Review on information systems

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The position of Information Technology in Management Accounting cannot be disregarded or overlooked and there is also a body of literature within the topic. The technology employed in Accounting is rolling out from the clay-based tokens and containers utilized in the past, for the punched cards and personal computers. Before the associated with Information Technology, record keeping and processing of data, which are the main functions of accounting was done personally and it had been laborious and error-prone.

The introduction of Information Technology to Management Accounting meant the Manager may carry out his functions of Planning, Directing, Controlling, Increasing and Making decisions, effectively, efficiently and with speed. The introduction of railroads and steel during the19thcentury resulted in an increase in the degree of commercial transactions plus the need to reduce human mistake to the barest minimum. Through the overdue nineteenth century, writing panels, peg planks, and record control subscribes were made to accommodate, repetitious data digesting tasks. The typewriter and adding machine were extended to create cash register, posting and accounting machine. This can be said to be quick the mechanization of accounting practice.

The creation of the large-scale digital computer in 1946 further elevated the productivity of performing accounting capabilities. It is the advent and utilization of Information Technology in Management Accounting which includes necessitated the quest to find out its effect on Accounting.

Accounting has evolved from simple record-keeping in the past into a system designed to evaluate within economic activity. Likewise, the technology used to store financial data has become incredible from clay tokens and jars to punched credit card and personal computer (Robert Kee). For a better understanding of the impact of Information Technology management Accounting, we shall take a look at the historical relationship among data digesting technology and accounting.

Recordkeeping seems to have began even before the advent of created language and numeral system. It is assumed that tiny tokens found throughout the Middle section East, dated around eight thousand B. C., were utilized to represent and quantify products such as sheep or steps of grain(SchmandtBesserat 1978, g. 52). This individual continues by saying that this representation of your economic deal or data was stored in clay jars and may had been processed with the help of or removing container bridal party to reflect an entity’s account balance (SchmandtBesserat1978, p. 52). This basic practice displays some of the basic function of accounting, just like storing, managing, retrieving and processing. According to SchmandtBesserat, the limitations of the type of record keeping might have led to the development of drafted language and ultimately alphabetic devices. The Greeks and the Aventure used alphabets and number systems to record economic transactions about storage means such as art (ostraca) and wooden panels coated with wax (Robert Klee). The Romans inside their computations usually used a great abacus, that was to become man’s earliest attempts to dietary supplement human processing of data (Robert Kee).

The feudal system emerged during most of European countries after the fall of theRoman Empire. Record keeping started to be much more localized and centered around organizations such as the house of worship and manorial estates(Chatfield, mid 1970s. P. 1920). A tally stick with notches cut utilized to record payment and receipt of funds. It might be concluded that the tally sticks performed the same role because clay cisterns and bridal party of the earlier, which ultimately were replaced by computer systems. Records of manorial properties were added up and balanced during an audit(Oschinsky, 1956, s. 9192), which will perhaps was an indication which a more intricate summation of economic data might be required.

During the tenth and eleventh decades, the solariego system in many of Italy became weakened and it absolutely was replaced with an economy depending on trade and commerce. This kind of led to the introduction of the twice entry program, which is a superb contribution to accounting practice because it offered a powerful and flexible model pertaining to managing info. The double-entry system was also overtaken in the 19thcentury with the advantages of the use of Information Technology in accounting.

To state that Technology has impacted positively about ManagementAccounting is usually to state the most obvious. Information Technology is among the most primary method of managing monetary data and thus, the dependence on Electronic Data Processing (EDP) technology and professionals to handle financial data is on the increase. Economic data usually are managed by a Data Base Administrator (DBA) (Page andHooper, 1992, l. 188), which can be responsible for this article, structure, and security of the database (Everest, 1966, p. 589600). This DataBase supplies access and availability, which usually conflicts with managements target of limiting and controlling access to a strong financial record with its attendant consequences. Even though authorization and password systems are often used to decrease their effects a data source system exposes companies to unauthorized users who can compromise into devices to perpetrate fraud or perhaps steal vital information.

An additional drawback of Technology in management accounting is that much of the traditional info management function of Accountancy firm have taken above by EDP professional, which has led to a gap between the technology and data used to apply accounting features, though they have also increased the features of the Curator to include taking care of the business data jointly with performing it is traditional position. The use of Information Technology in accounting has also generated a new corps of professionals in charge of the administration of the software program developed pertaining to accounting.

The application of Information Technology in addition has rendered the double-entry accounting model, which had been around for centuries while the primary means of managing economic data manually, obsolete. This is certainly as a result of using DBMS application, which now maintains the journals, ledgers, and types of procedures of manual accounting devices.

It can be concluded that the impact details Technology administration Accounting, although a meet development in this it has increased the efficiency and performance of accounting practice, in addition has created fresh challenges that did not are present in the accounting profession.