SNHU Accountants Role in Managerial Reporting Discussion Replies

Information for responses:

Some individuals argue that accountants should focus on producing financial statements and leave the design and production of managerial reports to information systems specialists. What are the advantages and disadvantages of following this advice? To what extent should accountants be involved in producing reports that include more than just financial measures of performance? Why?

In your response posts, agree with your peers by building upon their points or challenge their opinion and provide reasoning for the disagreement.

include documentation techniques such as context diagrams, logical DFDs, physical DFDs, document flowcharts, and systems flowcharts as accountants spend a great deal of time producing these as well as managerial reports, particularly since SOX was passed.  Besides, the title of the Discussion Forum is “Documentation Techniques”!  I am not quite sure I agree that the Discussion description of producing managerial reports is a documentation technique.

Responses needed with references:

1. Advantages of having accountants focus on financial statements while leaving managerial reports to information systems specialists include specialization and expertise. Accountants are trained professionals with in-depth knowledge of financial principles, ensuring the accuracy and compliance of financial statements. By delegating the design and production of managerial reports to information systems specialists, who possess technical proficiency, organizations can leverage their skills to create more sophisticated and customized reports. This specialization can enhance the efficiency and effectiveness of the reporting process.

However, there are disadvantages to this approach as well. Accountants possess valuable insights into an organization’s financial data, which extends beyond mere numbers. They understand the context and nuances of financial information, making them well-suited to provide an important perspective in managerial reports. Moreover, financial performance is interconnected with non-financial factors like customer satisfaction, employee morale, and operational efficiency. Excluding accountants from producing reports that incorporate these non-financial measures can result in a narrow and incomplete view of an organization’s performance. Therefore, accountants should play a role in producing reports that encompass both financial and non-financial metrics to provide a more comprehensive and well-informed assessment of an organization’s overall health and strategies for improvement. Collaboration between accountants and information systems specialists can strike a balance between technical expertise and financial acumen, leading to more effective decision-making.

2. There are advantages as wells as disadvantages of accountants assisting the entity’s design and production of managerial reposts with information systems specialists. The advantages of the accounting help design and produce managerial reports are knowing what information should be gathered to be included in the reports, implement internal controls, and advise management and IT on how to correct weakness or deficiencies before financial statements are produced. The disadvantages of nor including accountants in the design and production of managerial reports is that it will cause poor decision making by management, the entity will not function efficiently or effectively which will affect revenue and profits. Accountants can help design chat of accounts that will match will sales, expenses, accounts receivable, accounts payable, inventory, and revenue to produce financial and managerial reports effectively and efficiently in real-time without human errors. I think accountants should produce reports that include more than just performance measurements because they are not just numbers-crunchers. Accountants should be reporting on tax matters and investment options for the entity as well so the entity can take advantage of those options before the deadline.

3. Whether accountants should focus solely on producing financial statements and rely on information system specialists to design and produce managerial reports is complex. Each approach has advantages and disadvantages, and the extent of accountant involvement can vary depending on the organization’s needs and circumstances.

As technology continues to change, so does its role in accounting. Accounting is the systematic approach to recording financial data, and an accounting information system can be as rudimental as a pencil and paper to the most advanced technical system to date (Romney et al., 2021, p. 10). While information system specialists are generally concerned with the technical side related to software and hardware, the real issue is using the information (Joseph & George, 2005).

Historically, accounting information was limited to financial information and focused on a general ledger; other business processes with relationships to the general ledger can be integrated and increase information efficiency (Romney et al., 2021, p. 5). Accountants are poised to use the “language of business” and step into the design role to help build systems that aid decision-making (Joseph & George, 2005).

Accounting is not the only profession impacted; as more companies undergo digital transformations and rely more on information to drive decisions other partners in IT, engineering, and consulting will compete with accounting to contribute to a holistic information system (Joseph & George, 2005).