Original Research

The challenges of digital accounting systems in the South African telecommunications industry

Aanisah Miller, Vusani Moyo, Daniel Schutte

Received: 20 Oct. 2024; Accepted: 15 Jan. 2025; Published: 14 Mar. 2025

Copyright: © 2025. The Author(s). Licensee: AOSIS.
This is an Open Access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Abstract

Orientation: The research is centred on the challenges of digital accounting systems in the evolving technological landscape and their role in the economic development of emerging markets such as South Africa.

Research purpose: The purpose of this article is to provide a thorough analysis of the challenges encountered by financial accountants employed in the telecommunications sector in their efforts to enhance the reporting and analysis of financial information by utilising advanced digital accounting technologies.

Motivation for the study: The aim of this study is to investigate challenges encountered in using digital accounting systems in the business operations of companies in the telecommunications industry in South Africa.

Research approach/design and method: The study employed a qualitative research methodology, wherein data were gathered through semi-structured interviews. Thematic analysis was employed as the analytical approach to examine the gathered data.

Main findings: Financial accountants lack adequate training to improve their proficiency in utilising modern technologies. Digital accounting systems are not regularly updated to improve financial reporting for accountants and align with complex International Financial Reporting Standards (IFRS). Financial accountants acknowledge the importance of cybersecurity; however, attending training to be aware of the associated threats is not mandatory, as these threats are not included in their Key Performance Indicators (KPIs).

Practical/managerial implications: Management should stay informed about emerging technologies in digital accounting systems that can enhance efficiency for financial accountants. Continuous support will facilitate the optimal utilisation of these digital systems, thereby improving organisational performance. This can be achieved by providing training and ensuring the availability of ongoing resources to assist financial accountants in overcoming challenges.

Contribution: This article explores the challenges financial accountants in the telecommunications sector encounter in their pursuit of using digital technologies to enhance their financial reporting and analysis efficiencies and effectiveness in their organisations.

Keywords: accounting; business support; cybersecurity; digital accounting system; financial accountants; telecommunication.

Introduction

Accounting and finance have come a long way from handwritten bookkeeping ledgers to complex Enterprise Resource Planning (ERP) systems. Developments of the digital accounting systems have completely changed how businesses handle their financial data and operations. The advent of technology in accounting and finance has brought about many benefits for companies worldwide (Arriaza 2024). They Because of the digital transformation of accounting, organisations are able to manage their financial processes in a new way, enabling them to achieve operational excellence and drive business growth. Furthermore, companies need accounting information to tackle long-term and short-term issues, providing them with the required data to reinforce their functioning in different areas, including costs, expenditures and cash flow (Oudat, Alsmadi & Alrawashdeh 2019). According to Apriyanti and Yuvitasari (2021), firms using digital accounting systems in an effective manner have a higher likelihood of reporting their positive impacts on their performance compared to those that limit their use. Lufti et al. (2022) assert that accounting information has served as a fundamental basis for business decision-making, and the extensive use of digital technology has paved the way for the efficiency and effectiveness of accounting functions in modifying information relating to such functions. Effective information technology (IT) use ensures that accounting reports are timely and accurate, and that financial data can be accessed – both of which are great contributors to the decision-making and performance of firms, as explained by Almaiah et al. (2022).

According to Richins et al. (2017), one of the biggest challenges companies face is a lack of training programmes to help financial accountants embrace digital technologies in the accounting profession. As evaluated by Loozen (2023), talent management takes precedence as one of the primary people-related risks acknowledged by employers in the telecommunications industry.

In many regions of the world, especially developing countries, digital accounting system plays a significant role in the telecommunication industry. This study will especially focus on the telecommunication industry in the Gauteng province of South Africa.

According to Neogy (2014), the accounting information systems of the mobile telecommunication companies in Bangladesh have computerised accounting systems. This region is the country’s trade centre with Southern Africa and beyond. In 2013, the Gauteng region produced 33.8% of the national gross domestic product (GDP) in current prices (Gauteng City-Region Observatory 2024). The broader Gauteng region is estimated to have contributed about 45.0% of South Africa’s total economic output (Gauteng City-Region Observatory 2024).

Communications are vital for any organisation because they need to communicate information speedily, comprehensively and be adaptable so that they can remain relevant and compete against other organisations (Millennia Technologies 2022). Telecommunications have become a fundamental part of society, including how businesses operate. Even the most basic business processes and functions now require telecommunication to complete them successfully and in a way that allows them to remain competitive. It has completely transformed how the business world operates, and all modern businesses need to ensure they have the right infrastructure in place and continually train their employees in the effective use of technology (Millennia Technologies 2022).

In addition, 43% of telecommunications employees state that their company has improved its technological capabilities for remote work, 34% believe that further and more extensive changes are still required. One of the primary challenges faced by regional accounting firm organisations is the absence of adequate training programmes to assist professional staff in adapting to the digital disruption within the accounting profession (Bakarich & O’Brien 2021). Digital accounting systems are designed to help financial accountants achieve efficiency and accuracy (Raewf & Yaser 2020). Financial accountants should therefore possess essential digital literacy and skills to effectively utilise modern digital technology for professional and personal growth.

