In a national economy of Australia, Small and Medium Enterprises play a crucial role in maintaining the stability of the market along with ensuring the mechanism that promotes social stability, sustained and healthy developments (Li, 2015). Small and medium-sized enterprises (SMEs) are the independent, non-subsidiary firms that employ less than a given number of employees. This number varies across the countries (stats.oecd, 2018).
Accounting is one of the crucial functions of organization of any scale – small, medium and large. Accounting plays a major role in the success or failure of an organization by critically recording, analyzing, monitoring as well as evaluating the overall financial performance of a business (Wickramsainghe et al., 2017). The accounting software is the major sources of information for the managers and owners in the SMEs, in terms of measuring the financial performance of a company. As a result, the overall demand for the use of accounting software packages has also increased significantly especially, for managing the international accounting issues. The small and medium enterprises constantly face the accounting issues because of the problems such as lack of quality accounting staff, lack of accounting system, inefficient management of accounting work etc. (Machera & Macher, 2017).
The traditional accounting practices in the SMEs track the business performance on the basis of standards and systems that are established long time back. The traditional accounting systems hence, fail to effectively and quickly respond to the changing needs of the business environment. There are some major problems associated with the traditional accounting practices such as inaccurate performance measurement. Over the time, it is essential to make adjustments in the traditional accounting practices so as to manage the complexities related to the finance (Ezeagba, 2017).
The accounting software is the tool that is designed so as to help the management in the areas of finance. The technological advancements have opened up the possibilities related to generating and using the accounting information strategically (Husin & Ibrahim, 2013). Using the accounting information strategically is essential for the small and medium sized firms so as to deal with uncertainties in the competitive world. In order to compete in a global marketplace, the organizations face a range of accounting challenges. The organizations do not have to deal in a single currency or a single set of principles but, they to operate in an era of multiple currencies with a plethora of accounting tax rules (Dimitrui & Matei, 2014). With this comes into the play – accounting software. Accounting software can be described as the application software that helps the organization by recording and processing the accounting transactions within the functional domains such as general ledger, pay rolls, trail balance etc. (Radneantu et al., 2010)This particular paper will identify and analyze the benefits of using accounting software in the small and medium enterprises over traditional accounting methods in Australia. In addition, the factors contributing to the selection of accounting software will also be determined.
With an advent of globalization and business environment complexities, there has been an increase in the complexity and volume of accounting transactions. (Kaur, 2017).This presents a crucial need of an accounting system that can store and process large amount of acting data. This research is one of the efforts to determine the importance and benefits of accounting software for the small and medium enterprises in Australia. The focus of this study will be on obtaining the relevant findings that can expand the current knowledge on the accounting software.
This research will be divided into few chapters that will help it in making it easier for readers to understand the research in an effective manner. The first chapter of the research will focus on introducing the research topic and providing a background that is essential for understanding the research on the use of accounting software in the SMEs of Australia. The second chapter of the research focuses on the research problem and objectives of the research. The research problem will provide a view of the major issue that the research will focus on. The research objectives on other hand will guide the overall research into a particular direction. The third chapter will focus on theoretical background or the literature associated with the accounting software in the small and medium enterprises. The literature will explore the importance and benefits of accounting software in SMEs along with their benefits over the traditional accounting systems. The fourth chapter of the research focuses on the research design or methodology of the research that has been adopted for achieving the objectives of the research. Research methodology can be referred to as the research methods and techniques that are used in the research for achieving the research objectives in a systematic manner. The fifth chapter of the research will discuss the findings of the research obtained from qualitative and quantitative research methods. The last chapter of the research will focus on concluding the research along with providing a brief discussion on research limitations and recommendations for the future research.
Research problem and research objectives
The challenges and complexities in the accounting functions are increasing significantly. Therefore, there is a need of accounting systems that can help in solving the issues of accounting world especially, in the context of small and medium enterprises of Australia. This research will hence provide the suggestions regarding the use of accounting software in such organizations.
The major objectives of this research are as follows:
This section will present the literature review regarding the use of accounting software. There are a number of studies that have been conducted in the context of determining the usage of technology for managing the accounting functions of SMEs that is often overlooked. Therefore, this research is one of the efforts to determine the importance of technology such as accounting software in SMEs
In this context, the literature review will be divided into themes as follows:
Common themes/findings across the four articles
The four papers taken in the literature review share some similarities and differences in terms of findings and themes that are discussed in this section. The first common theme across the four articles is the use of technology in accounting in Small & Medium organizations for improving the accounting function.
The article by Sularto (2016) indicated that the Accounting information system in the restaurant can be used for performing the important functions related to data processing that range from Point of Sales (POS) transaction. The use of AIS in the small and medium organizations also helps in improving functionality and quality of such organizations (Sularto, 2016).
Lutfi et al. (2016) in the same context indicated that the Accounting information systems (AIS) are the useful computer-based accounting systems that help in improving the processing and transactions of the organization along with providing a report for the analysis of the organization (Lutfi et al., 2016).
