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The impact of accounting information systems on the quality of financial information and decision making in the Kingdom of Saudi Arabia

posted on 2024-04-22, 23:22 authored by Ashwag Madkhali

In recent years, the Kingdom of Saudi Arabia (KSA), as part of Saudi Vision 2030, implemented a digital transformation strategy in its public and private sectors to maintain a robust digital infrastructure. The transformation included the adoption of a qualified accounting information system (AIS) because the KSA emphasised the need to focus on, enhance, and generate high-quality financial information and decision making. In response to the KSA’s National Strategy for Digital Transformation, Saudi organisations invested heavily in collating a wide variety of information. It was therefore timely to investigate the impact of the AIS on the quality of financial information and decision making, which the current study addresses. This study has two key objectives. First, to assess the level of the quality of AIS in KSA. Second, to investigate the impact of the AIS on the quality of financial information and decision making.
Prior research examined different aspects of the AIS such as flexibility, reliability, ease of use, integration, accessibility, and timeliness. However, research assessing the AIS using the SysTrust criteria issued by the Assurance Services Executive Committee (ASEC) of the American Institute of Certified Public Accountants (AICPA, 2017) is limited. The SysTrust criteria used in this study focus on security, availability, processing integrity, confidentiality, and privacy. In addition, the interaction between the AIS technology, quality of the financial information generated, and associated decision making has not been comprehensively explored. As such, this study used the Task Technology Fit theory (TTF) as the theoretical base for empirically examining the relationship of the AIS, based on the implementation of SysTrust principles, to the decision making and quality of financial information in listed companies in KSA.
This research adopted a mixed-methods approach to provide comprehensive answers to the study’s research questions through the integration of quantitative and qualitative techniques. A variety of data collection methods were used, including semi-structured interviews and a structured questionnaire to achieve data triangulation. This study analysed 356 responses and 13 interviews from respondents, including key AIS stakeholders currently working in companies listed on the Saudi Exchange Market (Tadawul). This study focused on the key AIS stakeholder groups identified in prior literature including information producers, information custodians, information managers, information users, and internal auditors.
Analyses of quantitative and qualitative data were undertaken using Smart Plus, SPSS and Qiurkos software respectively. Several statistical techniques and qualitative approaches such as path analysis, correlation, regression, and thematic analysis were conducted to analyse the data. Regarding the first research question of the study about the level of the quality of the AIS, the findings revealed that the level of AIS quality in KSA is high, and companies should continuously maintain AIS quality to achieve the quality of financial information and effective business decision making. Additionally, the interviewees who participated in this study further validated the high quality of the AIS as revealed from the statistical analysis and confirmed that all SysTrust criteria had been implemented. However, there were concerns about the availability of the AIS due to exogenous reasons such as electricity and the internet. In terms of the second research question regarding the impact of the AIS on the quality of financial information, it was found from the survey and interview data that AIS impacts the quality of financial information positively. The positive impact is represented by the positive impact of AIS on the qualitative characterises of financial information, which includes relevance, reliability, comparability, understandability, and timeliness. Regarding the last research question about the impact of the AIS on decision making, findings revealed that the quality of the AIS, based on the implementation of SysTrust principles and criteria, had a significant positive impact on decision making.
Overall, the findings of this study have several contributions and implications. First, the study fills a gap in the literature by extending the TTF theory to organisational tasks such as decision-making in a developing country context, by evaluating the impact of AIS on decision-making. Second, this study develops a theoretical framework to empirically examine the interrelationship among AIS quality financial information, and decision making. The findings highlight the importance of SysTrust criteria and provide insights into the perceptions of different AIS stakeholder groups. Also, this study contributes to the theoretical understanding of the role of AIS in achieving desired outcomes and can guide future research in this area. The results also provide a foundation of application for organisations, stakeholders, and policymakers in line with KSA’s digital transformation goal included in the Saudi Vision 2030. Organisations can use SysTrust criteria as a checklist for examining the quality and reliability of the AIS. AIS stakeholders could follow the developed guidance where improvements are required in security, availability, processing integrity, confidentiality, and privacy of AIS. To safeguard a successful journey of digitalisation, policymakers can use the findings to formulate and develop policies ensuring the AIS’ quality. Furthermore, it contributes to the literature in KSA examining the unexplored quality of the AIS and financial information along with decision making in listed companies using the TTF framework. There are several limitations of this study. First, a possible limitation pertains to its focus on KSA and the use of SysTrust principles to measure quality. Because of these limitations, the findings of this study cannot be generalised and may not be applicable to other countries. However, the findings may be useful for companies in similar developing economies and the Gulf Cooperation Council (GCC) countries. Regarding the second limitation of the use of SysTrust principles, future research may be directed towards testing the use of other quality measurements. The study focused on financial information from the perspective of limited AIS stakeholders, but future research may include a wide range of stakeholders, such as external auditors and government agencies, as well as vendors, and other types of information, such as non-financial information. Finally, the interview sample size was small and did not represent all industries equitably. Future research can investigate the same research question using a larger sample representing all industries in the KSA.



  • PhD Thesis


xxi, 313 pages


Tasmania School of Business and Economics


University of Tasmania

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