The Role of the External Accountant in Small Firms

Breen, John P; Sciulli, Nick; Calvert, Cheryl

doi:10.5172/ser.12.1.5

Cited by 18 publications

(25 citation statements)

References 3 publications

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“…The adoption of analytical-based applications such as budgeting, production planning, modelling, and project management is still minimal. The findings are consistent with the results reported by Lefebvre and Lefebvre (1988), Raymond (1992), Bridge and Peel (1999), Foong (1999), Timtime et al (2003), Breen et al (2004), and Ismail and King (2007). These studies reported that SMEs used computers mainly for administrative and operational tasks rather than for strategic planning.…”

Section: 1supporting

confidence: 93%

“…The adoption of analytical-based applications for strategic decision-making is still minimal. These findings are in tandem with those of previous studies such as , Breen et al (2004) and Ismail and King (2007). Most respondent firms also reported that they sought supports from multiple external experts such as vendors, consultants, accounting firms, and government agencies for their AIS implementation.…”

Section: 2supporting

confidence: 92%

“…The possible reason is that accounting firms, compared to other external experts, are more knowledgeable about their clients' businesses and thus can help them implement effective AIS. Furthermore, Davis (1997) and Breen et al (2004) argued that SMEs rely on accounting firms as their most trusted business advisors. It is also interesting to note the level of managerial participation in AIS implementation among respondent firms.…”

Section: 2mentioning

confidence: 99%

“…While business managers could provide the expertise in their areas of operation (de Guinea et al, 2005), a combination of advices from several external experts could provide relevant information for an effective AIS implementation. In addition to the above three external experts commonly found in the AIS literature, accounting firms could also play a major role in AIS implementation for SMEs (Davis, 1997;Mitchell et al, 2000;Breen et al, 2004;Berry et al, 2006) because accounting firms could advise SMEs in the areas of costing, expenditure, and cash flow to support monitoring and control. Meanwhile, consultants and vendors could help them choose the right technology to match the business information requirements (Yap et al, 1992;de Guinea et al, 2005).…”

mentioning

confidence: 99%

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Factors Influencing AIS Effectiveness Among Manufacturing SMEs: Evidence From Malaysia

Ismail

2009

E J Info Sys Dev Countries

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This study examines accounting information systems (AIS) effectiveness and its influence factors in the specific context of small and medium manufacturing enterprises (SMEs) in Malaysia. The proposed model examines the impact of AIS sophistication, manager participation in AIS implementation, manager AIS knowledge, manager accounting knowledge, and effectiveness of external experts such as vendors, consultants, government agencies, and accounting firms on AIS effectiveness. We included 232 SMEs registered with the Federation of Malaysian Manufacturers (FMM) in testing the model. The results show that manager accounting knowledge, and the effectiveness of vendors and accounting firms significantly contributed to AIS effectiveness. Overall, this study suggests that managers of SMEs need to acquire sufficient accounting knowledge to better understand business information requirements. Second, SMEs should engage qualified vendors who have experience and understand unique characteristics of SME to overcome their lack of AIS knowledge. SMEs should also exploit their good relationship with accounting firms to help them implement effective AIS. Finally, it is important for SMEs to learn from AIS implementation so that opportunities can be recognized and priority can be given to those initiatives that support their information needs.

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Section: 1supporting

confidence: 93%

Section: 2supporting

confidence: 92%

Section: 2mentioning

confidence: 99%

mentioning

confidence: 99%

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Factors Influencing AIS Effectiveness Among Manufacturing SMEs: Evidence From Malaysia

Ismail

2009

E J Info Sys Dev Countries

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“…With the introduction of GST in Australia in 2000, such systems, where they exist, are becoming computerised (CPA Australia, 2003;Breen et al, 2004). This has been facilitated by a range of off-the-shelf accounting software packages, which have been produced as cost effective solutions for small firms and easy to use by those who are not trained accountants (Breen et al, 2004).…”

Section: Recording Informationmentioning

confidence: 99%

Understanding financial information used to assess small firm performance

Halabi

Barrett

Dyt

2010

Qualitative Research in Accounting &Amp; Management

100

116

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Purpose -The purpose of this paper is to investigate the reality of financial and management accounting in a small group of small firms. Specifically, from the owner's perspective, an exploration is undertaken to see what financial information is collected, how it is used (or not) to make business decisions and evaluate the firm's performance, and the role played by the accountant in that process. Design/methodology/approach -A phenomenological paradigm underpins this exploratory study. Semi-structured interviews were undertaken with the owners of ten small firms, where the focus was on understanding what happens in an organisational setting, as opposed to theory and textbook practice. Findings -The qualitative data supported prior research in other countries. The in-depth analysis revealed a very basic understanding of accounting information and problems with the financial literacy amongst these small firm owners. Accounting reports were not widely produced or used, so an informal assessment, such as how much cash was in the bank, was the primary means of assessing business performance. Accountants were used for taxation services, although some owners sought more general business advice. Originality/value -An understanding is developed of why there might be a gap between textbook rhetoric and reality of accounting practice in small firms. The conclusion is that accounting textbooks need to include more information about the reality of financial management in small firms.

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