The first issue identified is that financial accountants lack the necessary skills and capabilities to adapt to the digital changes in accounting systems, primarily because of the advanced technology involved (Zhu 2022). This study aims to determine whether financial accountants need additional skills or training to perform their daily tasks effectively and stay updated with the latest technological advancements and tools. Another issue that has been identified is the lack of accessible support from the IT department. Implementing digital technology can present various challenges, and the IT team may need to possess the necessary knowledge of accounting systems. It is crucial to collaborate with digital technology vendors who are readily available and can provide regular support to financial accountants, as this support can have a significant impact. The third issue identified as the foundation for this study is the failure to consider cybersecurity, cyberattacks and the risk of fraud.

This is because of a lack of anti-fraud strategies in digital accounting systems. AINasrallah and Saleem (2022) emphasise the importance of companies maintaining the confidentiality of customer and stakeholder information and safeguarding sensitive financial data. One of the challenges in the field of digital accounting pertains to the critical task of guaranteeing the security and privacy of data. These systems contain highly sensitive data, which hackers highly seek after. Therefore, financial accountants need to exercise utmost caution by employing robust security measures, such as encryption and multi-factor authentication. In addition, it is crucial for accountants to regularly attend training on cybersecurity awareness. These practices should be included in their Key Performance Indicators (KPIs) to ensure they are regularly updated. This vigilance is imperative, as any oversight can potentially enable unauthorised access by malicious individuals. Despite increased awareness of cybersecurity risks, many companies admit they are not effectively managing them. Protecting sensitive financial data from cyber dangers through encryption and other cutting-edge security measures is essential, especially in today’s rising cybercrimes.

Digital accounting systems assist financial accountants in streamlining tasks, reducing errors and providing real-time access to financial data. This enhances efficiency and decision-making, enabling organisations to make informed financial decisions quickly. However, these systems have also introduced challenges that accountants must navigate to effectively leverage them. This article aims to investigate the challenges financial accountants face in the telecommunications sector as they strive to improve financial reporting and analysis using modern digital accounting technologies.

The existing literature on digital accounting systems primarily addresses the general challenges encountered by accountants across various industries around the countries (Miaoquan et al. 2023; Obaid 2024; Tran, Ting, Nguyen & Tran 2023). However, it may not adequately consider the specific complexities and distinctions pertinent to the telecommunications sector in South Africa as an emerging country with unique institutional settings. The telecommunications sector is important in the South African economy. Furthermore, there is a methodological gap in examining the challenges, as previous research has employed quantitative methods (Judijanto, Wahyudi & Surya 2024; Lamba & Kashif 2023; Tran 2023). Qualitative methods, such as open-ended interviews, facilitate an in-depth exploration of financial accountants’ experiences and emotions concerning the challenges associated with digital accounting systems. The adaptability of qualitative data collection enables a comprehensive understanding of the specific issues encountered by financial accountants in the utilisation of digital accounting systems. These include the necessity for comprehensive training on adopting advancements in accounting technology, managing intricate billing systems and accounting for diverse revenue models.

There is limited research addressing the challenges financial accountants encounter in managing financial data from large-scale networks, which underscores the necessity for training in accounting systems, as well as the need to address integration issues and the support of accounting system teams within the telecommunications sector. According to Gulin, Hladika and Valenta 2019, the accounting profession is faced with numerous challenges in the era of digitalisation. This study will focus on the challenges financial accountants encounter when telecommunications organisations integrate digital accounting systems with other deeply entrenched systems, such as billing and customer relationship management systems, as well as the upgrades to the accounting systems necessitated by advancements in digital technology. In addition, the research highlights the necessity for specialised education in telecom-related billing systems, stressing the importance of accountants in understanding accounting principles and technical telecommunications accounting systems.

This study is structured as follows: The introduction section is followed by a section that details the literature review. The third section outlines the detailed methodology followed in this study; the fourth section outlines the discussion of the challenges faced by financial accountants when using digital accounting systems in the telecommunication industry in South Africa.

Literature review

Theoretical framework

The theoretical framework for digitalisation in accounting systems examines the adoption of technology, the role of innovation and the strategic utilisation of resources to inform the acceptance, implementation and integration of digital technologies within organisations. According to Zhang, Ye and Jia (2022), the purpose of digitalisation in accounting is to realise accounting automation and management intelligence, with the aim of empowering firms’ decision-making abilities. The theoretical framework underpinning digitalisation accounting is rooted in the concept of digitalisation within the accounting field, which emphasises the automation of accounting processes and the utilisation of management intelligence to assist businesses in decision-making.

According to Silva (2015), several theoretical models have been developed to examine information technologies’ acceptance and usage behaviour. The main theories are the Institutional Theory, the Technology Acceptance Model (TAM), the Theory of Planned Behaviour (TPB) and the Unified Theory of Acceptance and Use of Technology (UTAUT). An extensive examination of the Accounting Information Systems literature revealed that Institutional Theory has been employed to analyse the adoption of systems and technologies, primarily ERP, through isomorphic processes, specifically coercive, mimetic and normative mechanisms (Schiavi, Behr & Marcolin 2024). Telecommunications companies invest in advanced digital accounting systems to enhance operational efficiency and reporting capabilities, gaining a competitive advantage in a rapidly evolving industry. Institutional theory elucidates how external pressures influence the adoption and standardisation of such systems. Unified Theory of Acceptance and Use of Technology is a framework that identifies factors influencing the adoption of new technologies in accountants’ daily work, such as ERP systems. Its extended theoretical frameworks are widely recognised and extensively employed to predict behavioural intentions regarding technology adoption.

