Role of Emerging Technologies in Accounting Information Systems for Achieving Strategic Flexibility through Decision-Making Performance: An Exploratory Study Based on North American and South American Firms
- ORIGINAL RESEARCH
- Open access
- Published: 13 January 2023
- volume 24 , pages 199–218 ( 2023 )
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- Adilson Carlos Yoshikuni 1 ,
- Rajeev Dwivedi ORCID: orcid.org/0000-0003-4619-2557 2 ,
- Ronaldo Gomes Dultra-de-Lima 1 ,
- Claudio Parisi 1 &
- José Carlos Tiomatsu Oyadomari 1
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Nowadays, accounting departments highly rely on accounting information systems to make decisions based on current, updated, and contemporary data. And, most accounting practices can be enhanced by emerging technologies coupled with accounting information systems. Therefore, contemporary accounting information systems (AIS) coupled with emerging technologies is the highest priority in organizations to make decisions that can contribute to strategic flexibility and performance of the organizations. The objective of the study is to identify the role of information systems infrastructure integration (ISII) on strategic flexibility and innovation (SFI) through the mediated role of information systems (IS)-enabled strategic enterprise management (IS-SEM) practices and decision-making performance (DMP). The study is based on contemporary literature in the field of emerging technologies in accounting information systems particularly business intelligence and analytics (BI &A). Resource-based view had been applied to create novel constructs to test the research framework and hypothesis. The research framework and hypothesis are tested based on 388 organizations from Brazil and USA. The results reflect that information systems infrastructure integration impacts strategic flexibility and innovations in organizations. Further, there is no difference observed between North American and South American organizations. The results of the research suggest that accounting information systems (AIS) practitioners and researchers should look beyond emerging technologies investments and shift their attention to how information systems infrastructure integration (ISII) and information systems-enabled strategic enterprise management (IS-SEM) practices can leverage decision-making performance (DMP) and impact on strategic flexibility and innovation.
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Previous studies by practitioners and academic researchers have emphasized the role of accounting information systems (AIS) in enhancing management control systems (Belfo & Trigo, 2013 ). Decade-old literature on AIS emphasized traditional technology answers, such as; systems analysis, system design, adoption, and implementation. But, new research interest growing around the application of new and emerging technologies for accounting functions and how they can be aligned and integrated with existing accounting systems and practices (Chiu et al., 2019 ; Luftman et al., 2015 ). Emerging technologies affect every business process, function, organization, and industry (Dwivedi et al., 2021a ; Jha, 2008 ). Therefore, Institutional and industrial competitiveness and strategic flexibility can be achieved significantly with the help of emerging technologies (Asim & Nasim, 2022 ; Momaya et al, 2017 ). Strategic flexibility is defined as a strategic choice, strategic maneuvering, and strategic options (Evans & Bahrami, 2020 ; Roberts & Stockport, 2009 ; Sushil, 2015 ).
IS-enabled strategic enterprise practices are; ad-hoc accounting, budgeting, external management accosting, forecasting, non-financial analysis, strategic analysis, forecasting, non-financial analysis, monitoring, and managing an organization's performance. However, very few studies are available that addressed the issue of emerging technologies, IS infrastructure integration, and IS-enabled strategic enterprise management practices to influence decision-making performance and gain innovation (Rikhardsson & Yigitbasioglu, 2018 ). Also, very few studies are available in different countries and different regions. One exceptional study was carried out in the USA, which investigated the IS infrastructure integration, functionality, and self-service by business intelligence & analytics (BI&A) system to gain performance measurement capabilities and competitive advantage (Peters et al., 2016 ).
Moreover, recent studies of AIS rarely emphasize the effects of new and emerging technologies (Such as; big data analytics, BI, machine learning, cloud computing, environmental scanning, ERP integration, mobile and web services, computer-assisted auditing tools, and business process management) on the decision-making and innovation. Therefore, it becomes important and necessary to pay an appropriate focus on it (Appelbaum et al., 2017 ; Belfo & Trigo, 2013 ; Chauhan et al, 2012 ; Chiu et al., 2019 ; Dwivedi et al, 2021b ; Ho et al., 2009 ).
The emerging profile of managerial accounting is as a strategic controller, partner, and value manager (Abdelal et al., 2021 ). And given the potential influence of BI&A technology on decision support to managerial accounting on decision-making in firms, offer fruitful avenues for future research of AIS literature (Rikhardsson and Yigitbasioglu ( 2018 ).
Therefore, to fill the knowledge gaps mentioned by practitioners (Abdelal et al., 2021 ) and scholars (Appelbaum et al., 2017 ; Belfo & Trigo, 2013 ; Chiu et al., 2019 ; Tan, 2021 ), novel research must understand how emerging technologies may be exploited as a developmental path for strategic flexibility in innovation through strategic enterprise management practices and decision-making performance. Thus, this study proposes the research question:
RQ1 . How does IS infrastructure integration and IS-enabled strategic enterprise management practices influence decision-making performance, and what is their effect on strategic flexibility in innovation?
Another important issue of AIS research showed that many studies were conducted especially in developed economies and very few in developing economies. There is no comparative study between developing and developed economies. Moreover, IT spending worldwide in 2022 is projected to be $4.2 trillion, in 2021 the amount was $3.8 trillion, an increase of 8.6% (Gartner, 2021 ). In the USA, IT spending (technology products, infrastructure, technology-enabled services, and technology-skilled employees) was forecasted to be more than 1.94 trillion US dollars (Statista, 2021 ), i.e., 45% of IT spending worldwide. Brazilian firms spent more than $195 billion on the IT macro sector (Brasscom, 2021 ), which represented 5% of IT spending worldwide. Comparing the IT spending with GDP for both countries, Brazil spent 5.5% and the USA spent 8.8% in 2020, i.e., the developed country spent more than 3.3% (33% of GDP) than the developing country. Further, Then, there are huge significant variations in terms of IT strategies, business strategies, structural organization, cultures, and firm outcomes among developed and developing economies, such as the USA and Brazil. Therefore, this study addresses research question 2;
RQ2. Is there any difference between developing (Brazil) and developed (USA) economies for IS infrastructure integration and IS-enabled strategic enterprise management practices influencing decision-making performance, and what is their effect on strategic flexibility in innovation?
There is a possibility to firms demonstrate a different influence in the relationship at the proposed model research by the unobserved heterogeneity (Hair et al., 2016 ; Matthews et al., 2016 ). Therefore, the third question of this study examines if heterogeneity conditions present in the organizations from both countries can make different effects on the relationship of the proposed model research.
RQ3 . What are the internal organizational conditions that could amplify previous relationships?
The leaders can understand the role of IT investment in value-creating capabilities for the firm from the research. The research also contributes to the literature by discussing the impact of new and emerging technologies in accounting information systems for better decision-making and achieving strategic flexibility in innovation. This provides a framework that includes strategic enterprise information systems, and IS infrastructure integration for decision-making performance and results in strategic flexibility in innovation. Thus, the research contributes to filling various knowledge gaps mentioned by practitioners (Abdelal et al., 2021 ) and academics (Appelbaum et al., 2017 ; Belfo & Trigo, 2013 ; Chiu et al., 2019 ) to the AIS literature. The research also contributes by comparing the role of emerging technologies in value-creating capabilities in developed and developing economies.
Literature Review and Hypothesis Development
Assuming the importance of emerging technologies in accounting information systems (AIS), it is difficult to consider all current technologies to examine all of them in one comprehensive empirical research. Therefore, the research focused on only Business Intelligence and Analytics (BI&A). The research aim is to investigate how IS infrastructure integration (ISII) supports strategic enterprise management (SEM) practices to enable decision-making performance and gain strategic flexibility in innovation.
The definition of SEM practices is related to the use of information technology for strategic analysis, budgeting, forecasting, communicating targets, a combination of financial and non-financial indicators, comparing actual versus budget, real-time reporting, and monitory strategic objectives (Atkinson et al., 2011 ; Reinking et al., 2020 ). The strategic analysis using enterprise information systems refers to the firm gathering knowledge about vital external characteristics, allowing benchmarking by attainment to understand the market requirements and competitors to make scenario simulation (Aydiner et al., 2019a ; Conboy et al., 2020 ; Davenport et al., 2010 ).
The role of emerging technologies in accounting is to establish a budget process to determine the revenues, cost, expenditures, and assets investment for the current year. Also to propose and simulate value or key indicators, such as profit, return on investment, cash flow, and EVA. Therefore, it enables the forecasting process support, the tracking of revenue, and spending during the fiscal year, comparing actual revenues and expenditures with their budgeted values in the form of variance reports analyzing the causes of significant deviations from appropriations based on prior forecasts (Atkinson et al, 1995 ; Williams & Calabrese, 2016 ).
The strategic planning process contemplates the communication of the organization’s strategic direction for a specified period, and coordinates and integrate prescriptive actions as well as emerging strategic decisions by employees (Burgelman et al., 2018 ; Wolf & Floyd, 2017 ). The BSC framework (Kaplan & Norton, 1992 ) is the main methodology that supplements traditional financial indicators with multi-dimensional measures that provide effective integration of financial metrics and non-financial metrics in the strategic planning process (Alewine et al., 2016 ; Asiaei et al., 2021 ; Sen et al., 2017 ).
SEM can be identified in the AIS literature as the performance of business processes management (BPM), the performance of corporate management (CPM), and the performance of enterprise management (EPM), through BI&A infrastructure integration to monitor and manage a firm's performance based on Key Performance Indicators (KPIs), such as; cost, expenses, profit, return on investment (ROI), revenue and other non-financial metrics (Belfo & Trigo, 2013 ).
Therefore, the study discusses in the following subsections, the relationship between IS infrastructure integration (ISII), IS-enabled strategic enterprise management (IS_SEM) practices, decision-making performance (DMP), and strategic flexibility in innovation (SFI) using Resource Based View (RBV).
Resource-Based View of Accounting Information Systems
The RBV argues that firms that hold strong IT and organizational resources leverage organizational practices, that can create a competitive advantage and enhance performance significantly (Wade & Hulland, 2004 ). Thus, through the lens of RBV, IT and complementary organizational resources together enable organizational processes, practices, routines, and activities to impact outcomes and performances (Aydiner et al., 2019b ; Melville et al., 2004 ; Mikalef & Pateli, 2017 ).
Information technology (IT) investments and IT resources can classify into a portfolio of four IT strategic purposes: infrastructure, transactional, informational, and strategic assets (Aral & Weill, 2007 ). IT infrastructure is the foundation to share IT services by technical (servers, networks, laptops, databases) and human (help desk, application development, factory software) use by multiple IS applications (Dwivedi et al., 2022 ; Luftman et al., 2015 ; Weill & Ross, 2005 ). IT transactional relates to IS to automate processes by chain value and promote cutting costs, making a better relationship with customers and suppliers. IT Informational based on the infrastructure and data produced by the transaction level of IT promotes information for accounting and executives by reporting and communicating targets on all generic chain value (customers, suppliers, and regulators) (Aral & Weill, 2007 ). IT strategic assets enable firms to create exploration and exploitation innovation, such as entering a new market, the developing new products, services, or business models and business processes (Dwivedi et al., 2021b ; Goel et al., 2012 ).
Although various AIS studies have examined the strategic benefits to IT infrastructure and transactional dimensions. Few studies have been dedicated to investigating the informational and strategic purpose of AIS using and applying emerging technologies (Belfo & Trigo, 2013 ; Chiu et al., 2019 ). Therefore, through the lens of RBV, this study emphasizes IS-related capabilities (Li and Chan, 2019). The strategic purpose of IS infrastructure integration (ISII as zero-order capabilities) related to database structures to support AIS information routines by strategic enterprise management (SEM as first-order capabilities) practices and decision-making performance (DMP as second-order capabilities), promoting strategic purpose for flexibility in innovation.
IS Infrastructure Integration and IS-Enabled Strategic Enterprise Management Practices
IS infrastructure integration (ISII) refers to the database structures and processes, which provide reliable, accurate, multi-dimensional data, and support decision-making through the four performance dimensions; objects, attributes, time, and plan versions (Peters et al., 2016 , 2018 ). Objects are the dimension of responsibility center arrays (such as the center of revenue, expense, and profit), responsibility center aggregation unit patterns (such as region, country, unit, department, and manager), and plan versions (such as budget, actual results, forecast, and latest forecast) (Ranjan and Foropon, 2021 ). Attributes relate to calculating the elements (such as amounts of sales and purchases, stock in process, and turnover of employees). The dimensionality relates to periods (e.g., day, weekly, monthly, quarterly, semiannually and annually) (Peters et al., 2018 ).
Recent studies of emergent technologies of AIS related to BI and analytics (BI&A) (Appelbaum et al., 2017 ; Rikhardsson & Yigitbasioglu, 2018 ), and big data (Mikalef et al., 2017 , 2020a , 2020b ) have demonstrated that strategic enterprise management practices depend on strong ISII. The strong ISII supports BI&A applications to simulate strategic planning, communicating, and monitoring targets performed by proper use of organizational resources (i.e., by strategic analyses, budgets, and forecasting processes). For example, an organization can evaluate the BI&A applications to sales plans by monitoring functions in the business unit that are related to the evaluation revenue (Shuradze et al., 2018 ), promoting engagement and clarifying responsibilities by constant performance monitoring of the business unit performance (Akter et al., 2016 ).
The BSC framework is commonly used to measure the performance of BI&A in a firm from a management accounting perspective and enable analytics (Appelbaum et al., 2017 ). The BSC supports firms to translate their strategic objectives and targets into a comprehensible set of performance measures, combining elements of strategy, and financial and non-financial indicators (Kaplan & Norton, 1992 ; Mohamad et al., 2017 ). Hence, ERP systems available provide structured data, and strong ISII enables IS, such as; BI&A mechanisms that provide firms the ability to scan, understand and analyze various data sources and data types. BI& A also supports companies to gain competitive advantage by adjusting the responsibility of management (Appelbaum et al., 2017 ). Therefore, different alternatives for decision-making based on BI& A using AIS are possible. Which results in creating flexibility in the strategic renewal of the firm (Balasubrahmanyam et al, 2012 ).
As ISII support IS-enabled SEM practices with an organization's holistic view to plan, execute and monitor strategic and accounting actions (Appelbaum et al., 2017 ; Belfo & Trigo, 2013 ). However, when ISII is “low,” data are available across an array of fragmented and dispersed spreadsheets (Peters et al., 2018 ), using different data sources, and are manually integrated to produce the results. On the other hand when ISII is “high,” has an ERP-enabled common database configuration (Peters et al., 2016 ).
Therefore, strong ISII supports multi-dimensional data hierarchies by data objects and their attributes linked with integrated calculative schemes, that allow aggregate or disaggregate at various levels within a multi-dimensional data hierarchy model. Hence, firms with this IS functionality enables an active interface with the time dimensions and plan types, providing more unified access and handling of them. In contrast, when ISII is “low,” data modeling, analysis, and interaction by users occur using spreadsheets IS. A set of spreadsheets IS offers a restricted interactive interface with the object and attribute multi-dimensionality, i.e., users have relative difficulty switching between and elaborate a multiplicity view of time dimensions and plan versions (Peters et al., 2016 , 2018 ). Moreover, strong ISII promotes an accurate and extent of reliable multi-dimensional data availability for user interaction and modeling data to create information, knowledge, and intelligence for firms. Thus, the study proposes the following hypothesis that ISII can be “low” and limited by spreadsheet IS, and ISII can be high by multi-dimensional data integrated IS.
