HI5019 Strategic Information Systems
Australian industries are continuously expanding and the application of the cloud services and tools are increasing with the same rate. Accounting Information system is one of the sixty tools those are being utilized by the Australian industries and it can be defined as a computer software that allows industry to process and record the accounting transactions. The handy modules those can be utilized by the industries for boosting the performance and output includes trial balance module, payroll module, accounts payable module, general-purpose financial report module, and accounts receivable module. It is a possible measure for the current Australian industries for coping up from the competitive market and executing the daily operation activities in smooth and efficient manner. The only consideration during the implementation of the Accounting Information System (AIS) is whether the company has been doing an outgrowing business or implementing it within the existing IT (Information Technology) system. The Macquarie has been selected as the case study for this literature review for the transparency of the processes and benefits those could be utilized through the application of AIS for performing daily operational activities related to the accounting. The objective of this review is to express the benefits of the AIS and utilization of AIS for gaining competitive advantage in the current competitive world.
1. A) Organizational Structure (Macquarie)
The management of the Macquarie has been divided in five groups that include important operating groups, executive committee, global chief operation officers, and central group of managing director including Head of Risk Management (Heizer 2016). These are the top and valuable characters in the top hierarchy of the organization and have been responsible for managing the daily operational activities and strong decision-making those are beneficial for the organization (Macquarie.com 2018). It is their responsibility to make sure that the clients are happy with the products and services being delivered to them and continuously monitor and take decisions for improving the customer relationship. Following is the organizational structure of the Macquarie expressing the overall hierarchy of the organization.
Figure 1: Macquarie’s Organizational Structure
(Source: Macquarie 2017)
1. B) Operational Problems
Some of the daily operation activities in the organization are lacking in restricting the delivery of the products and service to the customers affecting the efficiency of the existing system of human handling the operations. Human errors are common issue for the management of the accounting within the organization including same data repeating, and many more that can result in the deficiency of the company in delivering the necessary objectives. Sessa and London (2015) provided a statement that “groups strive to place individuals in charge who are competent and committed to the goals of the group (Das and Dayal 2016).” Another possible operational activities affecting the efficiency of production and output includes the management of the accounting system that has many redundancy and not any monitoring facility and thus, making the executives to look after the records repeatedly for monitoring the output. These objectives are resulting in the deficiency of output and production and affecting the customer relationship due to human error and could possibly lead to fraud and stealing of the finance by an unwanted individual. Islam et al. (2014) expressed how poorly managing the accounting system can affect the reputation and daily operation of the organization and thus, resulting in the decrement of the performance and output of the organization. The argument made by Biest et al. (2016) in the context of the manual operating accounting system and how corrupting effect can influence the overall output of the organization in negative manner that “power tips the balance of activation between the inhibition systems and behavior approach and the behavioral systems associated with respect to the awards and threats.”
1. C) Most Likely System Acquisition Method
SAP, ERP, CAS, and MYOB
Automation in the daily operation activities of the organization has been a concerning objective for the delivery of the efficient and effective output for the organization in the present scenario. SAP, ERP, CAS, and MYOB has been playing crucial role in promoting these automations through eliminating the human errors and other drawbacks those are capable of affecting the performance of the Macquarie (Kanellou and Spathis 2013). These tools and technologies are based on the cloud services being handled by third party for the accomplishment of the operational activities with efficiency and accuracy. These are capable of providing HR system, inventory management, customer engagement, accounting system, and many more and thus, boosting the organization’s performance and output. Competitive world is the most targeted section for every organization and hence, these tools are helpful in building the reputation in the market and allowing the companies for gaining the competitive advantage through providing, better, automated, and accurate services (Kordecki and Bullen 2014). The accountants of the company are the most stress-handling individuals and these technologies and tools allow them to access the data or information saved in the database from anywhere through connecting to the internet. These are highly flexible and can be utilized for accomplishing all the activities included in the daily operations of not only accountants rather other executives in the industry.
1. D) Sales Procedures
Following flow chart describes the sales system of the Macquarie describing all thee operational activities involved from booking the order to the delivery of the product. The system will be initiated at the instance from where he or she booked the order and thus, the following activities will be proceeded as mentioned in the chart (Clegg, Kornberger and Pitsis 2015). For the termination of the system, it is a necessary element that the client makes the payment. The tools and software mentioned in the above paragraph are capable of allowing the organization to automate the processes and thus, delivering the necessary output with accuracy.
Figure 1: Flowchart of sales procedure
(Source: created by author using draw.io)
1. E) Control Problems and Possible Frauds
There are many beneficial aspects of the utilization of these tools and software however; every coin has two face and so is with the application of the above mentioned tools and software (Jebreen 2014). Frauds can be made in many ways even through utilizing automated services and can be listed as: false invoice payment, misappropriation, non-purchase payment, anonymous customer payment, anonymous vendor payments, and many more.
Right off the bat, False Invoice Payment: Any client performing two exercises among solicitations creation, endorsement and installment may prompt extortion in the association (Allison and Goethals 2013). Furthermore, Misappropriation: If a client do both buy endorsement and buy request can likewise extortion the association by controlling the information. Thirdly, Non-buy Payment If a same client do both or any of the exercises among buy great or great got can likewise make false exercises in the association. Another situation is that Anonymous Vendor Payment: A client dealing with both making (adjusting merchant master card), and making solicitations to that seller can likewise make deceitful exercises (Sardroud 2015). Last situation expressed by the creators is Anonymous Customer Payment: make or changing records of the clients and conceding credit to that client by a solitary client can likewise prompt misrepresentation cases in Macquarie.
