Acc 340 - the Effects of Technology on the Accounting Profession Paper

The Effects of Technology on the Accounting Profession Paper

Student

ACC/340

Date

Instructor

IT Systems and Accounting

Advances in Information Technology have changed many aspects in the accounting industry. Accounting was once done with a pencil and paper and a lone calculator, now days it is hard to find anyone manually completing accounting tasks. The automation of accounting tasks is now changed to include software and technology. IT includes things that render data or information in multimedia such as computers and software. Through this business information is positively impacted in a very productive way and accounting has advanced tremendously.

Information Systems

        There is a variety of new technology that has affected accounting processes. Technology such as computers, printers and fax machines is a huge impact because they replace paper and pencils. A business could easily afford this equipment because they are very affordable and available to businesses small and large. Software is also an effective tool for accounting, keeping data organized and in one location. There are many accounting programs available which are also affordable and popular, for example spreadsheets for calculation and reporting for accountants. Software is helpful for tasks such as bills payments, transaction recording and reporting. The Internet has made the retrieval of information very easy and fast, documents can be shared and researched. Much business can be conducted online, such as Taxes which can be filed online. Information can also be saved online with the help of host programs. IT is used in accounting security, using identification, passwords and data encryption to limit access to information and prevent unauthorized use. This replaces notebooks and papers in the old accounting ways which is easily accessible with loss or stolen information.

Benefits of IT

        Information technology systems allow accountants to easily and in a timely manner prepare and present financial data to management and stockholders. The information is also more accurate and efficient. Computerized accounting systems are tailored to businesses and companies and they can track and record financial transactions to output financial reports quickly and easily for management decision making. The accuracy of the reports is improved because of the internal check and balance measures in the accounting systems also because there are a limited number of qualified accountants who have access to adjust the financial information. Large amounts of financial information can be processed through computerized accounting systems, allowing for quicker close out for the accounting period.

Accounting Benefits

The accounting benefits that can come from information technology include many parts of accounting, making the creation, preparation, storing and updating a much easier task. The use of accounting programs or software helps input financial information without human data errors. Some tasks that have become less time consuming and difficult are the preparation of income taxes, tax laws change frequently and the manual preparation of taxes can be difficult it is now quite easy because of tax preparation software the same with auditing, it is time consuming and is also difficult to perform manually but now there is software available. Of course other software such as Word processing software which allows the creation, storage, and printing of any accounting data needed for reports, billings and financial statements. Electronic funds transfer is a great example of a positive impact on the accounting processes, EFT allows a company to make payments and collect funds electronically. Transactions are charged and credited through bank accounts and financial data is updated through a computerized system. Information technology allows for many tools to make accounting functions easier and more effectively.