H1. The strong IS infrastructure integration enhances IS-enabled strategic enterprise management practices.
IS-Enabled SEM Practices Influence Decision-Making Performance
Recent studies have demonstrated that ERP systems attempt to integrate structured transaction-based enterprise information by one central database to be retrieved from different organizational objects (Appelbaum et al., 2017 ; Belfo & Trigo, 2013 ). However, ERP systems are some restrictions to support the analysis, non-financial, budgeting, external management accounting, ad-hoc management accounting, and costs allocation (Rikhardsson & Yigitbasioglu, 2018 ), and IS-enabled strategic enterprise management (SEM) practices arise to better support management accounting by BI&A applications (Belfo & Trigo, 2013 ).
According to Peters and colleagues (Peters et al., 2016 , 2018 ), performance measurement activities for planning and control results are enabled by strong IS applications based on the technologies of BI&A to allow the multi-level managerial debate (interactive) or diagnostic by reinforcing performance aspirations. Consequentially, accounting practices, such as planning, control, performance measurement, transaction processing, and reporting are essential elements to improve decision-making by managers (Atkinson et al., 2011 ; Rikhardsson & Yigitbasioglu, 2018 ).
Previous studies have demonstrated that SEM practices can be decentralized strategic decision-making and improve a firm's performance through strong IS as BI&A (Belfo & Trigo, 2013 ; Han et al., 2017 ). For example, the BSC framework with a wide variety of performance measures (non-financial and financial) generates information to create strategic knowledge and the firm's intelligence to decision-making in undefined fluid environments through higher accessibility of many appropriate information that can be impacted in more efficient allocation of organizational resources (Asiaei et al., 2021 ; Asiaei and Jusoh, 2017 ). Moreover, managers and middle executives need to make decisions to face highly unstructured tasks under a high degree of uncertain environmental (external or internal) factors (Aydiner et al., 2019a ). Thus, as stated this study proposes the following hypothesis:
H2. IS-enabled strategic enterprise management practices improve decision-making performance.
Mediating Effect of Strategic Enterprise Management Practices
The effects of IS infrastructure integration (ISII) on management practices, such as dynamic capabilities, organizational agility, business process performance, and innovation have been studied a lot in the published literature (Kim et al., 2011 ). However, the investment in IT infrastructure alone cannot guarantee success for a firm (Li and Chan, 2019 ), in otherwise, IS infrastructure integration leverages management practices to fulfilling its business objectives (Aral & Weill, 2007 ; Belfo & Trigo, 2013 ).
Research results indicated that IT infrastructure integration can be associated with accounting BI functionality (such as strategy, budget, forecasting, and control) to increase competitive advantage through data driven decision-making from that spontaneous decision-making (Dwivedi et al., 2021a , 2021b ; Peters et al., 2016 , 2018 ). Hence, IS-enabled SEM practices through time savings, enhance management accounting tasks by information, and ultimately improve strategic decisions (Appelbaum et al., 2017 ). Thus, ISII as the foundation to support AIS enables accounting managers, executives, and analysts to make accurate, reliable, better and timely decisions (Davenport et al., 2010 ; Peters et al., 2018 ). Therefore, IS infrastructure alignment with IS-enabled SEM practices develops the ability for better management of accounting staff and executives to use emerging technologies, such as BI&A, to make the decision better. Thus, this leads to the following hypothesis:
H3. IS-enabled strategic enterprise management practices mediate the relationship between IS infrastructure integration on decision-making performance.
Mediation Effects on Strategic Flexibility in Innovation
Firms to survive need to understand and monitor changes in the environment that yield threats or opportunities to achieve strategic goals by being prepared to respond appropriately to market requirements (Contador et al., 2020 ; Davenport et al., 2010 ; Wolf & Floyd, 2017 ). Thus, the ability to effectively and timely identification of changes in the external environment depends on strong IS infrastructure integration associated with BI functionality to facilitate effective decision-making and timely response, which was theorized as strategic flexibility in innovation (Arnold et al., 2015 ).
IT and complementary organizational resources influence proximate and distal outcomes to gain organizational performance (Kohli & Grover, 2008 ; Melville et al., 2004 ). Previous studies, on resource-based views, have demonstrated that IS applications influence decision-making to gain organizational performance. For example, Aydiner and colleagues (Aydiner et al., 2019 a) identified that IS capabilities have strong effects on decision-making performance to influence business process performance. Rouhani and colleagues (Rouhani et al., 2016 ) examined the influence of IS applications, such as BI functions to enable decision-making and ultimately enhance competitive advantage. Another example is a recent study of IS has investigated the antecedents and direct effects of big data and decision-making capabilities on decision-making quality (Awwad et al., 2022 ; Shamim et al., 2019 ). It also helps employees to use BI&A for decision-making not only in accounting but across different functions, and internal and external stakeholders that may result in stakeholder flexibility in the organization (Dwivedi & Momaya, 2003 ).
Many studies have shown that IS applications enable firms to create innovation. For example, IS applications enable firm agility to scan constantly changing market conditions by exploiting unforeseen and capturing emerging business opportunities to gain innovation (Lu & Ramamurthy, 2011 ). Mikalef and colleagues (Mikalef & Pateli, 2017 ) have examined IT-enabled dynamic capabilities by leveraging the economical interconnectivity of cybernetic markets and achieving quicker to facilitate stronger market capitalizing agility to gain firm performance. A recent study of IS has shown that resource orchestration among knowledge strategy planning and IT capabilities have a direct effect to enable dynamic capabilities in innovation (by constantly seeking new opportunities, frequently observing proceedings and inclinations about the forthcoming inferences, quickly creating new goods and services, and incremental change in the product) to enhance firm performance (Yoshikuni et al., 2021 ).
Though IS outcomes have established the influence of IS applications on innovation, scarce studies are opening the black box concerning [IS portfolio strategic purpose: infrastructure, transactional, informational, and strategic (Aral & Weill, 2007 )] in the relationship between the IS infrastructure integration on strategic flexibility, even more, investigating cross-country research among Brazilian and US organizations. So, this research proposes that strategic benefits can be better explained by serial influence when IS-enabled SEM practices should impact the level of decision-making, fostering increased levels of strategic flexibility in innovation through the strong IS infrastructure integration. Hence, this study fills the knowledge gaps mentioned by Aydiner and colleagues (Aydiner, Tatoglu, Bayraktar, and Zaim, 2019 a) that are necessary for future research to examine serial mediation to gain innovation. Thus, the subsequent hypotheses are formulated:
H4. Decision-making performance intermediates the relationship between IS-enabled SEM practices on strategic flexibility in innovation.
H5. Effects of IS infrastructure integration on strategic flexibility in innovation are serially mediated by IS-enabled SEM practices and decision-making performance.
Difference of Proposed Model Research by Cross-Country
According to Melville and colleagues (Melville et al., 2004 ) proximate and distal outcomes performances in the framework of IT-business value have different influences from the firm sector, industry characteristics, and competitive environment by region. Moreover, the roles of AIS in organizations are different in how accounting functions are planned, managed and organized across different sectors, industries, countries, cultures, and organizational types (Rikhardsson & Yigitbasioglu, 2018 ).
Many empirical kinds of research have investigated the strategic benefits of AIS in developed economies (Alewine et al., 2016 ; Ali et al., 2015 ; Arnold et al., 2015 ; Chi et al., 2020 ; Reinking et al., 2020 ; Wilkin et al., 2016 ), and growing studies in the emerging economies (Asiaei and Jusoh, 2017; Mnif et al., 2020 ; Mohamad et al., 2017 ). However, fewer studies examined the cross-research with sourced data from different countries economies. Thus, to fill the knowledge gaps mentioned by Belfo and Trigo ( 2013 ), Peter, and Rikahardsson, and colleagues (Peters et al., 2016 , 2018 ; Rikhardsson & Yigitbasioglu, 2018 ) that is necessary to investigate the IT-business value related to the AIS field. This study formulated the following hypothesis.
H6. There is a moderation of natural countries in the relationship of the proposed model research.
Unobserved Heterogeneity by Sub-Populations
Recent studies of IS field have demonstrated that unobserved heterogeneity by sub-populations can distinguish across various groups of firms (). Appropriate method for unobservable heterogeneity by sub-populations assessment can identify different effects in the relationship of the proposed model research (Hair et al., 2016 , 2018 ; Matthews et al., 2016 ). Moreover, few AIS studies have examined the unobserved heterogeneity by sub-populations (Chiu et al., 2019 ; Rikhardsson & Yigitbasioglu, 2018 ).
Therefore, this research analyzes if the effects in the relationship can be different in the subgroup sizes through combinations of internal conditions by competitive strategy (Porter, 1998 ), and characteristics of the firm-age, firm size, firm sector, and natural country (Melville et al., 2004 ). The following hypothesis was proposed.
H7 : The occurrence of heterogeneity impacts the association of the proposed framework in the research.
The proposed framework research shows that hypotheses and assumes that ISII influences SFI by the serial mediation of IS-SEM and DMP, see Fig. 1 .
Proposed model research
The constructs had been previously validated from the current literature, and the novel construct was developed in multi-item measures. The IS-enabled SEM construct was created as a new instrument by the authors, and it was based on existing literature in accounting information systems and strategy (Atkinson et al., 2011 ; Belfo & Trigo, 2013 ; Peters et al., 2018 ) with pre-tests by practitioners and academics.
As recommended by Moore and Benbasat ( 1991 ), the IS-SEM construct was enhanced through the draft instrument with three rounds of card sorting carried out. First, the items of measures were supported by two professors and one senior executive. Second, the content validity of the survey tool was done by the group of practitioners (five senior executives) and academics (three professors) to receive their opinions on appropriate items for inclusion, so the items measure of IS-SEM was valid.
Third, a new scale measure of IS-SEM was mixed with other constructs items by a random order and was given to the twenty-six professors (65% of master and 35% doctors) and senior executives (more than 88% with 10 years of experience). Thus, the judges separated the items by construct, and the outcomes demonstrated 90% of assertively items into the novel scale. Three judges were contacted to understand why certain items were not grouped as expected, and so, they were adjusted or removed.
The constructs of IS infrastructure integration (ISII) were adopted by Peters and colleagues (Peters et al., 2016 ), decision-making performance (DMP) was adopted by Aydiner and colleagues (Aydiner, Tatoglu, Bayraktar and Zaim, 2019 a), and strategic flexibility in innovation was adopted by Arnold and colleagues (Arnold et al., 2015 ) and one item (SFI_5) from Chen and colleagues (Chen et al., 2017 ), and MLMV—measured latent marker variable [formative (Yoshikuni et al., 2021 )].
Control variables were measured by age, size, and sector of the firm, as suggested by earlier IS studies (Melville et al., 2004 ). The scale of the competitive strategy was adopted from Porter ( 1998 ) by cost leadership (an organization that seeks to become the lowest cost competitor), differentiation (a firm that seeks to distinguish itself from its rivals by offering superior value), focus on cost leadership or differentiation (a company that seeks focused strategy targets specific industry segments) (Appendix 1).
Moreover, as recommended by Morgado and colleagues (2018), validity and reliability of the survey instruments were checked statistically. All constructs were operationalized by Likert scale on 1 to 7 where 1 is least important and 7 is most important. The pilot study was conducted with the help of 34 Brazilian firms to check the measures' statistical properties, as recommended by Malhotra ( 2010 ). The survey items are available in Appendix 2.
The data was gathered from Brazilian and US organizations by convenience sampling method. The authors approached the practitioners in each firm through personal contacts. Moreover, the data collection process lasted for almost 4 months (120 days) in the year 2021.
The final sample of 388 cases comprised 198 Brazilian (51%) firms and 190 US (49%) firms, which is sufficient to satisfy the requirements of sample size for PLS-PM (Henseler et al., 2016 ). The size of the sample should be around 10 times the maximum arrows pointing toward dependent variable as well as 10 times formative indictors (largest) to measure the one construct (Hair et al., 2017 ). Hence, the sample size should be at least 60 cases to conduct this study, but we have 388 sample sizes, which is almost 6.5 times higher than required sample size for conducting this study.
The SEM based on partial least square method (PLS-SEM) has been used by SmartPLS version 3.3.3. Following assumptions are suggested by Hair et al., 2017 (Hair et al., 2017 ):
Allow flexibility related to the expectations on multivariate regularity;
Handling of structural model complexity and using smaller samples.
Uses formative and reflective constructs;.
Ability to analyze indirect and direct effects;
Practice as a predictive statistical power tool for construction theory (Hair et. al, 2017 ).
Table 1 shows the sample size characteristics (demographics) by country, respondent, age, size, and sector of the firm. Thus, large enough firm size, mature firm-age, service, and manufacturing establishments stood additional profoundly embodied in Brazil sample, and the USA showed more small and middle-size firms, middle-age firms, service, and manufacturing organizations, see Table 1 .
Common Method Bias
The research applies common method bias (CMB) during the research design phase to control; items constructed in clear and concise language, respondents chosen could answer the survey, the order of the questions was mixed, anonymous responses and confidentiality, and applying technical remedies (MacKenzie & Podsakoff, 2012 ; Fuller et. al., 2016 ).
The CMB was detected and controlled by the application of the statistical techniques suggested by Chin et al. ( 2013 ). The measured latent marker variable (MLMV) method was applied in dependents variables of IS-SEM, DMP, and SFI using 4 formative items for MLMV (Almeida et al., 2022 ; Yoshikuni & Dwivedi, 2022 ; Yoshikuni et al., 2021 ). The test compared the differences in all variance explanations (R 2 ) including and excluding additional marker variables, and the model with MLMV variables discovered a more suitable view than the original one (less than 1%), see Table 2 . CMS is not any concern or issue in this study.
Reliability and validity (convergent and discriminant) were tested before processing for model testing. Reliability was analyzed checking Cronbach Alpha threshold value 0.70, indicating acceptance of construct reliability (Fornell & Larcker, 1981 ). At the indicator level was assessed reliability through examining whether construct-to-item loadings were above the threshold of 0.70, thereby suggesting discriminant validity (Hair et al., 2017 ), see Appendix 1. AVE value should be above 0.5 and in the research lowest value was 0.65 for checking the convergent validity.
The discriminant validity was inspected in three ways; First, it was verified if each construct's AVE square root values are higher than its maximum association with any other construct (Fornell–Larcker criterion). Second, it was verified if each indicator’s outer loading was greater than its cross-loadings with other constructs (Bido & Silva, 2019 ) (Appendix 1). The heterotrait–monotrait ratio (HTMT) was analyzed, and their values were below 0.85, indicating discriminant validity (Hair et al., 2017 ; Henseler et al., 2015 ). Therefore, reliability of first-order reflective measures proved, and all items were suitable indicators for the respective latent variables, see Table 2 and Appendix 1.
Structural equation model.
