Strategic Information System Relevance and Reliability

Question: Discuss about the Strategic Information System for Relevance and Reliability. Answer: Introduction: In earlier days, several business firms maintained their business requirements through manual books of accounts such as Journal, Cashbook, Ledger etc. Therefore, the term bookkeeping was common phenomenon of keeping accounting records. However, this procedure of maintaining manual records was cumbersome, time consuming and very much exposed to human errors. In earlier days due to undersized volume of bookkeeping data, bookkeepers and accountants often found it convenient using manual mode of accounting system. Accounting software comes under the wider framework of accounting information systems such MYOB which is a computer software used for recording and processing the accounting transactions within functional modules such as accounts payable, accounts receivables and payroll and trail balance. It should be understood that the software such as MYOB is a combination of third-party application software with local modifications. MYOB generally varies largely due to its complexity and cost. MYOB accounting software does not only records the financial transactions but also helps in the production of accounting reports. Brief overview: Apostolou et al. (2013) opinion that paper ledgers, manual spreadsheets and hand-written financial transactions have all been transformed to computerised systems which can rapidly provide individual business transactions into financial reports. It is noted that computerised accounting systems follow the similar procedure of journal, ledgers, report and statement under the manual systems. With the help of computerised accounting, systems business firms can also develop reports and financial statements quickly and enable better administration reviews. In the study, Ramazani et al. (2014) argued that with modernization of technological improvements, information systems have led to computerization. Improvement made under this technology has replaced the manual book keeping systems with computer oriented systems. Computers in most of companies now perform accounting information systems that were performed manually. As stated by Wilson (2016) bookkeeping systems have been prevalent for centuries but with the introduction of technology and computerised accounting systems have radically transformed the accounting procedure in Australia. Development and adoption of MYOB: On the arrival of modern era, internationalization of economic trade and globalization of business have been on the superiority. Various business organisations in Australia are moving forward towards international markets due to various reasons such as availability of cheap resources, better tax regime, commercial liberalization of trade and legal requirements. All the previously mentioned strategies are inversely related to accounting procedure of a business entity (Antonelli et al. 2014). With a substantial growth in the accounting, activities and transactions there were possibilities of exposure to both internal and external error due to complexity of manual accounting systems prevalent in Australia. Perhaps there was a necessity of having MYOB, which would have the capability of storing and processing accounting data with high-speed storage, and processing abilities. This has led to development and adoption of accounting software such as MYOB in Australia. It is evident that every business weather big or small either simple or cumbersome needs accounting systems. As the business grows, acquires new customers, makes its way in new markets and keeps pace with regular changes in information technology. Hence, business firms in Australia need to maintain a highly effective accounting, inventory and statutory records (Khaneja 2015). This is where computerised accounting systems assist in identifying inventory accounting and statutory records. Existing market size: The current Australian market is largely dominated by the large number of accounting softwares. There has been a research on the impact created by the accounting software based on the MYOB. MYOB is one of the accounting systems with numerous corporate bodies consisting of small, medium and large companies. This software helps in including the functionality for managerial decision making along with gaining competitive market advantage (Khaneja 2015). As reported by the Australian yellow pages it has been reported that at least 72% of the business entities are making the use of MYOB accounting software. Research conducted in the survey of IT use in corporate business through 800 respondents showed that 77% of the respondents used accounting software such as MYOB to complete accounts. However, this figure has increased significantly in the last few years. Uses of MYOB: MYOB has at least been recommended by 89% of the users since it offers the visibility of the organisations cost, expenditure incurs, and offers more advanced financial decision-making. It is noteworthy to denote that accounting software such as MYOB helps in generating financial statement for the shareholders and the directors (Wilson 2016). This software also allows the firm to ascertain where every cent of the amount funded used. MYOB also facilitates in assuring that the compliance with reporting standard is maintained under the federal requirements. Market benefit: MYOB serves significant amount of competitive edge to the corporate business through variety of ways. With the advent of computers, MYOB is helps in saving time for a business as all the financial data is well organised. Time and cost management: With the help of computerised accounting software such as MYOB it enables the business firm to able to save resources and money through effective utilisation of the managerial decision (Zare et al. 2015). With the help of MYOB software accounting entries are recorded systematically and management are able to reduce the cost of labour in auditing. Another added benefits is that it helps in saving cost and time by improving the cash flow statement through enhanced debt management and stock control systems. MYOB also facilitates the shareholders by supporting the financial decisions