EFFECTS OF TECHNOLOGY ON THE ACCOUNTING PROFESSION

Effects of Technology on the Accounting Profession

Technological innovations over the past 30 to 40 years have greatly enhanced accounting and finance activities , procedures , and policies ADDIN ENRfu . Although technology is certainly not new to accounting recent advances have altered all aspects of the accounting function including : economic measurement , financial reporting , managerial planning and control , and auditing . The role of technology and computers within the organization also has changed . Local area (LAN ) and wide area (WAN ) network activities , including the Internet and the many forms of Electronic Commerce and Electronic Data Interchange

(EDI , in addition to Enterprise Resource Planning (ERP ) and other applications , have transformed the way accounting is done , calling into question the importance of traditionally valued accounting functions and skills (Lewis , 2003

Technology will be an integral component and vehicle for that change serving as a knowledge-based repository . Intranet and Web-based software and applications will be the foundation for this technology Technology allows many more highly diverse , geographically dispersed intellectually specialized talents to be capitalized as resources of an information-age organization . Network systems provide a common language and database for communications , capturing critical factual data about external environments , and helping individuals find knowledge sources and solve problems . As soon as a firm takes its first steps from data to information , its decision processes and management structure are transformed

As professional service firms , accounting practices are in the forefront of this

knowledge management . Accountants exploit their personal knowledge and training

codify that knowledge into explicit knowledge to be shared by other members of their

firms , and use that collective knowledge to provide value-added services to clients . The

codification , storage , and communication of that knowledge rely heavily on innovative

technologies . Although accounting has used technology for decades , the impact of

knowledge management on today 's organizations has elevated the role and application of

technology to preeminence . Technology is essential to support the creation and

dissemination of knowledge within members of global organizations as well as provide

essential tools for decision support . This has created a transformation in the tasks done by accountants , the way information is processed stored , and communicated , and ultimately the skills needed by accounting professionals

Educators and professionals according to Lewis (2003 ) have long identified areas such as communication and analytical skills as necessary for success in the accounting profession . With technology 's strong penetration into the profession , other skills and qualities have become essential . Specifically , technological proficiency will be required of all entrants into the profession and will be positively related with professional success . Thus , the generally accepted attributes assumed to lead to professional success (technical proficiency in the field of accounting ) must be supplemented to include those attributes required to achieve technological proficiency

The new post-industrial or information paradigm of wealth creation is profoundly changing the way business is being conducted , making traditional accounting concepts and methods inadequate to service this new model . The choices of the profession are , therefore , either to adapt to the new demands or to become irrelevant

The role of the...