BUSN20016 Research: The Impact of Technology on Accounting Industry

This report investigates the impact of technology on the accounting industry, focusing on its effects on operations and professionals. It examines the evolution of accounting from manual systems to computerized systems, highlighting the influence of information technology, accounting information systems, and evolving technologies like Artificial Intelligence. The report discusses the advantages and disadvantages of technological innovations in accounting, including cloud computing, enterprise resource planning, and forensic accounting. It also explores the impact of technology on accounting firms and develops hypotheses for further research. The methodology section outlines the research approach, data collection, and analysis techniques, including a Gantt chart and project budget. This student-contributed document is available on Desklib, a platform offering study tools and resources.

Running Head: THE IMPACT OF TECHNOLOGY ON THE ACCOUNT INDUSTRY
OPERATIONS AND PROFESSIONALS
The Impact of Technology on the Account Industry Operations and Professionals
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THE IMPACT OF TECHNOLOGY ON THE ACCOUNT INDUSTRY OPERATIONS AND
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Table of Contents
1.0 Introduction................................................................................................................................4
2.0 Problem statement.....................................................................................................................4
3.0 Aim and objectives....................................................................................................................5
4.0 Justification and potential output of the research......................................................................6
5.0 Conceptual framework and hypothesis development................................................................6
5.2 Influence of information technology on accounting..............................................................7
5.3 Accounting information systems...........................................................................................8
5.4 Evolving Technologies..........................................................................................................9
5.5 Advantages and Disadvantages of technological innovations in accounting......................10
5.6 Technological innovation in accounting management practices.........................................11
5.7 Technological effects on the accounting firms....................................................................11
5.9 Hypothesis development......................................................................................................12
6.0 Methodology............................................................................................................................13
6.1 Research approach and sources of data................................................................................13
6.2 Proposed data collection and analysis techniques................................................................14
Population, sample size, sampling procedure............................................................................14
6.3 Organization of the study.....................................................................................................15

THE IMPACT OF TECHNOLOGY ON THE ACCOUNT INDUSTRY OPERATIONS AND
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6.4 Gantt chart, Project budget, and budget justification...........................................................17
Gantt chart..............................................................................................................................17
Project budget.........................................................................................................................19
7.0 References................................................................................................................................20

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1.0 Introduction
Over the past two decades, society has experienced dramatic technological advancements
that have affected numerous sectors. Thus companies need to acquire various administrative
services and systems to control activities in real time. The technological transformation has also
affected the accounting firms' internal process. It is quite evidential that computers systems and
machines have replaced some of the human actions that have greatly enhanced the productivity
and effectiveness of the organisations, thus it’s quite difficult for current organizations to remain
competitive without technological resources. Rich conducted by Zhu, Zhang, Li, Sun, and
Robison, (2017) shows that numerous jobs are at great risk of being digitalized within a nest two
decades, and this will drastically change the market requirements of companies in order to adjust
to the business surrounding.
According to Handoyo & Anas, (2019) in the accounting occupation has also been one of
the industries that digitalization is expected to grow enormously. The application of technology
has created the need to broaden education as well as the ascent of accounting consultancy, while
other impacts may also exist as the outcome of the IT evolution. However, the evolution may not
have fully and extensively evaluated, thus forming the current question: what are the impacts of
new technology on accounting and effect on the public accounting profession?
2.0 Problem statement
The technological advancement over the past decades especially on the communication
and information have greatly placed a landmark for the accounting professions that had remained

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stagnant for quite a long period of time as a result of inadequate information exchange among the
users. Among the advancements, internet usage stands out as the most significant as it allows
information control and virtual transmission, also the application of the Public Fiscal
Bookkeeping System (SPED) has enabled the standardization of the fiscal obligations.
According to Taipaleenmäki and Ikäheimo, (2013) SPED has simplified the “taxpayers”
additional obligations, however has not extensively achieved satisfactory results in regards to
productivity and agility since it requires high implementation cost. It is evidential that inflation
technology is continuously transforming the accounting activity with time, thus any ineffective
operation of the systems might results in a large loss of money to numerous companies.
Going through the books in the library it’s quite difficult to late books that have
exemplary covered the digitalization’s impact on the accounting industry, thus creating an
interesting area to conduct a research. Secondly, due to the rising application of technological
advancements in various files, it is quite imperative for the business organizations, accounting
professional and any other related stakeholders to fully understand and be prepared in the
technical changes regarding the SPED especially on the digital bookkeeping, which forms the
accounting pillar of the SPED.
3.0 Aim and objectives
The current study proposes to investigate the importance of technology on the accounting
and accounting professionals. Thus the paper will prove various technologies advancement
system and positive and negative impacts of the technological elements in an organization as
well as on the accounting professionals.
Research question

