HI5019 Accounting Software or Packages used in Australia

HI5019 Accounting Software or Packages used in Australia

HI5019 Accounting Software or Packages used in Australia

Literature review

Introduction

According to Tóth (2012), with the change in the technology different accounting software have been developed for enhancing the performance of the accounting system. Different accounting software has been developed for the purpose of recording of the economic events, bookkeeping, reporting and providing support to the complex activities of the business. The term accounting software can be explained as a programme which is used for processing the accounting work in an easy and fast manner for meeting the demand of the management related to information. In the words of Ware (2015), accounting software or package can be understood as a class of computer program which are capable of performing accounting operations. Different accounting software or packages are available which can be used by the businesses as per their requirement. These various accounting packages include Quicks Book, Peach tree, and enterprise resource systems. The use of accounting software and packages helps in enhancing the speed, reliability, storage capacity, consistency, provides backup of the data for enhancing the performance of the operations of the business and communication of the information. It has helped in reducing the threat to the privacy and chances of errors or mistakes. Accounting software can be used for controlling different activities of the business.

HI5019 Accounting Software or Packages used in Australia

History of accounting software or packages

According to Scott (2015), there has been a dramatic revolution in the processing speed which has acted as a base for the purpose of future accounting software. All the changes in the accounting information system started with the development of first report generation “language” in the year 1959. After this in 1960, the focus of the companies shifted towards the development of the accounting system. In 1978 the first accounting software was developed and the name of the software was Peachtree Software. In 1983 Intuit was founded and launched a product Quicken. In 1980’s, innovative and eye-catching accounting software was developed by Teleware Inc. In the words of Trigoa, et. al. (2014), with the change in the requirement of the business and change in the business environment there is a need to make changes in the manner activities of the business are carried out. Advancement in the business environment and accounting information system has resulted in a rise in the development of different accounting software or packages. In the words of Belfo & Trigo (2013), different accounting challenges have been faced by the business which includes strategic analysis, benchmarking, forecasting, reporting in real-time, internal auditing and internal control and management of risk and external and compliance reporting. Several advancements have been identified in the accounting software or packages and these advancements can be seen in the form of web-based accounting software which has reduced the solely on-premise accounting software or packages.

Development and adoption of accounting software or packages in Australia

As per the report prepared by Bendovschi (2015), the evolution of the software accounting has been divided into three categories and these three categories include 90’s era, 00’s era and 2010 – on-going. These three categories of the software accounting can be defined as on – premises accounting, hosted solutions and cloud computing. The focus of the traditional accounting practices was the bookkeeping and financial reporting. With the change in the technology, the enterprises of Australia have started using cloud computing accounting software. In the words of Lim & Perrin (2014), various popular accounting software which are being used are MYOB and QuickBooks. Different accounting software are being developed and adopted as per the size and nature of the business. There are various reasons due to which businesses have started using accounting software and these reasons include cost benefit, time benefit, and accuracy. It has helped businesses in gaining competitive advantage (Edison, et. al., 2012). The use of the multi-tasking accounting software has enhanced the performance of the different operations of the business. The advancement in the accounting software system has resulted in the use of the innovative concepts for the management of the accounting aspects of the enterprise. The advancement in the accounting software has enhanced the satisfaction level of the users of the accounting software. The movement of the paperwork to the computer-based work has resulted in a major change in the manner in which the accounting operations of the business are carried out. Different accounting software are developed with different features which have fulfilled the expectations of the different users of the accounting software (Ryan, 2012).

Current market size of accounting software or packages in Australia

According to Heber (2015), different accounting software are being used by the businesses in Australia as per their requirement. MYOB has gained much importance in the market of Australia. Intuit is also offering a wide range of features in the accounting software which has attracted the users of Australia. Intuit in 2014 and 2015 have increased the size of the staff up to 60 and acquired two companies. Xero is a global level company which is operating in different countries is holding 15 % share of the market. In the words of Redrup (2016), Xero Australia is having 262,000 Australian users and is holding a winning market share in the Australian market. Different accounting software are offered with different features which provide a competitive advantage to these software. The most common accounting software used by the small businesses in Australia is MYOB. According to Kristin (2015), the focus of the users have shifted from manual data entry to the software data entry in which accounting software are used for the purpose of recording of the data. This has resulted in the effective utilization of the resources, reduction of the time involved, smoothing the services offered to the customers, growing the business and building better products. But it has been analyzed that almost 80 % of the businesses of Australia are still using excel spreadsheets and handwritten invoices.