The PLS analysis by the structural model is reflected in Fig. 2 , consisting of path coefficient ( β ) and R 2 . As demonstrated in Fig. 2 , hypothesis 1 and hypothesis 2 were confirmed. Significant relationship has been found between a firms’ level of IS infrastructure integration (ISII) on IS-enabled strategic enterprise management (IS-SEM) practices ( f 2 = 0.567, β = 0.602, t = 10.411, p < 0.001), supporting H1. In support of H2, the findings demonstrated strong and large effects of IS-SEM practices on decision-making performance (DMP) ( f 2 = 0.712, β = 0.698, t = 13.669, p < 0.001). Moreover, DMP is positively linked to strategic flexibility in innovation (SFI) ( f 2 = 0.311, β = 0.606, t = 7.581, p < 0.001). The research model based on SEM explains 36.2% of the variance for ISII ( R 2 = 0.362), 56.4% for DMP ( R 2 = 0.581), and 49,8% for SFI ( R 2 = 0.498), then, all coefficients of determination signify reasonable to considerable predictive power (Hair et al., 2017 ). The effect size ( f 2 ) values are all above 0.30 threshold values, indicating moderate to substantial effect sizes (Table 3 ).
Structural model research. *** p < 0.001, ** p < 0.01, and * p < 0.05, NS No significant. VAF Variance account for
To analyze the effects of mediation hypotheses H3 and H4 were examined to if the effect of ISII on DMP is better explained by IS-SEM, and DMP mediates the relationship between IS-SEM on SFI. A nonparametric re-sampling procedure has been employed in order to check the normality of sampling distribution through a bootstrapping approach. Table 4 demonstrates that direct positives effects without the presence of mediators between the relationship ISII on DMP ( β = 0.504, t = 8.74, p < 0.001), and IS-enabled SEM practices on SFI ( β = 0.564, t = 11.356, p < 0.001). However, when the mediators of IS-SEM and DMP were added in the, respectively, relationships and showed no significant direct effect on its dependent’s variables, demonstrating variance account for-VAF = 100%, a full significant mediating impact (DMP; β = 0.083, t = 1.393, p > 0.05, and (SFI, β = 0.009, t = 0.080, p > 0.05), supporting hypotheses H3 e H4.
Hypothesis H5 was tested, based on the guidelines (Hair et al., 2017 ), when findings of testing direct impacts and indirect impacts were compared. The direct impacts of ISII on SFI without mediators of IS-SEM and DMP were examined ( β = 0.564, t = 11.360, p < 0.001, R 2 = 0.318). The indirect impacts were tested by adding the mediators, ISII had no significant direct impacts on SFI ( β = 0.110, t = 1.648, p > 0.05, R 2 = 0.498). Hence, the results indicated that there is a serial mediation impacts of IS-SEM and DMP on the relationships between ISII on SFI, because (i) the mediation model explains more performance variance than the direct model, (ii) there is a significant relationship between ISII and IS-SEM, IS-SEM and DMP, (iii) the relationships between ISII on SFI in the direct model was no significant statistically, and (iv) there is a significant relationship between and DMP on SFI, supporting H5.
The control variables were not found a significant influence on the relationship of the proposed model research by age, size, and sector ( p > 0.05), see Table 3 .
The Q 2 value for the predictive model of DMP = 0.333 and SFI = 0.271 were above zero, indicating satisfactory predictive relevance (Hair et al., 2017 ). Also, the q 2 size effect showed an acceptable impact size of predictive significance (above 0.28 and 0.13, respectively). Additionally, the composite-based standardized root means square residual (SRMR) was a value of 0.053, indicating the overall fit of the PLS path model. The threshold value is 0.08 and below (Hair et al., 2017 ).
To examine hypothesis H6 the database was separated into subgroups of Brazil (198 cases) and the USA (190 cases). To analyze whether there are differences between firms from two countries, multi-group analysis (MGA-PLS) was used as a parametric approach (Hair et al., 2017 ). Table 5 demonstrates the major variance of PLS path coefficients does not differ significantly across Brazil and USA, just the relationship between ISS on SFI showed a difference of 0.333 statistically significant ( p value < 0.001). Thus, hypothesis H6 was partially supported.
To test hypothesis H7, finite mixture partial least squares (FIMIX-PLS) procedure has been used, which determined the number of segments retained from data through the use of a stop criterion to run ten times for segment (g = 2–5), assessed by the Akaike Information Criterion (AIC), Modified AIC with Factor 3 (AIC3), Bayesian Information Criterion (BIC), Consistent AIC (CAIC), Hannan–Quinn Criterion (HQ), and the normed Entropy Statistic (EN) (Hair et al., 2018 ), indicating that two-sector as the most appropriate solution, see Table 6 .
The structural model was examined by 1-segment (256 cases) and 2-segment (132 cases) and an MGA-PLS algorithm was performed to examine the segments and alternative solutions. Table 7 demonstrates that there are different statistically significant effects on the two segments to the relationship between ISS on IS-SEM, IS-SEM on DMP, and DMP on SFI.
Table 8 demonstrates unobserved heterogeneity into observed heterogeneity by making analytic groups available, comparing the cell count in into explanatory variables, and combining with the variables of country, competitive strategy, sector, age, and size of the firm, as recommended by Becker and colleagues (Becker et al., 2013 ).
The 1-segment demonstrates high-concentration firms from the USA with a competitive strategy of differentiation large and focus, agribusiness and government sectors, small and middle-size, being young and middle-aged firms. The 2-segment shows high-concentration organizations from Brazil with a competitive strategy of cost leadership large and focus, financial and industrial sectors, large firm size, being mature firms.
The outcomes of the study reflected that IS infrastructure integration (ISII) influences strategic flexibility in innovation (SFI) by the serial mediation of IS-enabled strategic enterprise management (IS-SEM) practices and decision-making performance (DMP). Moreover, comparing firms from Brazil and USA didn’t demonstrate the different effects of the proposed model research. However, by subgroups with different internal conditions, the influence of ISII on IS-SEM can be identified by competitive strategy, age, size, and sector of the firm. To the best of the researchers' familiarity, the IS-SEM practice had not been earlier subjected to large-scale empirical testing. Thus, this empirical study presents eight key findings.
First, the study conceptualized, operationalized, and measured IS-enabled SEM practices through the underlying AIS literature as emerging technologies. In contrast to past studies that investigated IS-related ordinary capabilities such as BI infrastructure integration, BI functionality, and BI self-service to influence competitive advantage (Peters et al., 2016 ), and strategic momentum and organization flexibility (Acharya, 2019 ; Peters et al., 2018 ).
Hence, this study fills the gaps mentioned by Chiu and colleagues (Chiu et al., 2019 ) that are required to investigate the effect of emerging technologies in management accounting practices, mainly the role related to the use of business intelligence and analytics (BI&A) on decision-making (Rikhardsson & Yigitbasioglu, 2018 ). Also, to address that a higher level of information integration helps to enhance strategic enterprise management (SEM) practices. SEM helps to discover new capabilities and new benefits that significantly enhance the role of the accounting function in the organization and help in the organization’s management ( Belfo & Trigo., 2013 p 9). So, the study contributes novel knowledge to the AIS field.
Second, the findings empirically support the claim that IS infrastructure integration facilitates the advent of IS-enabled SEM practices, therefore, supporting Hypothesis 1. The result fundamentally means that passing from IS infrastructure integration to IS ability to support accounting practices, as such strategy analyses, financial planning, and analysis solutions to support executives to manage financial planning, budgeting, modeling bottleneck, communicating, and monitoring key performance indicators. So, the result contributes to the extent of the knowledge of AIS literature, when identified that emerging technologies by BI&A applications are essential to enable strategic enterprise management practices.
Third, the results empirically support the hypothesis that IS-enabled SEM practices influence decision-making performance, confirming H2. This indicates that IS-enabled SEM routines promote frequent diagnostic and interactive feedback loops that comprise a comparison of actual results with feed-forward data to calculate feedback variances of organizational performance. Thus, this research underwrites to extending knowledge of AIS and management research, in line with prior AIS studies that showed emerging technologies (BI&A) can help executives to making-decision better by self-service of planning and reporting to gain organizational flexibility (Peters et al., 2018 ) and competitive advantage (Momaya et al, 2017 ; Peters et al., 2016 ).
Fourth, the results demonstrated that IS-enabled SEM practices were a mediator in the relationship between IS infrastructure integration on decision-making performance (DMP), confirming H3. Hence, in line with previous studies of IS capabilities through the lens of RBV, IS infrastructure alone can’t create value for decision-making performance (Aral & Weill, 2007 ; Aydiner et al., 2019 a; Kim et al., 2011 ). It is necessary to integrate with IS-enabled organizational capabilities (such as management routines, activities, and business process) to impact DMP (Angeles et al., 2022 ; Chan et al., 2019 ; Davenport et al., 2010 ; Nisar et al., 2020 ; Shalender & Yadav, 2019 ). Thus, IS infrastructure can be valuable and rare, but it may be imitable by a competitor. However, when IS infrastructure integrates and supports the IS applications allow accounting routines. Therefore, IS-SEM practices can be more expensive to imitable because firms build organizational capabilities combining with human expertise and IS resources, which results in DMP. Thus, these results extend knowledge of RBV literature.
Fifth, the outcomes demonstrated that DMP fully mediates the relationship between IS-enabled SEM practices on strategic flexibility in innovation (SFI), confirming H4. Moreover, the findings confirmed that the serial mediation of IS-SEM and DMP mediate the effects of IS infrastructure integration on SFI, supporting H5. Thus, this study backs to the extensive knowledge of IS literature, confirming that IS capabilities deliver strategic benefits to firms, through strong infrastructure and transactional applications that provide information for managing, accounting, analysis, planning, reporting, and monitoring to enhance making-decision and gain competitive advantage (Aral & Weill, 2007 ). Therefore, the empirical research proves that technological investment in IS infrastructure alone is not enough to promote SFI, independent of the context of developed or emerging countries' markets. Hence, using the lens of RBV theory, IS capabilities, and IS infrastructure integration helps to achieve decision-making performance when IS embedded in the accounting routines by SEM. Decision-making performance results in strategic flexibility in innovation.
Sixth, the test of possible natural country moderation demonstrated that there was no direct effects difference between Brazil and USA, but there is a little difference ( p < 0.05) in the relationship between ISII and SFI, demonstrating the correlation at this black box relationship, thus partial endorsing hypothesis H6. However, when comparing the characteristics of the firm size of both countries, the Brazilian sample has more concentration at large firm size (above 500 employees) and mature-age firms, and the USA has more emphasis on middle to large firm size (50–499 employees), and small to middle-age firms.
Seven, So, these findings demonstrated that small and middle-size firms in the developed economy have more conscious of AIS-business value and affordability to invest in IT assets. Whereas, in an emerging economy, the availability of IT investment can be concentrated in large-size organizations. In line with recent research of BI&A emerging technologies, realized in an emerging country, that have excluded small-size firms of sample research, because they mainly absence the monetary capitals to invest in IS systems and applications. So, this study contributes to the novel knowledge of AIS literature, when identifying differences in firm characteristics to influence the IT investment, use, and adoption of emerging technologies to gain SFI.
Eight, the analysis of the potential presence of heterogeneity influences the effects in the relationship of the proposed model research demonstrated, in 1-segment (256 cases) that the strong effects of IS infrastructure integration on SFI by serial mediation of IS-SEM and DMP with a substantial coefficient of determination (R 2 ), above 0.788, more apparent for US firms with a competitive strategy of differentiation (large and focus segmentation), characterized by young and middle-age and middle-size firms, and firms that belong to agribusiness and government sectors. The 2-segment (132 cases) showed the serial mediation of IS-SEM and DMP in the relationship between IS infrastructure integration on SFI with moderate R 2 for IS-SEM = 0.152 and SFI = 0.258, and the direct effects of ISII on IS-SEM and DMP on SFI were less than the 1-segment. The 2-segment is more apparent for Brazilian firms with a competitive strategy of leadership cost (large and focus), mature-age and large-size firms, and organizations that belong to the service sector.
Hence, these results contribute to novel AIS knowledge demonstrating that heterogeneity influences (with different effects) the relationship of AIS capabilities, confirming hypothesis H7. This empirical study demonstrated that organizations in developed economies prioritize IS investment to sustain competitive strategy by differentiation to gain SFI, on the contrary firms in the developing economy prioritize the adoption and use of emerging technologies to support competitive strategy by leadership cost to gain SFI. Therefore, it is possible to conclude that US firms adopted IS to support and SEM practices to influence may be more exploration innovation and Brazilian firms to maybe more exploitation innovation. Thus, this study fills the gaps mentioned by Rikhardsson and Yigitbasioglu ( 2018 ) that emerging technologies related to AIS can be investigated in newer contexts about how emerging technologies contribute to organizational performance, as well as changes in decision quality and resource use, by the influence of internal variables (such as; size, industry, organizing principles, power relations, organizational culture, and management characteristics).
Business Intelligence and Analytics delivers smart analysis and solution and insight about business and stakeholders based on rich data. Therefore, BI& A is at top of the accounting agenda in the organization. Today, organizations rely on efficient, effective, current, updated and timely data to make strategic financial and accounting decision. So, BI &A with IS infrastructure and IS capabilities help accounting to gain valuable insight about business to improve decision-making performance. Outcome of decision-making performance results in strategic flexibility in innovation. Therefore, aligning BI and A with accounting and financial objectives will result in proper budgeting, financial planning, monitoring revenue and expenses. Therefore, governance can option to choose, plan and adopt alternative options to take actions that will result in strategic flexibility in innovations (Rigoni et al, 2010 ). There is significant link that support Information Systems Infrastructure Integration results in Strategic Flexibility in Innovation. And Information Systems Strategic Enterprise Management and Decision-Making performance play mediated role in the process. The research findings suggest that there is no difference between American and Brazilian firms. There is no difference between large firms and small- and medium-size firms because American responses are from small- and medium-size firms where Brazilian responses are from large firms. However, IT investment and emerging technologies readiness are more in the US firms than Brazilian firms.
Implications of the Research
The outcomes demonstrated inferences for managers and accounting executives. Investment in emerging technologies in firms from developed or emerging economies has an important role to gain SFI to continue in an extremely fluctuating and competitive environment. Firms have access to extremely capable emerging technologies to exploit information and strategic knowledge more efficiently to gain a competitive advantage (Aydiner et al., 2019 a; Mikalef & Gupta, 2021 ; Sushil, 2016 ; Yoshikuni et al., 2021 ). However, notes that the imprudent integration of IS infrastructure may not provide the desired strategic benefits to increase competitiveness (Li and Chan, 2019 ). The reason that the serial mediation by IS-SEM and DMP occurs in the relationship of IS infrastructure integration on SFI is explained by how IS generates business value. Thus, from a practical perspective, IS infrastructure alone is not a “silver bullet,” it is a valuable and sometimes rare IT resource, with zero-order capabilities. But IS can enable tangible and intangible resources (first-order and second-order capabilities) to have decision-making performance, and consequentially IS capabilities produce business value and maintain competitiveness through innovation.
Ongoing investments in evolving emerging technologies push organizations' capabilities to gain competitiveness. This study emphasizes that AIS investments can be prioritized at firms to develop organizational capabilities not only for accounting units employees but for all employees that need decision-making to improve strategic flexibility in innovation. Hence, the responsibilities of executive accountants amplify by the adoption of emerging technologies integrating with other units, it not only focuses on roles within management accounting required, but support organizations with data, information, knowledge, and intelligence to make a better decision to gain innovation. Strategic flexibility is also important for exploiting economies of scale (Sumita & Yoshii, 2013 ). But leadership has a strong role to play in strategic execution through strategic flexibility (Dhar et al, 2022 ).
