A Study of Impact of Information Technology On Accounting Systems

A Study of Impact of Information Technology on
Accounting Systems
Dissertation Submitted to the
Bunts Sangha’s UKS Institute of Management Studies & Research
in partial fulfilment of the requirements for the award of the Degree

of
Post Graduate Diploma In Management
SUBMITTED BY
RAVI SUBHASH SHELAKE
(Roll No - 1939)
PROJECT GUIDE
Prof. Shalu Purswani
Bunts Sangha’s UKS Institute of Management
Studies &Research
Shashi Manmohan Shetty Higher Education Complex, Buntara
Bhavan Marg, Kurla East
April 2021
A Study of Impact of Information Technology on

Accounting Systems
Dissertation Submitted to the
Bunts Sangha’s UKS Institute of Management Studies & Research
in partial fulfilment of the requirements for the award of the Degree

of
Post Graduate Diploma In Management
SUBMITTED BY
RAVI SUBHASH SHELAKE
(Roll No - 1939)
PROJECT GUIDE
prof. Shalu Purswani
Bunts Sangha’s UKS Institute of Management Studies &
Research
Shashi Manmohan Shetty Higher Education Complex, Buntara
Bhavan Marg, Kurla East
April 2021
DECLARATION
I hereby declare that the dissertation “ A Study of Impact of

Information Technology on Accounting Systems” submitted for the
PGDM Degree at Bunts Sangha’s UKS Institute of Management Studies
& Research is my original work and the dissertation has not formed the
basis for the award of any degree, associate ship, fellowship or any other
similar titles.
Place: Mumbai
Date:05/05/2021
_______________________________
Ravi Subhash Shelake

CERTIFICATE
This is to certify that the dissertation entitled “A Study of

Impact of Information Technology on Accounting Systems” is the bona
fide research work carried out by Ravi Subhash Shelake,

student of Bunts Sangha’s UKS Institute of Management
Studies & Research during the year 2019 -2021, in partial
fulfilment of the requirements for the award of the Degree of
Post Graduate Diploma in Management and that the
dissertation has not formed the basis for the award previously
of any degree, diploma, associate ship, fellowship or any other
similar title.
________________
Prof. Shalu Purswani
________________
Dr. Krishna Shetty
Director
Bunts Sangha’s
UKS Institute of Management Studies & Research
Place: Mumbai
Date: 05/05/2021
ACKNOWLEDGEMENT
It is gratifying to express my indebtedness to some individuals who

rendered me notable assistance to bring my project work to a successful
completion. It would not have been possible for me to complete the task
without their help and guidance.
First of all, I would like to thank Director of UKS, Dr. Krishna

Shetty who gave me the opportunity to do this project work. Secondly, I
am very much obliged to Prof.Shalu Purswani, my guide who helped me
for completing the project.
A special thanks to my parents for their invaluable and continuous

support all through the study.
Last but not the least; I am thankful to almighty god for his grace and
mercy which has given me strength to successfully complete this project.
Place: Mumbai
Date: 05/05/2021
________________________
Ravi Subhash Shelake
PREFACE
While searching for a suitable topic for the PGDM Final Year
Project and to gain knowledge in the field of management I have made a
project report titled “A Study of Impact of Information Technology on
accounting Systems”.
The basic objective for opting this project is to gain some knowledge on
how the current business organisations functions and what are the different
Softwares are there in the market.
Doing this project report helped me to enhance my knowledge

regarding the different softwares and their alternatives available in the
Market. It is strongly hoped that this project covers not only the
various requirements of the Project Study but also of the Industry.
(Ravi Subhash Shelake)
TABLE OF CONTENTS
Chapter No. Title Page
No.
1 Executive Summary
Objectives of the study and Hypothesis
2 Introduction
Application of IT in various Sectors
Application of IT in Accounting system
Types of Accounting Softwares
Benefits of Accounting Softwares
Role of Accounting Softwares
Softwares
3 Research Methodology
Objectives & Hypothesis
Sampling area
Sample size
Data collection
Primary data
4 literature Review
secondary data
5 Data analysis and interpretation
6 Findings & suggestions
7 Conclusion
8 Bibliography
9 Appendix
EXECUTIVE SUMMARY
• Chapter No. 1: Introduction

In this chapter Selection and relevance of the problem, historical
background of the problem, brief profile of the study area, definition/s of related
aspects, characteristics, different concepts pertaining to the problem etc. can be
incorporated by the learner.
• Chapter No. 2: Research Methodology

This chapter will include Objectives, Hypothesis, Scope of the study,
limitations of the study, significance of the study, Selection of the problem,
Sample size, Data collection, Tabulation of data, Techniques and tools to be
used, etc. can be incorporated by the learner.
• Chapter No. 3: Literature Review

This chapter will provide information about studies done on the
respective issue. This would specify how the study undertaken is relevant and
contribute for value addition in information/ knowledge/ application of study
area which ultimately helps the learner to undertake further study on same issue.
• Chapter No. 4: Data Analysis, Interpretation and Presentation
This chapter is the core part of the study. The analysis pertaining to
collected data will be done by the learner. The application of selected tools or
techniques will be used to arrive at findings. In this, table of information’s,
presentation of graphs etc. can be provided with interpretation by the learner.
• Chapter No. 5: Conclusions and Suggestions

In this chapter of project work, findings of work will be covered and
suggestion will be enlisted to validate the objectives and hypotheses.
OBJECTIVES OF THE STUDY and HYPOTHESIS
The Objectives of the study are:

1. To examine the age of respondents impact on IT on Accountancy
2. To know the various types of accounting software’s
3. To study the benefits of accounting software’s
4. To study the application of IT in accountancy
5. To know the people’s attitude towards IT in Accountancy
6. To know which Accounting Software people prefer to use
7. To know whether people are aware or not about IT’s impact on accounting
system
IMPACT OF IT ON ACCOUNTING
Chapter 2
IMPACT OF IT ON ACCOUNTANCY
Introduction & History of IT
Information technology (IT) is the use of any computers, storage, networking and
other physical devices, infrastructure and processes to create, process, store, secure
and exchange all forms of electronic data. Typically, IT is used in the context of
enterprise operations as opposed to personal or entertainment technologies. The
commercial use of IT encompasses both computer technology and telephony.
The term information technology was coined by the Harvard Business Review, in
order to make a distinction between purpose-built machines designed to perform a
limited scope of functions and general-purpose computing machines that could be
programmed for various tasks. As the IT industry evolved from the mid-
20thcentury, computing capability advanced while device cost and energy
consumption fell lower, a cycle that continues today when new technologies emerge.
The term is commonly used as a synonym for computers and computer networks,
but it also encompasses other information distribution technologies such
as television and telephones. Several products or services within an economy are
associated with information technology, including computer hardware, software,
electronics, semiconductors, internet, telecom equipment, and e-commerce. Based on
the storage and processing technologies employed, it is possible to distinguish four
distinct phases of IT development Information technology is a rapidly growing field
that offers secure positions for individuals with a minimum of a bachelor's degree in
an IT-related field. From engineering to support, there are a number of specializations
that deal with the different components of information technology, and students with
solid technical skills as well as an aptitude for gathering information and interpreting
data are likely to find success in this industry.
Applications of IT in Various Sectors
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Many industries are realizing that information technology has the potential to give
them a competitive edge to increase profit margins and consumer satisfaction. Once
only used internally to control costs and increase operations efficiency, information
technology is now a major part of industries seeking a competitive edge in providing
new channels of service and meeting the growing demands from consumers for
information and value. From the simple application of e-mail communications to
online teleconferences connecting organizations worldwide, information technology is
having a direct impact on how industries conduct business. Using information
technology, automatized systems can track all steps of the manufacturing process,
predict purchasing habits and patterns, exchange contact information between vendors
and customers, and analyze massive amounts of data. As more industries realize the
multiple ways the new technology can assist them in providing their products or
services efficiently, new information technology jobs will be available. The increase
in information technology jobs across every sector of industry is also calling for
professionals with specialized knowledge of key industries. More than ninety percent
of all information technology personnel are working in business sectors outside of the
IT industry. This requires those interested in advancing their information technology
careers to pursue technical or professional certification relevant to specific industries
or field of interest.
 Information Technology in Retail
The internet has been a huge factor in changing the way many retailers do business.
Perhaps the greatest impact is the direct line of communication that the internet
provides between retailers and consumers. The future of retail business requires
retailers to embrace the latest changes in informational technology that enhance how
they engage with customers. Informational technology allows retailers to be available
day or night interacting with customers how, when, and where they are ready to shop.
Within the retail industry, there are information technology careers in data
management, software management, business architect, social media specialist, and
more. Retailers depend on information technology to manage inventory, track
customer-purchasing habits, predict trends, and deliver goods and services. Many
retailers understand the potential that mobile communications offer to engage their
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customers outside the physical retail location by offering real-time discounts,

