Name: BARAÑAO, ERICKA FEYNE

Section: W5.12
FINAL PROJECT
BIT02

INTRODUCTION

Accounting as the language of every business where all the transactions are being express on
its monetary value by using the major concept of collecting, classifying, summarizing and communicating
the financial information provided for economic decision making. As growing economy takes place,
advancement in information technology has brought in the face of accounting used in economic
and business sectors especially in relation to derivation of effectiveness of administrative
structure (Trabulsi, R., 2018).
The Accounting Information System, known to be AIS in short is a tool incorporated
with information technology that were designed to provides external and internal information for
better analysis of business performance. It is vital to every organization for it provides a system
of delivering management control and sound economic decision making. This structure
associated with methodologies and techniques to track financial history as well as the preparation
of financial statements (Pérez et al., 2010).
In line with this, the Accounting Information System as a part of business’ information
system, must be tied to organization’s structure for it uses to collect, store, manage, process,
retrieve and report its financial data that can be used by accountants, auditors, other regulators
and agencies which aims to ensure the highest level of accuracy and conciseness in a business'
financial transactions such as recordkeeping and making financial data simply accessible to the
management while securing the data complete and free from error, thus increase the productivity
and performance of the organization.

LITERATURE

I. Accounting Information System (IAS) in relation to performance measure and

productivity

An argument presented by Langfield-Smith (1997), that AIS is one of the primary

components to the strategic success of an organization. Supported by the study of Bouwens and
Abernethy (2000) have analyzes the roles of this AIS, the attributes on the different strategic
priorities for management decisions and the impact of this system on the entire organizational
performance provided the various designs and different strategies in line with this so-called IAS.
The various designs of AIS provides different organizational approached, which will lead
to the increase of performance of the organization. Investing in the AIS makes the management
more flexible and adaptable in facing different obstacles in the business’ environment (Chenhall,
2003).
The continuous growing and advancing of technology took place, it opened up the
opportunity of creating and using accounting data strategically. Subsequently, this is significant
and important for all firms to get along with the higher competitive market (El Louadi, 2005).
The need of improving and innovating information systems and the capacity on data processing
should be focused to match the entire market circulation.
On the study of Abdipour (2011) supported by McLeod & Schell (2007), knowledge of
supervisors in emerging with high-quality information systems is vital. Furthermore, the
application of AIS is significantly associated to the knowledge of supervisors. Since supervisors
are the persons in charge in the strategical needs and do the decision making on suitable AIS for
the organization.
On the other hand, the knowledge for the existence and success of a company is on the
hand of the management typically by means of the internet, computer programs such as emails,
word processing, spreadsheet, database, and accounting. The knowledge of the management on
information system will contribute to the improved competence of AIS. (Laudon & Laudon,
2005).
AIS plays an important role in increasing the productivity of an organizations in the
global competitive setting. Financial statements are the primary source of financial information
to external stakeholders and to the management itself. Despite the unceasing advancements and
widespread of technology, information technology (IT) took place on accounting practices
(Doms, Jarmin and Klimek, 2004).
Current study shows evidences of a relationship between performance measure and
productivity to accounting information system is pretty significant. Since, nowadays,
organizations are using online and digital platform in the way of capturing data, storing,
processing, and lastly distributing information (Sajady, Dastgir & Nejad 2008).
Researcher Conway (2009) supported by Soudani (2012) affirms that performance
measure assured the goals are being consistently met in an efficient way by using this
information system. Performance measure focuses on the overall organizations’ productivity
affecting various departments in the organization. The performance of management is measured
thoroughly by the goals and objectives achieved. Typically, organization assessed the
performance by means of budgeting and forecasting for comparability purposes followed by
identifying the rare outcomes which are need to be look into consideration. The main obligation
of the administrators is to identify the underlying financial risk and they are also responsible for
the development and monitoring of the internal controls using information system.
 CONCLUSION

As the information presented by various research and investigation, therefore we can say
that effects of accounting information system is very vital and important with regards to
performance and productivity of the organization.
The main reason for the usage of accounting information is generated is to provide sound
decision making. However, in order for the financial reporting to be effective, completeness,
reliability and relevance of the information is highly important. These qualitative characteristics
are necessary to be present for the information free from bias and other discrepancies.
Accounting information should provide the decision makers the ability to forecast future actions
for the betterment of the organization (Hunton, 2002).

