Impact of ICT in Accounting

Created by: Laura Evans
Created on: 10-05-13 19:31


	Impact of ICT in Accounting
	Advantages Saves time and money by automating the accounts. More accuracy Only need to post into the accounts once as it will automatically post the second account for you. E.g if you debit the bank with the detail vehicles it will automatically post on the credit side of the vehicles account with the detail bank with the same amount. Can be connected to a Payroll processing procedure so that payments are made automatically. Accounts are balanced off automatically. Information is automatically transferred into the final accounts so no need to collect the right information. These can all be backed up and be password protected. ICT will make it easier for the owner to assess the business at a point of time as accounts will automatically be ready, making it quicker for them to make costly decisions. Not as many staff need to be paid for the same amount of work done. The business will have increased their reputation by using the computer systems making them seem more up to date and reliable. New job opportunities for employees. Managers have less staff to manage and may give them a larger department/s to be managed. Employees get to learn new software making them more employable.	Disadvantages High cost of setting up the computer systems. Purchase of accounting software. Cost to train staff in this software. Inefficiently while staff are adjusting to the new system. Can cause technical faults so a technical support team will have to be hired if no already in the business. Will have to go through the recruitment process to find these. Staff morale may be effected. Security issues may occur and data could be lost or put in the wrong hands. Can cause fraud. Data back ups will have to be done regularly so that all information is safe and secure. Some staff may become redundant and will no longer be needed, so the owner will have to pay their redundancy. Staff may need to be paid a higher wage because they are more productive than before with the assistance of the ICT system. When faults occur they may stunt work and productivity of staff and the business.
	Evaluation Each business will have their own preference of how they produce their accounting information. In the long run using ICT systems will improve the profits of the business as it will improve productivity. They will have to pay for ICT professionals but they can also be used in other parts of the business for general ICT use.

Impact of ICT in Accounting

Advantages

Saves time and money by automating the accounts.
More accuracy
Only need to post into the accounts once as it will automatically post the second account for you. E.g if you debit the bank with the detail vehicles it will automatically post on the credit side of the vehicles account with the detail bank with the same amount.
Can be connected to a Payroll processing procedure so that payments are made automatically.
Accounts are balanced off automatically.
Information is automatically transferred into the final accounts so no need to collect the right information.
These can all be backed up and be password protected.
ICT will make it easier for the owner to assess the business at a point of time as accounts will automatically be ready, making it quicker for them to make costly decisions.
Not as many staff need to be paid for the same amount of work done.
The business will have increased their reputation by using the computer systems making them seem more up to date and reliable.
New job opportunities for employees.
Managers have less staff to manage and may give them a larger department/s to be managed.
Employees get to learn new software making them more employable.

Disadvantages

High cost of setting up the computer systems.
Purchase of accounting software.
Cost to train staff in this software.
Inefficiently while staff are adjusting to the new system.
Can cause technical faults so a technical support team will have to be hired if no already in the business. Will have to go through the recruitment process to find these.
Staff morale may be effected.
Security issues may occur and data could be lost or put in the wrong hands. Can cause fraud.
Data back ups will have to be done regularly so that all information is safe and secure.
Some staff may become redundant and will no longer be needed, so the owner will have to pay their redundancy.
Staff may need to be paid a higher wage because they are more productive than before with the assistance of the ICT system.
When faults occur they may stunt work and productivity of staff and the business.

Evaluation

Each business will have their own preference of how they produce their accounting information. In the long run using ICT systems will improve the profits of the business as it will improve productivity. They will have to pay for ICT professionals but they can also be used in other parts of the business for general ICT use.

Comments

Hendicks39

Report Thu 8th December, 2022 @ 14:28

The impact of ICT in accounting is to provide a means of recording and storing information about transactions. This has a number of advantages, such as automation, cost reduction and improved efficiency. It is becoming increasingly common for organizations to provide services over the internet rather than through a traditional bricks and mortar retail outlet, which means that they may not want their accounting service delivered in-house by an internal team. Instead, it may make sense for them to outsource the work to a professional third party such as Results Tax Accountants that are considered very reliable. In order to maximise the return on investment from their ICT investment, organisations need to ensure that they are using it effectively and efficiently. They should also consider whether they have enough in-house staff who are skilled in using these new technologies, or whether they will need additional support from an external partner.

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Impact of ICT in Accounting