How Technology Has Changed the Accounting Profession
1. Introduction
Thirty years ago, most financial accounting was done manually, leading to a great deal of paperwork. Currently, most accounting information is recorded via computers and wide area networks (Journal of Accountancy, 1994a). Technology has certainly changed the face of accounting over the years. While it is unclear whether technology’s impact on accounting has been positive or negative, it is clear that technology has drastically changed the accounting profession. Often a technological advance may be an asset to a business, but a liability to the firm’s accountant. For example, information can be provided in a timely and more accurate manner, but at the price of confidentiality. Some of the impacts of technology are neither positive or negative; they are simply changes. So in essence, the impacts of technology on accounting have been positive, negative, and neutral, but each impact results in a demand on the profession to conform to the changes.
The obvious advantage of technology is in the various tools that it has provided. Examples of these tools include computer-integrated manufacturing, communications technology, image processing, the Internet, and expert systems. These are a few examples of the many tools of technology whose purpose is to provide more detailed and accurate information in a timely manner.
Computer-integrated manufacturing has had a significant positive impact on the financial world and especially on cost accountants. With automated manufacturing, computers collect and report information almost simultaneously. This results in ‘an operational information system that fully integrates manufacturing with marketing and accounting data’, increasing both the quantity and timeliness of the information (Hansen & Mowen, 1997, p. 8). This detailed information has been significant in cost accounting, allowing accountants to develop activity-based costing systems. These new costing systems allow accountants to allocate overhead more
Thirty years ago, most financial accounting was done manually, leading to a great deal of paperwork. Currently, most accounting information is recorded via computers and wide area networks (Journal of Accountancy, 1994a). Technology has certainly changed the face of accounting over the years. While it is unclear whether technology’s impact on accounting has been positive or negative, it is clear that technology has drastically changed the accounting profession. Often a technological advance may be an asset to a business, but a liability to the firm’s accountant. For example, information can be provided in a timely and more accurate manner, but at the price of confidentiality. Some of the impacts of technology are neither positive or negative; they are simply changes. So in essence, the impacts of technology on accounting have been positive, negative, and neutral, but each impact results in a demand on the profession to conform to the changes.
The obvious advantage of technology is in the various tools that it has provided. Examples of these tools include computer-integrated manufacturing, communications technology, image processing, the Internet, and expert systems. These are a few examples of the many tools of technology whose purpose is to provide more detailed and accurate information in a timely manner.
Computer-integrated manufacturing has had a significant positive impact on the financial world and especially on cost accountants. With automated manufacturing, computers collect and report information almost simultaneously. This results in ‘an operational information system that fully integrates manufacturing with marketing and accounting data’, increasing both the quantity and timeliness of the information (Hansen & Mowen, 1997, p. 8). This detailed information has been significant in cost accounting, allowing accountants to develop activity-based costing systems. These new costing systems allow accountants to allocate overhead more