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The Effect Of ERP System Implementations on the Usefulness of Accounting Information PowerPoint PPT Presentation


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The Effect Of ERP System Implementations on the Usefulness of Accounting Information. Research Question. Does ERP implementation affect the usefulness of accounting information?. Accounting information usefulness. Two primary qualitative characteristics Reliability Relevancy Timeliness.

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The Effect Of ERP System Implementations on the Usefulness of Accounting Information

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The Effect Of ERP System Implementations on the Usefulness of Accounting Information


Research Question

Does ERP implementation affect the usefulness of accounting information?


Accounting information usefulness

Two primary qualitative characteristics

  • Reliability

  • Relevancy

    • Timeliness


Hypotheses

H1: ERP implementation reduces reliability of accounting information.

H2: ERP implementation improves timeliness of accounting information.


Theoretical Models

ERP

Reliability

ERP

Timeliness


Reliability Model

ERP

Reliability

Conceptual Level

Construct

Validity

ERP

Discretionary

Accruals

Operational Level


Relevancy Model

ERP

Relevancy

Conceptual Level

Construct

Validity

ERP

Reporting Lag

Operational Level


Research Design

One-group pretest - posttest design

  • tests a single group before and after a treatment

We test a group of companies before and after the implementation of ERP.


Regression Model-Reliability Analysis

  • Dependent Variable---Discretionary Accruals

  • Independent Variable---Pre (no ERP) and Post (ERP)

  • Control variables

    • To control for confounding factors and increase internal validity


Regression Model-Relevancy Analysis

  • Dependent Variable---Reporting Lag

  • Independent Variable---Pre (no ERP) and Post (ERP)

  • Control variables:

    • To control for confounding factors and increase internal validity


Data

  • We obtain our sample of ERP system adopters from a proprietary database supplied by a leading international provider of ERP systems.

  • Sample size

    • Reliability analysis:1645 observations

    • Relevancy analysis: 1585 observations


Reliability

Analysis

Results


Relevancy

Analysis

Results


Conclusions

  • ERP implementations reduce accounting information reliability.

  • ERP implementations improve accounting information relevancy.


Limitations

  • Research Design-pretest and posttest design

    • Advantage: comparisons are made by the same subjects.

    • Disadvantage: confounding factors

Alternative Designs?


Limitations

  • Measures for reliability and relevancy

    • Construct validity


Limitations

  • Sample selection

    • Selection bias

    • External validity


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