promotional updates, and enhancing options to purchase online or in store. Wireless
communication, QR codes, and augmented reality are only a few examples of the
changes information technology is bringing to the retail industry.
 Information Technology in Academics
Information technology in academics makes it possible for individuals to link faculty

with students around the globe. There is and perhaps will, always be debate as to
merits of online education over traditional classroom settings. Information technology
supports interaction, feedback and experience, with teleconferences, online chats, and
other applications such as Skype continue to enhance one-on-one interaction among
professors and fellow classmates on or off campus. Traditional education institutions
will not prevent the use of information technology from offering educational
opportunities. Those institutions that adapt to the changes technology brings and use
informational technology to enhance the student experience will be those that
continue to thrive. For consumers, the cost of an online education is usually much
lower than a traditional campus based program. Online education offers the
convenience and adaptability to customize the education process to individual student
goals, learning, and schedules. Some experts have referred to the advances that
information technology is bringing to academics as a “modern industrial revolution.”
Information technology careers in the field of academics will continue to expand as
educational programs across the country adapt to these rapid changes.
 Information Technology in Health Care
In the past, the health care system has made less use of informational technology than
other industries. Possible organizational challenges to the adaptation of health
information technology within the health care system include the fragmentation of
services, redundant services by multiple providers, and payment system barriers.
These are a few obstacles to implementing beneficial changes that health information
technology has to offer a system on the verge of unprecedented change. Some health
care systems that coordinate care between services and team members are using new
health information technology to deliver quality care by integrating health history,
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screening results, treatment plans, and other complex information from multiple
providers. The new health care reform currently under debate will bring the need for
widespread adaptation of information technology.
Health information technology can streamline the collection, storage, and retrieval of
patient information. Computerized orders from physicians reduce prescription errors,
miscommunication, and the time it takes to carry out changes in medications or other
orders. Electronic health records now used in house may soon be available to multiple
health care providers at the click of a mouse. This opens up concerns for security,
privacy rights, and access options. As insurance options enter into the health care
databases and imposed parameters brought about by the emerging health care reform
bring even more change to the health care system, information technology in health
care will continue to evolve to meet new demands. This will create new information
technology jobs at multiple levels. Those pursing information technology careers in
the health care field will need to purse professional certification and specialization.
Combining degrees in health-related fields with those in information technology can
provide a distinct advantage over others with only an IT background
 Information Technology in Media
Media field has been totally upgraded and transformed by the IT. Now, media can
cover news better and can distribute it for mass consumption on a larger scale. Apart
from TV and radio, online websites have been launched to keep people updated. Now
we are having 24*7 news.
 Information Technology in Banking
Few years ago, in banks working with hands and saving data on paper was a norm.
But with the arrival of computer, everything has changed. Now entries are directly
and efficiently recorded in PC files, money can be transferred online, account balance
can be checked, people have been provided with the service online banking service to
carry out various transactions.
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 Information Technology in Business
Businesses across the world, due to IT, are not bound to a geographical area anymore.
With the help of online communication they can reach the world. It’s because of IT
that there are so many people today who can work for employers that are located in
some different geographical area.
 Information Technology in Education
In the past, education was mainly done with the help of books. However, these days,
internet plays a vital role in teaching students valuable information regarding any
subject they want to learn about. There’s absolutely no shortage of information online
and can be accessed easily.
 Information Technology in Medical
IT has brought revolutionary changes in medicine sector as well. With the help of new
techniques, technologies and equipments developed by IT for this specific field,
physicians can provide more accurate treatment to patients. Something that wasn’t
possible ten to twenty years ago.
 Information Technology in Transport
Transport sector is also not untouched. New inventions and innovations have
upgraded the transport industry to a great extent. Roadways, railways, airways,
waterways all are revolutionized. Availability of seats, timings are all at a stone throw
just because of internet
Information Technology (IT) can be termed as a backbone to all the industries

because of wide-scale use of computers, internet and telecommunications systems.
Information Technology helps in managing, manipulating, storing, regaining,
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sharing/communicating and transmitting small as well as large amount of

information/data conveniently and effectively.
Work that was done manually in the past now can be done easily and efficiently with
the help of computers. There’s no need to store paper files as all the important
documents can be stored on computer and can be accessed without much hassle.
Better and faster communication online has led to globalization and have immensely
helped industries and businesses around the world.
However, things were not like this in 60s and 70s and IT sector was mostly limited
areas such as banking sector, large business houses, computer scientists and
mathematical engineers. The emergence of personal computers changed this scenario
and suddenly IT was being used in almost every sector. Big/small businesses,
industries, education sector, government sector, defense, marketing, fashion, security,
journalism etc. These days there’s hardly any arena that’s not being positively
affected by information technology.
Applications of IT in Accounting System
IT is the area of managing technology and spans wide variety of areas that include
but are not limited to things such as processes, computer software, information
systems, computer hardware, programming languages, and data constructs. In short,
anything that renders data, information or perceived knowledge in any visual format
whatsoever, via any multimedia distribution mechanism, is considered part of the
domain space known as Information Technology (IT). IT professionals perform a
variety of functions (IT Disciplines/Competencies) that range from installing
applications to designing complex computer networks and information databases. A
few of the duties that IT professionals perform may include data management,
networking, engineering computer hardware, database and software design, as well as
management and administration of entire systems. Information technology is starting
to spread farther than the conventional personal computer and network technology,
and more into integrations of other technologies such as the use of cell phones,
televisions, automobiles, and more, which is increasing the demand for such jobs.
 The influence of Information Technology on Accounting

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Computers, servers, the Internet, wireless and personal digital devices have forever
transformed the way companies conduct business. Software packages have also
improved traditional operations and production processes. Accounting has seen
tremendous advancements thanks to the growth of information technology.
Accounting software automates the traditional paper ledgers and accounting books.
These software packages may come with a variety of specialized features or a generic
program that can be customized to current business operations. Companies usually
choose accounting programs based on the size of their operations and the number of
users accessing the system. Large companies may choose system-wide software
packages, such as an enterprise resource planning system. Information technology
(IT) has created significant benefits for accounting departments. IT networks and
computer systems have shortened the lead time needed by accountants to prepare and
present financial information to management and stakeholders. Not only has IT
shortened the lead time required to present financial information, but it also has
improved the overall efficiency and accuracy of the information.
 Computerized Accounting Systems
The biggest impact IT has made on accounting is the ability of companies to develop
and use computerized systems to track and record financial transactions. Paper
ledgers, manual spreadsheets and hand-written financial statements have all been
translated into computer systems that can quickly present individual transactions into
financial reports. Most of the popular accounting systems can also be tailored to
specific industries or companies. This allows companies to create individual reports
quickly and easily for management decision making. Other advantages of
computerized accounting systems can be summarized as follows:
a) Increased Functionality
Computerized accounting systems have also improved the functionality of

accounting departments by increasing the timeliness of accounting
information. By improving the timeliness of financial information, accountants
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can prepare reports and operations analyses that give management an accurate
picture of current operations. The number of financial reports has also been
improved by computerized systems; cash flow statements, departmental profit
and loss, and market share reports are now more accessible with computerized
systems. 114 Maziyar Ghasemi et al. / Procedia - Social and Behavioral
Sciences 28 (2011)
b) Improved Accuracy
Most computerized accounting systems have internal check and balance

measures to ensure that all transactions and accounts are properly balanced
before financial statements are prepared. Computerized systems will also not
allow journal entries to be out of balance when posting, ensuring that
individual transactions are properly recorded. Accuracy is also improved by
limiting the number of accountants that have access to financial information.
Less access by accountants ensures that financial information is adjusted only
by qualified supervisors.
c) Faster Processing
Computerized accounting systems allow accountants to process large amounts

of financial information and process it quickly through the accounting system.
Quicker processing times for individual transactions has also lessened the
amount of time needed to close out each accounting period. Month- or year-
end closing periods can be especially taxing on accounting departments,
resulting in longer hours and higher labor expense. Shortening this time period
aids companies in cost control, which increases overall company efficiency.
d) Better External Reporting
Reports issued to outside investors and stakeholders have been improved by