Limitations and Future Research
The contribution of the study presents significant quantitatively findings through the serial mediation model in the accounting information systems (AIS) field, but there is some limitation that could be investigated in future research. Although Brazil and USA are classified as important countries in the American continent, their cultural, historical, and firm realities might develop obstacles to generalizing these results from a global perspective. Thus, future research could investigate developed and other emerging country firms by other continents or between countries from different continents, allowing comparisons and providing interesting findings. Future empirical research could investigate the longitudinal approach to ascertain the differences before and after the adoption of emerging technologies.
The study emphasized the data, information, knowledge delivery, and system feedback for management accounting by emerging technologies, as recommended by Rikhardsson and Yigitbasioglu ( 2018 ). However, there are many relevant themes and research gaps that maintain importance to be investigated in future research, mentioned by the authors (Rikhardsson & Yigitbasioglu, 2018 ). For example, how IS-enabled SEM practices could support mapping of appropriate visualization techniques to promote competitiveness, backed with empirical evidence; how IS-enabled SEM practices by qualitative methodologies in particular or multiple case studies would be useful to demonstrate push management accounting behaviors to drive firms to competitiveness; what factors could be improved to adopted and use IS-SEM in organizations for various user types and how governance mechanisms of emerging technologies need to be implemented effectively; and last, future research could investigate how data quality influence the strategic benefits of IS-SEM, because it is evident lack of papers in this area (Luftman et al, 2010 ).
Key Questions Reflecting Applicability in RealLife
Do IS infrastructure help for accounting decision making?
Do strategic enterprise information systems help to increase strategic flexibility?
What is the role of emerging technologies for accounting information systems for improving decision making performance in organizations?
How to improve accounting and financial decision making with the help of business intelligence and analytics?
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Measurement items for constructs.
IS infrastructure integration-ISII adopted by Peter and colleagues (Peters et al., 2016 ).
Please rate how well IS infrastructure integration (to support strategic planning, budgeting and forecasting systems)…
[ISII_1] are purely based on spreadsheets (1) versus (against). have a fully integrated IT systems architecture (7).
[ISII_2] consist solely of isolated and individualized spreadsheets (1) vs. are integrated by a common, shared online platform and database (7).
[ISII_3] use highly manual processes to extract data from transactional systems (1) vs. have fully automated integration with all relevant transactional systems (7)
[ISII_4] are based on data from disparate spreadsheets (1) vs. source all data from a single data warehouse (7).
IS-enabled strategic enterprise management (SEM) practices -IS-SEM
Please rate how well…
[ISII_1]Strategic management systems enable the company to formulate the content of the strategy through environmental analyzes (external and internal).
[ISII_2]The company discloses strategic objectives and goals for all employees supported by strategic management systems.
[ISII_3]Strategic management systems support managers in simulating scenarios for critical resource bottlenecks and analyzing their economic and financial impacts.
[ISII_4]The company coordinates and distributes the top-down and bottom-up strategic planning, budgeting, and forecasting process through strategic management systems.
[ISII_5]Strategic management systems support monitoring strategic objectives, progress and goals direction, and significant deviations analysis
SGE_6]Strategic management systems allow the company to consolidate information through accounting and management reports.
Decision-Making Performance-DMP adopted by Aydiner and colleagues (Aydiner et al., 2019a ).
Please rate how well your organization …
[DMP_1] communicates the results of organizational level analysis to work group and/or functional level operations to
enable effective support for decision-making.
[DMP_2] has a culture to facilitate long term strategic planning.
[DMP_3] makes strategic decisions effectively.
[DMP_4] reduces the time required to make decision.
[DMP_5] intelligence is designed to reach accurate and comprehensive information in a timely manner.
[DMP_6] decisions are more consistent between various departments in our company.
Strategic flexibility in innovation-SFI adopted by Arnold and colleagues (Arnold et al., 2015 ) , and Chen and colleagues (Chen et al., 2017 )*
Please rate how well our organization…
[SFI_1] has difficulty maximizing new market opportunities (RC)
[SFI_2] is able to introduce new products/services
[SFI_3] has difficulty accommodating major changes in basic product designs or service offerings (RC)
[SFI_4 ] is able to manage the impact of serving new classes of customers
[SFI_5]could allocate marketing resources (including advertising, promotion and distribution resources) flexibly to market a diverse line of products*
Measured latent marker variable -MLMV adopted by Yoshiuni and colleagues (Yoshikuni et al., 2021 )
Please rate the view about your life
[MLMV_1] It is easy for me to reach my goals.
[MLMV_2] I would never abandon the desire to have my own business.
[MLMV_3] I like the warm weather
[MLMV_4] I do not think about having children.
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Yoshikuni, A.C., Dwivedi, R., Dultra-de-Lima, R.G. et al. Role of Emerging Technologies in Accounting Information Systems for Achieving Strategic Flexibility through Decision-Making Performance: An Exploratory Study Based on North American and South American Firms. Glob J Flex Syst Manag 24 , 199–218 (2023). https://doi.org/10.1007/s40171-022-00334-9
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DOI : https://doi.org/10.1007/s40171-022-00334-9
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Quality and efficiency of accounting information systems
Calidad y eficiencia de los sistemas de información contable
Utopía y Praxis Latinoamericana , vol. 26 , no. Esp.2 , pp. 323-337 , 2021
Universidad del Zulia
Received: 27 February 2021
Accepted: 24 March 2021
Abstract: A good accounting information system, institution, or organization can increase its value through increasing quality and efficiency, especially in terms of supply chain efficiency and effectiveness, improving internal control structures, and improving decision making. This research was conducted using a survey questionnaire distributed to 51 employees who work in the Accounting Unit of Ministries and Institutions using the purposive sampling method. Structural equation modeling using the Lisrel 8.80 program was used to analyze the data. The results showed that the Accounting Information System Implementation had a significant positive effect on Organizational Performance through the Quality of Financial Reporting.
Keywords: Accounting Information, System Implementation, Reporting Quality, Organizational Performance.
Resumen: Un buen sistema, institución u organización de información contable puede aumentar su valor aumentando la calidad y la eficiencia, especialmente en términos de eficiencia y efectividad de la cadena de suministro, mejorando las estructuras de control interno y mejorando la toma de decisiones. Esta investigación se realizó mediante un cuestionario de distribuido a 51 empleados que laboran en la Unidad de Contabilidad de Ministerios e Instituciones utilizando el método de muestreo intencional. Se utilizó el modelado de ecuaciones estructurales utilizando el programa Lisrel 8.80 para analizar los datos. Los resultados mostraron que la Implementación del Sistema de Información Contable tuvo un efecto positivo significativo en el Desempeño Organizacional a través de la Calidad de la Información Financiera.
Palabras clave: Información contable, implementación del sistema, calidad de los informes, desempeño organizacional.
A resulting report is a form of accountability of government agencies for the implementation of government implemented. The main objective of financial reporting is to provide high-quality financial reporting information regarding economic conditions, especially the financial condition of an entity, that is useful for decision making (FASB, 1999). Meanwhile, in the Statement of Governmental Accounting Standards (PSAP) (2005), the purpose of financial reporting is to provide useful information for report users so that these reports can be used as a basis for accountability assessments and make economic, social, and political decision making better.
The relationship between reporting quality and organizational performance has been studied by several researchers, for example: (Biddle et al.: 2009, pp. 112-131). Muda et al. state that accounting plays an important role in encouraging accountability, efficiency, and effectiveness of public services. The quality of information will improve the quality of management in seeing changes around the organization so that it can quickly and accurately respond to these changes. The same thing is known from the IPSASB statement (2013), which states that the allocation of resources by the government is inadequate if it is supported by poor quality financial information. The same view is conveyed by several researchers who concluded that the quality of financial reporting is closely related to company performance (Pneman & Zhang: 2002, pp. 22-37; Richardson et al.: 2001). Furthermore, Bell et al. document that the audit opinion and the timeliness of the submission of local government financial reports have a significant positive effect on the financial performance of local governments (Muda et al.: 2018; Bell et al.: 2018).
Conditions that need to be considered before accrual-based implementation was implemented in 2015 are related to the 2012 LKPD audited by BPK, where only 16 provinces and 115 districts/cities received WTP opinions, with the current accounting system applied. Of course, it should be anticipated, lest none of the LKPDs from 539 provinces and districts/cities in Indonesia do not get WTP after the accrual basis is applied. Obviously, this is a setback related to the accountability of regional financial management. Of course, we understand that each region has a very diverse understanding of the system to be implemented. The use of application systems must also be encouraged, including when there are different systems, how to consolidate them so that they are compatible from one system to another. Meanwhile, for regions that are late in submitting LKPD 2012, regions that are late in submitting LKPD 2012 and LRA semester 1-2013 will postpone the transfer of DAU. In 2015, accrual-based SAP in all provinces and districts/cities will be held. With the hope, regional financial statistics can be compatible with the Central Government Financial Report (LKPP), which in turn, Indonesia has a single unit of state financial management. For this reason, regional government readiness needs to be tightened, and we try to facilitate from the institutional aspect (SOTK: Organizational Structure and Work Procedure) that the core of management in implementing accrual-based SAP is LO. Income and expenditure must be recognized at the time the transaction occurs, not at the time the cash inflows/outflows occur. This job is not too difficult, and it only needs commitment from the stakeholders. With the existence of SOTK SKPD and PPKD in each region, accrual-based SAP is expected to be included in the management system.
Several researchers have examined the relationship between accounting systems and financial reporting quality. The existence of an accounting information system provides many advantages in processing and presenting accounting information, especially for financial reporting purposes, because it can shorten the time it takes for accountants to prepare and disclose reports, and increase efficiency in presenting information so that it can have a positive impact on the business decisions of various interest groups. The same thing was also stated by Bell et al., namely that a good financial report is a report produced by a good AIS process. Bell et al. state that in order to produce relevant, reliable, and trustworthy financial reports, local governments must have a reliable accounting system because a weak accounting system can cause the resulting financial reports to be less reliable and less relevant, so that decision making is less optimal. Bell et al. documented that the regional financial accounting system has a significant effect on the quality of local government financial reports (Bell et al.: 2018).
The phenomenon of the relationship between the influence of Accounting Information System Implementation and Organizational Performance above is interesting for further investigation. In addition, indications of the scarcity and limitations of research regarding this study add to the need for further research on these variables.
Based on the gap above, the purpose of this study is to ascertain whether the implementation of an accounting information system can improve organizational performance by increasing the quality of financial reporting. The aim is to examine the phenomenon from the point of view of government accountants. The hope is that the phenomena mentioned above can be identified, especially in the context of Indonesia as a developing country.
Accounting Information System Implementation
Government agencies in most developing countries have created computerized accounting information systems to improve their public financial management, such as budget management and decisions, relieve fiduciary responsibilities, and organize financial reports for ministries, board agencies, and other government agencies (Baker & Powell: 2009; Din et al., 2021, pp, 1,10). As an organization, information systems can also help organizations achieve organizational goals, control internally and improve accountability and corporate governance in public institutions. This shows that an information system has a positive impact on various fields, such as financial management, public governance, and fiduciary risk management (ACCA, 2010).
In the government sector, the use of Information Technology (IT) has helped the government in modernizing administration in the areas of accounting, finance, project management, inventory control, and counter service operations. Service quality in the public sector is still low; therefore, the widespread use of IT is expected to improve service quality. And the productivity of the government sector. The implementation of the government accounting system provides benefits and benefits to the government in realizing transparency and accountability in financial management so that the implementation of program activities is well recorded and has clear dimensions in the presentation of financial reports.
Donelson et al. revealed that companies would only achieve high performance when they are able to carry out technology development (Donelson et al.: 2017, pp. 45-69). Trofimova et al. implement the implementation of the government accounting system, and regional management affects the internal control function (Trofimova et al.: 2019, pp. 416-424).
Good quality financial reporting can reduce the risk of imperfect information among users of financial statements or information asymmetry (Copeland & Galai: 1983, pp. 1457-1469). In the context of government, the government, which acts as an agent, certainly has more information than the general public, who acts as a principal. So, to reduce information asymmetry and increase agency accountability, government agencies are required to submit accountability reports that contain performance achievement of activities. Management carried out. The report is called the Government Agency Performance Accountability Report. LAKIP has several functions, including as a quantitative performance appraisal tool, as a form of accountability for the implementation of tasks and towards the realization of good governance, and as a form of transparency and accountability to society on the one hand and on the other hand, LAKIP is a means of control and a means of spurring improvement (Bordeleau et al.: 2020, pp. 173-185). The performance of each organizational unit.
The not optimal accounting function in the accounting entity is also the cause of the delay in submitting the SPJ report to the reporting entity so that reporting on the reporting entity is not on time. So that financial reports that should be presented at regular times to show changes in the state of the entity are not timely. According to research results.
Government Financial Reports can be said to be of quality if they contain predetermined characteristics so that the information generated can become the basis for decision-making for its users. The internal control system is an integral process that is carried out continuously. This is supported by previous research, namely Kewo & Afiah, which states that understanding of the financial accounting system affects the quality of financial report information (Kewo & Afiah: 2017, pp. 568-572). This means that employees of the accounting/finance section of the Government Work Unit have understood the accounting process to become financial reports so that the goal of making quality financial reports can be achieved. The research results of McDonald explain that the financial accounting system has a positive and significant effect on the quality of financial reports (McDonald: 1999, pp. 11-22; Bordeleau et al.: 2020, pp. 173-185). This means that the higher the level of application of the regional financial accounting system will improve the quality of financial reports.
The ministry's performance will increase if the quality of government financial reporting increases, as well as this, can be seen from the objective of measuring financial performance according to Chohan, namely as a report on the operation of government activities aimed at assessing the organization's financial performance in terms of efficiency and effectiveness as well as monitoring actual costs and costs, which is budgeted (Chohan: 2019; Bordeleau et al.: 2020, pp. 173-185). The efficiency ratio is a ratio that describes the comparison between output and input or realized expenditure and realized regional revenue.
Based on the explanation above, to ensure the success of the research implementation, the researcher proposed four research hypotheses:
H1: Implementation Accounting Information System a positive effect on the Quality of Financial Reporting?
H2: Implementation Accounting Information System a positive effect on the Performance?
H3: Quality of Financial reporting a positive effect on the Performance?
H4: Implementation Accounting Information System has a positive effect on Performance through Quality of Financial Reporting?
This study uses three variables, namely the independent variable (X) Implementation Accounting Information Systems, the intervening variable (Y) Quality Reporting, and the dependent variable (Z) Organizational Performance. The population in this study is an accountant who works at a public service firm. The sampling technique in this study used purposive sampling with the criteria that the accountant works at the Ministries and Institutions in Indonesia.
The analysis chosen was Structural Equation Modeling (SEM) with LISREL version 8.80 software. SEM has better capabilities when compared to the path and regression analysis. SEM can simultaneously analyze the relationship between variables or what is known as path analysis and confirm whether the indicators used are appropriate in explaining the variables under study are known as Confirmatory Factor Analysis (CFA).
Soto determine the minimum sample size of 100-200 respondents or five observations for each parameter estimate, in this study, the number of questionnaire items was 31 items; thus, the sample required was at least 31 x 5 = 155.
The data collection method used in this research is primary data collection, where the researcher collects data directly to the first source or object place by sending a questionnaire directly to the 51 accountant Ministries and Institutions in Indonesia via email and LinkedIn.
Respondent Profile Characteristics
Testing the overall fit of the model can be seen from the following figure.
Based on the picture above, it can be seen that the overall model fit test results using the X2 test (chi- square) obtained a value of 229.185 with a p-value of 0.000 and RMSEA of 0.168. When referring to the RMSEA value, the model is not yet fit, so a model respecification test is carried out to improve the Goodness of Fit model. Following are the results of respecification by correlating the errors between indicators gradually according to modification indiches.
