Principles of Accounting: Technological Advancements Report

This report delves into the technological advancements transforming the accounting field, focusing on the integration of artificial intelligence (AI) and software automation. It examines how these innovations impact accounting practices, making processes more efficient and reducing errors. The report explores the benefits of AI and automated software, such as time savings and risk reduction, while also addressing implementation challenges. It further analyzes the skills required for accountants in this evolving landscape and discusses the future scope of the accounting profession, including career opportunities and the need for a balance between human expertise and technological tools. The report also provides a comparative overview of accounting practices in Australia and the United Kingdom, offering insights into the global trends and future developments in accounting.

Running head: PRINCIPLES OF ACCOUNTING
PRINCIPLES OF ACCOUNTING
Name of the Student:
Name of the University:
Author’s Note:

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Table of Contents
Introduction...............................................................................................................2
Technological Advancements in Accounts...............................................................2
Analyzing Technological Advancement...................................................................4
Impacts of Technological Advancements in Accounting..........................................6
Accounting Skills, Ethics and Career Opportunities.................................................8
Comparing Accounting Practices of Australia and United Kingdom.......................9
Future Scope in Accounting Profession..................................................................10
Recommendations...................................................................................................11
Conclusion...............................................................................................................12
Reference.................................................................................................................13
Appendix.................................................................................................................15

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Introduction
The main purpose of this report is to conduct a research on what are the scope of
technological advancement of accounting field in near future. The research will also deal with
how such technological innovations in the field of accountancy help the users and accountants
(Bebbington, Unerman and O'Dwyer 2014). The research will also be aiming to reveal the
impacts and effects of technological innovations on the various accounting designations which
will be available in future. The innovations in accounting may be due to introduction of new
techniques such as application of artificial intelligence and use of accounting software
automation.
In todays world the role of technological advancements in the overall development of the
society is crucial. Most of the companies try to bring about innovations in different areas of
business in order to gain an advantage or competitive edge (Weigelt and Sarkar 2012). In
accounting field, innovations has taken place which has changed significant part of the internal
processes of such businesses (Scott 2015). The most common example for such technological
advancements in business is the introductions of computers and different software which
replaced the humans in companies for maintaining the accounting records. The role of
innovations in a business is essential in order for a business to survive and be competitive in this
changing market environment.

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Technological Advancements in Accounts
Accounting may be defined as the systematic process of preparation and presentation of
financial information. A research has been conducted to determine the development of
accounting as professions with the introduction of automated software and Artificial Intelligence
(Anandarajan, Anandarajan and Srinivasan 2012). Most of the larger firms in Australia have
already implemented the automated software and artificial intelligence for the purpose of
accounting. Only the smaller and medium business have not implemented these techniques. As
per the research of the group, there has been wide changes in the accounting field with the
introduction of computers and software for the process of computations and analysis. The
technological advancements of the accounting techniques which has popularized the use of
Artificial Intelligence and Accounting Software automation. Artificial intelligence is the
technology which allows computers to perform tasks which are decision based which was
previously performed by humans (Nilsson 2014). Such a technology gets better and better as it is
used for different decision making processes and analysis tasks. As per recent studies around
80% of company executives are of the opinion that with the introduction of Artificial Intelligence
in a company, the company can gain competitive advantage (Taipaleenmäki and Ikäheimo 2013).
Artificial Intelligence incorporation in accounting process will significantly reduce the amount of
data which are required to be analyzed by the accountants and makes the work of the accountant
easier. Accounting Software Automation refers to the process of incorporating the accounting
procedures to computerized software and programs (Brennan et al. 2012). The application of
software and computer programs in the process of accounting will be reducing the work of the
accountants and make the accounting process more effective and efficient.

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As per the research, the current accounting of the company consists of use of accounting
software and use of computerized system of accounting. These techniques are implemented by
almost most of the companies in Australia. The current accounting practices does not include the
Artificial Intelligence program which is still at its initial stages. The adoption of Artificial
Intelligence in the business of Australia will be taking further time in implementations Sharma,
A. and (Panigrahi 2013). Thus there is scope for introduction of Artificial Intelligence in
Australian companies. The level of skills which are required in the profession of an accountant is
that the accountant must be aware of the necessary standards, conventions and principles which
are currently in force in the country. The profession of accountants are becoming significantly
important these days as the companies are growing continuously as the market is developing.
The role of accountants in the business is important as they are responsible for the preparation
and presentation of the financial statements of the company. As the business are growing the
scope for accounting in such business are also growing. Many businesses have their separate
accounting department with teams performing as per the requirement of the business. The teams
are given the responsibility of preparation of different ledger accounts. Moreover with the
introduction of corporate governance and business accountability, the role of accounting has
become more prominent. Effective accounting of financial information helps in prevention of
frauds and also a means to measure the performance of the company with previous year
performances. As the process of accounting is being undertaken in the computer environment, it
makes the process more systematic and much easier to access. Accounting which utilizes human
resources need to maintain a lot of records which is not required if the company is maintaining
computerized books of accounts for the company. Another element of using automated software