Armitage et al. (2015) also indicated in their study that the small and medium enterprises in Australia can use the management accounting techniques such as variance analysis, operating budgets and costing systems in the organizations, for improving the performance of the accounting function.
The findings of the study conducted by Terziovski (2010) indicate that SMEs lack the innovation culture that can be used in the structured manner for the growth and development.
Different themes/findings across the four articles
The four articles included in this literature review have different findings and themes that are discussed in this section.
The study by Sularto (2016) has focused on the improvement of the accounting information system that is used in the restaurant SMEs. In this context, the author employed the Quality Function Deployment model in the SMEs (Sularto, 2016). The study by Sularto (2016) focused on the improvement of AIS whereas the study by Armitage et al. (2015) focused on the importance of management accounting systems in the SMEs (Armitage et al., 2016). The study Lutfi et al. (2016) has clearly indicated the importance of AIS in improving the processing and accounting of the SMEs (Lutfi et al., 2016). Lastly, the study by Terziovski (2010) found that there is a lack of structured innovation culture in SMEs and this makes them different from the large organizations.
Managerial implication of the four articles
The four articles chosen for this research have different managerial implications that are discussed in this section. The major managerial implications of the study conducted by Lutfi, Idris and Mohammad (2016) are that the managers can use the findings of research so as to determine the reasons as to why SMEs are lagging behind large organzitaions along with the major benefits of implemnting AIS in the SMEs (Lutfi et al., 2016). Further, the mangerial implications of (Terziovski 2010) are different from that as, they Armitage et al. (2016) focus on helping the managers in the context of designing the managemnt accounting courses for the SMEs. Finally the managerial implcations of the study conducted by Sularto (2016) are different from all the above studies as, the implications indicate the use of Quality Function Deployment (QFD) for improving the Accounting information system of SMEs (Sularto, 2016).
Study limitations and future research direction proposed in the four articles.
The four articles included in this literature review are associated with their own limitations and each of the articles has different recommendations for the future. The study conducted by Lutfi et al. (2016) has several limitatin such as a population that was confined to SMEs (manufactring) of Jordan. Secondly, a use of cross- sectional data and lack of impact of variables such as external support, organization size and culture. The future research direction for this research include inclusion of of sample from different countries and industries , use of longitudinal data along with determination of the impact of variables such external support, organization size and culture on the research findings.
The study by Terziovski (2010) on the other hand, is associated with the limitation that it has included one respondent from each SME and therefore, it presented the need of including multiple respondents from both large organizations and SMEs. The study by Armitage et al. (2016) also has limitation that the participants are only from the regions of Canada and Australia. Therefore, the future studies should focus on conducting the studies in different countries that have large number of SMEs. The study conducted by Sulrato (2016) has not highlighted any of the limitation in the paper, but one of the major limitations of this paper might be the confinement of the study to only banking and commerce industry. Therefore, the future researches should focus on including other industries as well.
This section of the research will particularly focus on the research procedures and techniques that are used in the research along with their justification. In this context, the focus will be on the research approach, type of research, types of data, data collection methods, sample designs, tools used for data analysis along with the ethical concerns associated with the research.
Type of research – In this particular research, a descriptive type of research will be adopted. The descriptive research is adopted for this particular research so as to completely describe the usage of accounting software in the Australian SMEs. A descriptive research is a useful form of research that is used for determining the usage pattern of the accounting software in Australian SMEs along with the ways that can help in improving the same (Mukhopadhyay & Gupta, 2014).
Research approach
There are three major types of research approaches – Qualitative, Quantitative and mixed research approach. In this particular research, mixed research approach will be adopted for achieving the research objectives. Qualitative research approach is an approach that involves a naturalistic and interpretive approach associated to the subject matter. Qualitative research focuses on narrations and the experiences of the participants involved in the study. The focus of qualitative researchers is on studying the research aspects in their natural setting so that the phenomenon can be interpreted in such a way that they make a meaningful sense.
The other form of research is quantitative research. Quantitative research focuses on gathering the data in the numerical form that can further be put into the categories, orders and units can be used to measure the same. Quantitative research uses the graphs and tables made from the raw data. In other words, quantitative research can be referred to as the structured way of collecting and analyzing the data collected from different sources. Quantitative research approach involves the use of statistical, mathematical and computational tools to derive the findings of research (Mukhopadhyay & Gupta, 2014).
In this particular research, a mixed research approach has been utilized. A mixed research approach has been chosen for this research so as to utilize the strengths of both the research approaches. A mixed research approach will help in expanding the dimensions of research by exploring two types of data that are helpful in the context of understanding the benefits of using accounting software to small and medium enterprises over the traditional accounting method along with other important insights of accounting software in the SME industry (Heyvaert et al., 2013). The qualitative and quantitative approach together will help in collecting the specific data regarding the accounting software in the SMEs such as their benefits over the traditional accounting system and the accounting software used by the SMEs (Chow et al., 2010). The qualitative research approach will help in obtaining the detailed views of the respondents from SMEs in Australia regarding the accounting software they use and its importance. The quantitative research approach further helped in quantifying the opinions of respondents about the accounting software. A quantitative research approach is important for this particular research so as to obtain the facts with the help of measureable data regarding the accounting software. This is however, not possible along with qualitative research (McKim, 2017).