The Effect of Accounting Information System Implementation on the Quality of Financial Reporting
Accounting Information System has a positive effect on the Quality of Ministry / Institution Financial Reporting. Based on the results of hypothesis testing, the Accounting Information System has a positive and significant effect on the Quality of Ministry / Institution Financial Reporting. The results of this study provide empirical evidence that the better the Accounting Information System, the better the Ministry / Institution's Financial Reporting Quality. The results of this study are in line with Altamuro & Beatty, which states that the implementation of information systems has an impact on all aspects of accounting, including financial reporting. Likewise with Bell et al. argues that the implementation of accrual-based government accounting is able to improve the quality of financial reporting of K / L in Indonesia. The implementation of an accounting information system can help reduce errors caused by one's negligence and inability to prepare financial reports (Bell et al.: 2018; Altamuro & Beatty: 2010, pp. 58-74).
In government agencies in Indonesia, the term Government Agency Performance Accountability System (SAKIP) is known, which is a systematic series of various activities, tools, and procedures designed for the purpose of determining and measuring, collecting data, classifying, summarizing, and reporting performance to government agencies. In order to account for and improve the performance of government agencies. This definition has been stated in Presidential Regulation No. 29/2014. SAKIP requires government agencies to account for and explain the success or failure of performance achievement by making a report called the Accountability and Performance Report of Government Agencies (LAKIP). With a good accounting information system, an institution or organization can increase its value through increasing quality and efficiency, especially in terms of supply chain efficiency and effectiveness, improving internal control structures, and improving decision making. This means that all manual procedures that allow errors to be generated can be reduced because of the computerized concept of these procedures, starting from data collection, recording, summarizing, to reporting financial positions and financial operations at State Ministries / Institutions. With this concept, the information generated to organizational management regarding the formation and achievement of specific final objectives will be relevant.
The Effect of Accounting Information System Implementation on Organizational Performance.
Accounting Information System has a positive effect on the Organizational Performance of Ministries / Institutions. Based on the results of hypothesis testing, the Accounting Information System has a positive and significant effect on the Organizational Performance of Ministries / Institutions. The results of this study provide empirical evidence that the better the Accounting Information System, the better the Organizational Performance of Ministries / Institutions.
The results of this study are in line with Donelson et al., who stated that companies would only achieve high performance when they are able to carry out technology development (Donelson et al.: 2017, pp. 45-69). In addition, Trofimova et al. also state that the implementation of the government accounting system and the implementation of regional financial management affect the internal control function (Trofimova et al.: 2019, pp. 416-424).
The results of research by Vasarhelyi & Alles also found that AIS has a positive effect on task efficiency. On the other hand, research from Soudani states that the effectiveness of accounting information systems has a significant contribution to organizational performance. However, the effectiveness of the accounting information system has an insignificant relationship with organizational performance but indirectly has a significant relationship with organizational performance (Vasarhelyi & Alles: 2008, pp. 227-239; Soudani: 2012; pp. 136-145).
Other research that is also in line comes from Mulyani et al., which proves that the implementation of accounting information systems affects organizational performance. Another concept comes from the research of Andarwati et al., which states that there is a positive relationship between SMEs using SIA for fiscalmanagement and banks with better performance measures (Mulyani et al.:2016, pp. 552-560; Andarwati et al.: 2018, pp. 38-42).
The results of this study support the concepts and theories of ACCA information systems (2010), whichstates that this information system is built for the purpose of helping organizations achieve organizational strategic goals, strengthening internal control, and improving accountability and corporate governance in public institutions. This shows that an information system has a positive impact on various fields, such as aggregate financial management, operational management, public governance, and risk management.
In the government sector, the use of Information Technology (IT) has helped the government in modernizing administration in the areas of accounting, finance, project management, inventory control, and counter service operations. The quality of service in the public sector is still low; therefore, the widespread use of IT is expected to improve quality. Services and productivity in the government sector. The implementation of the government accounting system provides benefits and convenience for the government in realizing transparency and accountability in financial management so that the implementation of program activities is well recorded and has clear dimensions in the presentation of financial statements.
If it is related to the existing accounting information system, there is still a lack of implementation of financial information that supports the implementation of the government program. For example, there are still accounts in the financial statements that are presented that are not in accordance with Government Accounting Standards (SAP), including mismatches in the presentation of current assets, fixed assets, other assets, and liabilities in the Ministry / Institution Balance Sheet, as well as income and expenditure accounts in Ministry / Agency Budget Realization Report (LRA), as well as expense accounts in the Ministry / Agency Operational Report (LO). This resulted in the results of the examination concluding that the implementation of activities by the central government on the object of the examination was not yet fully effective. This phenomenon can explain how the results of the examination of government agency reports are one of the responsibilities of government agencies conveyed in the form of reports. This form of accountability is very important because it can be used as a benchmark in assessing accountability and measuring the performance of the agency.
Quality of Financial Reporting has a positive effect on the Organizational Performance of Ministries / Institutions. Based on the results of hypothesis testing, the Quality of Financial Reporting has a positive and significant effect on the Organizational Performance of Ministries / Institutions. The results of this study provide empirical evidence that the better the quality of financial reporting, the better the organizational performance of ministries/agencies.
The relationship between reporting quality and organizational performance has been studied by several researchers, for example: (Biddle et al.: 2009, pp. 112-131). Muda et al. state that accounting plays an important role in encouraging accountability, efficiency, and effectiveness of public services. The quality of information will improve the quality of management in seeing changes around the organization so that it can quickly and accurately respond to these changes (Muda et al.: 2018). The same thing is known from the IPSASB statement (2013), which states that the allocation of resources by the government is inadequate if it is supported by poor quality financial information. The same view is conveyed by several researchers who concluded that the quality of financial reporting is closely related to company performance (Pneman & Zhang: 2002, pp. 22-37; Richardson et al.: 2001).
Furthermore, Bell et al. document that the audit opinion and the timeliness of the submission of local government financial reports have a significant positive effect on the financial performance of local governments. In line with that, Biddle et al. also stated that financial reporting transparency has a positive effect on investment efficiency (Bell et al.: 2018; Biddle et al.: 2009).
In the context of government, the government, which acts as an agent, certainly has more information than the general public, who acts as a principal. Thus, to reduce information asymmetry and increase agencyaccountability, government agencies are required to submit accountability reports containing performance achievements on management activities carried out. The report is called the Government Agency Performance Accountability Report. LAKIP has several functions, including as a quantitative performance appraisal tool, as a form of accountability for the implementation of tasks and towards the realization of good governance, and as a form of transparency and accountability to society on the one hand and on the other hand, LAKIP is a means of control and a means of spurring improvement.
The problem with the 2017 Ministry of Finance Financial Report shows that the information system in the Directorate General of Taxes has not synchronized the VAT data collected by VAT collectors with payment data, which can explain how the quality of reporting can affect organizational performance. The implication of this problem for the quality of financial reports is that the presentation of tax revenues is lower than it should be and also affects the performance of the ministry in meeting tax revenue targets.
Financial reporting plays an important role in promoting accountability, efficiency, and effectiveness of public services. The quality of reporting will improve the quality of management in seeing changes around the organization so that it can quickly and accurately respond to these changes. The same thing is known from the IPSASB statement (2013), which states that the allocation of resources by the government is inadequate if it is supported by poor quality financial information. A resulting report is a form of accountability of government agencies for the implementation of government implemented.
Effect of Accounting Information System Implementation directly on Organizational Performance through the Quality of Financial Reporting.
Accounting Information System has a positive effect on Organizational Performance through the Quality of Financial Reporting. Based on the results of hypothesis testing, the Accounting Information System has a positive and significant effect on Organizational Performance through the Quality of Financial Reporting. The results of this study provide empirical evidence that the better the Accounting Information System, the better the Quality of Financial Reporting, and the impact on the increasing organizational performance.
The results of this study are in line with Altamuro & Beatty, which states that SIA has a positive effect on organizational effectiveness through financial reports and good decision making. In addition, research conducted by Noerlina et al. also found that SIA had a positive effect on company decisions in terms of acquisitions and mergers through good quality accounting reports. In Nzomo Soudani’s research (2011), it was also found that AIS had a positive effect on organizational effectiveness and decision-making, as well as control activities due to quality reporting. In line with that, Vasarhelyi & Alles also found that accounting information has a significant effect on financial performance and stock prices through accounting information, namely earnings reporting quality and book value (Altamuro & Beatty: 2010, pp. 58-74; Noerlina et al.: 2011, pp. 18-20; Soudani: 2012; Vasarhelyi & Alles: 2008).
In statutory regulations, the relationship between financial reporting and organizational performance is contained in Government Regulation of the Republic of Indonesia Number 8 of 2006 concerning Financial Reporting and Performance of Government Agencies which requires government agencies to prepare performance reports. This performance report can be used as a tool to measure the performance of government agencies. Performance measurement must be based on predetermined parameters and can be compared so that the performance of an agency can be compared between years and between agencies. Furthermore, the scope of Government Regulation No. 8/2006 was later narrowed down in Presidential Regulation No. 29 of 2014 concerning Government Agency Accountability Systems. This regulation specifically regulates how government agencies report their performance in accordance with the provisions of the prevailing laws and regulations. With this regulation, the measurement and reporting of government finances can be a starting point in assessing the performance of Ministries / Institutions in a more systematic and structured manner.
Basically, the implementation of accrual-based government accounting is able to improve the quality of K / L financial reporting in Indonesia. The implementation of an accounting information system can help reduce errors arising from one's negligence and inability to prepare financial reports. The existence of an informationsystem (application/software) will facilitate and reduce the error rate in preparing financial reports. This information system can minimize the risk of typos, additions, account misclassifications, and other errors so that it can present information in financial reports more accurately and validly. Valid information will result in unbiased decision-making and make optimal performance.
In addition, a good accounting information system with its relevance is able to make a difference in a decision and produce quality reporting through the information that is closely related to the decisions to be taken. With that, financial reporting will have a feedback value (feed-back value), which is able to help justify and correct past expectations and has a predictive value, which can be used to predict what will happen in the future. It means that the decisions taken in implementing the targets based on the report will also be of high quality and produce a good performance (Alam and Shakir, 2019; Bhatti and Akram, 2020; Uwajumogu et al., 2019).
A good accounting information system will also encourage the presentation of appropriate financial reports to users before the information loses its capacity to influence decision making. In 2016, BPK provided WTP opinion on LKPP, which previously only provided WDP opinion. This increase is because the government has followed up on the results of the BPK audit of the 2015 LKPP, including improving the central accounting system (Aguenane, 2020; Gazi, 2019; Babalola & Yelwa, 2020).
The government's efforts, in this case, are reflected in the use of application systems that are continuously being encouraged, including when there are different systems, how to consolidate them so that they can be compatible from one system to another. Meanwhile, for regions that are late in submitting LKPD 2012, regions that are late in submitting LKPD 2012 and LRA semester 1-2013 will be carried out
A good accounting information system, institution, or organization can increase its value through increasing quality and efficiency, especially in terms of supply chain efficiency and effectiveness, improving internal control structures, and improving decision making. This is because the existence of an accounting information system can make the financial reporting process of an agency easier and faster because the management of data into accounting information can be done through the system so that it can reduce the risk of recording errors which will then result in the information presented and disclosed in the Ministry's financial statements. The State / Institution becomes more qualified and reduces the possibility of material misstatement of the State Ministry / Agency. The Government Agency Accountability System will specifically regulate how government agencies report their performance in accordance with the provisions of the prevailing laws and regulations. With this regulation, the measurement and reporting of government finances can be a starting point in assessing the performance of Ministries / Institutions in a more systematic and structured manner. The implementation of accounting information systems can also help reduce errors caused by negligence and the inability of a person to prepare financial reports so that they can present information in financial reports more accurately and validly. Valid information will result in unbiased decision-making and make optimal performance. In the context of governance, the government, which acts as an agent, certainly has more information than the general public, who acts as a principal. Thus, to reduce information asymmetry and increase agency accountability, government agencies are required to submit accountability reports containing performance achievements on management activities carried out; this will also have an impact on financial reporting which encourages accountability, efficiency, and effectiveness of public services. . The quality of reporting will improve the quality of management in seeing changes around the organization so that it responds quickly and appropriately to changes.
I. FARIDA : is an auditor in the Audit Board of the Republic of Indonesia. She has a lot of knowledge and skills in accounting, auditing, risk management, accounting information systems, public sector accounting, financial accounting, corporate finance/financial management, and taxation. She is currently a doctoral candidate of Accounting in University of Padjadjaran.
S. MULYANI : is a Rector in University of Singaperbangsa Karawang and a lecturer in the Accounting Department, Economic and Business Faculty, University of Padjadjaran. She has experienced more than 25 years in the field of information systems and good governance for the private, public, and sharia sector. She actively writes and gives consultations for analyzing and designing applied information systems, good governance, sharia finance, and others. She is currently the National Council Member, Institute of Indonesia Chartered Accountants.
B. AKBAR : is an auditor in the Audit Board of the Republic of Indonesia and a lecturer in the Accounting Department, Economic and Business Faculty, University of Padjadjaran and Institute of Domestic Government. He has a specialization in Auditing, Public Sector Accounting, and State Finance Law.
S.D. SETYANINGSIH : is an auditor in the Audit Board of the Republic of Indonesia and a lecturer in the Accounting Department, Economic and Business Faculty, University of Pakuan. She specializes in Auditing, Public Sector Accounting, and Financial Management. accounting and financial information, accounting information systems, auditing, behavioral financial and accounting research.
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Margaret Garnsey , Necip Doganaksoy , Elaine Phelan; Topics for the Accounting Information Systems Course: A Dual Perspective Approach from Educators and Employers. AIS Educator Journal 1 January 2019; 14 (1): 36–55. doi: https://doi.org/10.3194/1935-8156-14.1.36
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Researchers have studied which topics to address in the Accounting Information Systems (AIS) curriculum since the 1980s. Although previous studies have identified several core topics, they have noted that the rapid pace of technology calls for continued research. This study extends prior research by surveying and comparing the views of employers and AIS educators. Even though educators consistently rated the AIS topics higher in our survey than employers did, we find a general agreement between the two groups as to the relative importance of the topics. Educators and employers concur on core AIS topics, including spreadsheet skills, internal controls, and transaction processing/cycles and general ledger reporting. This is consistent with past research. On the other hand, the following areas have gained prominence among educators and employers: Sarbanes Oxley, encryption, SQL, ERP systems, Internet communication systems, and e-commerce. The findings of this study will assist AIS faculty in determining which content will be the most relevant to accounting majors.
Except for the Accounting Information Systems (AIS) course, the required courses for an undergraduate accounting major are typically predictable and consistent in most college curriculums. In contrast, the AIS course varies in both the topics and the emphasis on topics. Badua, Sharifi, and Watkins (2011) found a historical lack of consensus in oversight bodies seeking to influence the AIS curriculum (AAA Mock Committee Report, 1987; AICPA Core Competencies, 1999; AICPA Top Technologies, 2010). They state this “indicates that a considerable state of flux exists concerning suggested topical coverage in AIS courses over the years” ( Badua, Sharifi, & Watkins, 2011 , 91).
