Determinants of Intellectual Capital Disclosure

Discuss about the Determinants of Intellectual Capital Disclosure.

Software is used by an organization for the purpose of accounting to maintain and process the records of transactions further. These transactions help accountant in functional modules like trial balance, accounts payable, accounts receivable and many more. Software is a computer programme which helps a user to overcome problems. Accounting software helps an organization or its accountant to record, maintain and present a financial report of the organization at any time. All the software are heterogeneous in nature.  Their characteristics, uses etc are different from each other. Some organizations buy the software from third party, some modifies purchased accounting software according to their need and some organizations built their software in house (Santos and Intuit, 2009). Software has flexible nature. It can be operated by an authorized person from anywhere. Software has reduced the work load of an accountant as they don’t have to do paper work now and they can get financial report whenever they want.

Accounting Software in Australia:

Accounting software has a huge market in Australian market. As almost every organization uses software to record and maintain their financial transaction. Software reduced the complexity of accounting as it is so easy to access accounting software and records the data.

With the time, people and their needs are changing. Earlier people used to prefer paper work for recording and maintaining their data but now they are using software for it as it is easier for an organization than paper work.

In 1951, the computer was used by an private organization first time for recording the data in Australia. It has been 61 years from now, and now almost is using computer or accounting software to maintain their financial transaction. Univac1 was the first accounting software of Australia. Software accounting was not a familiar term before 1979, People used to keeping the books and paper work for financial transaction like Egyptians have started and used to do before 3000 years (Shurville, O'Grady and Mayall, 2008).

In Australia, approx 80% organizations were using papers to record and maintain their data before 2000. But after the implementation of GST at Australia, almost every organization have shifted to accounting software as it was the easiest way to record, maintain and present the software perfectly without any error. Still some organizations were rigid as they were not even trying to change their way of recording. The major benefit of using accounting software is significance and convenient.

Development and Adoption:

The first accounting software was launched in Australia in 1955. With the time, software quality has been increased. The current software in the industry are far better than the first software. Still industry need to make many changes and development in current accounting software. With the changes in computer, its processor and many more, the quality of software has been increased. At the time of implementation of GST, some people were not ready to adopt technique (Horngren and et all, 2012). But with the time, they change their thinking and adopted the software. As software are the best option for recording and presenting financial data. The main reason behind adopting the accounting software is presenting the final financial records to government by every organization.

It really took a very long time to understand the significant, need and convenient nature of accounting software by Australian organization. Still many organizations are not using software to record their data. Debra states that accounting software must be the main focus of every new organization.

Current Market Size:

The Accounting software industry of Australian market is not a large industry. But with the time and after understanding the benefit of software by Australian Citizen, it is growing up rapidly. From last 5 years, the industry’s share is increasing. The reasons behind increasing the share are high speed internet, new technology, new software, updated software and cloud computing.

The total share off accounting software industry in market is quite low. The main player of this industry is Xero with a market share of 65%. In accounting software industry, many companies are there and continuously entering with their new software or with an updated version. The top 5 player of this industry are Xero, Intuit QuickBooks, Saasu, Reckon and MYOB (Walther, Sedera, Sarker and Eymann, 2013). All these software are having more than 70% of accounting software industry. These all software are heterogeneous in nature and helpful for every industry to record, maintain and present their financial transaction and report. The services provided by these software are top in ranking and almost every user are feeling satisfy with it (Carey, Subramaniam and Ching, 2006). The purposes of accounting software are different from each other. An organization or accountant can choose the best software according to their requirement and need or even they are free to build new software according to their need.

Leaders in the market and their competitive advantages:

The main players in the accounting software industry at Australia are Xero, Intuit QuickBooks, Saasu, Reckon and MYOB. These all software are heaving a huge competition from each other (James And Maher, 2013).

Xero is the main player of Australian software industry. It is the most popular one in the industry. The market share of Xero is 65% currently and almost 5,00,000 organizations are  taking the services of Xero for recording and maintaining their data. Xero is providing many accounting features (Mcleod and Freeman, 2015). The main competitive advantage of this software is its flexibility. It can be used either in desktop or mobile platform. This software allows its clients to categorise and import all the business transactions (Xero, 2016).

