Technology in Accounting: Advantages and Disadvantages

Decades ago, the majority of financial accounting was done by hand on paper. Over the years, technology has been a key factor in changing the methods of accounting. Currently, most accounting information is recorded via computers and wide area networks (Journal of Accountancy, 1994a). It is hard to say whether technology in accounting has had a positive, negative, or no impact. Some major advantages and disadvantages of technology in accounting are listed below. Please give your viewpoint of the impact based on the given information.

Advantages of Technology in Accounting:

• Provides various new tools used to gather information in a timely manner (the Internet, image processing, communications technology)
• Eliminates the hassle of paper work
• Tools work to promote efficiency in the transferring of data between businesses and offices
• Expert systems assist in the decision-making process
• Promotes consolidation of information into a central database

Disadvantages of Technology in Accounting:

• Risk of losing accountability and confidentiality
• Rish of fraudulent activities
• Dependency on human forethought
• Risk of failure of computer system, resulting in an inconvenience which could possibly destroy businesses
• Area networking and collaborative computing can become difficult to follow