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and Artificial intelligence is that as such technologies are made by humans and therefore are also
subjected to errors which are made by humans.
Analyzing Technological Advancement
The introduction of artificial intelligence and automated software will definitely benefit
the business and also affect the internal structure of the company. The research was conducted by
the group on the future scope of accounting and how the process of accounting can be improved.
The group was surprised to know that most of the companies already have implemented the
automated software and Artificial Intelligence techniques in order to make their accounting
process more systematic. Another thing which was identified were that some business are finding
it difficult to implement the new strategy as it is still in its initial process. The group identified
certain benefits which are associated with the implementation of automated software in
accounting process which are discussed below:
1. Time Saving: With the use of Artificial Intelligence in the accounting processes, the
management can save a lot of time. The accounts departments are required to maintain
the books of account which if maintained physically requires a lot of time. In case of
computerized environment, time for preparation and maintenance of financial statements
is considerably reduced.
2. Elimination of Risks and Mistakes: With the introduction of computerized system and
automated software the risks associated with the physical book keeping of accounts are
minimized. In a computerized environment there is no chances of mistakes like
computation error and omission of a transactions (Hilton and Platt 2013). In
computerized system of accounting, software packages are such that if the accountant
enters one transaction then all the ledgers accounts associated with the transactions get

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automatically updated, hence there is no chance for omission of any transactions. For
example, when a purchase entry is recorded than all the ledgers which are related to the
entry like purchase account, cash account, creditors account in case of credit purchases,
discount receivable account. These accounts are updated automatically with one entry.
3. Simplicity: The entry of accounting information in a computerized environment brings
about simplicity in accounting process.
As per the research, the group has discovered that though the accounting system with the use
of software and artificial intelligence may have many benefits but it is not perfect. The system
has still at its initial stages and thus there is an implementation issue. The system is also quite
costly and thus small business will have problems in adopting the system.
Impacts of Technological Advancements in Accounting
The technological advancements which have occurred in the recent times have changed
the business structure and have provided businesses means to overcome the continuous changes
which are occurring in the market. The new technology artificial Intelligence is widely used
nowadays in mobile phones, computers, software. Artificial Intelligence has voice recognition
and voice command functions which are quite useful. Moreover artificial intelligence is very
useful when it comes to the development of new products.
In the case of accounting practices, in order to use a technology like artificial intelligence
in accounting process the accountants need to have adequate knowledge and confidence to deal
with the new technology meanwhile training the new accountants for the same technology. Some
of the business does not accepts such changes easily, they continue to follow the old techniques
until they are outdated. Such business need to apply the new changes and implement them

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effectively in order to gain advantage from the use of such technologies. The accountants of the
business need to view such changes as opportunities and not as threats and develop the overall
recording and analyzing structure of accounting in the organization with the help of the new
technology. Most of the countries are considering new approaches which can further develop the
accounting structure of the business. Accounting bodies around the world are of the view that the
answer to the development lies with the introduction of computer based software and artificial
intelligence for accounting purposes. Many countries have already implemented the strategy and
doing well with the new software. Such accounting software can be tally, ERP system, Expert
System and other systems as well (Schorr et al. 2013). These software when used by companies,
reduces the workload of the accountants and add more value to the financial reports preparation
process. The accountants always are in the process to add more value the business which can be
done by the implementation of the computer based software in the companies (Salsburg, Unisys
Corp 2014). The basic benefits which artificial intelligence can bring about in a business are that
such programs are extremely accurate and gives the correct results in most case scenario. These
programs are not time consuming and also saves some resources of the business. Artificial
intelligence may be good but it cannot exceed the intelligence of a human and thus it cannot be
expected that such a program will replicate a human intelligence. Thus it is clear from the
research that the company needs to strike a balance in the work place where such computer and
humans can work together in collaboration and provide the best results for the organization.
As per the head of accounting of Xero UK, artificial intelligence is the future of
accounting and in coming years the demand for the same will be immense in every company. He
also believes that the introduction of Artificial Intelligence will be beneficial to both large and
small companies. The basic strength of Artificial Intelligence is to provide simplified versions of