Technology Acceptance Model examines users’ perceptions and attitudes towards the acceptance and utilisation of advanced technologies. This framework assists organisations in determining the likelihood of user adaptation to changes brought about by new technologies, thereby aiding in the minimisation of resistance to technological adoption. As explained by Cheng (2019), conflicting perspectives persist regarding the application of the TAM and in the examination of TPB. The present study seeks to address this controversy by evaluating and comparing the predictive power of these two theories within a specific context. Advancements in technology and its infrastructure are opening up windows of opportunity to support and ease the process of day-to-day operations. Technology Acceptance Model is applicable to digital accounting systems for financial accountants by emphasising its usefulness and ease of use. Organisations can enhance these systems by designing user-friendly interfaces, providing training, integrating various systems between ERP and billing systems and highlighting efficiencies and accuracy. By understanding these factors, organisations can support financial accounting and reduce resistance, thereby promoting more widespread and effective use of digital accounting systems. Furthermore, the TAM serves as a theoretical framework within the information systems domain, elucidating the factors that influence users’ acceptance and utilisation of technology. Among these, the TAM is distinguished as one of the most influential and widely employed frameworks, focussing on understanding how human factors affect individuals’ acceptance of new technologies.

There are numerous vital sectors of the industry’s economy that have been affected by the use of digital accounting systems by accounting professionals. Table 1 illustrates the effects of using digital accounting systems in different industries.

Enterprise Resource Planning is a software system used by companies to manage and integrate various business processes across different departments (Klaus, Rosemann & Gable 2000). It consists of modules that address specific business functions and can be customised to fit the unique needs of companies. Accounting module systems are technological advancements that enable rapid, efficient and effective evaluation and reporting of financial data (Vemuri & Palvia 2006). These systems provide various functionalities that enhance compliance, streamline financial management and support informed decision-making. Because of the integration of digital technologies into accounting systems, companies can now manage their financial processes innovatively. This allows companies to achieve operational excellence and drive business growth, as assessed by Pendley (2018).

The importance of digital accounting technology in organisation

Digital accounting technologies are systems and tools designed to optimise and enhance accounting processes. These technologies leverage computing power to automate tasks, improve accuracy and provide valuable insights into financial data. In today’s business environment, cloud computing, artificial intelligence (AI), machine learning (ML) and robotic process automation (RPA) play crucial roles in the daily operations of a business. Cloud-based accounting facilitates real-time collaboration among teams and clients, allows access to data anytime and anywhere and enables automatic updates to accounting systems (Pendley 2018).

Digital accounting technologies enhance the precision and efficiency of financial processes by supporting fraud detection, risk assessment, anomaly identification and predictive analytics. In addition, RPA can streamline data entry, reconciliation and report generation, reducing errors and freeing up accountants to focus on more critical tasks. According to Experlu (2024), blockchain technology enhances the security, transparency and traceability of financial transactions within accounting systems. Furthermore, Vujovic (2024) explains that data analytics technologies enable accountants to analyse large volumes of financial data and derive valuable insights. The development of digital accounting systems has fundamentally transformed how companies manage their financial data and operations. These systems facilitate the reporting and processing of extensive transaction volumes and generate the necessary data for informed decision-making (Lufti et al. 2022).

Accounting is primarily concerned with the design of the system of records and the preparation of financial reports based on the recorded data and further, the interpretation of the reports to both the internal and external users for making decisions (Neogy 2014:39). Phornlaphatrachakorn and Nakalasindhu (2021) explained that it is noteworthy in today’s world that the digital capability of a business is fundamental to remaining competitive in the market. Integrating digital technology within contemporary accounting systems is of utmost importance, creating a pressing need for rapid innovation to sustain a competitive advantage within the global marketplace. Accounting systems have been transformed by digital technology, which improves their accessibility, efficiency, accuracy and security (Raewf & Yaser 2020).

Technological developments, globalisation and increasing competition constantly force professions to change, according to Gulin et al. (2019). Digital technologies have played a crucial role in driving global corporate transformation. They offer immense potential for development and efficiency, but at the same time, they present challenges that businesses need to navigate carefully. According to the KPMG-global technology report (2022), global respondents said they are laying the foundation for emerging technologies, with nearly half (46%) making plans for the future. However, the majority (55%) have not made any significant moves, choosing to wait and see what their competitors do or which products and services their customers demand.