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The current paper will focus on answering the following research questions:
a) What is Accounting information technology innovation?
b) What are the impacts of technology on accounting operations?
c) What are the impacts of technology on the accounts department staffs?
4.0 Justification and potential output of the research
Technological advancement is inevitable in the current century since it directly impacts
every aspect of life as well as organizations. Since organizations depend on profitability,
accountability, and transparency to attain competitive advantages, ignoring technology in the
accounts department will eventually create an amenity in organizations (Handoyo & Anas,
2019). Thus accounts at the need to adapt and change their way of thinking to adopt digital
bookkeeping to manage potential profits as well as enable the evolution of accountants from the
simple compiler and posters to specialized people that offer professional services beyond simple
financial analysis.
The current paper thus will benefit a large number of accountants and accounting first
who would like to comprehend the control of technology on their daily accounting operations. IT
managers, as well as professional accountants, imperatively need a sound understanding of the
business operations IT can impact and the relationship between the IT with the profitability of
the organization.
5.0 Conceptual framework and hypothesis development
Accounting refers to the system used by companies in measuring the financial
functioning through observing and categorizing all the operations such as sales, property,

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liabilities, and purchases in a way that aligns to the particular acknowledged typical layouts.
Accounting system enables organizations to evaluate past, present and future prospects to
ascertain competitive advantage and sustainability in the market.
5.1 Accounting across the ages
Accounting dates back during the invention of the abacus that was used to keep and track
business transactions. After some period of time, during the 19th-century calculations was
invented to enhance the accuracy of the information in the business calculation as well as speed
up the accountant jobs (Caria & Rodrigues, 2013). However, still, the accountant has to depend
on the paper entry system for effecting communication of the financial information.
By the end of the 20th century, the introduction of computers led to a new look of the
accounting profession (Adamo, Alexander, & Fasiello, 2019). The application of computer
software such as Microsoft excel and electronic spreadsheet, eliminated calculates and ledgers
reducing the workload, increasing the efficiency and effectiveness. In the analog accounting
system, the information would be collected and analyzed through an offline computerized system
that made the process to be complex with respect to time and energy. The introduction of the first
computers in 1980s has enabled the introduction of computerized programs and software that
enhance technological informational analysis (Felten, 2015).
5.2 Influence of information technology on accounting
Information technology comprises numerous aspects such as computers, the internet,
personal digital services and wireless, all that has transformed the company’s operations
(Bredmar, 2014). Different companies tend to choose different accounting systems and software

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that suits their operations, for example, big companies may choose wide-software systems such
as resource planning system to computerize their accounting.
5.3 Accounting information systems
Information refers to the collection of interrelated subsystems that work as one to gather,
process, store, transform and distributes information to effective operational planning and quick
decision making (Liu, 2012). The accounting information system was incorporated in the
information and technology to enhance the process of gathering reliable financial information
that is critical for the decision-making process.
Computerized accounting system enables companies to easily track their records and
effectively manage all the transactions (Elekwa & Eme, 2013). The computerized accounting
system is the advancement of the paper ledger manual and the handwritten financial statement
that can now be electronically priced as one report. The computerized accounting system has
numerous advantages, such as:
a) Increased functionality-The application of the electronic financial management system
has enhanced the functionality of the Accounts department of numerous organizations
(Cullinan & Zheng, 2015). Through the enhanced timelines, the accountants have the
capability to prepare reports and extract operation analysis of the current operations
through the production of different information such as cash circulation accounts, unit
profit and loss statements, market segment among many others. These reports are
essential in the decision-making process and strategic planning of the organization.
b) Improved accuracy of the reports-The application of the high-tech financial
management system has improved the accuracy of the reports due to the availability of

