Managerial accounting refers to the processes of measuring identifying, analyzing interpreting and communicating accurate and timely information required by managers to help them make decisions on the running of the business. Technological advances, especially in information technology, have had significant effects on managerial accounting and the processes it entails. Some of the areas that information technology has changed managerial accounting are in the equipment used such as bringing in the utilization of the computer which is fast easy and more accurate to use than traditionally relying on human labor. Information technology has also introduced software such as spreadsheet programs that are very efficient when making calculations and generating reports. The internet has also changed managerial accounting by adding easier and faster ways to make communications, and also there have been advances in security which ensure that information remains confidential (Talha et al., 2010).
Talha in his article a new look at management accounting acknowledges the effects technology has on managerial accounting and says that most of the processes have been automated. He, however, makes an argument that management accounting is not keeping step with the latest technologies and management philosophies. Talha says that managers in the present times have a bigger responsibility for information in the areas they are in charge of and which calls for a more integrated information system. In this case, Talha points towards the enterprise resource planning approach which is management software that allows an organization to use a system of integrated applications to manage the business and automate most of the office functions. Implementing enterprise resource planning has benefits such as complete transparency into all the critical process in the various departments of the organization, automatic and coherent workflow from one department to the other, a unified reporting system allowing all the analyzing work to be done in real time (Taipaleenmäki, 2013). Enterprise resource planning is also secure thus maintaining the confidentiality of the company information, and it also simplifies the work of keeping track of all the activities involved in the business operations.
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Talha in his conclusions recommends that management accounting to develop new methods to address the paradigm with information technology advancement. Organizations should implement the enterprise resource planning model as the first step towards embracing technology as it allows information to be easily accessed by people who need while remaining efficient and profitable to the company.
References
Taipaleenmäki, J., & Ikäheimo, S. (2013). On the convergence of management accounting and financial accounting–the role of information technology in accounting change. International Journal of Accounting Information Systems , 14 (4), 321-348.
Talha, M., Raja, J. B., & Seetharaman, A. (2010). A new look at management accounting. Journal of Applied Business Research , 26 (4), 83.
