2012) opined that AIS has left immense positive impact on organizational performances. The
primary impacts that accounting information system leaves on the overall performances of
business are as follows:
 Controls the internal operation procedure:
The primary functions that are controlled with the help of AIS process include budget
preparation for expanding the entire business process. Based on the internal resource, cash, rate
of organizational debt and procurement the budget of the organization is prepared. Flamholtz
(2012) opined that AIS primarily collect the raw data on how much debt the organization is
currently dealing with. Based on that very specific data and information the organization would
like to focus on monitoring and auditing their entire database. AIS primarily helps to make the
entire internal audit within stipulated time by maintaining the accuracy of data. As a result, the
business experts do not have to face challenges in getting overview about the ways of their
improvement.
Figure 1: Primary function of accounting information system
(Source: Zadek, Evans & Pruzan, 2013)

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 Accounting assets are appropriately stored:
Kleis (2012) stated that AIS helps to store the entire financial database chronologically
which gives a detailed overview to the organizational about their way of success. This particular
technological method can present the data and information from every year. If the business
experts need to go though the audit report three years before, AIS can easily store that data and
information. As a result, organizational managers can evaluate their performance record. Based
on the previous year performances, the managers aim to give better performance in comparison
to the last year. As a result, it ultimately enhances the performance level of the organization.
 One time investment:
Implementing accounting information system within the organization is a matter of big
expense that the organization may not have. On the other hand, it is also undeniable that
accounting software is one time investment. Galliers and Leidner (2014) opined that if the
business experts tend to invest money behind this resource for once the organization would be
able to reduce the labor cost. As a result, the budget saved from the cost of labor can be utilized
in business expansion. Ultimately, the organization faces positive impact after implementing AIS
within the operation system.
 Maintaining accuracy of data and information:
Accounting information system is effective enough in maintaining data accuracy as well
as chronology. The data gathered from AIS is not human created. Therefore, the business experts
can get accurate and intact data from AIS. Chae, Koh and Prybutok (2014) opined that this
accuracy of data and information leaves a major positive impact on the overall success of the
organization. Business managers get proper and accurate data about the financial and business

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profitability. Based on that data the managers tend to estimate their budget for business
expansion and promotional activities. In this kind of situation, the organization would not have to
face immense challenges in reaching the organizational goal. Lunardi et al. (2012) opined that if
the estimated budget would be high in comparison to the financial profit, the organization may
have to face immense challenges in rendering success. However, implementation of AIS has
made the financial database chronological and systematic. As a result, the organization can easily
maintain their business sustainability.
4.4 Barriers in implementing accounting information system within the organization:
After evaluating the point of views of different conspicuous scholars, it has been
observed that accounting information system has immense positive impact on organizational
performance. At the same time, it is undeniable that some of the business organizations are
there, which are still unable to implement AIS, due to some constraints:
Economic constraint:
Economic constraint is one of the most significant factors due to which business
organizations are unable to implement AIS method. Yigitbasioglu and Velcu (2012) stated that in
order to implement this information technology within organizational devices and to maintain its
updated method the business experts have to bear large amount of money. As a result,
organization may not be successful to afford that much amount within business process.
Lack of proper training:
Moser and Martin (2012) stated that lack of proper technological skill and competency is
one of the most effective factors based on which employees fail to maintain proper database even

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after implementing AIS. Large number of senior employees is there within the organizations who
are not accustomed with the advancement of technology. As a result, they have to face
challenges in maintaining proper database by using advanced technology. As a result, the entire
delivery of services become very much delayed.
Technological error:
If the organization has to face any kind of technological crisis, the business experts would
have to face innumerable challenges in getting organizational data. Accounting information
system cannot be run successfully without a proper configured device. As a result, technological
error can stop the entire flow of business. Drury (2013) opined that the business managers are
unable to get appropriate data and information at their required time. As a result, both the
customers and the service providers have to face challenges in maintaining an effective rapport.
Managers would have to struggle in gathering financial data properly due to this technical error.
After evaluating a critical analysis, it is observed that business experts may not be
efficient with the advancement of technology. Fullerton, Kennedy and Wideners (2014) opined
that appropriate executive of technology would be challenging for them. As a result, organization
has to suffer in maintaining financial database. In this kind of situation, the study has focused to
recommend some of the most effective ways of overcoming these challenges. However,
appropriate training and development session may help the employees in getting in-depth
knowledge in this very specific sector. Yu, Duan and Cao (2013) stated that organization can
hire a professional expert who would help the employees in enhancing their technological
competency.

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4.5 Literature gap:
The study has focused to provide detailed overview about the impact of accounting
information system on the overall business enhancement. It is observed that with the gradual
economic growth of market and competitive market threat business organizations focus on
developing their internal resources in order to make the entire operation of business more
systematic and dynamic. The study has analyzed some of the most effective advantages of AIS.
Accounting information system has made the entire business process more systematic. The
business experts are easily able to keep a chronological data record by using this information
system. As a result, business managers do not have to face challenges in getting an overview
about the financial database. Still, this very specific literature review is not devoid of some of its
major limitations. The study has evaluated some of the most effective barriers for implementing
AIS within the business process. The article after identifying the barriers has not provided some
of the major recommendations on how the organizations would be able to overcome those
barriers.
5. Conclusion:
The entire study has given detailed overview about the impact of accounting information
system in overall organizational performance. After conducting an in-depth literature review by
involving the numerous eminent scholars it can be concluded that accounting information system
has immense positive impacts in overall organizational performance. On one hand, the
implementation of this process can help the business experts in reducing their cost behind human
resources. On the other hand, the emergence of accounting information system has made the
entire process of business more systematic and rhythmic. The organization does not have to face
challenges in maintaining the database.