The Impact Of Technology On Financial Accounting Research Paper

The Impact Of Technology On Financial Accounting - Research Paper Example It has been observed that, while, on one hand, technology proves to be an asset for a business organization, it leads to the increase in liability for the accountants. Some of the technological tools like manufacturing of products through computer integrated systems, internet, expert systems, image processing etc. have a positive impact on accounting by facilitating collection, recording, and communication of accurate information about the various business transactions in a timely manner. However, technology has a negative impact on accounting, too. With technological advancements, the risk of losing confidentiality and accountability of the financial accountants has increased. Technology has paved the way towards creating more opportunities for different fraudulent activities in financial and management accounting. Furthermore, there are some impacts of technology on accounting, which cannot be termed either as positive or as negative ones. The pattern of hiring in different organiz ations has changed considerably, and the training and educational pattern of accountants have also changed because of the technological impact on this sphere. ... often we find that technological advancement has proved to be an asset for a business concern, but at the same time it has added to the liability of the accountants of the organization. As an instance, correct information is provided on a timely basis, but only at the cost of confidentiality. A few of the technological impacts on accounting are only changes in simple terms and can be termed neither as positive nor as negative. Hence, in a nutshell, technological advancements have neutral, positive, and negative impacts on accounting, but each of these impacts calls for the accounting profession to be in conformity with the changes. Positive Impacts of Technology The advent of various types of tools because of the technological advancement is quite obvious. It is one of the positive impacts of technology on accounting. Some of these tools are manufacturing process using computer-integrated system, the internet, communications technology, image processing, and the experts systems. All these are examples of few tools out of many, which have been designed to facilitate presentation of accurate information in a timely and detailed manner. Manufacturing processes in organizations using computer integrated system had an impounding effect on the cost accountants in the financial world. With the manufacturing process being automated, information is collected by the computers and reported instantaneously. This gives rise to a system of operational information which is characterized by the integration between manufacturing and other organizational processes like accounting and marketing. Activity-based costing systems are the results of this type of integration, which has a significant impact on cost accounting. Overheads are efficiently allocated by the accountants using this