computerized accounting systems. Improved reporting allows investors to
determine if a company is a good investment for growth opportunities and has
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the potential to be a high-value company. Companies can utilize these

investors for equity financing, which they use for expanding
 Software Tools in the Accounting Process
Up-to date accountants must be familiar with the software tools to help them perform
the accounting functions more effectively and efficiently.
Accounting software contains the basic accounting functions such as input, processing
and output. There are two classifications of accounting software as low-end and high-
end. Low-end is all-in-one software, which means all of the functions of accounting
system are performed within one software. Therefore, low-end software is used for
small companies
o Income tax.
Because tax laws are frequently changing, it is becoming exceedingly difficult to deal
with them. Therefore, manual tax preparation is becoming more and more difficult
and time consuming. Fortunately, tax preparation software is currently available for
companies. Therefore, instead of processing tax manually, companies can use
computer software to perform the same functions. As a result, even complex
calculations can be performed via computers in a short period of time.
o Audit.
Information technology has also computerized the auditing profession. If auditors
perform auditing functions manually, it takes time. However, audit software packages
are currently available for auditors. For example, trial balance software enables
auditors to input the working trial balance, handle all types of adjusting entries, and
automatically compute the adjusted trial balance.
o Word processing.
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Word processing is computer-assisted creation, editing, correcting, manipulation,

storage, and printing of textual data (Romney et al., 1997: 246). Accountants use
word processing software to prepare reports, billings, memos, and financial
statements.
o Graphics software.
Graphics can be prepared using graphics software. Graphics can be printed on paper
or displayed on slides, transparencies, and photos. Many auditors and managerial
accountants use the graphics software to graph the data in financial statements and
reports. Masaya Hashmi et al. / Procedia - Social and Behavioral Sciences 28 (2011)
112 – 116 115
o Image processing.
Creating, storing, and updating paper forms of documents take time. In addition, it is
very costly to process and store documents. Fortunately, these costs can be eliminated
with the help of document imaging systems. Image processing captures electronic
image of data so that it can be stored and shared. With the help of document imaging,
accountants can scan paper documents into the computer and process all of the files
electronically. Companies that use document imaging are moving toward paperless
offices.
o Electronic data interchange (EDI).

Electronic data interchange enables companies to communicate with each other
electronically. Therefore, EDI enables companies to exchange documents
electronically with each other. For example, computerized network enables purchaser
and the supplier to exchange purchase orders and invoices electronically in the form
of images.
o Electronic funds transfer (EFT).

Companies can now connect to banks through EFT. This system enables companies to
make payment and collection electronically. In this case, when company wants to pay
for accounts payable to a supplier, it can do it via EFT. Furthermore, whenever
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company makes sales, transactions are immediately charged to consumer’s bank

account and simultaneously credited to company’s account. In addition, all relevant
accounts such as accounts receivable and cash are updated immediately by the
computerized system. The use of the computerized systems mentioned above has led
to the automation of accounting information system. Accounting information systems
equipped with these kinds of technologically advanced tools can now perform
accounting functions more effectively and reduce costs.
Accounting programs or software can help accountants or business owners create

sales forecasts, economic business models and other business decision tools. They
will also automatically input the business' financial information, limiting the number
of human data entry errors. Standard defaults and mathematical verification processes
are additionally important features of accounting software. These processes ensure
that the company's accounting books are always in balance and do not violate any
preset requirements. Small business accounting software packages are usually basic
programs created with the non-accountant in mind. This allows owners and managers
to complete traditional accounting functions without much formal training or
technical knowledge. Small business owners may also be able to transfer this
information electronically to their public accountant for tax purposes. Electronically
transferring information is usually more accurate and timely than handing over a stack
of manual accounting ledgers.
Accounting Software’s
Accounting software is a type of computer software used by accounting professionals

to manage accounts and perform accounting operations. Accounting is the systematic
practice, work or process of communicating and recording financial information. In a
business setting, this is done for the purposes of internal and external audits, required
reports and financial analysis to meet legal or internal managerial requirements.
Accounting may also include systematic and diverse measurement, classification,

verification, summation and interpretation of financial information. Accounting
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software can range from simple, single-entry programs used for individual record-
keeping to more sophisticated, double-entry systems that can process accounts
receivable, accounts payable, payroll and inventory, among other functions.
Corporate accounting has become highly regulated and is more important than ever
because it allows companies to track their financial transactions and receive almost
instantaneous reporting and analysis. Before accounting software existed, accounting
tasks had to be performed by hand. By automating these tasks, accounting software
reduces the cost of accounting.
It also provides more accurate and timely reporting, allowing companies to better use
the information to make financial decisions. counting software describes a type
of application software that records and processes accounting transactions within
functional modules such as accounts payable, accounts receivable, journal, general
ledger, payroll, and trial balance. It functions as an accounting information system. It
may be developed in-house by the organization using it, may be purchased from
a third party, or may be a combination of a third-party application software package
with local modifications. Accounting software may be on-line based, accessed
anywhere at any time with any device which is Internet enabled, or may be desktop
based. It varies greatly in its complexity and cost.
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Types of Accounting Software’s
Accounting software is used to collect information about and report on the financial
viability of a business. This software is critical to the proper administration of an
organization. Before deciding upon which software package to use, it is important to
understand the different types of accounting software, and under what circumstances
each one should be used.
The following list itemizes the general classifications of accounting software:
 Spreadsheets.
Quite a small business can be run just using an electronic spreadsheet for its
accounting software. The spreadsheet software is inexpensive and the system can be
configured in any way at all. However, spreadsheets are prone to error, since
information may be entered in the wrong place, incorrectly, or not entered at all,
resulting in inaccurate financial statements. Consequently, spreadsheets are typically
only used by organizations that have very low transaction volumes.
 Commercially-available software.
Commercial off-the-shelf (COTS) software is the predominant accounting software

used throughout the world. It is moderately configurable to the needs of a business,
contains multiple layers of error detection to prevent the entry of incorrect
information, and produces standard reports that can usually be configured to the needs
of the user. There are COTS packages that are specific to certain industries, with extra
features to address the needs of their target markets. COTS software may require the
services of consultants to install, and can require a lengthy installation process, as
well as on-site staff to maintain the software. A variation on this concept is
accounting software that is available as an online service, which requires users to log
into the vendor's site to access the software.
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 Enterprise resource planning software (ERP).
ERP software integrates information from all parts of a business into a single

database. This approach eliminates the problems associated with having independent
department-specific software that does not share information. However, it is also
painfully expensive and may require more than a year to install. This software is
usually only needed by the largest and most complex organizations
.
 Custom accounting software.
This software is custom developed for an organization. This approach is usually only
taken when an entity's needs are so specific that they cannot be met by a COTS or
ERP package. However, this approach is rarely taken, since custom software tends to
be buggy and requires more maintenance than commercially-available packages.
The following list itemizes the Standerd classifications of accounting software:
 Personal accounting
Personal accounting software is mainly targeted towards home users,

supporting accounts,payable-type accounting transactions,managing budgets, and
simple account reconciliation, at the inexpensive end of the market
 Low-end market
At the low-end of the business markets, inexpensive applications software allows

most general business accounting functions to be performed. Suppliers frequently
serve a single national market, while larger suppliers offer separate solutions in each
national market.
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Many of the low end products are characterized by being "single-entry" products, as
opposed to double-entry systems seen in many businesses. Some products have
considerable functionality but are not considered GAAP or IFRS/FASB compliant.
Some low-end systems do not have adequate security nor audit trails.
 Mid-market
The mid-market covers a wide range of business software that may be capable of

serving the needs of multiple national accountancy standards and allow accounting in
multiple currencies.
In addition to general accounting functions, the software may include integrated or

add-on management information systems, and may be oriented towards one or more
markets, for example with integrated or add-on project accounting modules.
Software applications in this market typically include the following features:
 Industry-standard robust databases

 Industry-standard reporting tools
 Tools for configuring or extending the application (e.g. an SDK), access to
program code.
 High-end market
The most complex and expensive business accounting software is frequently part of
an extensive suite of software often known as enterprise resource planning (ERP)
software.
These applications typically have a very long implementation period, often greater
than six months. In many cases, these applications are simply a set of functions which
require significant integration, configuration and customization to even begin to
resemble an accounting system.
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Many freeware high-end open-source accounting software are available online these
days which aim to change the market dynamics. Most of these software solutions are
web-based.
The advantage of a high-end solution is that these systems are designed to support
individual company specific processes, as they are highly customizable and can be
tailored to exact business requirements. This usually comes at a significant cost in
terms of money and implementation time.
 Horizontal market
The choice of whether to purchase an industry-specific application or a general-

purpose application is often very difficult. Concerns over a custom-built application
or one designed for a specific industry include:
 Smaller development team

