The Impact of Technology on Managerial Accounting: Article Review

Managerial Accounting: Impact of Technology

Abstract

The article “An examination of the effects of information technology on managerial accounting” by Zekai Efeoğlu examines the effect of information technologies on managerial accounting and accountants. The study uses the survey method to analyze the technological developments in the administrative-accounting fields and the extent of these changes in the Turkish iron and steel businesses.

An Examination of the Effects of Information Technology on Managerial Accounting

Introduction

Managerial accounting in business necessitates technological advancements to maintain relevance in the contemporary market. However, structures in institutions mostly decelerate technological advances in management accounting; thus, it is crucial to understand its influence on firms (Efeoğlu, 2012). The study examines the effect of information technology on managerial accounting.

Literature Review

The literature review examines 21 different studies that delve into managerial accounting changes in recent years. Previous studies delve into significant changes in accounting attributed to the integration of informational systems and automation, resulting in managerial accountant duties changing from conventional to technological-based functionality (Efeoğlu, 2012). Technology results in the decentralization of management accounting applications, centralization of decision-making, and standardization in managerial accounting applications, resulting in more in-depth profit analyses (Efeoğlu, 2012). Technology enhances management accounting practices by increasing efficiency in decision-making while reducing operational costs.

Data Analysis

The researcher used an online survey as their primary data collection method. The study comprised two-part 35 questions aimed at obtaining quantitative information using a 5-point Likert scale. Of the 27 businesses available for review, the researcher chose four companies with the maximum number of employees and 11 randomly selected firms as their sample.

Results

The study found that informational technology caused significant changes in managerial accounting applications using advanced managerial accounting and budgeting and reporting. Additionally, informational technology enabled accountants to attain new skills, lessening their time on their duties. The finding shows that information technology increases efficiency in managerial accounting.

Conclusion

The study provides a literature review on the effect of information technology on accounting and accountants, thus providing support for the impact of technology on managerial accounting. Therefore, the findings enhance the correlation between technological advances and advancement in managerial accounting.

Abstract

The article “Management accounting practices of SMEs: The impact of organizational DNA, business potential, and operational technology” examines the effect of operational technology on SMEs. The study used 110 questionnaires as its sample size, and the results showed a positive correlation between operational technology and management accounting practices.

Information Technology and Managerial Accounting Effect on Management

Introduction

Information technology ensures effective data collection and analysis, which enhances the managing accounting systems’ role in predicting the consequence of alternative actions and activities. They are crucial to the success of a business. Thus, it is essential to understand their influence on managerial performance. The study examines the role of informational technology and management accounting system on managerial performance.

The researchers use 18 studies as their theoretical frameworks. According to the studies, gathering and conveying information is crucial in management performance. Therefore, management performance enhances information processing using information technology, and management accounting use the data to predict the consequence of activities in the organization.

Data Analysis

The researchers used the quantitative method as their primary data collection method. The sample consists of 35 subjects from 6 managerial telecommunication companies. The study used the Pearson Product Moment formula due to its accuracy, stability of grain score, and consistency. Finally, the researchers used classical assumptions in testing data for viability before subjecting it to regression testing.

Results

The study proved that informational technology influences managerial performance; thus, managers using informational technology are more apt to perform better in the workplace. Similarly, the researchers also found that the management accounting system positively influences managerial performance. Thus, informational technology and management accounting significantly enhances managers’ performance. However, the research was limited, as it utilized only one type of industry.

Conclusion

The findings show the importance of information technology and management accounting skills to managerial performance. Therefore, the results justify further research, thus acting as a foundational literature review that can explore other related issues.

Abstract

The article “The effect of information technology on accounting system’s conformity with the business environment: A case study in banking sector company” delves into the effect of information technology on managerial accounting. The researchers found an effective method of using an accounting system to identify an organization’s external environment and its correlation with the internal environment.

The Effect of Information Technology on Accounting

Introduction

The contemporary business environment continually changes, necessitating research into accounting technological conformity with the business environment. The IT’s role in conforming to business environments ensures seamless integration of accounting systems, enabling business adaptation to challenges. The study examines the impact of information technology on accounting systems’ conformity to a business environment.

