Adoption Of Cloud Based Accounting Information System In Business Organizations
Overview of Cloud Computing
Adoption of the cloud computing has been growing rapidly over the last few years. Adoption of this system promises different firms significant improvement in the business processes due to superior capacities of cloud based AIS in comparison to the traditional information systems. With these considerations, this paper aims to presents a critical analysis of cloud computing. It would start with brief overview of cloud computing. The next section would comprise of evaluation of some of the benefits and drawbacks of the cloud computing followed by a section on probable recommendations of the success factors for the cloud computing. The report will then end with a conclusion which summarizes and synthesises the whole report.
Cloud computing is the management approach for provision of on-demand admittance to the collective computational capitals in the most convenient and cost-effective way, including insignificant connections with different cloud providers. Cloud computing is the IT service, where the software and hardware facilities are distributed on request to different clients across the IT network in a self-service style (Lawrence, Brad, Chris & Denna 2010). Within the last few centuries, cloud computing has changed from talented, developing technology to the most trustworthy substitute in satisfying an entity’s IT requirements. It appeared as technology development of distributed and grid computing, virtualization, service oriented architecture, utility computing as well as web services (Asatiani 2016). One of the main values of cloud computing for different businesses is derived from provision of resources in a scalable, flexible and economical manner, which is attractive and affordable to the IT investors and customers.
It is the storage of data and servers in secure data centres which could only be accessed by different user via the internet browsers. This implies that there is no requirement for different servers in a business, with financial information easily accessed via iPhones, iPads, PCs or other mobile devices, despite of their distance. In addition, cloud computing permit for unlimited number of the computers in accessing the cloud, without influencing or affecting on performance, implying that unlimited storage and processing capacity (Lawrence, Brad, Chris & Denna 2010). Further, cloud computing provide relevant financial information to different users for decision-making in an entity. Cloud computing simultaneously provides information for numerous decision-makers in human resources, management, supply chain logistics, finance, market and production (Saini, Saini, Yousif & Khandage 2011). Some of the different types of the cloud computing are private, personal as well as public clouds. Private cloud computing assist firms in securing information in the hosted data centre for improved reliability, efficiency and security while personal cloud computing enable an organization to access all personal information in a single place and sharing it with the other members.
Adoption of the cloud based AIS is said to result in greater development in the accessibility of relevant data, information processing as well as in data analysis, improvement of automation of business processes and tracking of end users and data manipulations enhanced via utilization of IT (Saini, Saini, Yousif & Khandage 2011). Further, adoption of cloud based AIS is believed to lead to significant benefits as a result of cloud computing superior capacities compared with the traditional information systems (Hsu 2013). Cloud based AIS bring cost allocation flexibility for different organization which aims at moving capital expenses into the operational expenses. In essence, adoption of cloud based AIS result in reduction in organization’s cost as a result of improved operational efficiency and in turn permits more rapid placement of the new products or services (Lawrence, Brad, Chris & Denna 2010).
Challenges and Benefits of Adoption of the Cloud Based AIS
Adoption of cloud based AIS is also beneficial since it allow for automation and transactional capacities of accounting information system which is grouped as automation capability allowing automation of routine operation processes via IT; hence, increasing performance efficiency in an organization. Successful adoption of the cloud based AIS is also said to enhance better compatibility in between operating and applications systems (Zhygalova 2013). In addition, cloud based AIS result in reduction in number of employees operating the IT infrastructure; hence, resulting in a major decrease in an organization’s expenses and a major increase in its profit. Further, cloud based AIS is beneficial since it provide more efficient information processing capacities as a result of elastic nature of cloud computing infrastructure that permits rapid de-allocation as well as allocation of enormously accessible capitals to the business facilities on request basis as well as decline of time in processing data-intensive or computer-intensive jobs (Lawrence, Brad, Chris & Denna 2010). This rapid elasticity capacity of cloud based AIS permits different firms to quickly scale up their service usage and in turn mirrors the information processing demands of these firms.