This section will focus on the data collection methods that will be used for collecting the data regarding the accounting software in Australia. There are two major types of data that are collected for a research- primary data and secondary data. The primary data are the first hand or original data that are collected for the research specifically based on the research objectives (Rengasamy, 2017) In this research, primary data were collected with the help of two tools – questionnaire and survey. Another type of data are the secondary data that are the second hand data collected from the sources such as books, journals, reports etc. The secondary data are collected by student/researcher other than the researcher of research. The combination of primary and secondary data for the research will help in developing a rich base of data that will be helpful in achieving the objectives of research related to the accounting software in SMEs in Australia (Cheng & Phillips, 2014).
The primary and secondary forms of data have their own strengths that will be helpful for this particular research. The secondary data for the research related to accounting software in Australia were available readily and it was also easily accessible and inexpensive. In addition, the secondary data were also advantageous for this research because it is collected over certain long periods (Mun?ar et al., 2012). This will allow us to effectively determine the shift from the traditional accounting system to accounting software in SMEs in Australia. The primary research on the other hand, will help in eliciting the research-specific data such as data pertaining to the accounting software used by the SMEs and its benefits with the help of interviews and surveys.
Data Collection tools
In order to conduct an effective research, few tools will be used under qualitative and quantitative research. The qualitative data will be collected using the questionnaires and interviews. The questionnaire can be defined as the set of questions in context to the research objectives that are used for collecting the data from a certain number of respondents. The interviews can be defined as the face- to -face or telephonic interaction with the respondents so as to obtain a detailed set of information (Alshenqeeti, 2014). These data tools have been chosen for this research because of their strengths. The primary data collection tools for example, questionnaire will help in collecting the data from a large sample of respondents in less time and in cost-effective manner. Similarly, interview will help in eliciting the detailed data about the usage of accounting software in Australian SMEs (Elise Paradis et al., 2016).
Sample Design
This section will focus on the sample design of the research. Sample can be defined as the group of people, items and objects that are chosen from a large population for the research. There are two major forms of probability sampling – probability sampling and non- probability sampling. The probability sampling can be defined as the sampling in which the probability of inclusion of all the elements or units of the population is equal (Lameck, 2013). The non- probability sampling on the other hand can be defined as the sampling in which the probability of selection of all the elements of the population is not equal. For this particular research, purposive sampling will be used. Purposive sampling is a non -probability sampling that is focused on selecting the sample on basis of the purpose of the study. The purposive sampling is also known as the selective, subjective or the judgmental sampling. The sampling frame of this study includes all the SMEs of Sydney. A purposive sampling technique has been chosen for the research so as to collect the data that is specific to the SMEs of Australia (Clark, 2013). The purposive sampling is chosen for the research so as to obtain the sample that ensures the generalization of the findings to overall SMEs in Australia. In addition, it will also help in reaching the target in less time. The sample size of this study is 30. The sample of this particular study will include the SMEs of Australia.
Data Analysis
The data collected with the help of qualitative and quantitative research will be analyzed differently. The data collected with the help of quantitative research will be analyzed using a graphical analysis. The data collected with help of questionnaires will be analyzed using the graphs. This method of data analysis has been chosen for this research so as to present the data in a simple and effective form. The responses of the respondents of SMEs will be presented in percentage format (Etikan et al., 2015). The qualitative data collected from the interviews will be analyzed using a technique called thematic analysis or the theme- based analysis. This method of data analysis is one of the most effective and widely used data analysis techniques. In context of using this technique, the data collected from interviews will be organized in a pattern or themes so as to relate the data with the research objectives and obtain the relevant qualitative findings (Braun & Clarke, 2018).
There are some major ethical concerns associated with a research however; these ethical concerns will be addressed in the research methodology adopted for exploring the SMEs in Australia. The participants of the research will be not be subjected to harm in any of the ways. The major priority will be the respect for participant’s dignity. Prior to study, consent will be obtained from the research participants so as to ensure that participants are participating willingly (Yip et al., 2016). Further, one of the major priorities will be to protect the privacy of data collected from the respondents with the help of qualitative and quantitative research. In addition, the confidentiality of the research data will also be ensured along with the anonymity of the organizations and individuals involved in the research. All the communication done in respect of the research will be done with a transparency and honesty. No misleading information will be circulated and the focus will be on avoiding the element of biasness throughout the research (Fouka & Mantzorou, 2011).
Conclusion
The above paper has presented the proposal for the research that will be conducted on the use of accounting software in the SMEs of Australia. The proposal of the research has introduced the research topic and clearly indicated the research methodology that will be used for conducting the research. The findings of this study will be helpful in terms of determining the importance of accounting software and the type of accounting software that should be used in SMEs.
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