MYOB is the most rated software in Australian market. This software helps the organization and its client to enhance their profitability and helps in making a better decision by taking a concern of the entire financial document. Its features are the main competitive advantage of this software. This software is providing its services online as well as offline. Its new feature ATO- certified super stream is helping the clients to be up to date and MYOB is providing this in the cost of $0 (Brüggen, Vergauwen and Dao, 2009). The new version of this software is just awesome as its services are making all the clients happy and satisfy.

Saasu is trying to grab the market and be the best one. The company and team is working so hard to make this software the best software and future of accounting software. Saasu’s services are quite different and it is better than other software in some accounting features such as user can do all the cash transaction just by clicking a button. It can be connected with any e-platform, e-commerce, CRM and many more. Its smart banking services are liked by every user. Saasu is easy to access and convenient (Saasu, 2016).

Intuit QuickBooks is the first preference of every Australian small organization. Its price is quite low than any other software in the market. The price of this software is $12/ month for the whole software and updated version and $21/ month for premier version. The organizations are using this software for recording and maintain their data, enhancing profitability, tracking the business and income and expenditure. The security system of this software is like banking security which helps user to secure their data from competitor and media (Intuit QuickBooks, 2015).

Reckon is providing almost all accounting feature in a single software comprehensively. The software is currently working for making this software the best software of the industry. This software is affordable by every small organization of Australia. Credit management, resource planning, billing, practice IQ and desktop super are some of the comprehensive feature of this software. A free trial is offered by this software and the price of this software is just $5 at starting period. It is the lowest price of Australian software industry (Reckon, 2016).

Gaps and Challenges:

Accounting software industry is facing many problems in the market due to competitors, customer preference, new technology, innovations etc. the main challenges which are facing by the industry are: Xero’s prices are not affordable by every organization, MYOB is also asking for a high price for its new version, Intuit is having less accounting feature and Reckon is not able  to provide all the accounting facilities.

After studying many modules, published articles, research paper and more, it can be concluded that these software had a great history. Almost everyone started using Software for recording their financial data. Software industry is increasing day by day in Australian market. Still there is a great room for make changes in accounting software. The charges are quite high of software and all the accounting features are not available in software. It is not easy for every user to understand their working.

So accounting software industry must control on its price, provide all the accounting feature in software, use new technology for software and provide a learning kit to users.

References:

James D. And Maher W. (2013). 7 accounting packages for Australian small business compared: Including MYOB, QuickBooks online, Reckon and Xerox. BIT. Retervied on 8 Dec 2016 from http://www.bit.com.au/Review/344651,7-accounting-packages-for-australian-small-businesses-compared-including-myob-quickbooks-online-reckon-xero.aspx

Brüggen, A., Vergauwen, P. and Dao, M., 2009. Determinants of intellectual capital disclosure: evidence from Australia. Management Decision, 47(2), pp.233-245.

Carey, P., Subramaniam, N. and Ching, K.C.W., 2006. Internal audit outsourcing in Australia. Accounting & Finance, 46(1), pp.11-30.

Shurville, S., O'Grady, T. and Mayall, P., 2008. Educational and institutional flexibility of Australian educational software. Campus-Wide Information Systems, 25(2), pp.74-84.

Santos, T.A., Intuit Inc., 2009. Technique for identifying and collecting record-keeping information. U.S. Patent 7,558,777.

Horngren, C., Harrison, W., Oliver, S., Best, P., Fraser, D., Tan, R. and Willett, R., 2012. Accounting. Pearson Higher Education AU.

Walther, S., Sedera, D., Sarker, S. and Eymann, T., 2013. Evaluating Operational Cloud Enterprise System Success: An Organizational Perspective. In ECIS (p. 16).

Mcleod, S. and Freeman, J., xero limited, 2015. Systems and methods of automatic accounting of leave liability.. U.S. Patent 20,150,302,360.

QuickBooks (2015). Home. Retrieved on 8 Dec 2016 from https://www.quickbooks.co.za/

Xero (2016). About Us. Retrieved on 8 Dec 2016 from https://www.xero.com/au/about/

Reckon (2016). About us. Retrieved on 8 Dec 2016 from https://www.reckon.com/au/about-us/

Saasu (2016).About. Retrieved on 8 Dec 2016 from https://www.saasu.com/about/

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