Analyzing Accounting Information System Impact on Retail Profitability

This report examines the impact of Accounting Information Systems (AIS) on the profitability of retail businesses. It begins with an executive summary highlighting the benefits of AIS implementation, such as faster and more efficient operations. The report then provides a summary of the theory and progression in the field, common and different themes across selected articles, and managerial implications. Key themes include the changing retail sector, indicators of retail performance, the relationship between AIS and productivity, and the use of AIS in retail businesses. The report also discusses regulatory environments, AIS in small businesses, and trends in online retailing. The findings suggest a positive correlation between AIS implementation and improved profitability, offering insights for managers to enhance financial performance through technological advancements. The report concludes with research limitations and proposed future directions.

Running head: ACCOUNTING INFORMATION SYSTEM IMPACT IN IMPROVING
BUSINESS PROFIT
The Effect of Accounting Information System in Improving Business Profit: A Case Study on
Retail Industry
Name of the University:
Name of the Student:
Authors Note:

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PROFIT
Executive Summary
Implementation of such technology in the accounting system is deemed to make the operations
of business faster, simpler and better in several ways. Research on this field has progressed over
years where it is evidenced that for increasing profitability of a business the accounting process
of the companies must be improved From analyzing the findings of the selected four articles
several effective managerial implications have been deduced that is intended to offer better
strategies in developing effective accounting information system that can further improve
business profit. The findings of these articles also revealed that implementing technologically
advanced Accounting Information System also contributes in increasing profitability with
maintaining information accuracy and maintaining accounting process faster than human
capability.

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ACCOUNTING INFORMATION SYSTEM IMPACT IN IMPROVING BUSINESS
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Table of Contents
Summary of Theory and Progression in Selected Research Field...................................................3
Common Themes across Selected Articles......................................................................................3
Theme 1: Changing Retailing Sector...........................................................................................3
Theme 2: Indicators of Retail Performance.................................................................................4
Theme 3: Accounting Information System and Productivity......................................................4
Theme 4: Accounting Information System in Retail Businesses................................................5
Different Themes across Selected Articles......................................................................................5
Theme 1: Regulatory Environment of Australian Retail Industry...............................................5
Theme 2: Accounting Information System and Profitability in Small Scale Businesses............6
Theme 3: Accounting Information System and Productivity of All Businesses.........................6
Theme 4: Trends and Issues in Online Retailing.........................................................................7
Managerial Implications of Selected Articles..................................................................................7
Research Limitations and Future Directions Proposed in Selected Articles...................................8
References........................................................................................................................................9
Bibliography..................................................................................................................................10

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Summary of Theory and Progression in Selected Research Field
With technological advancement all the business activities based aspects have bee
changed. Technological changes in the major business processes are observed to have impact on
the success of the business in the global competitive environment. Moreover, it is gathered from
existing researches that technological innovations within businesses is affected through several
changes and innovation (Urquía Grande, Pérez Estébanez and Muñoz Colomina 2011).
Considering such situation, technology within the accounting process is vastly employed in the
current years that manage day to day transaction and storing in the clouds. Implementation of
such technology in the accounting system is deemed to make the operations of business faster,
simpler and better in several ways.
Research on this field has progressed over years where it is evidenced that for increasing
profitability of a business the accounting process of the companies must be improved (Kapute
Mzuzu, Maureen 2014). This is for the reason that the accountant re responsible for having
understanding on the company’s current profitability along with the strategies employed by the
companies in increasing its profit in the near future. In ensuring same, the companies must
implement efficient technology that makes the recording simpler, better, faster along with safer
that further assists in better decision making.
Common Themes across Selected Articles
Theme 1: Changing Retailing Sector
Four of the articles that were selected explaining the ways in which trends are changing
in the retail sector that is affecting performance of these companies Urquía Grande, Pérez

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Estébanez and Muñoz Colomina (2011) explained that retailing industry of Australia is changing
with respect to increased competition and because of increased popularity if online shopping. It
has been gathered that due to such situation regulators are focusing on offering information to
improve understanding of the online shoppers regarding goods purchased overseas aligned with
Australian safety standards along with existence of complexities in goods exchange and
arraigning refunds. Industry (2011) stated that due to changing retail business landscape these
companies are considering to improve their systems along with data processing capacity in
aligning with their information needs.
Theme 2: Indicators of Retail Performance
Kapute Mzuzu, Maureen. (2014) revealed that entry barriers might be low in certain areas
of retail sector and there are certain indicators which indicate barriers might be high in some
sectors. These articles revealed that one such retail performance indicator is high profitability of
Austin retailers in contrast to the global retail sector. Urquía Grande, Pérez Estébanez and
Muñoz Colomina (2011) explained that high shareholder funds of the Australian retailers than
the European and North American retailers also serves as an effective indicator off retail
performance.
Theme 3: Accounting Information System and Productivity
Kapute Mzuzu, Maureen. (2014) elucidated that there is a positive relationship between
Accounting Information System (AIS) and productivity of the retail companies. It has also been
revealed that IT based accounting systems implementation has resulted in decrease of the labor
costs and time that has improved productivity of retail companies. Urquía Grande, Pérez
Estébanez and Muñoz Colomina (2011) added that the retail companies consider using AIS
technology in order to observe improvements in its fiscal management process that can

