According to Gelinas, Sutton and Oram (1999), information technology has positively impacted the accounting processes. The systems do not have a need to do the cumbersome manual accounting anymore. The technology has also improved over the years from the use of simple equipments like calculators to more complex, fast, and easy use of computers. These gadgets have immensely reduced the time required for preparation of financial information.
Information technology results in improved accuracy of the accounting system. This resulted from the improved computerized systems that have the ability to do internal checks that ensure accounts are properly balanced prior to financial statement preparation. Accuracy is also guaranteed as only a few qualified accountants can access and make changes in the financial information. An organization utilizing the information technology can give reliable and timely financial reports to external investors and stakeholders. This is due to computerized accounting systems that ensure better reporting. The investors can thus make informed decisions on the status of the company regarding investment growth potentials. The company can also utilize the reports to acquire funding for expansion of its operations.
The accountants find it easier to process large amounts of financial information when utilizing computerized accounting systems. This is due to the fast processing speed involved. The fast processing has resulted in quick closing of the accounting periods. This reduction in time of closing an accounting period reduces the costs associated with the manual system, longer working hours and high labor costs. The company’s efficiency is thus improved. The functionality associated with timeliness of information in the accounting department is also increased. The management can thus keep track of the company’s current status in terms of finance.