 Increased risk of vendor business failing
 Reduced availability of support
This can be weighed up against:
 Less requirement for customization

 Reduced implementation costs
 Reduced end-user training time and costs
Some important types of vertical accounting software are:
 Banking
 Construction
 Medical

 Nonprofit or fund accounting
 Point of sale (retail)
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 Real estate investment trust

 Child care management software
 Management for Bookselling
 Hybrid solutions
As technology improves, software vendors have been able to offer increasingly

advanced software at lower prices. This software is suitable for companies at multiple
stages of growth. Many of the features of mid-market and high-end software
(including advanced customization and extremely scalable databases) are required
even by small businesses as they open multiple locations or grow in size.
Additionally, with more and more companies expanding overseas or allowing workers
to home office, many smaller clients have a need to connect multiple locations. Their
options are to employ software-as-a-service or another application that offers them
similar accessibility from multiple locations over the internet
 SaaS accounting software
With the advent of faster computers and internet connections, accounting software
companies have been able to create accounting software paid for on a monthly
recurring charge instead of a larger upfront license fee (software as a service - SaaS).
The rate of adoption of this new business model has increased steadily to the point
where legacy players have been forced to come out with their own online versions.
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Benifits of Accounting software
 Simplification.
Accounting systems put finance control in the hands of a non-accounting audience, as

they are designed to give numbers a meaning, and to perform automated calculations.
With little to no training at all, the business owner can complete all accounting
operations and comply with legal standards from his own computer (mobile device),
and without paying an external party to keep his budget in the loop.
 Cost savings.
Accounting and finances systems automate core calculations and administrative

procedures and take control of your revenue framework so that you won’t have to
outsource finance management to an external expert. In parallel, they also reduce
costs related to printing and distributing documentation and store sensitive data in
secure and monitored locations.
 Full financial transparency.
From an accountant’s or an auditor’s point of view, the highlight of good accountancy

systems is that they avoid costly and recurring human errors. In the business scenario,
calculating inaccurate totals or failing to report data in time can lead to a crisis, and
that’s where automating calculations is most useful.
 Accurate forecasting.
It’s one of the main advantages of accounting software. Understanding in detail the
patterns and trends of your financial performance is something that would take ages to
complete without a solid system. Accounting software gives numbers a meaning,
helping you understand where to cut expenses or where to invest more. With a clear
overview of your current financial state, you will find it easier to develop smart
strategies and allocate resources the right way.
28
 Productivity.
Should a business owner have to choose a single suite of digitized services to improve
performance, his first option should definitely be accounting software. These systems
drill deep inside the most cumbersome, day-to-day tasks of companies, collect,
organize, and analyze their most sensitive data, and what is most important, make
smarter use of their money.
 Tax compliance.
Many of today’s top accounting systems are dedicated to payroll assistance and
reporting and adhere to tax regulations automatically. Once you’ve activated them,
they become your number one source of tax and audit information; they store all the
important details for you to maintain a transparent workflow.
 Improved relationships with customers.
One could argue that accounting software has little to do with how customers are
served, but that couldn’t be any further from the truth. Most accounting systems
nowadays (regardless of their main functions) work around effective billing and
invoicing, and prevent all sorts of delays and miscommunication. They are also easy
to personalize on the business’s behalf, and thus, make company performance appear
more professional and credible.
 Security.
Financial data is the company’s most valuable information and must be prevented

from falling into the wrong hands or getting lost by mistake. That’s exactly what
accounting & finance systems do for their users, prevent accounting from being
jeopardized in any way, and keeping an extra copy in case you need to retrieve them.
29
In most cases, you will get to build your internal security structure, and decide who
will have access to sensitive data.
30
Role of Accounting Software
 Accounting
Accounting is the main component of each system in this category and the one you
should be looking for first when choosing a reliable solution. What we have in mind
by ‘accounting’ is general ledger, fixed assets, accounts payable & receivable, and
bank reconciliation. These are, of course, the basic and most important ones, while
advanced systems have much more bells and whistles to offer to their users.
 Billing & Invoicing
There are accounting systems exclusively devoted to billing and invoicing, but most
of them still treat similar operations as an integral module of any finance operation.
Thus, they let customers automate mundane collections, adjust operations to new and
effective payment methods and industry standards, and prepare accurate and in-time
invoices for their clients.
 Budgeting and Forecasting
This is also a common bundled module in most accounting systems, which calculates
and interprets finance performance for the current year and helps estimate the budget
of the upcoming one. Using it, companies can prepare their estimates and set up
feasible and optimistic sales targets.
31
 Management of fixed asset
Both as a separate tool or an inclusive module, fixed asset management helps manage
financial data much more accurately. The module combines features such as audit
history, cost records, depreciation calculation, resource allocation and many more.
32
 Payroll management
With an array of payroll features, you will be able to calculate and process employee
payments, prepare and print their checks without delays, and respond to all active
legal and tax commitments without errors. There will be systems out there exclusively
devoted to payroll management, used by enterprises and high-tier performers to
remind them of their financial obligations.
 Project accounting
Project accounting software is usually packed in separate systems that represent the
accounting version of vertical industry software. They are most welcomed by
construction operators and software developers, where both costs and applicable rules
differ from one project to the other. The main capability of this software is to estimate
and handle overheads and costs related to labor, material, and equipment, in line with
all other features frequently met in accounting systems.
 Fund accounting
These features are to be found in accounting software designed for government

agencies and nonprofit organizations and include tracking donation expenditures,
grant management, GASB (governmental accounting standards board) regulations,
and a special suite of financial reports.
 Inventory management
Inventory management is a specific toolkit developed for stock control, and where
you will find all the necessary tools to give your business a higher shelf-life product
line. This means you will be able to control the availability and movement of your
products and avoid all sorts of delivery issues such as overstocking or understocking.
33
Accounting Softwares
Counting is not an easy task. Small businesses to large enterprises face common
challenges when it comes to managing their business’ finances. Some of the top
obstacles you may encounter involve payroll management, unforeseen expenses,
taxes, and cash flow management. Accounting software solutions can help you
handle some of the time-consuming tasks so you can focus on more important aspects
of running your business.
There are numerous accounting products available to cater to different business sizes,
types, and niches.
1) FreshBooks
2) Sage 50cloud
3) NetSuite ERP
4) Zoho Books
5) Gusto
6) Tally ERP 9
7) ProfitBook
8) Busy Accounting software
9) Marg Accounting Software
10) Saral Accounting Software
11) Mprofit
12) Quick Books
13) Wave Accounting
34
1)FreshBooks
FreshBooks is one of the leaders in our accounting software category. Our team found
FreshBooks to be the most easy-to-use accounting solution for freelance accountants
and small businesses currently offered in the market.
The software is used by more than five million users around the world to streamline
time tracking and invoicing. The vendor has recently updated the product to allow
easy collaboration between team members and has added a redesigned dashboard
where you can prioritize tasks and manage payments. The classic features have not
changed and FreshBooks continues to offer top-rate invoice-to-payment
functionalities, including direct payment gateways, overdue payment reminders, delay
fees, and payment claims. You can use the system to collect payments easily and
automate the recurring billing process to accept Google Checkouts, Amex, PayPal,
and credit card payments.
FreshBooks also recently added features such as bank reconciliations, invitations for
up to 10 accountants, new balance sheet reports, directly adding the credit card to the
client profile and adding payments in bulk. It also improved its navigation experience
by adding sections for Invoices, Reports, and Accounting
35
2. Sage 50cloud
Sage 50cloud is a best-in-class online accounting platform built to help SMBs