Digital accounting systems also streamline complex calculations, including commission computation and implementing International Financial Reporting Standards (IFRS) standards such as IFRS 15 and 16, in contrast to using MS Excel for calculations. According to Ananda and Kurniawan (2023), telecommunication tower data is stored across multiple discrete files within Microsoft Excel. They further explained that utilising Excel as a fragmented data management tool may present challenges in consistently integrating and verifying this data. Commission systems for digital accounting play a crucial role in accurately calculating and managing organisational commissions (Abdulle, Zainol & Ahmad 2019). These systems in digital accounting systems streamline the commission management process, improve accuracy, enhance transparency and eliminate manual errors that may occur when calculated manually.

Financial data stored in digital accounting systems may be vulnerable. Therefore, this data must be adequately protected and secured through effective cybersecurity measures. To minimise the risk of illegal access, data breaches and data loss, companies need robust cybersecurity measures. These measures should include firewalls, encryption, access limits and regular data backups, as evaluated by Glimsdhal (2019). According to AINasrallah and Saleem (2022), companies must enhance their accounting system’s security and protect against possible breaches and cyberattacks. This can be achieved by implementing robust security measures and staying alert to emerging cyber threats. Previous studies on digital accounting systems have mainly focussed on the financial and banking industry (Al-Okaily et al. 2022). Financial accountants handle sensitive customer information, including financial and personal data. Therefore, it is imperative to implement robust cybersecurity measures and provide comprehensive employee training on data protection best practices (Pendley 2018). Companies should establish backup procedures to ensure the consistent backup of accounting data and develop a disaster recovery plan to minimise downtime in case of system failure or data breach.

Implementing digital technology can come with various challenges, such as companies’ IT teams not knowing accounting systems. Financial accountants could run into technological problems or difficulties. At the same time, companies can establish an IT department with expertise in digital accounting systems to ensure minimal disruption in the accounting routine. Digital technology vendors can train financial accountants to use digital accounting systems effectively. In addition, financial accountants can offer ongoing technical support to address any problems and ensure the software functions smoothly, as explained by Expense (2022).

Given the substantial financial, technological and strategic risks associated with digital business and digital business transformation, financial accountants play a crucial role in assisting companies to navigate this process safely. Financial accountants’ expertise assists companies in leveraging the potential of technological advancements in this field and maximising the advantages of digitalisation (Busulwa & Evans 2021). However, despite the advantages and benefits of using digital accounting systems, financial accountants have been averse to fully embracing this digital transformation. Companies face challenges with financial accountants who lack digital skills because of inadequate training and are left behind or replaced by automation because of technological advancement (Huerta & Jensen 2017). In today’s digital world, financial accountants should advance their skills brought by the developments in technology and must also use new resources to produce accurate financial reports. This requires proper support from system developers and adequate training. Inadequate training and the unavailability of manuals for the system users can lead to human errors and inaccurate data presentation.

The significance of digital accounting technology in the telecommunication industry

Telecommunications is transmitting information over a distance using technology such as telephone lines, cable or satellite. It is a key part of the modern world, as it allows people to communicate with each other and access information and resources from around the globe (Chai & Lazar 2023). Four major telecommunication companies in South Africa, namely Vodacom, MTN, CellC and Telkom, are governed by The Independent Communications Authority of South Africa (ICASA). The telecommunications sector has embraced digital technologies to transform their business models and improve customer service, operational efficiency and agile service delivery, as explained by Awadhi, Obeidat and Alshuridah (2021).

The telecom sector handles numerous intricate financial tasks such as invoicing, incorporating IFRS 16 on the fibre lines and towers rented and complex calculations of the commission for the franchise. Incorporating digital accounting systems can help organise and simplify these tasks, guaranteeing accurate financial reporting. South Africa has distinct regulations of ICASA and tax adherence compared to other countries. Adopting digital transformation in accounting can significantly impact the prosperity and economic development of the telecommunications industry. According to Neogy (2014), digital transformation has assisted companies in the telecommunications industry by providing timely accounting information and aiding in budget preparation, monitoring and implementation.

A comprehensive knowledge of how digital accounting systems can assist in following these regulations is essential to prevent legal fines and non-compliance. The telecommunications sector in South Africa is expanding and changing. Digital accounting systems must have the ability to expand to effectively manage growing transaction volumes and business operations. Effective billing and precise financial management can assist in enhancing customer satisfaction.

To the best knowledge of the researcher, there are limited or no studies that have explored the challenges faced by South African financial accountants in the telecommunications sector following their organisations’ adoption of digital accounting systems. Relying exclusively on foreign studies on digital accounting systems in the telecommunications sector may present several challenges. Different countries have unique regulations and standards that oversee telecommunications and accounting practices. Because of variations in regulations, what may be effective in one country may not be applicable in another. Furthermore, there can be significant disparities in technological infrastructure between countries. In addition, studies relying on the technology and infrastructure of one nation may not be applicable if another country has different technology or infrastructure. Finally, it is important to take into account the specific local context to successfully implement and manage digital accounting systems in a particular country or region, even though research from other countries can provide useful information. Researching the impact of digital accounting systems in the telecommunications sector in South Africa is imperative for these reasons.

This study aims to determine how the digital transformation in accounting systems has impacted financial accountants’ business operations in telecommunications. Furthermore, this investigation will explore the extent to which financial accountants receive sufficient management support, including skill upgrades and comprehensive training on cutting-edge digital accounting technologies and the resulting impact on their performance. In the competitive telecommunications sector, staying ahead requires embracing the latest technologies.