This flux is due at least in part to rapid changes that occur in technology and its use by professionals. Albrecht and Sack (2000) noted that advances in technology have reduced the cost of gathering data and reporting information. In the past decade, “big data” has become a popular term as business decisions have become more data-driven. AACSB Accounting Standard A5, issued in 2018, states, in part, that accounting students should have experience in “development of skills and knowledge related to data creation, data sharing, data analytics, data mining, data reporting, and storage …” ( AACSB International, 2018b , p. 27).
The proliferation of topics makes it difficult to determine which items should be emphasized in the first – and in many cases the only – undergraduate AIS course. The current thought processes of educators 1 and employers 2 are valuable for determining the future content of required AIS courses. We deemed this review necessary to assess the relevance of the AIS curriculum at our institution. Our objective was to explore which AIS topics are the most important to graduates so we could tailor our AIS courses to emphasize the topics most relevant to our students. The challenge of knowing which topics to address in the AIS course has grown as the number of topics in the subject has increased. Badua, Sharifi, and Watkins (2011) conducted a review of syllabi for AIS courses between 1997 and 2007. They found that while the average number of topics in a course remained constant, the diversity of topics increased.
Our paper contributes to the existing research on AIS course topical coverage by comparing survey results from educators and employers. The findings of our study confirm previous research that identifies core topics that should be addressed in the AIS course. We also identify additional topics that are of moderate importance – topics AIS educators may want to consider addressing in their curriculum. The results of our study can inform curriculum reform decisions beyond our institution.
The next section provides a review of research on the AIS curriculum. Then we discuss the survey instrument and respondents, an analysis of the results, and finally a summary and conclusions.
“Technology is used to gather, transform, and analyze data into meaningful information for decision making. … Yet these changes (in technology) are usually not reflected in a robust timely fashion in academic accounting programs nor student's internship experiences. This curricular deficit creates a significant risk for accounting program graduates, who, upon employment in a global environment, are expected to effectively and efficiently utilize and understand technologies and their capabilities, impacts, risks, and opportunities to add value to their organizations.” ( The Pathways Commission, 2012 , p. 72)
In 2015, the Pathways Commission noted data collected from practitioner and academic focus groups “indicated (1) a strong consensus for some technologies (e.g., accounting students need to be highly competent with spreadsheets) and (2) significant discrepancies for other technologies” ( The Pathways Commission, 2012 , p. 10). Boulianne found that despite the importance of technology to accountants, “IT has lost ground, notably due to the larger coverage of Finance and Strategy/Governance” (2016, p. 314).
In many accounting programs, the AIS class is the technology course. Research regarding AIS topical coverage has been ongoing since the 1980s. Table 1 presents a summary of the topics most frequently mentioned as important in previous research.
Topics Considered Important in Previous Studies
In one of the earliest studies of AIS, Davis and Leitch (1988) found spreadsheets to be the highest-rated topic by recent accounting graduates. Spreadsheets continue to be rated the most important technology skill for accountants ( Harper & Dunn, 2018 ; Tam, 2013 ). As indicated in Table 1 , transaction cycles/processing, internal control, and databases are the other topics most often mentioned as important to accountants.
Some research has indicated there are disparities in the perceived importance of different technologies between academics and practitioners and between different types of practitioners. As mentioned above, the Pathways Commission (2015, p. 10) noted that data collected from practitioner and academic focus groups “indicated (1) a strong consensus for some technologies (e.g., accounting students need to be highly competent with spreadsheets) and (2) significant discrepancies for other technologies” (e.g., XBRL). In a study of 440 professional accountants, Welch, Madison, and Welch (2010) found CPA firms rated computer auditing highly while accountants in industry and government rated database software and IT operations higher. Winstead and Wenger (2015) surveyed practitioners (primarily CPAs) and academics about the desired proficiency of undergraduate accounting graduates in nine areas of AIS. In all areas of organization systems proficiencies, and in two of three areas of reporting and data sharing proficiencies, the academics favored higher levels of proficiency than practitioners. Newer topics (e.g., XBRL, data-sharing technologies, and basics of e-commerce) produced the most disagreement between the groups. Research also shows that the relative importance of different competencies for new graduates depends on several factors, including the size, industry, and nation of the employer ( Winstead & Wenger, 2015 ; Hastings & Solomon, 2005 ). Various authors ( Badua, Sharifi, & Watkins, 2011 ; Davis & Leitch, 1988 ) note that as new technologies emerge, AIS educators face an increased diversity of topics. Our research builds on this previous work by identifying, comparing, and contrasting the AIS topics that educators and employers currently identify as important for accounting graduates.
We surveyed two types of respondents: AIS educators and employers of accounting graduates. Educator respondents are from attendees of the AIS Educators Conference. The AIS Educators Conference is attended primarily by individuals currently teaching AIS. They are generally involved in research in the field, which indicates they have current knowledge of up-and-coming topics. Badua et al. (2011) and Richtermeyer and Kovar (2001) have also used this population when investigating AIS. Employer respondents are from firms who recruit accounting students at our institution. Although specific to our institution, Table 2 shows they represent a diverse group with regard to industry. The sample includes 18 public accounting firms, two large national/international firms, and 16 local/regional firms. It also includes several asset management firms, banks, federal and state departments (e.g., taxation and finance, health and human services, etc.), national/local manufacturing firms, and service companies. Slightly over thirty percent of the firms have more than 1,000 employees, twenty percent have between 500 and 1,000 employees, and the remainder is evenly divided between those with 100 to 500 employees, 50 to 100 employees, and less than 50 employees.
We developed two versions of the survey. The first part of the employer survey consisted of questions related to employer characteristics. The corresponding part of the educator survey consisted of questions related to the institution where the participant taught and whether the participant had taught an AIS course in the last three years.
The second part was identical for both groups. It consisted of listing potential AIS topics and asking participants to rate the topics for what proficiency an undergraduate accounting major should have at graduation (see Table 3 in the Analysis section). The list is a compilation from previous research on AIS. The number of items was limited so that survey participants could complete the survey in approximately ten minutes since some research indicates shorter surveys have higher response rates ( Burchell & Marsh, 1992 ; Clarkberg & Einarson, 2008 ). Respondents were to rate each topic on a Likert scale or answer as no opinion. The scale is the same as one used by Tam (2013) : 1. No Opinion, 2. Not Relevant, 3. Awareness Only, 4. Some Understanding, 5. Good Understanding, 6. Full Understanding, and 7. Ability to Apply/Use.
Summary Statistics and Rankings of AIS Topics by Educators and Employers (Sorted by Employer Mean Response)
Administration of Survey
We e-mailed a link to the survey to 124 attendees of the 2015 AIS Educator Conference in July 2015. We sent out email reminders at one-week intervals for four weeks. We received fifty-four usable responses for a response rate of 43%. The vast majority (85%) of the respondents had one undergraduate AIS course in their curriculum, followed by 11% with two courses, and the remaining 4% with more than two AIS courses. Over 90% of the respondents have taught AIS in the past five years. Moreover, the profile of the respondents closely resembled the general attendee profile of the AIS Educator Conference. Panel A of Table 2 shows the type of institutions where participants currently teach.
We also e-mailed a link to the survey to 57 employers who recruited accounting students from our institution during the two academic years (2015–2016 and 2016–2017) following the AIS Educator Conference. We sent email reminders at one-week intervals for two weeks and then made follow-up phone calls asking employers to participate. We received 49 usable responses for a response rate of 85%. Panel B of Table 2 shows the breakdown of employers by industry. Two industries (CPA firm and financial and legal) account for 67% of responses.
The summary statistics in Table 3 are based on the responses on the Likert scale defined above. The table provides a breakdown of the employer and educator responses, as well as a breakdown of employers by public accounting, financial/legal firms, and other.
The “no opinion” category was included as a choice in the survey so that respondents who were unfamiliar with a topic would not merely guess at its relevance. The number of responses (n) varies by question since we omitted the “no opinion” responses from the analysis. We include a brief analysis of the no opinion category at the end of the results.
Evaluation of Topics
The data from the employer and educator columns in Table 3 was used to construct a contingency table ( Table 4 ) that summarizes the relationship between the educator and employer responses. We divided the items, based on their median, into three categories: greater importance (7. full understanding or 6. ability to apply/use), moderate importance (5. good or 4. some understanding), and less importance (3. awareness only or 2. not relevant).
Contingency Table of Educator and Employer Responses Categorized by Median of Responses
Slightly over half the topics fell in the same category for both the employers and educator respondents. Many of these topics are in the moderate importance category for both groups. Employers classified slightly more than 25 percent of the topics as being less important while educators rated them as having moderate importance . Almost half of those topics are related to databases and database design (ER diagrams or UML class models, REA ontology, QBE, SQL, and relational database implementation). The only database-related topic that employers rated as having moderate importance was basic database concepts.
The only item that had medians in the category greater importance for both the educator and the employer respondents was basic spreadsheet skills. Advanced spreadsheet skills were also considered important by both groups (falling in the moderate importance category). While not necessarily taught routinely in AIS classes, as mentioned in the literature review, research has consistently shown spreadsheet knowledge is considered important for success to an entry-level accountant.
Educators categorized three other items as having greater importance : transaction cycles, internal controls, and COSO. Employers classified those items as moderate importanc e. Internal controls and COSO relate to the topic of internal controls, which research has consistently mentioned as an important topic in the AIS curriculum (see Literature Review). Both groups categorized the related topics of IT controls and IT audit as having moderate importance .
Another block of topics categorized as having moderate importance by both groups is related to e-commerce (these topics include digital signatures, encryption, and privacy regulation and controls). Employers rated the topic of e-commerce itself as being of lesser importance . Employers also had XBRL as of lesser importance . Educators rated XBRL as having moderate importance . Richtermeyer and Kovar (2001) reported that a majority of AIS faculty either covered or intended to cover these topics.
CPA firms. This category consists of both local/regional and national CPA firms (total n=18).
Financial and legal firms (total n=16).
Other firms (total n=17). We constructed this category by combining the responses of the other types of employers displayed in Panel B of Table 2 .
Table 5 displays the response categories for which the importance category of the designated employer category differed from those of the combined employer group.
Changes in Responses in Comparison with Combined Employer Responses
Both the CPA and the other firms categories scored COBIT higher (as of moderate importance) than the combined group, while financial and legal firms and other firms scored query by example higher (as of moderate importance) than the combined group. Also, the other firms category scored structured query language and basic computer programming higher (as of moderate importance ) than the combined group while CPA firms scored basic database concepts lower (as of low importance) than the combined group.
To permit an item-by-item comparison of the educator and employer groups, we constructed the scatter plot displayed in Figure 1 Panel A. In this figure, each plotted point corresponds to the mean response for an AIS topic. The diagonal reference line (i.e., identity line) represents perfect matching in the mean responses between the groups. In the figure, nearly all of the points are above the diagonal reference line, suggesting that educators consistently rated the topics higher than employers did. In their study, Bain, Blankley, and Smith (2002) reported a similar pattern. The plotted points reveal a positive correlation, which suggests that there is general agreement between the two groups as to the relative importance of the topics. (The Spearman's rank correlation of means is 0.78 with p-value <0.001. In the Bain, Blankley, and Smith (2002) study, the reported correlation value was 0.51.)
Comparison of Group Means
Table 6 displays a summary of the educator and employer responses by each topic. We used the Mann-Whitney U test to statistically compare the distribution of responses of the educator and the employer groups to each one of the 37 topics. This is a nonparametric counterpart of the well-known t-test used to compare population means. The Mann-Whitney U test is appropriate for the current application given the ordinal (Likert scale) nature of the responses. The test identified statistically significant differences (at the 0.05 significance level) between the two groups for 30 (out of 37) topics. Comparison of sample means using the two-sample t-test led to nearly identical results. The seven topics for which there is no statistically significant difference (i.e., the p-value of the test is greater than 0.05) in the responses of educator and employer groups are shaded in Table 6 .
Educator and Employer Mean Responses and Ranking by AIS Topic
We compared the rank of each topic for the educator and employer groups in Table 6 . There are two differences we believe are worth mentioning. Internal control was one of the highest-ranked topics for both groups (2 for educators and 4 for employers). However, the rank for COSO shows a marked disparity between the groups (6 for educators and 22 for employers). The COSO internal control framework is accepted as the authority on internal controls, so it was not readily clear to us why the employer rank for COSO was significantly lower than their rank for internal control as a topic. We were able to gain a better understanding of this apparent discrepancy as described below.
We carried out a comparison between the financial and legal firms and CPA firms, even though the reliability of such an analysis is limited by the modest sample sizes. Figure 1 Panel B displays the scatter plot of mean responses to survey topics by these two employment sectors. All in all, there is a high degree of agreement between the groups with a Spearman's rank correlation value of 0.62. It is worthwhile to mention that in a topic-by-topic comparison, the only one that showed a significant difference between the two groups was COSO (p-value < 0.01). The rank for COSO was 7 for CPA firms while it was ranked 37 (last) for financial and legal companies. This suggests that there is a close agreement between educators and respondents from CPA firms about the importance of this topic in an AIS course.
The second significant difference noted in Table 6 relates to system documentation. For employers, systems documentation in general, business process diagrams, flowcharts, and data flow diagrams had similar ranks (7, 8, 9, and 11, respectively). Educators had the same rank as employers for flowcharts, but the ranks for systems documentation in general, business process diagrams, and data flow diagrams were lower (13, 17, and 22, respectively). This is a shift from Bain et al. (2002) , where the rank for systems documentation was higher for faculty than professionals (3 vs. 22). It seems that employers are placing more emphasis on documentation than they had before Sarbanes Oxley.
No Opinion Responses
As mentioned above, we included the “no opinion” category in the survey so that respondents who were unfamiliar with a topic would not guess at its relevance. Moreover, the rate of “no opinion” responses is a useful gage to assess the familiarity of different groups with AIS topics. Table 6 displays the percentage of “no opinion” responses by question. We noted a relatively higher occurrence of “no opinion” responses for the employer group. For educators, the “no opinion” response rate for all questions was less than 10%.
In contrast, for the employer group, 10 (out of 37) questions had more than 25% “no opinion” response rate. The questions with high “no opinion” responses were also those that generally ranked lower by the employers. As would be expected, there was a tendency to say “no opinion” among people who do not supervise entry-level accountants (median “no opinion” response rate of 21%) vs. those that do (median “no opinion” response rate of 8%).
We found that employers and educators rated almost two-thirds of the AIS topics in the same category ( Table 4 ). The educators and employers rated internal control, transaction processing systems and cycles, systems documentation, computer fraud, and database management as moderately important or most important. Employers had more topics rated as lesser importance , while educators rated most of those topics as having moderate importance .
A direct one-on-one comparison of our research to prior studies presents nontrivial challenges due to the differences in topics explored, importance ratings employed, and subject populations of the studies involved. However, our findings on core topics closely agree with the conclusions of other authors. These core topics include spreadsheet skills, internal controls, transaction processing/cycles, and general ledger reporting. The significance of these topics has remained relatively constant over time. Covering these topics in the basic AIS course would leave time for a few additional topics of particular interest to an instructor or that are requested by advisory committees or local employers. Having a standard core of AIS topics across schools would prevent confusion as to what new graduates learn in the basic undergraduate AIS course.
Educators and employers in our study rated topics that were predicted by Bain et al. (2002) to exhibit rising prominence as having moderate importance . These include SQL, ERP systems, Internet communication systems, and e-commerce. Certain other areas, such as Sarbanes Oxley and encryption that have gained prominence over the last few years and were rated as having moderate importance in our study, were not considered in most previous studies.
