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Automation of Accounting and Control Processes
In the modern business world, automation in accounting and control functions in an organization is characterized by information technology (IT) in business processes. Accounting procedures in a business entity include financial planning, budgeting, financial reporting, payroll management, tax management, auditing, financial forecasting, and financial management (Marshall and Lambert 200). On the other hand, control processes involve the procedures applied by a business organization to ensure the reliability, accuracy, and validity of the third parties financial statements. Auditing, assurance, tax management, and compliance with authorities regulations represent a firms crucial control functions (Nnenna and Amaka 446). The integration of IT in accounting and control procedures through automation presents tremendous benefits to a business corporation from the analysis.
Enhanced accuracy and precision in the preparation and presentation of accounting data and information stand out as a fundamental benefit of automation in its practice. Gotthardt et al. link information entry procedures, such as stock-taking and financial forecasting, with the increase in the incidence of human error, particularly in instances where automation in these procedures is disregarded (93). On the other hand, the use of such innovations as artificial intelligence, including robots in various accounting procedures, triggers significant improvements in the extent of precision and the speed of executing accounting-related tasks (Gotthardt et al. 94). This, in turn, enhances the attainment of quality in various business operations, including the development of balance sheets.
Accounting-related innovations result in an enhanced understanding of its related processes and procedures. For instance, double-entry principles may be complicated to some accountants, especially in the application. However, the use of automation-oriented software linked to the field such as quick books facilitates the ease of applying accounting rules (Linton and Solomon 197). Furthermore, the timely delivery of financial reports and increased efficiency in accounting functions are also among the strategic advantages that result from the automation process through time and cost savings.
There are also enormous benefits that arise from the automation of control processes within a business enterprise. The use of IT in auditing and tax procedures helps facilitate the efficiency of business operations. The purpose of auditing as a control procedure is to ensure that the financial statements generated by the accounting department are reliable and accurate (Laudon and Traver 64). Therefore, the integration of IT into auditing functions contributes to the promptness in transactions ascertainment processes and the validation of the accounting and financial information prepared from relevant records. Automated controls facilitate business continuity by ensuring that the financial resources are appropriately utilized and allocated in the required model (Marshall and Lambert 203). Further, the automation in control processes, such as auditing, helps access investment funds since venture capitalists rely on audit reports during decision-making about investment options.
Although automation in accounting and control procedures generates significant benefits in terms of quality and operational efficiency, it is imperative to consider some of the challenges that result from the above-mentioned approach. One primary drawback is that this process requires a company to invest considerable financial resources in its implementation and maintenance; this, in turn, renders it costly (Gotthardt et al. 96). Automation of accounting processes may lead to job redundancy and the limitation of human effort in executing accounting and control functions. This, consequently, results in significant layoffs and the loss of jobs. Furthermore, the drawbacks presented by the possible risks of fraud and hacking within an IT environment extend to the automated processes (Laudon and Traver, 33). This, subsequently, limits its degree of reliability in the preparation of financial and accounting reports within an entity if fraud or hacking occurs.
Automated Monitoring of Operational Systems
The aspect of automation in monitoring operational systems is crucial and beneficial in enhancing operational efficiency in an organizations procedures. Managers in a business organization often track the functioning of a companys processes to achieve the entitys goals and aspirations (Marshall and Lambert 201). The implementation of automated monitoring technology within the function of operating systems present key advantages and efficiencies to a companys processes.
Operational systems are essential in business continuity; they enable management executives in pertinent departments to complete the structure of business activities while effectively monitoring the loopholes in productivity points. The adoption of automation technology in the monitoring functions saves on time as well as financial resources. Automated monitoring of operational systems presents the benefit of efficiency in business-process operations, which positively affects an enterprises profitability. For instance, control and monitoring systems within the production unit enhance the employees capacities to manage and keep track of the manufacturing systems and plants. Before being applied in the companys operations, these technologies are usually configured. Furthermore, the customization of the structure and topology of pertinent production plants and data regarding the production process components outgoing and incoming interfaces must be done to enhance operational efficiencies. Process control images may also be integrated to facilitate the visualization of the organizations production activities.
Such innovations as the computer-aided engineering exchange (CAEX) foster the standardized or syntactical computerized storage of planning information, facilitate the storage of uncompleted planning phases, and support object-derived conceptions. Its meta-modeling strategies typically simplify the development of systematic information exchange (Al-wswasi et al. 820). The above-mentioned innovation delineates its model structures, and during data dissemination, CAEX libraries can be transmitted to other systems along with its pertinent data. CAEX has been associated with significant reductions in manufacturing complexities due to its ability to export semantic and structural data from the CAEX libraries and interpret the data received.
Works Cited
Al-wswasi, Mazin, et al. A Survey on Smart Automated Computer-Aided Process Planning (ACAPP) Techniques. International Journal of Advanced Manufacturing Technology, vol. 97, 2018, pp. 809-832. SpringerLink. Web.
Gotthardt, Max, et al. Current State and Challenges in the Implementation of Smart Robotic Process Automation in Accounting and Auditing. ACRN Journal of Finance and Risk Perspectives, vol. 9, 2020, pp. 90-102. ResearchGate. Web.
Laudon, Kenneth, and Carol, Traver. E-commerce: Business, Technology, and Society. 12th ed., Pearson, 2016.
Linton, Jonathan D., and George Solomon. Technology, Innovation, Entrepreneurship, and Small Business: Technology and Innovation in Small Business. Journal of Small Business Management, vol. 55, no. 2, 2019, pp. 196-199. Taylor and Francis Online. Web.
Marshall, Thomas, and Sherwood, Lambert. Cloud-based Intelligent Accounting Applications: Accounting-Task-Automation Using IBM Watson Cognitive Computing. Journal of Emerging Technologies in Accounting, vol. 15, no. 1, 2018, pp. 199-215. Taylor and Francis Online. Web.
Nnenna, Chukwuani, and Egiyi, Amaka. Automation of Accounting Processes: Impact of Artificial Intelligence. International Journal of Research and Innovation in Social Science, vol. 4, no. 8, 2020, pp. 444-449. ResearchGate. Web.
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