The central problem to be researched in this study is the impact of significant shifts towards digitisation in the telecommunications industry for financial accountants. This is because of technological transitions and financial accountants’ use of digital accounting systems. However, financial accountants lack the necessary skills to operate the new systems, and companies fail to provide adequate training and business support to ensure proficiency. Without proper support, inaccurate financial reporting may occur, exposing the company’s operations to cyberattacks and other related risks (Glimsdhal 2019). Therefore, there is an imminent need to address this research gap and explore the challenges encountered in the use of digital accounting systems in the business operations of companies in the telecommunications industry in South Africa.

Research design and methodology

The purpose of this study was to gain a deeper understanding of the challenges faced by financial accountants when utilising digital accounting systems within the telecommunications industry in the Gauteng province. This study utilised a qualitative research methodology.

The target population for this study comprises financial accountants employed within the telecommunications industry in the Gauteng province of South Africa. Specifically, the focus is on the metropolitan municipalities of the City of Johannesburg, the City of Tshwane and the Ekurhuleni Metropolitan Municipality, where the head offices of all four major telecommunications companies are located. The study includes financial accountants who are currently utilising or have previously utilised digital accounting systems within the telecommunications sector in Gauteng. These accountants must possess experience with digital accounting systems, as this criterion is essential for their inclusion in the study. There are approximately 100 financial accountants employed in the telecommunications industry within Gauteng province. Approximately 57 911 members and associates are registered as Chartered Accountants (CAs) alongside Associate General Accountants (AGAs) and Accounting Technicians (Ats). Furthermore, they are integrated into the global network of Chartered Accountants Worldwide, which encompasses 1.8 million CAs and students (South African Institute of Chartered Accountants [SAICA] 2024). There are over 11 000 members of the South African Institute of Professional Accountants (SAIPA).

In addition, the sampling techniques employed in this study were a combination of purposive and snowball sampling to select the financial accountants as participants. The researcher used convenience sampling, meaning participants voluntarily participated in the study (Burns, Veeck & Bush 2017). With purposive sampling, the researcher identified financial accountants who can answer the research questions and have experience and knowledge about the study to share and indicate their experience and interest. Snowball sampling is used in research studies in which participants are asked to provide the names or identifiers of other eligible financial accountants who can participate in the interview session (Burns et al. 2017).

The objective of the interview guide for this study was to provide a framework for the interviewer and the individual interviewees to guarantee that the dialogues remain pertinent to the topic under investigation in this study. An interview guide is a collection of research questions that focus on the most important aspects of the investigated research topic (Saunders, Lewis & Thornhill 2007). The qualitative data were collected using in-depth semi-structured interviews, following the guidelines established by Miles, Huberman and Saldana (2014). The article relied on primary source data to acquire related information. Data collected through qualitative research methods must be carefully analysed to identify patterns among words and effectively analyse and interpret them while ensuring that the integrity and quality of the data are preserved (Burns et al. 2017). Semi-structured interviews were conducted using predetermined questions to guide the conversation. This approach offers the advantage of allowing for in-depth exploration of a respondent’s opinions on the subject matter.

The interviewees were invited to participate in the study via email using Microsoft Teams. The email included the interview guide, which allowed the interviewees to familiarise themselves with the questions beforehand. The interviews were conducted using Microsoft Teams, and each interview was recorded with the interviewees’ permission using the built-in recording tool of Microsoft Teams. During these interviews, handwritten notes and recordings were made via Microsoft Teams. The transcribed raw data were subsequently processed before being analysed. The field notes, as described by Rossman and Rallis (2017), were expanded into comprehensive write-ups as the notes taken during the interviews often only captured a portion of the actual dialogue. Furthermore, the Microsoft Teams recordings of the field events were meticulously analysed alongside the field notes, resulting in further annotations.

Data saturation was reached after the 10th interview; however, additional interviews were conducted to gather diverse perspectives from financial accountants. Hennink, Kaiser and Marconi (2017) noted that conducting a few interviews can cover a broad range of data issues, but more data are required to gain a deeper understanding. They further mentioned that additional data will depend on a range of saturation parameters, including the study’s purpose and population. The researcher conducted 12 semi-structured interviews within the telecommunication industry in the Gauteng province of South Africa, as presented in Table 2.

This systematic approach to processing and organising the data enabled the researchers to refine the original notes and recordings into a more comprehensible format, thus facilitating subsequent analysis. Data editing is a crucial process in which collected data are reviewed and adjusted to ensure its quality (Gobo & Mauceri 2014; Salem & Lakhal 2018). According to Stringer (2014), data editing can be done manually, with the help of a computer, or a combination of both. Editors may need to correct spelling and grammatical errors made by respondents and follow up on incorrect or uncertain responses (Oppong 2013). This study adopted a field editing approach, meaning that editing occurred during the data collection.

A thematic analysis was then applied to analyse the data. This is an appropriate method as the study seeks to understand a set of experiences across the dataset. Further, the data will be analysed using a thematic approach, which makes sense given that the study’s goal was to comprehend a range of experiences throughout the dataset. The data analysis consisted of scanning the data to extract primary themes and additional pertinent insights that might not align with the initial pre-determined themes but still held significance for further analysis. Various themes were identified, and subsequently, the data were categorised into sub-themes, as presented in Table 3.

