Accounting Information Technology in Small Businesses: An Inquiry

This inquiry addresses the prevalence of computerized accounting information technology in the U.S. small business environment. Academic and practitioner literature gives the impression that small business has widely adopted computerized accounting systems. Our study looked at a broad range of small businesses and found that a large majority are still using accounting practices that do not constitute true integrated computerized accounting systems. Further, of those which are using integrated software, over 90% are using industry-specific software rather than the general-purpose small-business accounting packages which dominate the literature. These results suggest that: (1) penetration of integrated accounting software is not as prevalent in small business as the literature might imply, (2) there is opportunity for research into why business owners do not utilize integrated software, (3) there may be opportunity to help entrepreneurs improve their efficiency and effectiveness, and (4) entrepreneurs using integrating software find benefits beyond simple accounting functions.