Literature Review

The literature review examines 23 different studies to build its case on the correlation between technology and managerial accounting. In managerial accounting, informational technology facilitates budgeting and reporting, information interpretation, decision-making, and control. However, due to the fast development of informational technologies, accounting systems mostly lag, necessitating technology integration to enhance the shortcoming.

Data Analysis

The study was conducted in a Lithuanian organization using an interview as the preferred quantitative method. The researcher measured the strategy, goal, structural, and interaction complexity in the environment and performed an accounting system analysis by assessing the strategy, implementation, and range of decisions making in the firm. For data analysis, the researchers used the Likert scale, and the reliability of the results was determined using Cronbach’s alpha coefficient. Finally, the researcher used Spearman’s correlation to check the validity of the selected framework.

Results

The dominating external environment shows that it reacts to external changes. For efficacy, the IT department needs to integrate different systems, update databases, and make the services available to all employees. Other changes that increases efficiency includes more in-depth application of accounting information in the accounting system, while implementing new information technologies ensures a heightened reaction process. However, the study’s limitation included a limited sample size as it evaluated only one bank and six respondents. Information technology could enhance accounting systems even in cases where the latter is incompatible with the business environment.

Conclusion

The influence of the business environment needs compatibility with informational technology to ensure conformity with the accounting system. Therefore, the finding shows that technology greatly enhances managerial accounting by reinforcing its shortcomings.

Abstract

The article “The impact of information technology, management accounting system characteristics, and locus of control to the managerial performance in the telecommunication service companies” delves into the influence of management accounting systems and information technology on managerial performance. The study concludes that management accounting systems and information technology significantly impacted managerial performance.

Impact of Operational Technology on Management Accounting

Introduction

The sustainability of contemporary management accounting services in Small- and Medium-size Enterprises (SMEs) necessitates businesses to engage in operational technology to enhance its operation. However, despite the benefits accrued by adopting technology into managerial accounting, there is a lack of exposure in most Malaysian SMEs. The study delves into the impact of operational technology on the management accounting practices of Malaysian Small- and Medium-size enterprises.

Literature Review

The literature review examines 30 studies that explore different influences on management accounting practices (MAP). MAP enhances business profitability by effectively utilizing the resource while improving operational efficiency and performance. The usage of operations technology enhances management accounting practices through increased productivity in the costing system.

Data Analysis

The researchers used a two-language (English and Malay) survey questionnaire as their primary data collection method. The study performed a pilot test using 20 SMEs and later mailed the questionnaire to 310 SMEs, but the final analyses contained 102 sets of the surveyed data. The collected data was then analyzed using Structural Equation Modelling (SEM) and Statistical Package for Social Sciences (SPSS).

Results

The study found a significant positive correlation between operational technology and management accounting practices (p-value = 0.001). The data proved the research question, meaning that operational technology significantly enhanced management accounting in Malaysian SMEs. Therefore, operational technology is crucial in the operation and development of SMEs.

Conclusion

The study provides a literature analysis of the significance of operational technology in Small- and Medium-size enterprises. Therefore, the finding shows a significant correlation between information technology and managerial accounting in the operation of SMEs.

References

Azudin, A., & Mansor, N. (2018). Management accounting practices of SMEs: The impact of organizational DNA, business potential and operational technology. Asia Pacific Management Review, 23(3), 222-226. http://dx.doi.org/10.1016/j.apmrv.2017.07.014

Efeoğlu, Z. (2012). An examination of the effects of information technology on managerial accounting in the Turkish iron and Steel Industry. International Journal of Business and Social Science, 3(12). https://doi.org/10.1016/S2212-5671(15)01476-8

Klovienė, L., & Gimzauskiene, E. (2015). The effect of information technology on accounting system’s conformity with the business environment: A case study in banking sector company. Procedia Economics and Finance, 32, 1707-1712. doi: 10.1016/S2212-5671(15)01476-8

Gurendrawati, E., Murdayanti, Y., & Putri, G, A., The Impact of Information Technology, Management Accounting System Characteristics, and Locus of Control to The Managerial Performance in the Telecommunication Service Companies. Integrative Business & Economics, 4(1), 357 – 366. http://dx.doi.org/10.6007/IJARBSS/v8-i7/4339