Determination of Necessary Requirements
In order to determine the requirements for the accounting information system at this hypothetical company, which will hereafter be referred to as the “XYZ Company,” the textbook for this course, as well as several secondary research sources were analyzed with the needs of the XYZ Company in mind. First, the new system must be capable of data collection, meaning that it is able to record all of the transactions entered into the system, in order to ensure accurate financial reporting (Prasad & Green, 2015). Secondly, the new system should be capable of outstanding documentation, meaning that all transactions that take place are recorded via a system of vouchers. The third requirement for this system is that it has high caliber control paths, which will make the system easy for all of the end users to navigate. The fourth requirement is that the system should be able to generate accurate financial reports upon command. Finally, the system should be able to disallow for the changing of financial records once the voucher has been closed. Another peripheral requirement is that the system should be extremely secure, and be able to accurately record the logins of all users, and track the times at which they logged into the accounting system.
Challenges the Organization May Face in Implementing the System
While it is abundantly clear that the XYZ Company badly needs a new system, one should expect that major challenges will occur when implementing this updated system. First, given the nature of organizational politics, it will be a challenge to convince members of executive leadership that they should take on the risk and expense of implementing a new system (Sudaryanti et al, 2015). Those organizational leaders who are responsible for approving expenditures on behalf of the XYZ Company are the most likely to raise concerns about the expense necessary to purchase, install, and maintain the new information system, and will likely state that the old system is working perfectly fine, and so there is no real need to replace it. Additionally, once the new system is installed, there will be downtime required on the part of the entire XYZ Company, during which time the company will be less able to serve customers (Diatmika et al, 2016). While the Information Systems department will do all that they can to make the installation of the new system as seamless as possible, a system as complicated as this new one is may take several days to properly install and implement. Moreover, once everything is in place, there will be a significant learning curve, as the XYZ Company employees learn how to use and navigate the new software system.
Systems That Must Be Replaced and Why
The XYZ Company must replace all of its accounting systems, for multiple reasons. To begin with, the systems that the XYZ Company currently has in place are outdated and obsolete, and they are placing the company at risk for losing valuable clientele. Upon an examination of the current software systems in place at the XYZ Company, the review showed that the current system lacks an accounting system budget, which is rather common among some of the older versions of accounting software. Additionally, the current system in place makes repeated errors in calculation, even when the end user has correctly followed all of the prescribed procedures for use. In an accounting firm such as the XYZ Company, the presence of basic errors in calculation can be disastrous, especially when an especially sensitive client account is concerned. If serious errors in calculation are made, even inadvertently, it can open the XYZ Company up to accusations of incompetence, malfeasance, and even outright fraud. Furthermore, the system that is currently in place at the XYZ Company makes extensive use of manual accounting spreadsheets. Not only are such manual spreadsheets completely obsolete within accounting systems in 2017, these forms of accounting are more prone to user error. Additionally, with the use of spreadsheets, if a user makes just one error, the entire report will be flawed, as one minor error tends to be replicated when entering data into a manual financial spreadsheet.
As this paper has demonstrated, the XYZ Company is in dire need of a new accounting informational system. The accounting software that the company currently has in place is out of date and obsolete. While the executive leadership at the XYZ Company tends to be exceptionally conservative as regards its willingness to spend money on new technology, it is clear that the time has come for them to replace their accounting systems. When an accounting system is obsolete, it is prone to making serious errors, and then replicating them endlessly. In an accounting firm such as the XYZ Company, the presence of minor errors in financial reports can have major consequences for the company, the clients, and the employees. Indeed, the implementation of a new IT and software system at the XYZ Company may well take a few days to properly install, and it may also take almost a month for all of the employees to properly learn how to use and navigate the new system. However, once these minor obstacles are successfully overcome, the ease with which the XYZ Company is able to successfully complete all of its accounting tasks, and perform these tasks to perfection, will make the expenditure and effort worthwhile.