Furthermore, the inclusion of sub-themes allowed for probing the perspectives of financial accountants on the influence of technological advancements on their profession, as well as the challenges encountered during the adoption of digital accounting systems.

Ethical considerations

Ethical approval to conduct this study was obtained from the North-West University Economic and Management Sciences Research Ethics Committee (EMS-REC) (No. NWU-00710-24-A4).

Results and discussion

This section presents the empirical results of the study. The interdependency of themes indicates that to successfully implement digital accounting systems in the telecommunications sector, employees must be trained and upskilled to operate the new systems effectively. In addition, employees need support from management, and the internal control systems must be upgraded to align with the new infrastructure, as presented in Figure 1.

FIGURE 1: Digital accounting systems.

Furthermore, the researcher focussed on the most important aspect of each theme and which aspects of the data set it covers, creating a coherent narrative of how and why the coded data within each theme provides unique insights, contributes to the overall understanding of broader questions and interacts with other themes, as explained by Kiger and Varpio (2020). A list of sub-themes was developed through the analysis and divided into four broader themes that are of relevance to this article, with the main theme being the effects of digital accounting systems.

Effects of digital accounting systems

Understanding digital technologies in accounting

According to Kozarkiewicz (Cited by Obaid 2024), digital transformation, in general, enables organisations to keep pace with emerging and evolving customer demands, offering better opportunities for competition and increased competitiveness by creating new value that ensures sustainability in the future. Financial accountants 1, 2, 5, 6, 9, 10 and 12 unanimously agreed that using technology and automation is widely embraced in accounting. Automation effectively streamlines processes, significantly reducing the need for manual labour and minimising the risk of human error. Consequently, professionals now have more time to dedicate to the analysis of numerical data, unburdened by repetitive tasks. As explained by Gulin et al. 2019, contemporary computer systems have significantly alleviated the workload of accountants, facilitating efficient and rapid completion of repetitive tasks that were previously integral to traditional accounting methods. Financial accountants 8, 11 and 12 strongly expressed their belief that automation, coupled with the implementation of audit trails, has greatly diminished the likelihood of misplacing important documents, a common occurrence in manual processes. Probing was used to understand how technology helped business operations position themselves for future growth and adaptability in the ever-evolving market. In contrast, one respondent explained, as presented in Table 4.

As evaluated by Kreher (2024), 57% of the surveyed companies believe it is essential to formulate a digitalisation strategy with well-defined objectives to enhance their digital processes. Utilising digital accounting systems within the organisation ensures the achievement of objectives and improves the organisation’s sustainability (Meiryani et al. 2022). This involves the examination of overall computations, generation of financial statements and pertinent data for decision-making purposes. This type of information holds significant importance for telecommunications industries, where automating the billing process ensures accurate and timely customer billing. This can translate into financial outcomes such as KPIs, impacting cost drivers or other performance metrics.

The respondents were asked how technological advancement affected their profession, and financial accountants 6, 9 and 12 responded that the transition is processed in real time. It is easy to quickly retrieve accurate information and provide it to management and stakeholders to make informed decisions. Digitalisation does not automatically result in cost reductions for every company. It can accelerate processes and reduce the time required, freeing human resources for other activities that add value (Kreher 2024). The companies have limited resources for processing journals because other financial accountants are dedicated to analysing the data. In contrast, one respondent explained, as presented in Table 5.

With this functionality of RPA, tasks can be executed more efficiently and with a reduced workforce. New digital solutions, such as AI, blockchain, big data, cloud computing and continuous accounting, will impact the reduction of manual data entry while enhancing the speed, quality and accuracy of data as evaluated by Gulin et al. (2019). Financial accountants 1, 2, 3, 4, 7, 8,10 and 11 have confirmed that the implementation of a streamlined journal preparation and submission process has made things much simpler, giving them more time to perform analysis. This streamlined process includes a workflow for approval, ensuring that journals are automatically posted after receiving the necessary approvals. This advancement has greatly simplified the work involved in accounting tasks. Routine tasks that do not necessitate a high level of education and training, and which require minimal human communication, can be readily automated (Kim, Kim & Lee 2017). As a result, work is now completed with enhanced efficiency and a smaller headcount. According to Chipriyanova and Krastva-Hristove (cited by Jejeniwa & Mhlango 2024), automated accounting systems, characterised by their ability to perform complex calculations, data analyses and financial transactions with minimal human intervention, have significantly increased efficiency, accuracy and speed in accounting operations. Furthermore, financial accountants 2, 6, 9 and 11 commented that reports can be generated significantly faster compared to the previous system. Some programmes allow you to scan the documents, and a robot will handle the validation process for you, making it much quicker, with just a click of a button, the invoice is posted to the general ledger, eliminating the need for separate processing. In contrast, respondents 6 and 9 explained, as presented in Table 6.

