Discuss about the Literature Review on Accounting Software/Packages .
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 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.
In the words of Tsai et al. (2011) another challenge which is faced by the users of accounting software is weak reporting service. Accounting software is not helpful to users in providing out the business information. It is very easy to insert data in these accounting software but very hard to extract out the relevant data. Some accounting software does not allow the data to be retrieved. Elragal and Haddara (2012) argued that some accounting software is not user friendly and this brings a challenge of lack of efficiency in carrying out business operations. These accounting software are lacking behind in compatibility, features, automation and expansion of abilities. In addition to this, if the customer is using outdated software then the challenge of accuracy will arise because of data corruption and data corruption is a major issue to be taken care of.
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 so that errors and
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.
Tsai et al. (2011) states that the expertise of well experienced professional will required for implementation of accounting software in the organization. These experienced professional charges a high amount of fees which is a challenge for organization. In addition to this organization need to impart accounting and software information analysis skills to employees with the help of coaching which incurs additional cost to organization. It is analysed by Guse (2012) that a large number of Information technology related system in organization fails to bring a productive result to the organization. Because, accounting packages generally fails to integrate with the objective of organization. The accounting software is very technical and technology is intangible for the user. It creates a gap for the user in analysing the actions to be carried out in order to understand the digital requirements. The user is only interested towards solving of end problem with the help of accounting software.
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 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.
But, in the views of Suarez, et al., (2013), the current accounting software contains the feature of automatic updating and customization. The security is a most significant term in the business activity. The current business environment depends on the use of accounting software. A company may come in the worst situation due to loss important financial data. In order to avoid the fear of loss the significant financial data, the companies take the help of accounting software. So, the level of the security is significant in accounting software that provides profit over the competitors. Along with this, payroll processing and tax preparation are also significant features of the accounting software. The software that is able to easily calculate taxation of the firm and payroll of the employee always get the competitive advantage in the market.
From the argument is made by the Chua, et al., (2012), it is found that choosing an appropriate accounting software is able to provide the help to a firm in the different terms such as stock analysis, payroll analysis, sales and budget analysis. The main advantages of this are its speed, accuracy, up to date information, legibility and efficiency. Hence, the use of accounting software reduces the cost of staff and time on the maintaining the firms’ account.
Abugabah, A. and Sanzogni, L. (2010) Enterprise resource planning (ERP) system in higher education: A literature review and implications. International Journal of Human and Social Sciences, 5(6), pp.395-399.
Arif, M., Kulonda, D., Egbu, C., Goulding, J.S. and Toma, T. (2011) Enterprise-wide information system for construction: A document based approach. KSCE Journal of Civil Engineering, 15(2), pp.271-280.
Chua, Y.L., Cheong, C.S. and Gould, G., (2012) The impact of mandatory IFRS adoption on accounting quality: Evidence from Australia. Journal of International Accounting Research, 11(1), pp.119-146.
Elragal, A. and Haddara, M. (2012) The Future of ERP Systems: look backward before moving forward. Procedia Technology, 5, pp.21-30.
Guse, G.R. (2012) Managerial Challenges Affecting the Enterprise 2.0 Migration Process. Revista de Management Comparat International, 13(5), p.742.
Khorshed, M.T., Ali, A.S. and Wasimi, S.A. (2012) A survey on gaps, threat remediation challenges and some thoughts for proactive attack detection in cloud computing. Future Generation computer systems, 28(6), pp.833-851.
Kubick, T.R., Lynch, D.P., Mayberry, M.A. and Omer, T.C. (2014) Product market power and tax avoidance: Market leaders, mimicking strategies, and stock returns. The Accounting Review, 90(2), pp.675-702.
Pulakanam, V. and Suraweera, T. (2010) Implementing accounting software in small businesses in New Zealand: an exploratory investigation. Accountancy Business and the Public Interest, 9, pp.98-124.
Sener, C. and Fthenakis, V. (2014) Energy policy and financing options to achieve solar energy grid penetration targets: Accounting for external costs. Renewable and Sustainable Energy Reviews, 32, pp.854-868.
Suarez, F.F., Cusumano, M.A. and Kahl, S.J. (2013) Services and the business models of product firms: an empirical analysis of the software industry. Management Science, 59(2), pp.420-435.
Tsai, W.H., Shaw, M.J., Fan, Y.W., Liu, J.Y., Lee, K.C. and Chen, H.C. (2011) An empirical investigation of the impacts of internal/external facilitators on the project success of ERP: A structural equation model. Decision Support Systems, 50(2), pp.480-490.
Yen, T.S., Idrus, R. and Yusof, U.K. (2011) A Framework for classifying misfits between enterprise resource planning (ERP) systems and business strategies. Asian Academy of Management Journal, 16(2), pp.53-75.
Zia, A. and Khan, M.N.A. (2012) Identifying key challenges in performance issues in cloud computing. International Journal of Modern Education and Computer Science, 4(10), p.59.
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