The Effects of Technology on the Accounting Profession Alonzo White ACC/340 August 14, 2011 Jennifer Coleman Question: Describe how information systems are changing the various aspects of the accounting profession. Include a description of a variety of new technologies and their effects on accounting processes. In addition, discuss how these technologies have changed the way accounting is performed at your organization or an organization of your choosing. Answer:
New technology in information systems have bought significant changes in accounting profession, practices and processes. It has increased the efficiency and accuracy in accounting and has speed up the process for manual accounting tasks, but also improved security of accounting data and increased transparency. Large organizations and multinationals are changing over to this new information systems and technologies to carry out their accounting tasks on global basis.
This information system has led to standardization not only among the different divisions, locations and offices of a single organization, but also on a global basis. Microsoft, Oracle for accounting has greatly reduced the time taken to prepare the financial statements and benefitted auditors and accountants to complete and submit their statements in timely manner. MIS reporting has been made possible by Information systems only to take timely decisions.
A new payroll management system from companies like Paychex has greatly improved payroll accounting and is a plus for accountants handling large payrolls. The new system allows accountants to collaborate and merge their work with accountants of the same company located at different location. The new Sarbanes Oxley Act has been the result of increased availability of quality information systems, without which, it is impossible for the companies to remain in compliance of these legislations.
Let us take the example of a multinational company like IBM, whose offices are located throughout the world and accounting is done at various locations, according to local laws, customs and currencies prevalent in the particular countries. But since IBM is a US based multinational and the final preparation of all these statements will be according to the GAAP principles and in US dollars, it is important for global companies like IBM to maintain similar accounting practices and standards everywhere.
Such large scale deployment of accounting policies and practices with global standards is impossible without the new information systems and technologies. With the use of these technologies, companies like IBM have no worries or fear in preparation of accounting statements; payroll related issues and management information systems (MIS) issues as the processes are standardized with the deployment of standard accounting and ERP packages such as Oracle.