efficiently manage their finances as well as compliance with taxes and reporting
requirements. It comes with 50 enterprise-level features and capabilities to help you
keep a tab and get a handle on your taxes, inventory, budgeting, cash flow,
expenses, invoicing, and financial data, among others. It offers an extensive array of
add-ons including credit card processing, HR/payroll, POS, e-commerce, data
management and more. With its mobile capability, you can make payments on-the-
go and bill customers, and provide your accountants real-time access to accounting
books.
A unique attribute of the accounting platform is that it combines the robust feature set
of the desktop with the accessibility of the cloud, letting you access and store data in
the cloud and perform others tasks in your on-site PCs. You can use the software to
track purchases and vendors and pay bills while its expense management features let
you undertake mobile payments and bank feeds. It also allows you to connect to your
bank accounts, providing for real-time recording of sales and receipts, tracking
receivables, transferring funds, reconciling bank accounts, and making deposits.
It also offers new features such as electronic invoices, streamlined transaction
approvals, and integrated Microsoft Pay. The vendor offers a comprehensive free trial
to get you up to speed with the features
36
3. NetSuite ERP
NetSuite ERP is essentially a customer relationship management (CRM) solution, but

the platform can be used for sales force and marketing automation, as well as order
management and customer support. It offers a load of tools and features to make
financial management simple.
The vendor offers a great demo of the product that will introduce you to all key
features. You can easily sign up for NetSuite ERP free demo here .
Standard features include pre-configured dashboards that can be customized by users
for their specific needs. NetSuite ERP also offers robust automation and scalability
features. It can grow with your company and automate processes such as financial
management, order management, revenue management, fixed assets, inventory
management, and billing. Users can easily customize their view of key performance
indicators and generate reports that are specific to their role in the company.
4. Zoho Books
37
Why is Zoho Books is best accounting software? The reason is this award-winning
solution offers great value for money. It easily automates bank feeds, sends payment
reminders automatically, and makes it easy to send and track retainer invoices. The
system is unique as it integrates with Stripe and makes it simple to do payment
reconciliation.
Zoho Books is similar to Freshbooks in the manner it supports collaboration to
dissolve miscommunication between a company’s accounting and sales units. Similar
to Freshbooks, Zoho Books also offers mobile optimization and API for integration
with other business apps. You can also make use of premade integrations with other
Zoho products. It also enhanced its features like invoice templates and custom domain
and added new features like recurring journals and bulk payments received and
project deletion.
5. Gusto
38
Gusto is the accounting software you need if your main task involves HR and payroll.
Built for small businesses, Gusto simplifies your payroll process right from the start.
Anyone can use the software as instructions are explained in plain English, not
jargons. New employees are easily added on the payroll. Additionally, it takes care of
pay rates, multiple schedules, automated payroll filings, tax payments, and W-2s and
1099s. Meanwhile, it integrates your HR and payroll so you can manage your team
efficiently.
The data is centralized in a single system which cuts down time in synchronizing data,
looking for the right information, and making sure everything is up-to-date. This
functionality also minimizes as you no longer have to manually enter information on
different systems and calculations are accomplished automatically. If you need to
extend the system’s functionalities, you can seamlessly do so by connecting the app
with your existing tools such as FreshBooks, Xero, and QuickBooks. You can explore
the software first when you sign up for Gusto free trial here to help you determine if
it matches your needs.
6. Tally ERP 9
39
Tally is considered a market leader in the business accounting software for small and
medium sized businesses. It serves the purpose of accounting, sales, purchase,
inventory and payroll for an organization. It is a user-friendly software developed by
Tally Solutions Pvt Ltd., specifically designed for accounting purposes. It helps in
managing:
Journal & Ledger
Debit & credit notes
Trial balance
Balance sheet
P&L
Cash flow, and more
SMEs can streamline their finance and control related operations such as bank
reconciliation, budgeting, inventory valuation, internal audits, etc. through this
accounting solution.
7.Profitbooks
40
Profitbooks is a cloud accounting software specifically designed for small

businesses. It is a cloud-based accounting solution that lets you create invoices, track
expenses and manage inventory, helping you save time and manage finances
efficiently. This solution also helps with:
Tracking your receivables
Managing online payments
Get detailed tax reports
Track inventory lifecycle
Creating unlimited customers & vendors
As it is a cloud-based accounting solution, the information can be accessed remotely,
thus ensuring mobility
8. Busy Accounting Software

41
Busy accounting software is developed by Busy Infotech Pvt Ltd. It is an integrated

business software helping SMEs to manage accounting, sales, purchase, VAT, CST,
currency, payroll and multi-location inventory. Salient features of Busy accounting
software are:
Multi-currency financial accounting
Production
Bill of Material
GST invoicing & reports
Multi-location inventory management
It is available in three different editions: Basic, Standard and Enterprise.
9. Marg Accounting Software
Marg Accounting software is developed by Marg Compusoft Pvt Ltd and is well
known among small and medium enterprises of India. It is simple to use, easy to
configure and flexible in customization. It ensures:
Easy & fast billing
42
Efficient reporting
GST tax calculation
Barcode management
Tax reconciliation, etc.
It can also effectively manage transactions related to accounting, purchase, taxation,
invoicing, inventory etc. of the SMEs.
10. Saral Accounting Software
This business accounting software is developed by Relyon Softech Limited, and helps
in managing complete inventory and accounting transactions. It is a user-friendly
software allowing manufacturing, trading, service as well as non-profit organizations
to create their book of accounts and:
Audit log as per GST guidelines
TDS management
Generate GSTR 1, GSTR 2, GSTR 3
Perform GST-compliant billing
43
11.MProfit
MProfit is a leading portfolio management and accounting software for Indian

Investors, traders, family offices, advisors, CAs and corporates. This software makes
business processes easier and effortless by promising simplified accounting solutions
including:
Budgeting
Investment
Bonus
Loan and advances
Other important features are for financial management along with mobile support.
12. Quickbooks
44
This business accounting software is designed by Intuit Inc for various types of small
businesses. It is an online accounting software with an easy to use interface and tools.
It offers more than 40 reports including:
Profit & loss account
Balance Sheet
Cash Flow Statement
It helps manage day to day accounting transactions, billing and invoice activities,
inventory, and budgeting, with mobile support for iOS and Android users.
13.Wave
Wave is a free cloud accounting software for small businesses . It is a secure and

popular accounting solution to manage day-to-day business transactions and generate
financial statements such as Profit & loss statement and Balance Sheet. Key features
of this business software include invoicing, payroll, receipts, and direct deposit.Wave
45
Accounting makes it easy to Track all your income & expensesPrepare smartly for the
tax time
Limitations
Heavy Cost of Installation:
Computer hardware needs replacing and software needs to be updated from time to
time with the availability of newer versions.
Cost of Training:
To ensure effective and efficient use of computerized system of accounting, newer

versions of hardware and software are introduced. This requires special training and
cost is incurred to train the staff personnel as specialists.
Fear of Unemployment:
Reflects the feelings of the staff on the introduction of computerized accounting

system. The staff fears redundancy and show less interest in computers.
Disruption in Work:
When computerized system is introduced, there might be loss in the work time and
certain changes in the working environment. 5. System Failure: The danger of a
system crashing due to some failure in hardware can lead to subsequent loss of work.
This occurs when no back-up is retained.
Time Consuming:
In order to avoid loss of work at the time of system failure, there is a need for
providing backup arrangements which is a time consuming process.
Unanticipated Errors not Known:
Unlike human beings, computers do not have the capability to judge or detect
unanticipated errors in the system.
46
Breaches of Security:
The danger of viruses and hacking into the system from outside creates a strong need
for security of system. Similarly, the person who has created the specific program can
easily defraud by tempering with the original records.
Health Dangers:
Extensive use of computers may lead to many health problems such as eyestrain,
muscular complaints, backache etc. resultantly reducing working efficiency as well as
increasing medical expenditure.
47
Chapter 3
RESEARCH AND METHODOLOGY
Objectives
 To examine the age of respondents impact on IT on Accountancy
 To know the various types of accounting software’s
 To study the benefits of accounting software’s
 To study the application of IT in accountancy
 To know the people’s attitude towards IT in Accountancy
 To know which Accounting Software people prefer to use
 To know whether people are aware or not about IT’s impact on accounting
system
Sample
This study is based on primary data that have been collected through means of wells
structured questionnaire. The sampling size of the data is about 50
Data Collection
1. Primary Data
2. Secondary Data
PRIMARY DATA: The Primary Data involves getting original data directly from the
general public. It is been designed to answer specific questions of interest to the
researcher. To collect primary data following method was used.
48
1. QUESTIONNAIRE: A questionnaire is a set of questions related to the topic