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solutions. Another key advantage of using the program is that it saves time of the business. As
per the head of accounting of Xero UK, as more and more time is saved in the business, this
gives an opportunity to business to focus on their revenues and costs which in turn will be
creating true value in the organization. Xero Tech week also estimated that the artificial
intelligence program will be demanded significantly in near future and that to so much that there
is a high possibility of getting close to $400 billion by 2020. In addition to this artificial
intelligence can bring about automation of software which can be used in the accounting
processes (Wenger 2014). Therefore it can be said that the future of artificial intelligence in the
field of accountancy looks bright and it is hoped that the same will be bringing about significant
developments in the field.
Accounting Skills, Ethics and Career Opportunities
Accounting Skills Required
The accounting profession has become very popular in the recent times. The job position
of an accountant has been attracting a lot of potential students in Australia to take the course of
accounting in order to take up the post of an accountant in near future. However some basic
skills are necessary for the candidates which the profession demands in this new technologically
advanced era. As per the analysis and market survey the following requirements are there which
can make an individual eligible for the post of accountant:
1. The first requirement for any candidate is to get a degree in the field of accounting and
finance which may be a bachelors in Commerce or business.

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2. The second requirement is not as necessary as the first one which requires a person to
have some working experience in the field of Accountant.
3. Attaining a master degree really provides value to the name. This again is not a necessity
but is optional.
4. Another optional requirement can be getting a certificate showing that a person is fit for
the job of an accountant.
5. Moreover the candidate should be acquainted with the application of software like tally,
ERP and also have a knowledge about automated accounting software and artificial
intelligence.
Ethics in Accounting
The accounting profession is a popular choice for employment due to the fact that the
profession has integrity and significant role in measuring the financial performance of any
business. The accounting profession follows certain standards which are placed by the country or
can follow the International Financial Reporting Standards (IFRS) (Ahmed, Neel and Wang
2013). These standards set the ground rules which every accounting professionals are expected to
follow while preparing the financial statements of the company. In Australia the accounts of the
company are prepared by following AASB standards (AASB, C.A.S 2014). The companies in
Australia have mostly computerized system of recording of financial information and therefore
the candidate out there needs to have knowledge of the automated software which are used in
such companies.
Career Options in Accounting

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There is a plus point for the candidates which are pursuing accounting profession which is
there are a lot of job openings for the post of accountants in Australia. There is huge demand for
accounting professionals in the Australian companies. Research shows that with the advent of
new technological improvements and overall market development there has been a boom in the
job opportunities for finance professionals in the Australian market.
Comparing Accounting Practices of Australia and United Kingdom
It is not just in Australian markets but also in United kingdom the demand for accounting
professional are immense. The demand for new accounting professionals is created due to new
companies being established or the overall development and expansion of the business market in
UK. As per the analysis of the accounting market in United Kingdom, there is wide scope of
opportunities for any individual seeking accountant profession. The companies in United
Kingdom have already implemented the use of computerized packages for accounting purposes
and such companies require individuals to have appropriate knowledge of such software. The
group conducting the research is of the view that the markets of both UK and Australia are
suitable for candidates who are interested in accounting profession as there is lot of scope in the
accounting profession in recent times. The Accountants of United Kingdom follow the standards
issued by the Chartered Accountants of England and Wales. Similarly in Australia firms follow
standards od ASB. The accounting treatments in both the countries are mostly similar as well as
the common fundamental principles and conventions set by IFRS is also followed.
Future Scope in Accounting Profession
The demand for the accounting profession in recent times has increased more and more
with the development of the business market, establishment of new companies, technological

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changes in the accounting field. The accounting professionals are growing as the job has a decent
career prospect and has very comfortable salary in Australia. Not only in Australia but also in
other countries the profession is thriving. The demand for the profession has become so much
that the hiring managers are having difficulties in identifying the talents which they require and
which will be suitable for their organization. As the technology of the country improves the need
for accounting professionals also increases. In other words when a new technology is introduced
than this will be giving more data and information than the previous technique used by the
company. This new data and information need to be analyzed and interpreted for which the role
of accountants becomes crucial. These analysis are crucial because the investors and the
management will be taking important decisions on the basis of this interpretation of the financial
data. As the business are growing the scope for accounting in such business are also growing.
This brings room for implementation of new technologies which can improve the internal
structure of the company. Such new technology can be implementation of artificial intelligence
and use of automated software such as ERP system, Expert System (Madapusi and D'Souza
2012). In the case of accounting practices, in order to use a technology like artificial intelligence
in accounting process the accountants need to have adequate knowledge and confidence to deal
with the new technology meanwhile training the new accountants for the same technology.
Therefore for accountants which are entering a business where such automated software or
artificial intelligence are already implemented than the business needs to provide adequate
training to the new accountants for the software the company is using. The training is provided to
the new accountants in order to ensure that they develop the skills required to work with the
software. Once the training is complete the effective and efficient utilization of the software can
be ensured in the company. Therefore it can be said that the future of artificial intelligence in the