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Executive Summary

How the increasing automation and changes in regulation:This report would be presenting the impact on the internal processes of an accounting firm with the evolution of the automation and the rapid changing in the accounting regulations within the context of HKM & Co. With the help of the academic theories, the significance of the issue and the possible recommendations would be studied.

The literature review on the given issue would provide information regarding the importance of the issue within the context of other accountancy firms. It can be seen that with the changing requirements of the organisation, IFRS makes certain amendments to its previously issued accounting standards to better facilitate its associated stakeholders.

In addition to this with the rapid advancement in the technology and the telecommunication sectors, machines have significantly replaced the needs of the human resource working in the organisation. All these have a significant impact on the performance of the teams.

Different management theories would be utilised for efficient management of the change in the organisation along with their limitations discussed in the last part.

From the detailed assessment of these factors, it could be recommended for HKM and Co. that in order to minimise the impact of this changing regulation and the increasing automation, Executives of the business must undertake initiatives by either employing project team or through self-service.

They should be targeted to analyse the rapid changing requirement and provides an optimal suggestion for better growth of the organisation.

1.0 Problem Identification

The revenues of HKM & Co. are significantly dependent upon the provision of quality customer services. However, increasing automation and the changing regulations could create an impact on the productivity of the accounting firm.

2.0 Significance of the problem

Considering HKM & Co. which is providing the accounting services for its customers, the advancement in the automation process could ultimately change the duties of the employees working in the firm. This refers to the requirement of the skills that must be incorporated in its human resource to understand the advanced automation and act accordingly.

In addition to this, from the perspective of the changing regulations, the requirement of updating the information arises which otherwise could hinder the generation of accurate results for the business. The evolution of rules could be regarding updated accounting standards as issued by IFRS that must be followed by the different accounting firms.

These could include the change in the lease standards, revenue recognition standards, budgeting standards, disclosure standards, and taxation standards. Since the services of the current company under analysis are more or less related to these criteria, HKM & Co. is obligated to have a consistent check and balance on these changes that could otherwise create a loss of prospective customers.

The significance of the change could also be analysed from the below-given updates of 2016 regarding the changing accounting regulations which require efficient management.

2.1 Impact of increasing automation on the internal process of organisation

According to Arnold, Blisard, and Duggan (2013), the use of emerging technologies has enhanced the effectiveness and the efficiency in the productivity of the business. Since with the automation, accounting firms are able to generate financial results on the timely basis (Automation Primer, 2016).

Moreover, the use of automation decreases the chances of errors in the services; accounting firms provide to its customers (Rotman, 2016). Since it perfectly considers the requirement of customers and act accordingly (Accountants, 2016).

According to Banker, Chang, and Kao (2002), the use of increasing automation creates opportunities for the small and medium-sized accountancy firms to enter or exit in the different markets easily. It provides more information regarding the current and potential clients that the business could undertake for improving their sales revenues (Fulbier and Klein, 2015).

Increasing automation from the perspective of accountancy firms fosters the delivery of services through the availability of different secure processes (Banker, Chang, and Kao, 2002).  However, the advancement in automation has also been negatively criticised under some studies……………….