demonstrated under the monetary reports. Administration and accuracy: It is worth mentioning that MYOB is one of those accounting software that facilitates the business to stay organised. With the introduction of accounting software, it makes the business trouble-free. This enables the business to potentially locate the data at any point of time. However, in the manual systems there are less probability for any discrepencies or error to be occurred instead of making multiple entries (Ramazani et al. 2014). Therefore, MYOB enables the financial transactions to be updated in contrast with the balances of the customers. Reliability of storage and timeliness: One of the common phenomenon concerning the accounting software is the storage aspect of accounting software. The financial data recorded in MYOB is stored and preserved for a definite period of time. Accounting software and packages like MYOB enables the company to perform speedy recovery of accounting transactions before jeopardising any significant aspects of accounting transactions. Implementing MYOB enables the business to look into the current state of their financial position. Challenges: It is widespread evident that accounting software offers large number of competitive advantage to business however, they are also equipped with the challenges as well. The requirement of accounting software like the one MYOB involves time and cost. As stated by Ggs and zer (2014) the administration and management are in opinion that MYOB is costly and involves sufficient amount of cost with high level of expertise. Integration of systems: A large part of the problems is associated with the small-scale business systems integration. Small business is required to upgrade the technologies provided by the software in terms of public interest. Small business and managers are not only under the obligations to evolve under the Information Technology but such changes also need to evolve rapidly to meet the objectives of the organisation. High cost of implementations: It is worth mentioning that companies in Australia have a fear of computers as they are slow learners and need more help from external consultants as they use only limited functions of software. This results in increase of cost of implementations of MYOB software packages in small business in Australia. Insufficient IT expert: Parente (2012) argued that most of employees in Australia does not have sufficient amount of expertise to use the MYOB software efficiently. Thus, training employees involves large number of labour cost for both small and medium size companies to impart adequate skills for handling such software. Distribution of information: MYOB enables a company to distribute and hand out financial information easily. Financial reports are directly printed from the accounting software and are distributed within and outside the organisation to those who are in need for the information. Reports are produced to assist the managers in monitoring and controlling the business for example the debtors analysis are helpful in determining the customers whose accounts are due (Zare et al. 2013). Hence, MYOB enables the preparation of financial statement to meet the financial obligations of business firms in Australia. Recommendations: Depending upon the findings below listed are some of the recommendations regarding the implementations of MYOB software in Australia; It is recommended that large number of small and medium size industries should undertake sufficient measures to reduce the cost of labour and expenses involved in audit. For effective implementation of MYOB, training of employees is necessary for effective implementation of this software. It is recommended for small-scale industries to implement cost benefit analysis before making the decision of using MYOB. This helps in understanding the numerous benefits, which comes with the MYOB software. It is worth mentioning that there are sometimes problems, which are associated with the failure, or crashing of MYOB software. This involves migrating of the data to the terminal in order the meet the needs of the organisation. Reference List: Antonelli, R.A., de Almeida, L.B., Colauto, R.D. and Longhi, F.L., 2014. Accounting professionals' perceptions concerning the influence of information technology in decision-making process.African Journal of Business Management,8(1), p.1. Apostolou, B., Dorminey, J.W., Hassell, J.M. and Watson, S.F., 2013. Accounting education literature review (20102012).Journal of Accounting Education,31(2), pp.107-161. Ggs, C.G. and zer, G., 2014. The Roles of Technology Acceptance Model Antecedents and Switching Cost on Accounting Software Use.Academy of Information and Management Sciences Journal,17(1), p.1. Harrison, R., Flood, D. and Duce, D., 2013. Usability of accounting software: literature review and rationale for a new usability model.Journal of Interaction Science,1(1), p.1. Hui, Q. and Chang, S., 2016, March. Accounting Safety System in E-Commerce and Its Application. In2016 Eighth International Conference on Measuring Technology and Mechatronics Automation (ICMTMA)(pp. 63-66). IEEE. Khaneja, S., 2015. E-Accounting in the Current Scenario: Impact of Information Technology.The International Journal of Business Management,3(9), p.290. Lu, K., Fu, Y., Gu, C. and Zhang, L., 2012. Problems and Solutions of Popularization of Accounting Computerization.Physics Procedia,33, pp.1155-1159. Parente, E.G.V., 2012. A Comparative Analysis of Accounting Software.IEEE Latin America Transactions,1(10), pp.1203-1207. Ramazani, M., Allahyari, A. and Ganbari, A., 2014. Examining the Influential Factors on Acceptance of IT among Accountants.ARPN Journal of Systems and Software,4(3). Ramazani, M., Askari, R. and Fazli, E., 2014. Application of ANP in Evaluating Accounting Softwares based on Accounting Information Systems Characteristics.Journal of Emerging Trends in Computing and Information Sciences,5(5). Wilson, R.M. ed., 2016.Researching Accounting Education: Australian Contributions. Routledge. Zare, I., Nekounam, J., Baghbadorani, M.R.S. and Hossini, H.R.M., 2013. Study of role softwares of accounting on relevance and reliability of accounting information.Life Science Journal,10(5s).