Employers rated several topics related to databases in the lesser importance category. This is surprising given anecdotal evidence from graduates of our accounting program and previous research ( Fordham, 2005 , p. 117) that found both “advanced understanding of relational database design” and “working knowledge of database query design…” were important AIS skills. Looking at the subdivision by employer type ( Table 4 ), both financial/legal and other firms scored QBE higher than the combined group, as having moderate importance and other firms also scored SQL and basic computer programing as having moderate importance . In contrast, CPA firms rated basic database concepts as having lesser importance than the combined group rated them. This agrees with prior research that found database skills were more important in industry and government ( Welch, Madison, & Welch, 2010 ). It may be that CPA firms have the client supply most of the data for analysis, while in other firms, accountants are responsible for retrieving the data.
The single topic rated as having greater importance by both groups was basic spreadsheets. Advanced spreadsheets had the second highest mean in both groups ( Table 3 ). Some business schools, including ours, teach/require basic spreadsheet proficiency as a component of the general business curriculum. Badua's (2008) analysis of AIS course syllabi did not find spreadsheets as one of the top ten topics covered.
There was less agreement between the educator and employer groups on the topics considered to be of lesser importance . The sentiment of irrelevance expressed by employers was far stronger than that expressed by educators. Some of the less important topics identified were XML, basic programming, and the Internet (TCP-IP, client-server systems).
Employers also had XBRL in the lesser importance category. Educators rated XBRL as having moderate importance . The employer rating was surprising, given the fact the SEC requires companies to submit financial statements in XBRL. It seems that accounting students should have a basic understanding of XBRL and how it is used. That understanding would be facilitated if students understood XML (rated as of lesser importance by both groups of respondents) before being introduced to XBRL. However, this response is similar to the findings of Winstead and Wenger (2015) , where CPAs favored a lower level of proficiency than academics for “data-sharing and XBRL.” Looking at the breakdown by employer category, other firms was the only category that changed XBRL from lesser to moderate importance .
Changes at Our Institution
Our department first implemented a required AIS course for undergraduate students entering the school in 2009. This change was a result of a recent program review and the implementation of the 150-hour requirement for CPAs in New York. Before that time, an elective AIS course was offered only once per academic year due to lack of student demand/interest. The new course was offered for the first time in the Spring 2011 semester. Since that time we have used a variety of different textbooks and approaches to teaching the course. Also, although our Accounting Program is not separately accredited, we were aware of Accounting Standard A7 issued in 2013 and reiterated in 2018 as Standard A5. The standard states, in part, that accounting students should have experience in “development of skills and knowledge related to data creation, data sharing, data analytics, data mining, data reporting, and storage …” ( AACSB International, 2018b , 27). To ensure the required AIS course is current and to determine what content is most appropriate for the elective AIS course, our department decided to survey AIS educators, and firms that recruit our students. The results of those surveys, reported in this paper, have helped us to tailor our AIS courses to provide the highest level of relevance to our students.
We have made modest changes to the required AIS course. We have increased the coverage of internal controls and COSO and made the AIS course a prerequisite to the auditing course. The prerequisite has presented some problems due to the number of required accounting courses. We have continued with it at present but may have to change it to a co-requisite in the future.
Rather than flowcharts, we now use business process diagrams (BPDs) to illustrate system documentation. In our survey, flowcharts and BPDs had the same mean response from employers. However, the mean for BPDs had no significant difference with the mean of educators (see Table 6 ). This is noteworthy since, in general, employers rated topics lower than educators. Several students have commented that they have found this relevant when interviewing for jobs. Each semester students are required to complete a project requiring them to analyze data in a database to investigate a business problem and communicate their findings. In the most recent semester, students were required to complete a BPD of the system, to document their understanding, before completing the other parts of the project.
Both educators and employers have consistently ranked basic and advanced spreadsheet skills as important for accounting students. Our surveys reinforced these findings. As mentioned above and as implied by AACSB, we believe that the topic of basic spreadsheet skills belongs in a course required for all business majors. Therefore, we only introduce a limited number of spreadsheet functions (e.g., what-if analysis and data validation) that have specific applications in the text.
We have revamped the elective AIS course in our department based, in part, on the results of our research. The class is now taught in a computer classroom with students spending significant time in each class learning different types of software. We have added a several-week module on advanced spreadsheet functions. Both employers and educators ranked advanced spreadsheets highly (second for employers and fifth for educators). Anecdotal evidence from students indicates they have found this knowledge immediately useful in their internships and employment. In our survey, employers were asked: “Please list any specific Commercial Accounting software students should have experience with.” Quickbooks was the most frequent software mentioned. In response, we have added a Quickbooks module. We also added modules on NetSuite (a cloud-based ERP system) and Tableau (for data visualization). Students have reacted favorably to the changes. Enrollment in the elective doubled in the second offering of the revamped course.
At the graduate level, our M.S. in Accounting program has added a concentration and a certificate in data analytics to address growing interest in this area. The four new courses that comprise this concentration area are: Business Intelligence and Information Systems, Quantitative Methods for Data-Driven Decision Making, Data Visualization and Predictive Analytics, and Decision Modeling and Analytics.
Implications and Suggestions
Based on survey results and the limited changes made at our institution, we have several suggestions. Both employers and educators rate Excel as having greater importance . As mentioned above, we have added an advanced spreadsheet component to our elective AIS course. Several students have commented they have found this useful in internships/jobs. In general, we believe the best way for students to acquire and build competency using spreadsheets is to incorporate an advanced spreadsheet assignment in every accounting course, negating the need to include it as a separate topic in AIS.
“Consistent with mission, accounting degree programs integrate current and emerging accounting and business practices in three primary components within the curricula. 1. Information systems and business processes including data creation, manipulation / management, security, and storage. 2. Data analytics including, for example, statistical techniques, clustering, data management, modeling, analysis, text analysis, predictive analytics, learning systems, or visualization. 3. Developing information technology agility among students and faculty, recognizing the need for continual learning of new skills needed by accounting professionals” ( AACSB International, 2018b , 27).
The recent AACSB 2018 Business Standards update has added Technology Agility to Standard 9 – Curriculum Content ( AACSB International, 2018a ). This implies that technology should be integrated throughout the business curriculum, not just in accounting classes.
Badua et al. (2011) found that the number of topics covered in an AIS course has remained constant at about six. However, they note that the variety of different topics taught in AIS courses has increased over time. The results of the current research show that AIS educators and employers agree on a broad array of topics that is of moderate importance to accounting undergraduates. A single undergraduate AIS course does not have sufficient time to cover in any depth or even introduce all of the topics identified as being important. We agree with the suggestion of Badua et al. (2011) that a second AIS course may be warranted. This second course would contain those “likely to change with technological innovation.” We believe the second course could address topics rated as moderate importance not addressed in a basic AIS course and topics important to local employers.
We recognize this suggestion may be impractical at many institutions due to the number of required courses for accounting majors. Boulianne (2016) found a decrease in the number of required IT courses in accounting programs since the unification of the three Canadian professional accounting associations. With the advent of the 150-credit hour requirement for a CPA license, schools should critically assess whether there are courses that relate primarily to the CPA examination that could be moved to the graduate program allowing for additional flexibility in the undergraduate program. Another approach is to determine if there are IT topics/skills that are relevant for all business students to have. Examples of possible topics include privacy regulation and e-commerce. A required course could then be designed to address those topics as part of the curriculum for all business students. A business course focused on technology is in line with the recent update of AACSB Business Standards, which includes Technology Agility ( AACSB International, 2018a ).
Limitations of the Study
There are several limitations to the current study. Our first survey only included instructors attending the AIS Educator Conference. Similarly, we e-mailed employers' surveys to employers who recruit accounting students at our college. However, we believe that the industries that recruit our accounting students are similar to other schools located in a medium-sized metropolitan area (~1,000,000 population). The majority of respondents were from CPA, financial, and legal firms. The ordering of topics in the survey may have created a bias in responses. The topics were not randomized. Bryan and Smith (1997) found randomization did not eliminate bias. Another concern is sampling bias created due to nonresponse. For the employer group, the exceptionally high response rate (85%) to the survey alleviated our concerns in this regard. For the educator group, even though the response rate was lower (43%), the sample size (54) was satisfactory. Moreover, the profile of the respondents closely resembled the general attendee profile of the AIS Educator Conference.
As explained in Table 2 , the sampling periods used for the educator and employer groups are slightly different. The sampling period for the employer group was extended by an additional year to achieve a more representative sample. We believe that that the added duration for the employer group is not sufficiently long to incorporate a marked change in the opinions of the educator and employer groups on AIS topics of interest.
It would be helpful to explore the perceptions of different types of employers in more detail. Our limited sample size prevented an in-depth analysis in this regard. We also did not collect detailed information on the survey participants. Collecting additional demographic information would be useful.
Summary and Future Directions
This study aimed to compare the perceptions of educators and employers regarding topics of importance in AIS education. To that end, we surveyed AIS educators and employers of recent accounting graduates. In line with past research, our findings reaffirmed the strong agreement between educators and employers on core AIS topics, including spreadsheet skills, internal controls, transaction processing/cycles, and general ledger reporting. On the other hand, Sarbanes Oxley, encryption, SQL, ERP systems, Internet communication systems, and e-commerce have gained prominence among educators and employers.
Our study highlights the need to investigate emerging questions on AIS curriculum. For 85% of the educators surveyed, their institution only offered one AIS course. The number of AIS topics continues to grow. It would be useful to study the need for a second AIS course from both the educator and employer points of view. Another topic for further research is the determination of the factors that underlie markedly different ratings of topic between the educator and employer groups (e.g., database concepts, XBRL). The depth and breadth of data analytics in the AIS curriculum warrants further study. Likewise, Blockchain technology and cryptocurrencies have recently gained prominence in business publications. They highlight the fact that it is important for research addressing topics in AIS to be performed periodically so that we can monitor trends and new topics.
This paper contributes to the literature by reporting on the perceptions of educators and employers of the topics that are important to accounting students. It provides data that will assist educators in evaluating what topics would be most relevant to their students. Curriculum research should be performed periodically because we, as accounting educators, must consider industry needs and the changes in technology as we update and improve our curriculums.
The authors would like to thank both the current and prior Editors-in-Chief, the associate editor and two anonymous reviewers whose comments and suggestions greatly improved the quality of our original manuscript.
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The List of 70 Accounting Thesis Topics for Students
Accounting describes the process of recording and consolidating financial transactions in business. It involves analyzing, reporting, and summarizing financial transactions to organizations, businesses, tax agencies, and regulators. This is usually presented via a financial statement, a concise summary of all the financial dealings over a stipulated period. It provides clear documented information of a company’s operations, cash flow, and present financial standing. High accounting standards improve the credibility of financial statements. These financial statements can range from cash flow statements, income statements, loss statements, balance sheets, etc. This constant and customary method of financial reporting enables shareholders and other beneficiaries of a business to examine the performance of the said business.
Accounting Thesis For Students
Accounting research topic ideas, topics for accounting thesis, interesting accounting topics for your paper, accounting research questions, accounting dissertation topics, research papers topics on accounting, financial topics to write about.
Accounting is essential for majorly business and management students. They start the basics of the subject in their lower levels, and some progress to further the subject in their higher studies. During this period of education, there will come a time they will require accounting topics for the thesis. They will need to focus on all the elements of the thesis in accounting and compile topics that will suit their interests.
Accounting thesis topics for students are tailored towards a particular aspect of the profession. In this manner, picking an accounting thesis topic and nurturing it will be based on your stage of education, be it an undergraduate, master’s, or PhD level.
Usually, there are areas of improvement and weaknesses in the world of finance. These errors are often the birth of research and analysis to create accounting research paper topics, buying a dissertation , or thesis topics in finance for students.
Trying to focus on many problems at a time can make you not finish your research topic in accounting at the appointed time. As a student, this is one error you want to avoid.
Naturally, you cannot master all the accounting subjects with the same ease. Hence, focus on the ones your strength resides in and discard the ones that posed a certain level of difficulty during the study. This is an important tip and recommendation when picking accounting topics for research. Here are some good examples of accounting research topics ideas.
- Accounting origin
- The Ethics of Accounting and Its Relevance in The Society
- Company structure influence on Accounting
- Information Systems For Accounting
- Accounting and Taxes
- Accounting as Relates to Personal Finance
- Profit Management
- Financial Markets and Accounting
- Accounting Methods Applied Throughout History
- The Age of Virtual Accountants
Accounting thesis topics for accounting students can be chosen according to the interests, and strengths each student shows in a certain period of their education. This can involve multiple accounting research paper topics, with the student now being left to choose the one they master more appropriately.
Usually, companies have weaknesses in different areas, it is a case of whether they are notable. When trying to pick accounting research topics as an undergraduate, you should focus on a singular problem and view it from various angles of prescriptive solutions.
- Inventories of Merchandise
- System Control and Inventory Management
- Manual of Different Accounting Principles
- International Financial Reporting Standards of Negligible Assets
- Procedures for Adopting Financial Reporting Standards
- Tax Culture as a Method of Keeping Companies in Check
- Accounting Guidelines of a Business
- Management Accounting Research
- Automation of Accounting Processes and Its Effects on Businesses
- Data Technology in Accounting Functions
These accounting topics come in forms that pique the interest of accountants and everyday business people. It should be bold, descriptive, and tally with a trending and important issue in all areas that concern the accounting sector. Getting topics like these are not as easy as you would imagine. It usually takes broad-spectrum research and paying rapt attention to business accounting flaws or potential problems.
- Modern Techniques of Debt Management
- Latest Technologies in Digital Accounting
- Fundamental Forensic Accountancy Skills
- Importance of Fast Information Integration for Modern Accounting
- Analysis and Design Risk in Accounting Systems
- Accounting Management and Financial Markets
- Issues in Implementation of Theoretical Accounting Processes in Applied Accounting
- Strategies to Make Organizational Finances Transparent
- Offshore Accounting Processes
- Significance of Financial Markets in Different Economies
When looking for accounting research topics ideas, determining the reason behind the question is the most challenging and vital decision in writing topics for accounting research papers. This difficulty arises because the foundation of your entire accounting topic depends on that one question.
Getting it wrong or mixing up the wrong statements can greatly impair the direction of your accounting topic for a research paper. Some good accounting research questions include:
- How to Investigate Forensic Accountancy?
- How to Avoid Debt Growth in Businesses?
- The Process of Making Accurate and Informed Accounting Decisions?
- How Does Culture Influence the Accounting System?
- Steps to Follow to Become a Certified and Chartered Accountant?
- How to Discover Effective Accounting Systems for Accountants?
- When Do You Need to Hire Personal Accountants?
- What are the limitations of digital Technology Evolution for the Accounting Niche?
- What Factors Facilitated the 2008 Worldwide Financial Crisis?
- What are the Processes Involved in Tax Assessment in Organizations?
In choosing an accounting topic for a project, you need to pick a topic that interests you, writing becomes easy and fast when you do. You can seek out simple accounting research topics if that’s what you can handle, or you could go for current accounting topics and interesting topics in finance.
However you choose to make that decision is up to you, but whatever topics you eventually come up with must not be vague or narrowly written. There should be a balance. Finally, you should extensively research and review your dissertation topic before making your topic decision. Having all these in mind, let’s look at some project topics on accounting.