of research and are to be filled for the purpose of gathering information from
respondents. The questionnaire was filled by 38 respondents who were from
all age group from the area selected.
SECONDARY DATA: Secondary data is the data collected by the other than the
user. Common sources of secondary data collected are through qualitative
methodologies. The secondary data collected can also be helpful in the research
design of subsequent primary research and can provide a base line by which the
primary collected can be compared. It is always wise to being any research activity
with a review of the secondary data. Sources of secondary data can be already
published journals, published articles related to the topic, research paper, textbook,
internet etc.
Primary
Data
Data
Collection
Secondary
Data
49
Chapter 4
Review of Literature
James E. Hunton, 2002, stated, “digital revolution, which is still unfolding before
our eyes, has changed the very nature of work for accountants and forced
researchers and practitioners alike to struggle with a host of new threats and
opportunities facing the profession. Accounting behavioral researchers in
particular must deal with a wide array of human-to-computer, information
processing and decision-making issues that did not exist a mere two decades ago.
We academics can put our collective heads in the sand, as some have already
chosen to do, or we can view these turbulent times in the global business
community as exciting, provoking and enlightening. Herein, I attempt to address
many ways in which psychology-based researchers can engage in meaningful
studies aimed at raising the accounting profession to a new level of quality and
relevance by incorporating the impact of information and communication
technologies on human attitude, cognition and performance.”
Rajiv D. Banker stated, '”In recent years, information technology (IT) has played a
critical role in the services provided by the public accounting industry. However, no
empirical research has evaluated the impact of IT on public accounting firms. This
study focuses on five offices of an international public accounting firm that recently
made large IT investments, primarily in audit software and knowledge‐sharing
applications. Both qualitative and quantitative information from the research site are
analyzed to estimate the change in productivity following the implementation of IT.
The results from both regression analysis and Data Envelopment Analysis (DEA)
indicate significant productivity gains following IT implementation, documenting the
value impact of IT in a public accounting firm.”
Prof. M. S. Yadav,2016, stated, “ Information technology had carved across all the
aspects of modern day activities ranging from small to medium and medium to large
applications and operations. The trends of human centric systems which are more
common and popular at times are now slowly and gradually diminishing from our
public and private corporate establishments. The new , most versatile, popular,
50
advent, efficient technique wherein the basic approach is computer centric modus
operandi have overridden almost all the modern day industrial practices from very
basic step of requirement elicitation to final product outcome. Information and
Communication technology is this computer centric system. ICT has increased
efficiency, reliability, effectiveness, performance and other characteristics of modern
day commercial operations. ICT has increased and renovated financial structure both
in quality and quantity. ICT has sophisticated the way transactions are catered in any
financial system with optimal levels of performance and efficiency. Now it is the time
to think beyond the curtains and ensure proper implantation and maintenance of
information and communication technology.”
Shy (1997),stated “diffusion theory posits five characteristics of innovations that

affect their diffusion: relative advantage (the extent to which a technology offers
improvements over currently available tools), compatibility (its consistency with
social practices and norms among its users), complexity (its ease of use or learning),
trialability (the opportunity to try an innovation before committing to use it), and
observability (the extent to which the technology’s outputs and its gains are clear to
see). Diffusion studies have demonstrated that innovations affording advantages,
compatibility with existing practices and beliefs, low complexity, potential trialability,
and observability, will be more extensively and rapidly diffused than an innovation
with the cluster of opposite characteristics”
Zozak (2005), Stated, “Theory of Reasoned Action (TRA) defines relationships

between beliefs, attitudes norms, intentions, and behavior. According to this theory,
an organizational behavior (e.g., use or rejection of technology) is determined by
one’s intention to perform the behavior, and this intention is influenced jointly by the
organizational attitude and subjective norm, defined as “the organization’s perception
that most businesses/clients who are important to it think it should or should not
perform the behavior in question” According to TRA, attitude towards a behavior is
determined by beliefs about the consequences of the behavior and the affective
evaluation of those consequences. as the organizational subjective probability that
performing a given behavior will result in a given consequence. Affective evaluation
is “an implicit evaluative” to the consequence; thus the attitude construct in TRA is
general in nature and is not anchored to any given belief set. This approach represents
51
an information processing view of attitude formation and change which states that
external stimuli influence only through changes in the organization’s belief structure”
Connor, 1997, Stated, “The socio-technical systems perspective has become

influential in the analysis of the organizational impact of information technology. The
theory views any organization as an open system of interdependent sub-units
transforming inputs to desired outputs. The gainful employment of any technology
hinges on the ability and willingness of users to employ it for worthwhile tasks (i.e.,
those deemed central to the organization’s goals). Socio-technical systems theory has
given birth to a framework for technology design that emphasizes holistic job
satisfaction (rather than just task performance) and user participation throughout the
development process. Thus, socio-technical theorists recommend the analysis of all
stakeholders, not just the direct users of a technology, the formation of planning
groups to oversee the design, the performance of prototyping exercises, and the
analysis of likely impact the technology will have on the organization. In studying
technology acceptance, socio-technical theorists conceptualize acceptance in terms of
two competing forces: control and enhancement. Control factors are those that impose
rules or structures upon the users, thereby removing autonomy (control over their own
actions) from them. Among the control issues raised with respect to technology
design are: access, reliability, confidentiality, monitoring, pacing, stress, social
contact. Low or high presence of certain factors (e.g., low reliability, high pacing)
with the introduction of a new technology is likely to reduce the user’s perception of
control and thus increase the risk of resistance Enhancement factors include sense of
mastery, growth of knowledge, discretion, ability toact informally, requirement for
certain skills, and enabling worker cooperation. A technology that is designed to
support such factors is likely to increase user acceptance in an organization.”
Martin and Leben, 1989, Stated, “Activity theory is an approach to understanding

human work and technology which emphasizes the long-term well-being of workers
or users. Eschewing “one best way” task design for user-determined task procedures,
action theorists seek to design work practices that are enriching and that lead to
development of skills and knowledge. Activity theorists argue that acceptance of
technology is contingent on the extent to which it meets these goals in the context of
the user’s own work. Activity theory largely aligns itself with the broad humanistic
52
aims and the methods of the socio-technical approach. It is at least partially

distinguishable by its emphasis on the product of the organizational process which
characterizes socio-technical systems thinking.
M Salehi, V Rostami… - International Journal ,The main objective of an

accounting information system (AIS), a pre-eminently user-oriented system, is the
collection and recording of data and information regarding events that have an
economic impact upon organizations and the maintenance, processing and
communication of information to internal and external stakeholders. The results of
this study show that although AIS is very useful to Iranian corporation, it is a gap
between what AIS is and what should be.
Yaser A Jasim, This research aims to measure the effect of information technology
(IT) on the accounting system IT helps to improve the quality and performance of
accounting transactions in a transparent and safe manner in good security ways. In
this review, we provide a detailed theoretical analysis of the subject discussed by
focussing on the principles of the organization historically and reporting directly. The
researchers also test and obtain satisfactory results depending on the question tested
and the hypotheses. The findings of this work are satisfactory. Finally, the results
indicate the role of computing information technology in reducing time, costs and
improving health.
Francis Pol C Lim- 2013, The emergence of information technology in accounting is

an innovative system. Nowadays, most business entities, from large corporations
down to micro enterprises, are aided by their Accounting Information Systems in
managing their operations. This paper provides a review on the impact of information
technology on accounting systems. This paper also discusses things about the
accounting processes and its types. Accounting is a critical factor for the business,
having the touch of IT can enhance speed and accurateness of computations as well as
to enhance its flexibility to change and safety storage of information
Yuliia Lutsyk,Global challenges of contemporary issues, 94-97, 2018, The article

studies condition of accounting system development and impact of information
technologies on accounting process. Proved, that searching for efficient mechanism of
creation, using and analysis of information resources is one of the actual tasks, which
53
in future will allow to achieve positive economic effect

