Adoption of Accounting Information Systems in Businesses

Adoption of Accounting Information Systems in Businesses

Metin Uyar (Istanbul Gelisim University, Turkey)
Copyright: © 2019 |Pages: 24
DOI: 10.4018/978-1-5225-8015-7.ch007
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This chapter aims to explain how the accounting information system is adopted in businesses. The development of e-services and e-business affect the activities of the accounting systems. In this context, factors affecting the adoption of the system have been identified with respect to their specifications. The data was collected using the survey method. The partial least squares method that is a technique of a structural equation model was used to analyze. According to the findings, the organization structure, stakeholders, technology, and external structure influence the adoption of the accounting information system. The organization structure has been identified as the strongest factor. Technological progressions have a high impact on adoption. Findings show that management is sensitive to new data management approaches such as big data, business intelligence. Practical recommendations were presented in accordance with the findings.
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The development of e-services and e-commerce affects the activities of accounting. Internet technologies and social media change the structure and functions of the Accounting Information System (AIS). Big data and blockchain show that the accounting system should be approached with a new perspective. These changes emphasize the need for companies to better understand the adoption and use of information systems. In the globalization age, enterprises search to improve the productivity and effectiveness of their activities for high profitability and increase performance. To provide economic value from knowledge, specially developed systems aim to process and manage information. The material weakness of information technologies is a factor that negatively affects managers' decisions (Holder et al., 2016). The enterprises that have access to and manage information gain a competitive advantage. To achieve this goal, there is a need for systems combining communication techniques and technology. Information systems are created and implemented to enhance performance through the whole organization. The presence of the system helps managers decide. Information is data that have been organized and processed, so that gives meaning and improve the decision-making process (Romney & Steinbart, 2017).

High-quality information has valuable characteristics for decision-making (Mohamad et al., 2017). O'Brien & Marakas, 2011). Qualification of decision-making contributes to the increase in effectiveness. Quality and use of information are produced by an effective accounting information system (Wilkinson, 2000). Many studies reveal that information quality is effective in the growth of businesses and in the development of performance. Accounting information system (AIS), an effective tool to respond to internal and external changes, can increase the success of the business. Accounting information system, which is one of the most important sub-systems in the organization, changes the acquisition, processing, storing and distribution of information (Hall, 2018). The accounting information system is a system that collects, records, stores and processes data for the decision maker.

The accounting information system is a mechanism that combines software, hardware, network communication with the human element (Wilkinson, 2000). The accounting information system is a function provides and assess financial data that is intended to be useful in making economic decisions). It engages in financial and economic operations which affect decision making about allocating resources effectively. Accounting plays a critical role in making economic decisions. Automated accounting information contributes to the reduction of human error in business and accounting processes (Dalcı & Tanış, 2009). Good management of resources and better control of costs, increased success in budgeting and forecasting are fundamental contributions of accounting information system. Accounting information allows the company to prepare a plan by affecting the budget preparation. Therefore, enterprises need to adopt AIS, which is key to an organization to organize, manage and operate the process in the business environment. Ismail (2009) states that firms are concerned to the issues of their AIS quality by the search to develop accounting information system adoption effectiveness.

To apply the accounting system successfully, it is key to emphasize the quality of adoption to manage all the processes of system design. The elements of the system interrelated and integrally work with harmony (Hurt, 2013). The key to system success is the correct adoption of the components by the business. Laudon & Laudon (2012) state that adoption and integration should be smooth for a preferred system to be effective. System adoption can be affected by many organizational and individual factors. It is important to examine the factors affecting the adoption of the accounting information system in the enterprise because of company sustainability.

Key Terms in this Chapter

Cost Accounting: It is the specialty of accounting that provides the calculation of unit and total costs.

Tax: It is the legal obligation that companies or individuals must pay on their incomes.

General Ledger: Special structures that show the account details and balances used in accounting.

Financial Reporting: Financial pictures that give information to internal and external stakeholders about the company's activities.

Decision-Making: The manager must make a judgment about the future by using data and information.

Partial Least Squares: It is a special statistical technique that provides detailed evaluations for small samples.

Accounting: It is the information system that enables the monitoring of financial transactions based on documents.

Internal Auditing: It is the internal auditors' control of the compliance of the company works with the laws and principles.

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