The Effects of Accounting Information Systems on Firm Performance: Exploring Technology Integration in the Accounting Process

Abstract

This study explores the role of Accounting Information Systems (AIS) in enhancing organizational performance across four critical sectors which comprise of Retail, Construction, Healthcare (Private Practices), and Hospitality (Restaurants and Small Hotels)in the United States over a 25-year period from 1999 to 2023. The primary objective is to examine how AIS integration impacts financial performance (FP), operational efficiency (OE), and decision-making quality (DMQ) in these industries. By focusing on these sectors, the study captures the diverse challenges and opportunities associated with AIS adoption in different operational and strategic contexts. Using Ordinary Least Squares (OLS) regression, the study evaluates the relationship between AIS (independent variable) and the three dependent variables (FP, OE, and DMQ). The analysis leverages extensive longitudinal data to assess both the short- and long-term effects of AIS integration. The results reveal a strong and positive impact of AIS on financial performance, with a high coefficient and an R-squared value of 0.9276, indicating that AIS explains 92.76% of the variation in FP. This underscores AIS critical role in driving financial growth through improved resource allocation, accurate reporting, and strategic planning. For operational efficiency, the findings show a statistically significant but moderate effect, as reflected in an R-squared value of 0.4801. While AIS contributes to streamlining processes, other external and structural factors may influence OE outcomes. The study also finds that AIS significantly enhances decision-making quality, with an R-squared value of 0.6179, highlighting its role in enabling more informed and accurate decision-making processes. This research provides valuable insights into the transformative impact of AIS on key performance metrics across multiple industries. The findings not only emphasize the importance of AIS in improving financial outcomes and decision-making but also highlight the need for further exploration of its role in operational efficiency. These results contribute to the growing literature on technology-driven performance optimization.