The Effects of Technology on the Accounting Profession

The accounting profession is changing rapidly. Noor Azizi Ismail, in his article: Information Technology & Accounting: Issues and Challenges, gives a brief history of Information Technology as it applies to accounting.

The term accounting system had been used before the introduction of the computer. In the early 1950s and 1960s, known as the �machine accounting’ era IT was mainly implemented to support the clerical aspects of accounting functions such as payroll, accounts receivable and accounts payable…However, as accountants were busy with the technical accounting issues such as the format of financial statements they started to hire technical assistants, known at that time as �machine accountants to operate the technology. (Ismail, 2003, p.2)

Times have definitely changed. Now accountants must be able to operate the technology on their own. One of the new technologies that accountants must master are tax software programs such as Turbo Tax. Using one of these programs allows the preparer to enter information and either print out a return or file it electronically. (Moscove, Simkin, and Bagranoff, 2003, p.17) Tax preparers are not the only people who must change with the times. Those conducting audits must also adjust. Companies are increasingly moving away from paper documentation. Information is now being stored in electronic formats such as computer disks. (Moscove et al., 2003, p. 17).

The internet has changed the way accountants do business as well. Now, instead of mailing an envelope containing a tax return to the Internal Revenue Service, the return can be electronically filed. Also, Information may now be exchanged by different branches of one business to a single location for processing. For example, I worked for an engineering company that has branches all over the United States. Using a computer that has been “connected” to other branches in the region I was able to process payroll checks using information that was entered in a different state.

A new opportunity for accountants has been created. As companies turn to computers for record-keeping, security risks become an issue. There are auditors who analyze the risks associated with computerized information systems