Maziyar Ghasemi, Vahid Shafeiepour, Mohammad Aslani, Elham Barvaye, This
paper attempts to clarify the impacts of information technology (IT) on accounting
systems. The biggest impact IT has made on accounting is the ability of companies to
develop and use computerized systems to track and record financial transactions. IT
networks and computer systems have shortened the time needed by accountants to
prepare and present financial information to management. This system allows
companies to create individual reports quickly and easily for management decision
making. Other capabilities of computerized accounting systems are: Increased
Functionality, Improved Accuracy, Faster Processing, and Better External Reporting.
Finally, this paper shed light on advantages and disadvantages of using information
technology (IT) in accounting systems.
Lina Kloviene, Edita Gimzauskiene, 2014, The new business environment
determines major changes in organization’s resources, structure, strategic objectives,
departments, accounting and goods. Economic and technological changes and
especially the developments in information technologies have significantly changed
work environments and the management of businesses. The main objective of
management accounting is to provide information for decision making. In such a
competitive environment, it has become very important for managers to make
consistent, logical and strategic decisions and develop instruments and models that
provide financial information.According to this aspect the importance of accounting
information has increased. The purpose of this article is to investigate the impact of
information technology (IT) on conformity between accounting system and business
environment. The article presents results of case study performed in Lithuanian
organization disclosing relations between business environment and accounting
system of an organization and developments of information technology ensuring
conformity between accounting system and business environment.
Maziyar Ghasemi, Vahid Shafeiepour, Mohammad Aslani, 2011, This paper
attempts to clarify the impacts of information technology (IT) on accounting systems.
The biggest impact IT has made on accounting is the ability of companies to develop
and use computerized systems to track and record financial transactions. IT networks
and computer systems have shortened the time needed by accountants to prepare and
present financial information to management. This system allows companies to create
54
individual reports quickly and easily for management decision making. Other
capabilities of computerized accounting systems are: Increased Functionality,
Improved Accuracy, Faster Processing, and Better External Reporting. Finally, this
paper shed light on advantages and disadvantages of using information technology
(IT) in accounting systems.
Joseph N Taiwo, 2016,ICT has been a major factor of efficient accounting system
and great organizational performance recently. ICT has been used to augment the
reliability of accounting information and organizational performance. Accounting
systems include the computer hardware and software fundamentals in recording
accounting information. Organizational performance in this study was related to
ability finances, ability to meet set goals and actions. However, to maximise the
benefits of information technology systems, the appropriate implementation and
adoption procedures have to used, or else, there is little or no impact of these
technologies on the earlier mentioned variables. This study investigates empirically
the impact of information technology on accounting systems and organizational
performance. This study utilizes secondary data and Pearson’s correlation was used
for analysis using SPSS for a sample of 20 staff in financial services and other related
accounting departments in Covenant University. The results of the empirical findings
show that there is a significant positive relationship between ICT system and
accounting system and a significant positive relationship between ICT and
organizational performance
Lina Kloviene, Edita Gimzauskiene, 2014,The new business environment

determines major changes in organization’s resources, structure, strategic objectives,
departments, accounting and goods. Economic and technological changes and
especially the developments in information technologies have significantly changed
work environments and the management of businesses. The main objective of
management accounting is to provide information for decision making. In such a
competitive environment, it has become very important for managers to make
consistent, logical and strategic decisions and develop instruments and models that
provide financial information. According to this aspect the importance of accounting
55
information has increased. The purpose of this article is to investigate the impact of
information technology (IT) on conformity between accounting system and business
environment. The article presents results of case study performed in Lithuanian
organization disclosing relations between business environment and accounting
system of an organization and developments of information technology ensuring
conformity between accounting system and business environment.
Yaser A Jasim, Manaf B Raewf, 2020,This research aims to measure the effect of
information technology (IT) on the accounting system IT helps to improve the quality
and performance of accounting transactions in a transparent and safe manner in good
security ways. In this review, we provide a detailed theoretical analysis of the subject
discussed by focussing on the principles of the organization historically and reporting
directly. The researchers also test and obtain satisfactory results depending on the
question tested and the hypotheses. The findings of this work are satisfactory. Finally,
the results indicate the role of computing information technology in reducing time,
costs and improving health
Rajiv D Banker, Hsihui Chang, Yi‐ching Kao ,Journal of information systems 16

(2), 209-222, 2002
In recent years, information technology (IT) has played a critical role in the services
provided by the public accounting industry. However, no empirical research has
evaluated the impact of IT on public accounting firms. This study focuses on five
offices of an international public accounting firm that recently made large IT
investments, primarily in audit software and knowledge‐sharing applications. Both
qualitative and quantitative information from the research site are analyzed to
estimate the change in productivity following the implementation of IT. The results
from both regression analysis and Data Envelopment Analysis (DEA) indicate
significant productivity gains following IT implementation, documenting the value
impact of IT in a public accounting firm.
Yaser A Jasim, Manaf B Raewf, 2020 ,This research aims to measure the effect of
information technology (IT) on the accounting system IT helps to improve the quality
and performance of accounting transactions in a transparent and safe manner in good
security ways. In this review, we provide a detailed theoretical analysis of the subject
56
discussed by focussing on the principles of the organization historically and reporting