Identification of the leaders in the Australian market and their competitive strengths

According to Fairbanks (2017), accounting software are used for the different activities of the business. There are various reasons for which accounting software used and these reasons act as competitive strengths of the businesses offering this different accounting software. In the words of Fundbox Team (2014), these reasons include speed, accuracy, backup, reduction in cost, elimination of chances of errors, reporting in a proper manner and organizing the data in a proper manner. As per the report of Fairbanks (2017), the most common and popular accounting software used by the Australian businesses include QuickBooks which provide support to multiple locations or departments, syncing with more than 400 integrations and bundling inventory, Xero which is capable of supporting unlimited users and linking with more than 500 integrations, Zoho Books in which a portal is offered to the clients, reorders the notifications and billing by projects and tasks and Saasu. Most common accounting software which are being used by the small businesses of Australia include Reckon, Xero, MYOB and QuickBooks Online. The main motive behind include in the use of accounting software is the effective and efficient results. For gaining a competitive advantage this accounting software are being offered with enhanced and innovative features including cost and simplicity, backup, automation, dealing with the accountants, reducing the physical bulk and smoothing the operations (James, 2013).

Identification of the current gaps or challenges identified by the users or customers of accounting software or packages

According to Maduqne (2013), the major challenges which are being faced by the users of the accounting software include weak reporting service, lack of efficiency, lack of accuracy in the generation of the results, lack of security of the information or data, outdating, expensive, lack of the required features, Poor Customer Relationship Management, poor speed for the access, lack of technical support, lack of Software compatibility and lack of user-friendly interface. In the words of Rana (2016), varieties of issues or challenges are faced by the customers of the accounting software due to which the performance of the businesses are getting affected. These challenges are a lack of multi-tasking feature, lack of flexibility, lack of effective management of the data, lack of proper updates in the software and lack of multi-user access of the accounting software.

Suggestions for coping with the gaps or challenges

For the purpose of enhancing the performance of the business, there is a need to use accounting software as per the requirement of the business. There is a need to evaluate the effectiveness of the accounting software used before the adoption of the software, as there is a need to match the requirement of the business with the features offered by the software. The responsibilities need to be segregated as per the activities for ensuring the effective execution of the activities. The results or the outcomes of the accounting software need to be reviewed at regular intervals so as to ensure that the software is performing well and in an effective manner. The advantages or the issues with the accounting software which the business is intending to use need to be analyzed in advance.

References

Belfo, F. & Trigo, A., 2013, “Accounting information systems: Tradition and Failure Directions”, Procedia Technology 9, pp. 536 – 546.

Bendovschi, A. C., 2015, “The Evolution of Accounting Information Systems”, SEA - Practical Application of Science, Volume III, Issue 1 (7).

Edison, G., Manuere, F., Joseph, M. & Gutu, K., 2012, “Evaluation Of Factors Influencing Adoption of Accounting Information System By Small To Medium Enterprises In Chinhoyi”, Interdisciplinary Journal Of Contemporary Research In Business, Volume 4, No 6.

Fairbanks, L., 2017, “The Best Accounting Software of 2017”, Top ten reviews.

Fundbox Team, 2014, “Five Reasons to Use Small Business Accounting Software”, FundBox.

Heber, A., 2015, “The cloud accounting supremacy war in Australia”, Business insider.

James, D., 2013, “7 accounting packages for Australian small businesses compared: including MYOB, QuickBooks Online, Reckon, Xero”, Bit.

Kristin, 2015, “The evolution of accounting & bookkeeping”, Shoe Boxed.

Lim, N. & Perrin, B., 2014, “Standard Business Reporting In Australia: Past, Present, And Future”, Australasian Journal of Information Systems, Volume 18, Number 3.

Maduqne, 2013, “Problems faced by companies that are using accounting software for their businesses”, Qne Accounting Software.

Rana, K. L., 2016, “What were the challenges faced by accountants with desktop accounting softwares?”, Quora.

Redrup, Y., 2016, “Xero primed to keep gaining market share in Australia, new managing director Trent Innes says”, Financial review.

Ryan, E., 2012, “The Evolution of Accounting Software: Past, Present and Future”, The Journal of the Global Accounting Alliance.

Scott, B., 2015, “The Accounting Journal: 60 years of Accounting Software”, Myob.

Tóth, Z., 2012, “The Current Role of Accounting Information Systems”, 'Club of Economics in Miskolc' TMP, Vol. 8, Nr. 1, pp. 91-95.

Trigoa, A., Belfo, F. & Estébanez, R. P., 2014, “Accounting Information Systems: The Challenge of the Real-Time Reporting”, Procedia Technology 16, 118 – 127.

Ware, E. O., 2015, “Computerised Accounting System an Effective Means of Keeping Accounting Records in Ghanaian Banks: a Case Study of the Ga Rural Bank”, International Journal of Research in Business Studies and Management, Volume 2, Issue 11, pp. 111-141.