Cloud based AIS is also beneficial since it enables or enhances development of the virtual business environment which could be described as the suite of the integrated applications and tools which support some specific business needs or capabilities. Further, cloud based AIS is beneficial in different organizations since it allow transfer of financial information with ease and fast across large distance, making the process independent of the geographical region (Saini, Saini, Yousif & Khandage 2011). It enhances location independence as well as ubiquitous access which in turn facilitate free flow of financial information not just across an entity’s business units but also through numerous geographical areas. In addition, cloud based AIS is beneficial in an organization business operations since it permit more effective and efficient control and tracking of sensitive organizational financial information. Adoption of cloud based AIS is also beneficial since it permits automatic data backup, hence, removing any probability of forgetting to backup relevant data and reducing any probability of making human errors. This assists in securing information in an event of any fire break up, theft or other events which could put important and sensitive information in an organization at risk.
In spite of the above benefits of cloud based AIS, there are numerous drawbacks or disadvantages that could affect an organization’s decision in implementing the cloud based AIS. The first challenge to cloud based AIS is in relation to ensuring service availability and business continuity (Pring 2010). Although cloud based AIS service providers are in a position to use numerous software and hardware models in making sure there is better reliability of services via more strict service level agreements and higher service fees, there are some threats linked to moving out of the business. Another challenge of adoption of cloud based AIS is data lock-in, data security as well as data transferability limitations. Basically, cloud based AIS deliver better information accessibility; nonetheless, mining of these information in the event of any relocation to other system could bring a lot of issues. It raises cost of per unit of the computing resources as well as costs of the data communication (Dimitriu & Matei 2015). Further, adoption of cloud based AIS could have some challenges in that storing confidential or sensitive data in cloud related system would bring about some security issues. In other word, adoption of the cloud based AIS increases risk of unauthorized access to the globally accessible applications as a result of multitenant nature of the cloud computing. Further, adoption of cloud based AIS bring about security threats like authentication attacks, social networking attacks, man-in-the-middle bouts, rejection of the service attacks as well as the side channel attacks (Salleh, Teoh & Chan 2012).
As a result of numerous benefits in the above analysis, it is recommendable for an organization to adopt this system. This is based on the fact that adopting the cloud based AIS would assist the company to optimize its IT operations and offer maximum business value via re-evaluation, automation and improvement of its main business processes. Further, it would be recommended for the organization to adopt cloud based AIS since it would save considerable costs linked with maintaining, operating and building a data centre. This means adoption of cloud based AIS would allow an organization to lower its expenditures on the support employee, especially those offering infrastructure support, help desk services as well as system management.
Despite its advantages, there is need for an organization to carry out a risk analysis and to be very strict on choice of service providers (Dimitriu & Matei 2015). It should take into account guarantees provided by service provided in regard to protection of the personal data and should ensure that service provider would offer all crucial guarantees in fulfilling most of its obligations under data protection act. In addition, with security concerns or issues, there is need for the company adopting cloud based AIS to ensure that the cloud provider have higher level of security to ensure no possibility of any human errors.
Conclusion
It can be concluded that cloud based AIS is the management approach for provision of on-request admittance to the collective computational capitals in the most convenient and cost-effective manner, including insignificant connections with different cloud providers. It is also storage of data and servers in secure data centres which could only be accessed by different user via the internet browsers. It provides relevant financial information to different users for decision-making in an entity. It adoption of cloud result in greater improvement in the accessibility of relevant data, information processing as well as in data analysis, improvement of automation of business processes and tracking of end users and data manipulations enhanced via utilization of IT. In addition, it can be concluded that despite of adoption of cloud based AIS being associated with above benefits, adoption of cloud based AIS is viewed to bring a lot of challenges such as data lock-in, data security as well as data transferability limitations. Thus, there is need to adopt better strategies to reduce such challenges in future.
References
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