2. A) Development and Adoption of the AIS
Taylor (2017) said that continuous development of the technology and increase in population lead to the great market that was boosted by globalization and thus, managing the customer, clients, vendors, and supply chain management have become one of the concerning objective in the present scenario. The pen and paper recording system was replaced by excel sheets, thereafter, some offline tools with spreadsheets and similarly it continuously inherited the properties and became advanced through the application of the cloud services. Accounting Information system and accounting software packages allows the organization to store the data in the cloud and execute bigger calculation without any extra effort and thus, saving lots of time and elimination of human errors (Stavseth 2015). Accounting software packages in Australia has become the integral part of the system and being utilized for performing all the accounting operational activities and managing the data and information. Most of the industries are adopting the accounting software packages based on their demands and requirements for accomplishing the accounting operational activities. In this new era of globalization, many competitors are looking forward to be ahead of others and cover the entire market and attract all the customers through providing better and enhanced services. These have not only automated the accounting services, it also bears the loads from the accountant and manage all the calculation at an instance and has been much more accurate (Ruivo, Oliveira and Neto 2014). Cloud services allow the executives and other members to monitor the growth and development of the organization and thus, can be utilized for accessing the data or information from anywhere in the world.
2. B) Current Market size
Most of the Australian industries have been utilizing and implementing the accounting software packages irrespective of the sector as it is applicable for every sector of the industry. The market is becoming bigger and much bigger and thus, it was the need of the industries to utilize a similar application, which can meet the needs and requirements of the companies (Lee, Khao and Yang 2014). Accounting software packages came in trend and almost more than sixty tools are being utilized within the Australia among which, MYOB, CAS, AIS, and others are popular ones. Despite of the size of the industry, accounting software packages have become more applicable tools for the Big, small, and medium sized industries that is not only automating and speeding the activities but also enhances the accuracy and precision of the calculation. Many of the accounting software are available those are flexible in nature and capable of handling all size if the industry application. Wamba et al. (2015) reported that the exceptionally rise in the accounting software enables the developer to introduce with new features at low prices and the vendors who are eligible to make it possible are covering the large market in this section.
2. C) Competitive Advantages
The leading software are the CAS and MYOB those have covered almost 60% of the accounting software package industry and much popular among the industries. These tools allow the companies to accomplish all the daily operation activities in context of the accounting as mentioned in the above paragraph and can be adjusted as per the current need of the organizations. There are many competitive advantages along with the advantages mentioned above allowing the companies to be always ahead of the competitors:
Higher input speed: the data or information related to the accounting, purchase, and selling can be easily fed into the system and allowing the accountants, or cashiers to spent less time in data collection and attend more customers (Islam et al. 2014). It is helpful in managing more customers at very less time and thus, bigger sales can be made in easy and accurate manner without any error.
24 * 7 Data access: It allows the access to the data from anywhere allowing the users to be connected with the operational duties always and accomplishing the necessary operational activities. Even if the executive is out of country, or riding somewhere, or many other scenarios the employees and executives are capable of accessing to the database at just an instance via connecting to the internet.
Higher efficiency: The output of the accounting software packages are remarkable as; there is not any chance of the human error and every calculation can be made with accuracy (Jebreen 2014). Automatically saving the progress of the data or information also contributes in the higher efficiency of the accounting software packages.
Cost reduction: there is no need of extra hands or employees for managing different branches and sections of the organization as a single accounting software package can allow the individuals to accomplish all the necessary activities. Third party is completely responsible for handling the security and maintenance of the implemented accounting software package and thus, the organization will have not to pay extra for the maintenance of the new system.
\Flexible: Irrespective of the size of the organization, AIS can be utilized for accomplishing the operations related to the accounting and delivering the necessary output as per the need of the organization. Those could be modified many services for fulfilling the needs and requirements of all size of the industries (Bies et al. 2016). It is capable of handling whatever is the need of the storage and data exchange in manner to ensure that the organization had not to pay extra and thus, company will be paying only for the services those have been utilized by it.
Compatible: It can be established within the existing system of the organization if the operations are, being performed electronically ensuring the efficiency and effectiveness of the software being utilized within the industry. It can boost the operational activities of the existing infrastructure of the organization allowing individuals to accomplish the prior activities and align with the existing policies of the organization.
2. D) Challenges Encountered by Users
AIS are novice in nature, thus, users will need proper training on how to utilize the application, and thus, training becomes the essential part for the successful and effective deployment of the AIS within the existing system of the organization. Data breaches and cyber-attacks are another concerning objective while talking about the challenges in AIS. Bugs and glitches might occur while delivering operational activity (Wamba et al. 2015). The third party might refused or lost after the implementation and buying the services.
Based on the above report it can be concluded that accounting software packages are capable of accomplishing the objectives and goals of the organization relating to the accounts and finance management. It can be helpful for the organization in gaining competitive advantage and thus, the organization can be ahead in the race of the competition if utilized in an efficient and effective manner. The above report evaluated the existing system and operational activities being delivered in the Macquarie and identified the beneficial aspects on the application of AIS. The findings state that accounting information is beneficial irrespective of certain drawbacks if proper and effective protection measures have been executed. The report also emphasizes on the market size of the accounting software packages and relation has been established that MYOB is the leading accounting software package spreading in the market. Based on the findings and research following recommendation has been made those can be capable of making the implementation much efficient and effective.
Considering the operational activities and hierarchy of then organizational structure of Macquarie, MYOB can be recommended as the best package of the accounting software package.
It should be made sure that the policies of the software package align with the existing policies of the organization
Different levels of authority can be arranged for accessing the data or information. Security should be kept at high standard in manner to secure the data and information and assure the safety of the customers.
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