Financial accountants 6, 7, 8 and 12 further explained that these systems have evolved to offer more than just financial accounting functionalities. They now provide management accounting information, including insights on general calculations, population of financial statements and relevant data for decision-making. Kreher (2024) mentions that efficiencies can be increased and processes can be sustainably optimised through various digital technologies. With a simple click of button, reports can be generated from the accounting system for management purposes. This has significantly reduced the time required to populate reports into Excel and conduct further manipulations. In contrast, one respondent explained, as presented in Table 7.

Herbert (cited by Gulin et al. 2019) investigated that digitalisation and automation are used to eliminate or minimise routine and repetitive tasks; it will therefore enable accountants to focus on more creative, non-routine and non-structured tasks that require more thinking and additional skills.

Challenges when using digital accounting systems

Although digital accounting systems help accountants work efficiently and reduce their workload, accountants also face challenges that can affect reporting timelines, often requiring them to work additional hours. System malfunctions, software faults and data entry mistakes can still lead to inaccurate financial data. According to Obaid (2024), one of the challenges of digital transformation in accounting science is the lack of a proper strategy for successfully implementing new technologies. Therefore, financial accountants must establish careful procedures for validating and reconciling data to ensure the accuracy of their financial records. The accuracy of the output is directly dependent on the accuracy of the input. In contrast, one respondent explained, as presented in Table 8.

Another challenge is the dependency on technology itself. While it reduces manual work, if the system goes offline or experiences downtime, it can significantly impact business operations. Financial accountants 4 and 7 mentioned that systems can be quite challenging to navigate. In contrast, one respondent explained, as presented in Table 9.

Digital accounting systems are highly efficient and often underutilised despite their specialised features that may go unnoticed. One other challenge that financial accountants encounter is not having access to other functionalities with the accounting systems: In contrast, one respondent explained, as presented in Table 10.

The lack of clear instructions on the basic principles of the digital accounting system can result in inefficiency. Zhu (2022) assessed that the general business problem was that some accountants at accounting firms lack the digital skills to meet their client’s needs in the current data-driven business world.

Effects of linking accounting systems with other systems

Telecom companies utilise various software platforms to manage their operations. However, integrating digital accounting systems with these systems can be challenging and time-consuming. Accountants play a crucial role in ensuring smooth data transfer between systems, minimising disruptions or losses. Inadequate integration can lead to inefficient workflows and discrepancies in financial reporting. In contrast, respondents 6 and 12 explained, as presented in Table 11.

However, there are challenges with this integration, financial accountants 1, 4, 5, 6, 7, 8, 9, 11 and 12 explained that if integration is not executed properly, it can result in significant issues, such as systems that do not communicate. Participants are not particularly enthusiastic about the integration of other systems with ERP systems, as there is a concern that other information may not be accurately transferred to the ERP system, potentially resulting in issues related to accuracy and completeness. This requires a considerable amount of maintenance to ensure proper functioning.

Understanding how digital accounting systems enhance the implementation of international financial reporting standards

The telecommunications industry encounters unique challenges in accounting and financial reporting. Consequently, companies within this sector must consistently adhere to accounting standards to remain compliant. The telecom industry faces unique hurdles when considering accounting and producing financials (Babler & Francis 2022). Digital accounting systems must adhere to various accounting rules and regulations. Dingli (2023) mentioned that organisations frequently encounter difficulties with varying data definitions stemming from different accounting principles, such as IFRS and Generally Accepted Accounting Principles (GAAP), and embedding policy updates into daily accounting can prove formidable. Thus, financial accountants should stay on top of legislative changes and ensure that their digital accounting systems are up-to-date to remain compliant. In contrast, one respondent explained, as presented in Table 12.

Participants felt that the integration of IFRS 16 into digital accounting systems offers numerous advantages, facilitating streamlined lease accounting processes, enhancing the accuracy of financial reporting and ensuring compliance with international accounting standards. This integration enhances efficiency by automating the calculation of amortisation tables and monthly journals, which are frequently managed using Microsoft Excel—an approach that is prone to errors, particularly in the context of rental leases for towers that necessitate adjustments because of additions and disposals. It is important to note that changing auditors may lead to a shift in their opinions, necessitating adjustments to the system. In contrast, respondents 7 and 2 explained, as presented in Table 13.

Implementing complex IFRS standards eliminates the possibility of errors and ensures more accurate reporting without the need for spreadsheets or manual intervention. Technological advancements and emerging technologies, such as cloud computing, AI and blockchain, can enhance the role of accountants and revolutionise the financial industry by reducing the need for manual data entry. These technologies offer opportunities to improve the efficiency, accuracy and reliability of financial data processing (Guli et al. 2019).

Training and skills in digital accounting systems

Education and new skills required to use the accounting systems

The accounting sector’s technology field is always changing with the constant release of new tools and updates. Obaid (2024) mentions that leaders and employees often lack the digital thinking, knowledge and skills necessary to work in digital environments. While digital accounting systems are designed to streamline accounting procedures, they can occasionally become intricate and challenging. Financial accountants 4, 7 and 11 mentioned that they often encounter difficulties when trying to comprehend certain features and resolve issues within these systems. In contrast, respondents 12 and 2 explained, as presented in Table 14.