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effectively contribute positively to its economic returns, financial profitability as well as
productivity. These articles have also elaborated that the retail companies implement AIS in their
accounting attaining higher and positive figure in consideration to other company groups that
indicate low average.
Theme 4: Accounting Information System in Retail Businesses
From analyzing four of the selected articles it has been gathered that retail business
employ technologically modified AIS or better evaluation of their business performance along
with accounting information as an effective accounting delivery stream. Urquía Grande, Pérez
Estébanez and Muñoz Colomina (2011) revealed that in the retail business scenario, accounting
systems is observed to deal with economic events along with transactions and most of them take
place from daily business environments.
Different Themes across Selected Articles
Theme 1: Regulatory Environment of Australian Retail Industry
The article “Effects of accounting information system on organizational profitability”
revealed that ensuring the quality of the flow of new regulation in the retail industry is deemed
important. Patel (2015) also stated that for measuring successful implementation of AIS in the
accounting processes of the retail organizations, they must consider dealing with lack of
consideration of alterative options, lack of consultation along with maintaining improvements of
the Regulator Information Systems processes. Government can facilitate the retailers in attaining
competitiveness through ensuring retailer flexibility by making necessary changes in the
Austrian retail regulatory environment through implementation of AIS. Implementation of
effective AIS can facilitate in operating, shopping hours and workplace practices.

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Theme 2: Accounting Information System and Profitability in Small Scale Businesses
The article “The impact of Accounting Information Systems (AIS) on performance
measures: empirical evidence in Spanish SMEs” explained that AIS investment in the small scale
businesses can contribute to attain leverage for attaining a stronger and highly flexible corporate
culture in order to effectively deal with constant changes in business environment. Urquía
Grande, Pérez Estébanez and Muñoz Colomina (2011) stated that information society along with
innovative computer tools have facilitated the small scale companies in making efficient use of
their accounting systems in relation with their consumers and the suppliers. These researchers
also explained that advancement in electronic banking facilitates the retail companies in attaining
time saving advantages in their transactions along with attaining improved tax management
through AIS implementation.
Theme 3: Accounting Information System and Productivity of All Businesses
The article “Economic Structure and Performance of the Australian Retail Industry”
revealed that implementation of AIS has a vital role in economic and social systems management
of the retail companies. This facilitates in better decision making process. Industry (2011) also
added that the Australian policy makers and the government must consider AIS implementation
in business environment. Such policies can encompass equipments tax reductions that can be
used in AIS successful implementation. It has also been revealed that Is small Austral businesses
do not implement AIS in their business operations this has resulted in poor performance resulting
from poor record keeping of business information. The article also elucidated that AIS is needed
in all the businesses sectors for maintaining efficient business of goods and services, requested
payments along with better cash transfer facilitation.

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Theme 4: Trends and Issues in Online Retailing
The article “Impact of Accounting Information Systems on Profitability of Small Scale
Businesses: A Case of Kampala City in Uganda. International Journal of academic research in
management” expained the trends and issues in the Australian online retailing that has
necessiated the imlementation of AIS in the acounting prycesses of the companies. This artcle
also focussed on explaining the cost of community outweighs the advantages relaed with import
restrictions. This is conisdered to prevent the rrtailers from importing as well as selling clothing
as well as other goodss that is observed in the retailers multichannel establhsments. In addition,
Kapute Mzuzu, Maureen. (2014) also reveaked that the nline reai prtces through implementtaion
of AIS technology needs skilled resources that are short in supply and for this reason there must
be suitable sequebcing and prioterisation of the refirm of review efforts.
Managerial Implications of Selected Articles
From analyzing the findings of the selected four articles several effective managerial
implications have been deduced that is intended to offer better strategies in developing effective
accounting information system that can further improve business profit. The findings of these
articles also revealed that implementing technologically advanced Accounting Information
System also contributes in increasing profitability with maintaining information accuracy and
maintaining accounting process faster than human capability (Kapute Mzuzu, Maureen 2014).
With having numerous benefits of implementing technologically advanced accounting
information system can facilitate in increasing business profit through speeding up the recording,
processing, decision making along with implementation time. Such findings confirmed that there
is a positive link between the Accounting Information System and the companies’ profitability
within the retail sector. Such findings can be helpful for the managers in the retail sector in

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PROFIT
improving company profitability through making technological advancements in the accounting
information system implementation.
Research Limitations and Future Directions Proposed in Selected Articles
From analyzing the research and the findings gathered from the four selected articles it
has been revealed that there are certain limitations in the existing researches that is proposed to
be addressed through future research directions. Analysis of the literature presented in these four
articles it has been gathered that there exist certain limitations regarding explaining the ways in
which AIS implementation can offer better financial and economical results for the company in
monitoring its effective performance (Urquía Grande, Pérez Estébanez and Muñoz Colomina
2011). Moreover, they also had a gap in explaining the ways in which AIS is implemented
internationally in comparison to the retail companies that re just employing such accounting
technology for fiscal management. Moreover, these articles also had a limitation in explaining
the importance of well-designed strategy for supporting investment in AIS. Based on such
findings, the future research intends to conduct analysis on regression between the performance
indicators and the companies productivity along with use of Accounting Information System
through considering the time variable. Future research will also focus on providing value added
along for the retail practitioners in the accounting field along with explaining the relationship
between the implementation of AIS along with performance and productivity indicators existing
for the companies.

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References
Industry, A.R., 2011. Economic Structure and Performance of the Australian Retail Industry.
Kapute Mzuzu, Maureen., 2014. Impact of Accounting Information Systems on Profitability of
Small Scale Businesses: A Case of Kampala City in Uganda. International Journal of academic
research in management. Volume 3. ISSN: 2296-1747.
Patel, F., 2015. Effects of accounting information system on organizational
profitability. International Journal of Research and Analytical Reviews, 2(1), pp.168-174.
Urquía Grande, E., Pérez Estébanez, R. and Muñoz Colomina, C., 2011. The impact of
Accounting Information Systems (AIS) on performance measures: empirical evidence in Spanish
SMEs.

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ACCOUNTING INFORMATION SYSTEM IMPACT IN IMPROVING BUSINESS
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Bibliography
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