Impact of New Technologies on Accounting: An Analysis

This essay provides an in-depth analysis of technology's impact on accounting. It examines how new technologies have influenced various aspects of accounting, both positively and negatively. The essay highlights the benefits of technology, such as virtual document storage, the elimination of bureaucracy through online platforms, increased efficiency, and cost-effectiveness. It also addresses the negative impacts, including security concerns, the costs associated with implementation and maintenance, and the rapid pace of technological change. The essay concludes that while there are challenges to adopting technology-based accounting, its importance for companies is crucial to avoid financial losses. The essay references several sources to support its claims, providing a comprehensive overview of the subject.

How does technology impact accounting

Contents
INTRODUCTION.......................................................................................................................................3
MAIN BODY..............................................................................................................................................3
CONCLUSION...........................................................................................................................................5
REFERENCES............................................................................................................................................6

INTRODUCTION
The essay is based on analyzing impact of new and advanced technology on accounting. In
current time period there are numerous kinds of technologies which is affecting to aspect of
accounting in both positive and negative manner. In most of the entities, advanced technology
based accounting is being applied for better result.
MAIN BODY
“Impact of technology on accounting”
The greatest influence which new technology has made on finance is the willingness of
businesses to create and use computerized processes to monitor and document banking
transactions (Liucheng, 2018). New information technology platforms and automated systems
also reduced the time taken by auditors to plan and introduce financial reports to managers. In
order to adapt to business trends and the demands of consumers, accountants need to stay up to
date with technical developments. The manner in which accounting is conducted today has been
led by technical advancement. Efficiency and organization is strengthened by digital resources
and web platforms.
Positive impact of technology on accounting:
Virtual storage of documents- It's a costly and time-consuming job to maintain paper notes. And
there are other problems, such as physical space, to remember. Physical storage has increasingly
been replaced by digitizing records. One such advantage is speed of connectivity, and there are
many more, especially with the use of cloud services.
Elimination of bureaucracy through the use of platforms- Technology based accounting systems
are easy and simple networks that provide consumers with distribution channel as well as
records, documentation and any other digitally content conduits (Natu, 2019). This versatility
removes bureaucracy levels and thus reduces time. Online management tools are also offered by
these networks that support finish the project and accomplish goals.

Information- Managers can view a wide range of on-demand documents and in more depth than
under a hierarchical framework. Credit management is typically strengthened and workers are
able to react rapidly and reliably to account requests, providing higher customer support. If other
workers are able to import raw files to their computers, there may be less physical contact
between various parts of the company, and accounting employees may thus feel less respected.
Cost effectiveness- It may be expensive to employ an in-house bookkeeper or outsource the job
to a bookkeeper or accounting company. The software package has an initial expense that will
need an accountant to be contracted to set up the books and coach the company owner to use the
system, but then it becomes cost-effective easily. Further than the computer acquisition and
configuration, the owner doesn't have to charge for it. Many applications have operated for
decades with web browsers which need an affordable update only periodically at lower cost.
Negative impact of technology on accounting-
Security- In a computerized accounting, the safety of the accounting records is limited to the
consistency of the scheme itself as well as the security framework of the business (Zhang, Dai
and Vasarhelyi, 2018). A poorly secured software and directory leaves attackers or unauthorized
employees a permission to connect all the financial records of the organization. If their
confidential financial data is acquired, this information will be used for malicious reasons that
may harm the business or the staff. Work with the technical experts to build a monitoring scheme
that safeguards the accounting data from both foreign hackers and unwanted internal access to
prevent security issues. This usually requires an internal access control shield to deter hackers
and strong passwords.
Cost- If the corporation only uses computers for other activities; it might not be a major cost to
expand its usage to the finance department. Even so, for tools, facilities, security services and
personnel preparation, there will be an investment costs and a continuing financial burden.
Established workers will need practice and not all of the workforce will be able to transition to
the new scheme. When computer technology has been completely introduced, company will
need fewer workers to run it on a regular basis; despite the financial savings, this causes a human
expense.

Regular changes in technology- Technology based accounting systems can become obsolete over
time and technology shifts quickly (Azudin and Mansor, 2018). Compared to modern
applications, the flexibility of an older device is reduced. This suggests that you either continue
to run with less features on the machine or expend the money on updating to a new version or
system. Moving the old information from the existing system will also be difficult if you move to
an entirely new accounting system.
CONCLUSION
On the basis of above essay this can be concluded that though there are some limitations to adopt
technology based accounting but it has crucial importance for companies. If business entities will
not adopt advanced accounting than this may lead to financial loss of company. Hence, there is a
significant impact of technology on accounting.

REFERENCES
Liucheng, Z., 2018. Application Prospect of Block Chain Technology in Accounting Industry.
In 2018 International Conference on Mechatronics Engineering and Computer Sciences
(ICMECS 2018). IEEE (pp. 559-562).
Natu, P.R., 2019. Impact of Block-chain Technology on Accounting and Finance. Journal of the
Gujarat Research Society, 21(16), pp.119-123.
Zhang, C.A., Dai, J. and Vasarhelyi, M.A., 2018. The Impact of DisruptiveTechnologies on
Accounting and Auditing Education: How Should the Profession Adapt?. The CPA
Journal, 88(9), pp.20-26.
Azudin, A. and Mansor, N., 2018. Management accounting practices of SMEs: The impact of
organizational DNA, business potential and operational technology. Asia Pacific
Management Review, 23(3), pp.222-226.