- Quality in Quantitative Management Accounting Research
- Management Accounting and Supply Chain Strategy
- Notable Trends in Business Research and Accounting Finance and Management Control
- Effect of Auditing On Financial Reporting
- Importance of Fraud Detection in a Digital Environment
- The Globalization of Auditing Standards- an investigative analysis
- Studying the Effects of Intellectual Capital on the Development of Large Industries
- Tax Legislation in Freelance Businesses
- Critical Analysis of the Effects of Small Business Budgeting on Tertiary Institutions
Research papers on accounting involve a great deal of interest in the subject matter being researched. The aim is to enlighten and provide analytical detail to the readers. Also, in choosing a research paper topic, you should aim to acquire your readers’ attention.
This can be achieved by having sound knowledge of the research topic and gathering relevant information to explain the research better. Here are some good examples of accounting topic research papers.
- A Review on Government Management Accounting: Research in 2022
- Business Correspondence Analysis: Its Application in Management Accounting Research
- The Conceptual Framework of Strategic Management Accounting
- Meaning of Accounting Theories for Business
- What Impact Does Accounting Information Systems Have on Business Performance?
- Best Accounting Practices for Online Businesses
- Problems with the Normative Theory of Accounting
- Implementation of the International Public Sector Accounting Standards Board in the University System
- The Relationship between Public Sector Expenditure Accounting and Infrastructural Development
- Application of Accounting Standards in Critical Business Processes of Financial Conglomerates.
In the world of finance, various improvements are to be made with various issues that need solving. Highlighting the need for change and evolution brings about the intention of addressing these issues.
With the inception of digital currencies, new online databases for recording and carrying out financial transactions, there is a wealth of financial discussions to be had. With this fact also comes greater financial issues that need attention. Some eye-opening financial topics you can write about to address some financial systems include:
- Need for Accounting Technology
- Issues of Financial Ethics
- How to Develop and Improve Financial Systems
- Perspectives on Earnings Management
- Effective Methods of Tax Reduction for Organizations
- Role of Financial Markets in Accounting Management
- Methods of Preventing Financial Fraud
- What you should know about the Goldman Sachs Securities Fraud Case
- Commodities in Financial Markets
- Effect of External Factors on Cash Flow
Accounting thesis topics for students are nearly limitless. Not only with the issues that need solving or understanding, but the different facets of accounting that the world currently operates on that’s why many students are looking for help who will write my thesis , we have good news for such students because we have been doing this for a long time. This gives room for continuous enlightening and improvement due to the various areas accounting comes in contact with. There is the realm of management accounting, auditing, tax accounting, bookkeeping, online accounting, and many more. With the different list of accounting topics and thesis topics suggested, you can pick out any of them and chart your course to become a great accountant in the future.
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A THESIS REPORT ON Implementation Accounting Information System of Insurance Industry in Bangladesh BY Major in Accounting Thesis Advisor
The increasing sophistication of technology has opened up the use of accounting information systems (AIS) to companies. These systems are important because they enable all levels of management to access comprehensive information that goes into the planning and controlling of activities within business organizations. In addition, AIS provide quality information to internal and external users and typically cover six main aspects: people, procedures, data, software, information technology infrastructure, and internal controls. This study uses a questionnaire survey to examine the influence of AIS on internal auditors in Turkey. AIS are vital for internal auditors because they process the transactions, that is, they maintain financial records. It is, to the best of my knowledge, the first study to do so. In all, I put 12 questions and 106 internal auditors were agreed to participate the survey and found that internal auditors in Turkey believe that AIS contribute positively to their work.
The alignment of Business and IT is still an important concern of both business and technological managers. The vast directions of accounting information system on financial reporting quality presents the most important relations between the challenges and technological responses in pointing out the way for future research in order to improve the alignment between adopted technology and organization performance, in this particular case the support of management information systems to accounting and management. The main objective of this study is to review the theoretical and empirical literature on the effect of accounting information system on reporting quality to ascertain research gaps from past studies. The study concluded that past studies on the effect of accounting information system on reporting quality are limited and have yielded positive results; while some studies documented accounting information system improves financial performance, others suggested accounting information system aids management strategy. Furthermore most studies were carried out in advance economies, where advanced computerized accounting information system techniques have been in practice. Keywords: Accounting Information system, Data Quality, Financial Performance.
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Showing result 1 - 5 of 71 swedish dissertations containing the words thesis in Accounting information system .
1. Robust inference of gene regulatory networks : System properties, variable selection, subnetworks, and design of experiments
Author : Torbjörn E. M. Nordling ; Elling W Jacobsen ; Rolf Findeisen ; KTH ;  Keywords : ENGINEERING AND TECHNOLOGY ; TEKNIK OCH TEKNOLOGIER ; NATURAL SCIENCES ; NATURVETENSKAP ; NATURAL SCIENCES ; NATURVETENSKAP ; NATURAL SCIENCES ; NATURVETENSKAP ; NATURVETENSKAP ; NATURVETENSKAP ; NATURVETENSKAP ; TEKNIK OCH TEKNOLOGIER ; NATURAL SCIENCES ; NATURAL SCIENCES ; NATURAL SCIENCES ; ENGINEERING AND TECHNOLOGY ; network inference ; reverse engineering ; variable selection ; model selection ; feature selection ; subset selection ; system identification ; system theory ; network theory ; subnetworks ; design of experiments ; perturbation experiments ; gene regulatory networks ; biological networks ;
Abstract : In this thesis, inference of biological networks from in vivo data generated by perturbation experiments is considered, i.e. deduction of causal interactions that exist among the observed variables. Knowledge of such regulatory influences is essential in biology. READ MORE
2. Management accounting as constructing and opposing customer focus : three case studies on management accounting and customer relations
Author : Mikael Cäker ; Linköpings universitet ;  Keywords : NATURAL SCIENCES ; NATURVETENSKAP ; NATURVETENSKAP ; NATURAL SCIENCES ; SOCIAL SCIENCES ; SAMHÄLLSVETENSKAP ; Computer science ; Datavetenskap ; Economic Information Systems ; Ekonomiska informationssystem ; Business and economics ; Ekonomi ; Humanities and Social sciences ; Humaniora-samhällsvetenskap ;
Abstract : This thesis is on the relation between management accounting and customer focus and relates to discussions about how internal managing processes in organizations are interrelated with interorganizational relations, specifically constructions of customers. Both a normative and a descriptive perspective on the relation are taken within the different parts of the thesis, which consists of a licentiate thesis, three articles and a synthesizing text. READ MORE
3. Autonomous cloud resource provisioning : accounting, allocation, and performance control
Author : Ewnetu Bayuh Lakew ; Erik Elmroth ; Hiaohui (Helen) Gu ; Umeå universitet ;  Keywords : ENGINEERING AND TECHNOLOGY ; TEKNIK OCH TEKNOLOGIER ; TEKNIK OCH TEKNOLOGIER ; ENGINEERING AND TECHNOLOGY ; cloud computing ; distributed infrastructure ; monitoring ; accounting ; performance modeling ; service differentiation ; business data processing ; administrativ databehandling ;
Abstract : The emergence of large-scale Internet services coupled with the evolution of computing technologies such as distributed systems, parallel computing, utility computing, grid, and virtualization has fueled a movement toward a new resource provisioning paradigm called cloud computing. The main appeal of cloud computing lies in its ability to provide a shared pool of infinitely scalable computing resources for cloud services, which can be quickly provisioned and released on-demand with minimal effort. READ MORE
4. Metadata Management in Multi-Grids and Multi-Clouds
Author : Daniel Espling ; Erik Elmroth ; Erwin Laure ; Umeå universitet ;  Keywords : NATURAL SCIENCES ; NATURVETENSKAP ; NATURVETENSKAP ; NATURAL SCIENCES ; grid computing ; cloud computing ; accounting ; billing ; metadata ; monitoring ; structure ; fairshare ; scheduling ; federated ; Computer Science ; datalogi ;
Abstract : Grid computing and cloud computing are two related paradigms used to access and use vast amounts of computational resources. The resources are often owned and managed by a third party, relieving the users from the costs and burdens of acquiring and managing a considerably large infrastructure themselves. READ MORE
5. Benefits of Coordinating Plug-In Electric Vehicles in Electric Power Systems : Through Market Prices and Use-of-System Network Charges
Author : Ilan Momber ; Lennart Söder ; Tomás Gómez San Román ; José Villar Collado ; KTH ;  Keywords : ENGINEERING AND TECHNOLOGY ; TEKNIK OCH TEKNOLOGIER ; TEKNIK OCH TEKNOLOGIER ; ENGINEERING AND TECHNOLOGY ; Electric Vehicles ; Power Systems ; Optimization ; Elektrische Voertuigen ; Energiesystemen ; Optimalisatie ; Elbilarna ; Elkraftsystem ; Optimering ; Vehiculos Electricos ; Sistemas de Potencia ; Optimización ; Electrical Engineering ; Elektro- och systemteknik ; Economics ; Nationalekonomi ; Industriell ekonomi och organisation ; Industrial Engineering and Management ; Energy Technology ; Energiteknik ; Transportvetenskap ; Transport Science ;
Abstract : Both electric power systems and the transportation sector are essential constituents to modern life, enhancing social welfare, enabling economic prosperity and ultimately providing well-being to the people. However, to mitigate adverse climatological effects of emitting greenhouse gases, a rigorous de-carbonization of both industries has been set on the political agenda in many parts of the world. READ MORE
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Accounting Information System Descriptive Essay
Major internal and external users of the information, decision support system, business cycles, hospital strategy.
The subject of the case study is a hospital that uses an intranet to aid in the making of decisions and also carrying out internal auditing.
In the use of the intranet all the personnel that carry out their activities in the hospital are served and especially the top management of the hospital, the hospital uses an information management system and their intra net is built to complement the Information system in the accounts department the (AIS) specifically as means of decision support system application which is used for performance indicators and which aids the top managers of the hospital.
Computer based controls are used to survey the malfunctions of the software and also indicators of performance are initiated so as to state the effectiveness of every department and also the ultimate performance of the entire hospital. It contains queries in the database of the Accounting Information System (Labrso, 2011).
This system does produce a wide range of results in form of reports that include monitors and indicators that analyze medical and also drug resources, debit and credits for the customers, the guidelines of clinic practice, procedures and schedules of surgeries, comparison of the policy of the patient policy on daily basis and also reports and forms that are online, view of each doctor’s performance in regard to their patients and the clinics is also made part of the system’s output.
Distinguishing between invoiced and the non-invoiced revenues and also analysis regarding of the receivables which are related to patients and also related to institutions of social security and companies of insurance. This is the main data that is found inside the Intranet.
The information system is designed to fit in to the nature of the structure of the hospital that includes that fact that the hospital covers an area of about 55,000 Meter squared, containing clinics and also outpatient service clinics with various specialties, installed within the state of the art equipment, the hospital has about one thousand four hundred employees, of whom two hundred are distinguished physicians and many leading freelancers.
The facility is equipped with about 300 beds within the clinics, 25 rooms of operation, thirty eight ICU beds, twenty four unit beds for offering dialysis and 78 on a day basis nursing beds. hospital works as a charity, foundation that is non-profit, giving vital care that is both primary and secondary in its society (Labrso, 2011).
With the kind of structure that the hospital has, various information systems that is flexible and also integrated, makes it vital for any given private or even public organization that is in search of offering modern, effective health services and also remain competitive. The hospital has an information system that is separate, connecting to various databases that give support to numerous applications.
For instance there is one that analyzes the test from the lab Information system, in short its (LIS), there is one for the administrative purposes that include the admission of the patients, the clinics’ enrollment and also the dismissals that are given, the accounting billing, HR transactions and also application for the medicine over the telephony, separate servers for the email and also the internet, to add to this there is the user applications that are individual based that are developed for the sake of appointments in regard to the clinic of the outpatient service, there is an application that supports charges imposed on the inpatient service, and also an application that is able to calculate the voucher billing, the results are then handed to the insurance companies and funds (Labrso, 2011)..
The hospital’s organisaitonal chart was designed without any influence from the IT department by the quality Assurance, the in corroborations with the IT department with the Quality Assurances team embarked on the process of designing models to be installed in the various sections like the admission office of Patients, the outpatient service, pharmaceutical service and the procurement department.
The IT and the quality Assurance team worked to be able to conform to the International Standard Organization 9000. Information requirements rising from the Accounting department lead to the birth of the department of internal control (Labrso, 2011).
The user of the information can be derived form the hospital’s organization chart beginning with the , the president’s Office, branching into the General director’s office and the Press room, in the General’s directors office is attached the Legal department, From the General Director’s office it branches into the medical service Division, Nursing service Division, administrative Service Division, from the Administrative service Division there is the Managing Director’s Office, in the managing Director’s office there is the Quality assurance department, The IT department, Internal Auditing Department.
The management used information obtained from various sections and mostly the Accounting department to be able to make necessary decisions, the management also uses the information system to be able to measure the efficiency of the subsections and individual performance of medical practitioners(Labrso, 2011)..
The work of the Auditing department is to give report on the performance and financial indicators by the use of queries developed from the relational database (Labrso, 2011)..
Medical personal used the information system to be to manage their schedules in regard to patients
Major external users of the information form the hospital are the Insurance fund companies and the National social security organizations and the international Standards organization (ISO).
In the department of internal auditing in regard to the intranet it is able to produce statistic relating to the financial and performance reports on a daily basis, monthly and yearly.
The information required by the management of the hospital and the director of finance are analyzed by team that does the reporting, these reports do contain basic information of day to day operation that has information regarding patients and financial accounts and especially for the medical practitioners their performance is analyzed on the software then rated, in categories of the doctor that is recommended ,therapist doctor and doctor of execution based on charges founds on their patients’ invoices.
The Accounting Inforamtion System does analyze data that is concerned with the hospital’s revenues, by making clear the deference between the revenue in total, to the non-invoiced and invoiced in relation to the different categories of the hospital’s patients dependent on fund whether still under hospitalization or not and whether they are in or out patient (Labrso, 2011).
Information here is generated speedily and effectively, this information is vital to setting of objectives and goals of the Hospital.
Business cycles in the hospital are all interrelated at some point. Report from the various systems does produces information for the management and also the external parties this cycles include the.
Transactions between doctors and their clients which is the source of revenue (revenue cycle), the invoices are input into the general ledger where the entire transactions are summed up on daily, weekly, monthly and on yearly bases, this provides funds to the financing cycle the financing cycle, cycle is able to provide the payroll for the Human resource and the procurements of necessary medical resources, reports form the general ledger are used by major external users of the information, for example the Insurance company, national security Organization, also the financing institutions like banks use the Report from the general ledger to analyze their accounting records are also used by the management to be able to lay the organization’s goals
The strategy of the hospital is to become competitive by simply being efficient and utilizing its resources maximally, the hospital encourages competitiveness without compromising the quality of services that it offers. In application of the accounting information system does indeed track the Accounts, medical resources, monitor the efficiency of its personnel which ensures quality of service, competitiveness
Labrso.K. Using the Hospital Intranet for Decision Support and Internal Auditing . Greece: Athens University of Economics & Business, Department of Accounting & Finance, (2011)
- Chicago (A-D)
- Chicago (N-B)
IvyPanda. (2020, July 2). Accounting Information System. https://ivypanda.com/essays/accounting-information-system-case-study/
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IvyPanda . "Accounting Information System." July 2, 2020. https://ivypanda.com/essays/accounting-information-system-case-study/.
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