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the interior payment and balance procedures that countercheck the money-movements
and make appropriate accounting balance before the production of the final financial
statement. Additionally, the computerized systems do not allow the entries of the journal
that might be out of equilibrium during the placement thus ensure that individual money
exchanges are accurate.
c) Faster processing rate-The computerized accounting systems have high processing rate
that can handle large financial information and quickly process the required analysis
through the accounting systems. This has considerably lessened the amount of time and
energy used in the accounts department resulting in labor-intensive as well as reduced
operations cost.
5.4 Evolving Technologies
Artificial Intelligence (AI)-AI denotes to the machines that undertake tasks that require
a high level of intelligence such as knowing, sensing, reasoning and creating. The recent
technological advancement on AI has resulted in the creation of the algorithms learns that enable
the machines to learn the statistical analysis of a large amount of data rather than through the
explicit programming (Mulgan, 2018). Through the application of the artificial intelligence,
accountants will be able to provide good advice to organizations to solve problems as well as
induce investors’ conference on the financial status of various organizations. The machine
learning enables the accountant to use coded accounting entries that improve the efficiency and
rules resulting in an automated process. Additionally, machine learning is able to predict and
forecast revenue collection thus provides a good basis of decision making regarding the
production quantity.

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5.5 Advantages and Disadvantages of technological innovations in accounting
Technological novelty has greatly altered the accounting activities as well as the roles
such as the creation of an accounting adviser. The accounting firm that moved into the eighteenth
ages of the 21st era has the advanced and deepest information of accountancy as a result of the
automation of the process (Huber, 2016). Below are some of the benefits that technology is
contributing to technological innovation in the accounting industry:
a) Cloud computing – cloud computing enables computers to collect dispensation
resources and information through the application of internet thus breaking the office
walls and create a virtual office (Bechtel, 2013). Through this, accountants are able to
complete these tasks in any location rather than being restricted in one place.
b) Enterprise resource planning- ERP is a term used to refer to a wide range of computers
software and hardeners that enhance the incorporation of departments in an organization (
Mapero, 2019). Through the use of the ERP, human resource management is able to
cooperate with the accountants to determine the pay roles and the salary stability of an
organization.
c) Forensic accounting – Refers to the concept of investigating fiscal transactions that are
perceived to be criminal. Forensic accountants are able to use technology to determine
illegitimate transactions in organizations thus reduce corruption and embezzlement of
funds.
On the other hand, the final results obtained from the technological systems majorly
depend on the accuracy of the inputs, thus when facts are insufficiently explored for correctness,
and then the extracted facts will results into fallacy (Hasso & Duncan, 2013). Secondly,

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numerous accounting software need personalization to meet the organization's objectives and
necessities.
5.6 Technological innovation in accounting management practices
The encroachment of new technologies results in the creation of organizational structure
changes as well as the reorganization of the production and operational process that determine
the competitiveness of the coordination in the market (Taipaleenmäki, & Ikäheimo, 2013).
Technology has resulted in great agility and productivity in most of the accounting firms and
activities, since it has eased the decision-making process, enhance services provisions, among
other actions. However, according to some scholars, perceive new technologies to possess a
neutral impact on accounting while others observe negative effects. Ilić and Anđelić, (2017)
states that one of the major technological limitations is the overdependence on human resources
since it is the product of human creativity thus repeats human errors. When human errors are
linked to technology tends to be very destructive and expensive.
5.7 Technological effects on the accounting firms
In respect to the accounting operations, technological advancement especially the IT is a
significant aspect in the management process as well as the accounting activities of the
respective firms. Thornburg & Roberts, (2013) expresses that IT have a great impact on the
knowledge management process that directly interlinks. The most common highlight IT aspect
on the accounting context is the capability of the computerized accounting system to increase the
speed of processing as well as efficiency that eventually offered the organization a better
competitive advantage. Rahman, Hassan and Said, (2015) states that a competitive environment
requires organization with improved accounting system enhance customer’s value creation as
well as distinguish themselves from the potential computers through a well-defined business

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strategy. Thus the strategy should be supported by other factors such the accounting systems, and
organizational design among others.
5.8 Accounting information system model
Figure 1 shows a simple accounting information system model that is applicable to all
information systems irrespective of the technical design. The pattern contains the following
fundamentals: users, facts gathering, facts management, fact analysis, facts production, data
source, and feedback (Liu, 2012). At the first stage, data from either internal or external sources
is collected and entered through confirming the validity and to enhance relevance and efficiency.
the fed data as then stored in the database and processed through by the algorithm and
accounting statistical tools to generate information that is forwarded to the external users.
5.9 Hypothesis development
Hypothesis 1 Ho: High-tech financial management does not have direct influence on the
accounting management practices of organizations
H1: High-tech financial management has a direct influence on the accounting
management practices of organizations
Hypothesis 2 Ho: Information Technology systems does not have a direct influence on the
productivity of the accounts department and professionals.
H1: Information Technology systems have a direct influence on the productivity
of the accounts department and professionals.