In connection with this, accounting information system (AIS) and organizational

productivity are pretty much related to each other which means access to accounting information
will lead to organizational effectiveness in getting along with the evolution of highly competitive
market. As the growing economy using technological development and innovation makes easier
for the management to foresee future situation of the organization. Moreover, using this
accounting information system is more convenient that manual process and it becomes relevant
to time which will lead to exaltation of management performance through achieving the
organization’s objectives and goals.

REFERENCES

Bouwens, J., Abernethy, M.A., (2000). “The consequences of customization on management

accounting systems design”. Accounting, Organizations and Society. Retrieved on June
27, 2021 at https://fdocuments.in/document/the-role-of-sophisticated-accounting-system-
in-strategy-role-of-sophisticated.html

Chenhall, R.H., (2003). “Management control systems design within its organizational context:
findings from contingency-based research and directions for the future”, Accounting,
Organizations and Society. Retrieved on June 27,2021 at
https://www.sciencedirect.com/science/article/abs/pii/S0361368201000277
Doms, M. E., Jarmin, R. S. & Klimek, S. D., (2004). “Information Technology Impact on Firms
Performance”. Economics of Innovation and New Technology. Retrieved on June 26,
2021 at http://misq.org/skin/frontend/default/misq/pdf/appendices
El Louadi, M., (2005). “The relationship among organization structure, information technology
and information processing in small Canadian firms”. Canadian Journal of
Administrative Sciences. Retrieved on June 27, 2021 at
https://www.researchgate.net/publication/229884257_The_Relationship_Among_Organi
zation_Structure_Information_Technology_and_Information_Processing_in_Small_Cana
dian_Firms

Hunton, J. E., (2002). “Blending Information and Communication Technology with Accounting
Research”. Accounting Horizons. Retrieved on June 27,2021 at
https://ibimapublishing.com/articles/IBIMABR/2011/166128/
Langfield-Smith, K., (1997). “Management control systems and strategy: A critical review”.
Accounting, Organizations and Society, vol. 22(2), pp.207-232. Retrieved on June 27,
2021 at https://www.sciencedirect.com/science/article/abs/pii/S0361368295000402.

Laudon, KC& Laudon, JP., (2005). “System of Information Management”. Yogyakarta: Penerbit
Andi. Retrieved on June 26, 2021 at https://elib.unikom.ac.id/download.php?id=317086

McLeod, R & Schell, G., (2007). “Management Information Systems”. New Jersey: Printice-
Hall. Inc., 10th Edition. Retreived on June 27, 2021 at http://www.aast.edu/pheed/staffad
minview/pdf_retreive.php?url=65_43655

Pérez, E.R., Urquía, G.E., Muñoz, C.C., 2010. “Information technology implementation:
Evidence
in Spanish SMEs”. International Journal of Accounting and Information Management.
Retrieved on June 26, 2021 at http://www.researchgate.net/publication/46545239_Infor
mation_technology_implementation_Evidence_in_Spanish_SMEs

Rehab U. Trabulsi, 2018. "The Impact off Accounting Information Systems on Organizational
Performance: The context of Saudi SMEs”. International Review of Management and
Marketing, Econjournals. Retrieved on June 26, 2021 at
https://www.econjournals.com/index.php/irmm/article/view/6221

Sajady, H, Dastgir, M & Nejad, HH., (2008). “Evaluation of the Effectiveness of Accounting
Information Systems”. International Journal of Information Science and Management.
Retrieved on June 26,2021 at http://ijism.ricest.ac.ir/index.php/ijism/
article/view/101/85

Soudani, SN., (2012). “The Usefulness of an Accounting Information System for Effective
Organizational Performance”. International Journal of Economics and Finance.
Retrieved
on June 27, 2021 at https://www.semanticscholar.org/paper/The-Usefulness-of-an-
Accounting-Information-System-Soudani/36ec15894dl8e246325fb3380ddcfacc8d60a