directly. The researchers also test and obtain satisfactory results depending on the
question tested and the hypotheses. The findings of this work are satisfactory. Finally,
the results indicate the role of computing information technology in reducing time,
costs and improving health.
Ivana Mamić Sačer, , 2013 ,An accounting information system is of a great
importance for preparing quality accounting information for a wide range of users.
The study elaborates the impact of information technology on accounting process and
as a consequence on accounting information systems quality. This paper analyzes the
basic characteristics of accounting information systems quality, discussing the model
of AIS’s quality measurement. The perception of the quality of accounting
information systems by accountants in mediumand large companies in Croatia is also
presented. The paper presents the historical overview of AIS’s quality based on three
empirical studie
Liu Liyan ,2013,stated that Application of information technology in accounting has
improved the efficiency and quality of the work, optimized business decision and risk
management. However, the research on application of accounting information system,
as well as the application level is far behind the development of the information
system itself. The paper analyzes the impact of information technology on accounting
theory, on accounting profession, and further analyzes its impact on accounting
education, and tries to give some suggestions.
Yen et al. (2011) stated that accounting software is third party software, which is
licensed and fulfil various business objectives and had been used by the organization
from decades. Though the software has various advantages but in extracting benefit
from third party software is always a challenge for organization. This report carries
out the literature review on accounting software packages in Australia.
According to Pulakanam and Suraweera (2010), accounting software used in
Australia carry business oriented activities in contrary to operating system or other
environment software. It is analysed that operating system or other environment
software upgrades are generally not transparent to the organizations. In oppose to this,
Arif et al. (2011) states that accounting software upgrades are fully transparent to
business organizations. Accounting software showed their first appearance during
57
1960s in Australia at the time when payroll and accounting software were provided by
companies like McCormack & Dodge for lease. In the early times, accounting
software only fulfils the financial and accounting needs.
In view of Tsai et al. (2011) accounting software has widen its scope with the
passage of time and started fulfilling other needs related to operations, human
resource management, customer relationship management and also perform various
other functions. These software systems are usually manufactured on the basis of in
house applications and policies. Abugabah and Sanzogni (2010) stated that older
accounting software used to focus on single task in the organization. This leads to
inflexibility in organization and also faces problems in fulfilling customer
requirements. Accounting software should be always integrated with the organization
applications.
In the words of Guse (2012) accounting software is a finest way to develop business
strategies, goals and objectives. This resulted in implementation of accounting
software throughout the organization for increasing functionality in organization.
Success of accounting software depends on the ability of accounting software to cater
the need of organization.
In accordance to Pulakanam and Suraweera (2010), new releases of accounting
software has raise the issue of increase in challenges faced by management at the time
of implementation. Generally, the decision to install new accounting software in
organization is influenced by the supplier statement that the software will provide new
and innovative business functionality. In contrast to this, Yen et al. (2011) stated that
in reality the users or customers of accounting software face various challenges. The
customer of software is always tensed about the accessibility of data by another party
as lack of security is a biggest challenge for users. Firewalls are solution to this
challenge but at the time system got screwed, firewall failed to perform its security
function
58
Zia and Khan (2012) exemplified that accounting software provides less feature at a
high cost. In addition to this accounting software need to update timely and the cost
incurred on updating is also very high. Customization is another challenge for users of
accounting software as they are designed on a standard basis. So, the customer finds it
difficult to get rid of extra particulars because of non availability of customization
feature. Switching cost is also very high of this accounting software. Khorshed et al.
(2012) mentioned that the organization faces the problem of because of non
availability of bank reconciliation feature in accounting software. These accounting
software are not able to carry out bank and credit card reconciliation. The bank
reconciliation feature is highly recommended for business organization
Elragal and Haddara (2012) argued that accounting software is accessed through
internet and internet speed issue is a challenge for the user. Delay in speed of
accounting software sometimes occurs due to distance in location of the main server.
Instead of accounting software growth from past to the present day, there are
numerous problems which are faced by the consumer of accounting software. Zia and
Khan (2012) stated that accounting software promises to benefit the users but not all
accounting software have significant results. Accounting software generally delays in
scheduling and leads to increase in budget of the business organisation. In addition to
this accounting software sometimes do not help in accomplishment of organizational
goal and objective.
According to Abugabah and Sanzogni (2010), the challenges of accounting
software are not related to its implementation only. But the challenges occur because
of complexity arises from the change in organizational culture due to implementation
of accounting software. Another challenge faced by user of accounting software is
unavailability of technical staff on time. In case if the accounting software fails
suddenly while making of accounts then there will be need of technical staff to start
the system again. But, non availability of technical staff in shorter duration is
challenge for the user. Another gap is the establishment of clear objectives for
accounting software which is difficult because the user and the supplier have different
perspectives in their mind.
The findings of Kubick, et al., (2014) identifies that Xero, Sage 50 and Intuit are
some leaders in accounting software in Australia. The companies use accounting
software in order to manage their different accounts. Xero devolves cloud-based
59
accounting software that helps to get a competitive advantage in the Australia. It has
approximately 65% market share in Australia. It is made for especially modern
entrepreneurs that want keep their accounts secured. It equates to a smarter, cost
saving, easy to set up and simple and intuitive UI. That is why; Xero is more liked by
the business firms in order to maintain the account. At the same time, the study of
Sener and Fthenakis, (2014) state that Intuit is a major competitor of the Xero and it
has 20% market share in the industry of the accounting software/ packages. It has
great integration system and unlimited users for collaboration that are able to provide
the competitive advantage to the Intuit. Sage 50 is also famous accounting software
in Australia. It has 10% market share. The effective price strategy of the Sage 50 is
able to achieve the competitive advantage. It contains all essential elements that are
required for business. The utilization of Sage 50 is also easy and smooth. There has
not the requirement of any special training or skill to operate this. It allows the get a
real-time view of firms’ cash flow.
60
Chapter 5
DATA ANALYSIS AND INTERPRETATION
61
Age Total %
10-20 11 26.3
20-30 26 71.1
30-40 1 2.6
40 and above 0 0
62
Interpretation:
The above pie chart shows the age of the respondents 26.3 respondent are below 20
years. 71.1 % responses were filled by the age group under 20-30. There were only 1
respondent who falls under the age group of 30-40. And no any response from age
of 40 and above years. Higher range of respondents were falls under the age of 20-
30.
63
Gender Male Female
Total 20 18
Percentage 52.6 47.4
Interpretation:
There were total 38 respondets out of which there are 47.4% of the respondents are
females and 52.6% respondents are males.
64
Particulars Yes No
Total 33 5
% 86.8 13.2
Interpretation:
It seems from the survey that out of 38 respondent 86.6 that respondents use
digital transactions whereas only 13.2% respondent never use IT in accountancy.
65
Particulers Total %
Highly Agree 17 44.7
Agree 20 52.6
Neutral 1 2.7
Disagree -
Interpretation:
From the above pia chart, 44.7% respondents highly agree, 52.6% respondents agree
and 2.7% respondents are neutral on the question of IT making positive impact on
66
Accounting system.
67
Particulers Total %
Tally ERP 9 34 89.5
Freshbooks 1 2.6
Net Suits ERP 1 2.6
Wave Accounting Software 2 4.3
Interpretation:
From the above pia chart, 89.5% people says that Tally ERP 9 is most used software
in accounting sector wheras 4.6% people says Wave accounting software 2.6%
respondents says Freshbooks & Net Suits ERP respectivly.
68
Particulers Total %
Tally ERP 9 34 81.6
Freshbooks 1 5.1
Net Suits ERP 1 5.1
Wave Accounting Software 2 8.2
Interpretation:
From the above pia chart, 89.5% respondents preffers to use Tally ERP wheras
8.2% respondentse prefers Wave accounting software & 5.1 % respondents prefers
Freshbooks & Net Suits ERP perticulerly.
69
Particulers Total %
Strongly disagree 4 10.5
Disagree -
Neutral 4 10.5
Agree 20 52.6
Strongly agree 10 21.1
Interpretation:
From the above pia chart, 52.5% respondents are agree, 21.1 respondents are highly
agree and 10.5% respondants are strongly disagree and neutral particularly with the
statement, ‘Because of use of IT in Accounting, Transactions Of Accounts Made
more transparent, more reliable, and more fast’
70
Particulers Total %
Disagree 2 4.2
Neutral 12 31.6
Agree 20 52.6
Interpretation:
From the above pia chart, 52.6% respondents are agree, 31.6% respondents are
neutral and 4.2% respondents are disagree & 5.8% respondents are strongly agree
and strongly disagree particularly with the statement ‘Use of IT in Accounting is Safe
Accounting.’
71
Particulars Yes No Maybe
Total 5 17 16
% 13.2 44.7 42.1
Interpretation:
From the above pia chart, 13.2% respondents says yes, 44.7% respondents says no &
42.1% respondents thinks maybe use of IT is costly.
72
Particulars Total %
Disagree - -
Neutral 4 10.3
Agree 24 63.2
Interpretation:
From the above pia chart, 63.2% respondents are agree, 10.3% respondents are neutral
and 5.4%% respondents are strongly disagree & 21.1% respondents are strongly with
the statement ‘Information Technology becomes the most useful factor for
Accounting system?’
73
CHAPTER 6
Finding and Suggestions
I want to suggest that peoples should use as much as IT in accounting because it Made
accounting more transparent, more reliable, and more fast people should also aware
about different kinds of software’s that are used in accounting and make comparison
between them and choose best one.
74
CONCLUSION
Information technology advancements have greatly helped the accounting systems of
business entities. Because of today’s computerized accounting information systems,
business performance seems to improve. Many transaction processes were simplified
thus creating efficient operations. The affordability of computer technology for small
business entities creates great opportunities for these entities to improve their
business. Information technology advancements made effective and efficient
information flow that enhances managerial decision making, thereby increasing the
firm’s ability to achieve corporate and business strategy objectives. Business entities
much choose compatible systems and software for them to be effective. In these
advanced days in information technology, computers have improved the accounting
processes but computers can’t replace the role of man in the accounting systems.
Advancements in information the technology have enabled companies to computerize

their information systems. Accounting information systems have also been
computerized as a result of significant Improvements in the technology. As
accounting information systems are being computerized, accountants must gain the
skills to use computerized systems. The use of computerized Accounting information
systems has brought opportunities for companies to perform the accounting functions
more effectively and efficiently because the use of computerized AIS has brought
significant time and cost savings. Use of information technology to perform
accounting functions has brought a chance for companies to progress toward
paperless offices. Companies applying a production system may as well apply it more
effectively if they use computerized systems. Such tools as electronic data interchange
and electronic funds transfer can provide companies with opportunities to apply
production system more effectively and save money.
75
Bibliography
https://getarealdegree.com/how-is-information-technology-used-in-different-
industries/
https://searchdatacenter.techtarget.com/definition/IT
https://en.wikipedia.org/wiki/Information_technology
https://www.accountingtools.com/articles/types-of-accounting-software.html
https://financesonline.com/accounting-software-analysis-features-types-benefits-
pricing/
http://www.aessweb.com/pdf-files/aefr-2014-4%285%29-655-670.pdf
https://www.techjockey.com/blog/accounting-software-list
76
APPENDIX
Q1). Name of the Respondent?
Q2). Age of the respondent?

a) 10-20
b) 20-30
c) 30-40
d) 40 & above
Q3). Gender of the respondent?

a) Male
b) Female
Q4). Have you use Information Technology in Accounting?

a) Yes
b) No
Q5). Information Technology Making Positive Impact on Accounting System?

a) Highly Agree
b) Agree
c) Neutral
d) Disagree
Q6). Which Of the Following accounting software is used mostly in accounting

sector?
a) Tally ERP 9
b) Fresh Books
c) Net Suits ERP
d) Wave Accounting Software
Q7). Which of the following accounting software do you prefer to use?

a) Tally ERP 9
b) Fresh Books
c) Net Suits ERP
d) Wave Accounting Software
Q8). Because of use of IT in Accounting, Transactions of Accounts made more

transparent, more reliable, and faster?
a) Strongly Disagree
b) Disagree
c) Neutral
77
d) Agree
e) Strongly Agree
Q.9). Use of IT in Accounting is Safe Accounting?

b) Disagree
c) Neutral
d) Agree
e) Strongly Agree
Q10). Use of IT in Accounting is Costly?

a) Yes
b) No
c) Maybe
Q11). Information Technology becomes the most useful factor for accounting
system?
b) Disagree
c) Neutral
d) Agree
e) Strongly Agree
78

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