The Sophistication and Quality of Computer-Based Accounting System Among Small and Medium Manufacturing Firms in Malaysia

Topics: Business, Small business, Management Pages: 10 (3061 words) Published: January 19, 2009
PhD Proposal
The Sophistication and Quality of Computer-Based Accounting System among Small and Medium Manufacturing Firms in Malaysia
Malaysia is rapidly shifting its orientation into an information technology (IT) based environment, which emphasizes on the use of technology in providing information. This is evident by the Malaysian Government establishment of the Multimedia Super Corridor (or MSC) in 1998. The MSC, therefore, manifests the Government commitment in leading the informationbased technology, be it in the world or in the region. The MSC will help to spearhead the country into a borderless and paperless environment where the creation of sophisticated and advanced IT products will change the way people do businesses in the future. It is envisaged that when IT is fully adopted by the Government, the E-Government status will be realized. As the Government moves towards an E-government, the private sector is also predicted to move in tandem with the Government's aspiration, particularly the accounting systems. The private sectors not only need to be consistent with the government, but also with the development and sophistication in business dealings. An adoption of computer-based accounting systems (CBAS) becomes vital and may well be the determining factor for the survival/success of an organization, especially small and medium businesses. Small and medium businesses, particularly the small and medium scale industries need to play a very crucial role in achieving Malaysia's aspiration to become a fully developed nation by year 2020. The manufacturing sector is expected to spearhead the drive to fulfill this vision. In view of that, the Malaysian government is constantly trying to promote and upgrade small-scale businesses to provide a strong and competitive industry for the success of large businesses. Enhancement of the technical capabilities through a greater and more diffusion of sophisticated technology among small businesses are often an effective way to improve their productivity and competitiveness (Foong, 1999). The importance of IT to businesses is illustrated in the Second Industrial Master Plan (1996-2005). One of the thrust of the second IMP, for example, is to meet the challenges of a globalize environment by encouraging the utilization of information intensive and knowledge driven processes of high value-added manufacturing related activities.

A review of published literature shows that, to date, a number of studies have been conducted to identify the factors affecting the use of IT in small and medium businesses. Albert & Kinman, 1990; Chan & Kelvin, 1990; DeLone & McLean, 1992; Adam, Nelson & Todd, 1992; Wilson & Sangster, 1992; Yap, Soh & Raman, 1992; Cragg & King,1993; Sangster, 1994, 1995; Hashim, Syed Yahya, Abu Bakar, Sa'yan, & Omar, 1996;Igbaria & Zinatelli, 1997; Foong, 1999; Thong, 1999). Most of the studies, however, focus on the use and implementation of information systems in general. Not many studies attempt to identify the use of IT in accounting by small and medium businesses. An exception is the study by Duschinsky and Dunn (1988) and Chen and Williams (1993). However, findings from these studies are mostly descriptive, and thus do not revealed the relationships among the indicators of the sophistication of IT use in accounting and the factors that affect the usage. Therefore, this study seeks to fill the void in research determinants of CBAS adoption in small and medium businesses. Second, it seeks to understand the determinants of CBAS adoption in companies categorized as small and medium businesses in the specific context of Malaysia. Small and medium scale industries are the focus of this study as they will be one of the primary foundations for Malaysian future industrial thrust (Mahathir, 1991). Small and medium scale industries are seen as potential vehicle for Malaysia to achieve the status of industrialized nation by the year 2020. Therefore, small and medium...

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