Financial accountants 1, 3, 5, 6, 8, 9 and 10 mentioned that they had received training for all accounting systems, and the manuals for each module were also provided. Financial accountants 2, 4, 7, 11 and 12 stated that they did not receive formal training on the system. Instead, they learned it independently through job training and often relied on their colleagues for assistance. Financial accountants do not actively participate in training sessions for new systems to stay up-to-date with advancing technologies. Accountants must acquire additional skills over time, as failure to do so can result in inefficiencies. According to Jejeniwa and Mhlango (2024), digitisation of the accounting industry requires a holistic approach to reskilling and upskilling the workforce effectively.

Business management support

Continuous support from management and information technology

Accountants were asked about the average waiting time when encountering technical issues using the accounting systems. All the financial accountants who participated in this research stated that the waiting period is typically not very long, with an average of 3 h. Most accounting departments have a designated person assigned to the finance team to assist. This is done through a Service Level Agreement (SLA) with the vendor systems, which outlines the expected turnaround time. This agreement ensures guaranteed availability, particularly during the reporting period, either for 24 h or for immediate assistance, depending on the tool used and the terms of their customer support agreements. In the case of urgent matters, the expected turnaround time is 24 h. Participants acknowledged that IT support is consistently available, particularly during month-end periods, and that there are no delays encountered. However, if a new requirement arises, it may take a few weeks to incorporate it into the ERP system. When IT help is not easily accessible, accountants may have to rely on IT specialists to handle these problems, which can be challenging. This reliance can delay financial reporting and other essential accounting tasks. Probing was used to determine if management understood the system and whether they understood the reports the system was producing. Financial accountants 5 and 11 explained that management lacks interest. We find ourselves having to retrieve reports from the system and break them down further for management to understand. In contrast, one respondent explained, as presented in Table 15.

Digital accounting systems offer significant benefits to organisations. When effectively utilised, these systems enhance various organisational functions and contribute to improved financial performance, as such, managers are required to optimise the utilisation of all available resources to enhance overall firm performance as assessed by Okpo and Eshiet (2023).

Internal controls on occupational fraud

Understanding of cybersecurity risks

The increasing dependence on IT in South Africa is leading to an escalation in the cyber threat landscape, and studies has revealed several instances in which security vulnerabilities have compromised IT systems in the telecommunications sector (Pieterse 2021). Significant confidential financial data are stored within digital accounting systems, making this attractive to cyberattacks. The participants were asked if they knew cybersecurity risks and best practices for protecting sensitive financial data. All the financial accountants who participated in this research explained that they are educated to be vigilant for potential anomalies. If they notice any irregularities, they are required to promptly log a call or bring it to the attention of the risk department. According to Aiken (2019), users have limited knowledge or awareness of the risks of being online and have never been involved in educational or training programmes on cybersecurity. Financial accountants 2, 3, 4 and 11 further mentioned that the IT department sends weekly emails to enhance cybersecurity and security breaches awareness. The emails serve as reminders to employees, advising them to exercise caution when clicking on links and refrain from responding to emails from unfamiliar senders. As researched by Hasan et al. (2024), prominent accounting firms, including Deloitte, PwC and EY, have integrated advanced cybersecurity protocols into their operations. These measures encompass AI, blockchain technology, sophisticated encryption and ongoing surveillance to safeguard financial data. This integration illustrates a proactive strategy in cybersecurity, ensuring that companies are adequately prepared to address emerging threats.

Measures in place to ensure security and compliance

A relative lack of education, awareness and training could contribute to increased problems with cybersecurity, vulnerability to rising levels of cybercrime and poor password practices (Shillair et al. 2022).

There was a discussion to determine the measures in place to ensure the security and compliance of the digital accounting system, especially about sensitive financial data. The rapid shift towards digitalisation has exposed companies to significant cybersecurity risks, making protecting these systems a paramount concern according to Nurwanah (2024). All the financial accountants who participated in this research indicated that access control is crucial, and its effectiveness depends on the user. Different passwords are used to access Microsoft Windows and digital accounting systems. Restricted access to files or modules within the systems is implemented to prevent unauthorised breaches and to ensure the safety of files. If an additional access to a module is needed, a form must be completed and signed by the management. To ensure secure access to the digital accounting system, it is recommended to use strong passwords that are not easily guessable. Furthermore, granting access only to a limited number of individuals classified as super users is essential. In addition, regular password refreshments should be conducted monthly to enhance security, and user information should be kept up-to-date, especially when individuals move between departments. For example, when an individual moves from the finance department to the marketing department, they will still need access to System Applications and Processing (SAP), although the level of access may vary. Reviewing and adjusting user access rights when individuals leave departments or the company is important. Lastly, logging in to the company’s VPN when working remotely is necessary. Otherwise, the system should automatically log you out. Two-step verification requires phone access, such as using an SMS or the Microsoft Authenticator app. According to Hasan et al. (2024), multi-factor authentication (MFA) has emerged as a standard procedure for augmenting cybersecurity in accounting firms. By necessitating various verification methods, including passwords, biometric information and one-time codes, MFA considerably enhances the security of user accounts.

Ongoing initiative to raise awareness of cybersecurity

Technologies, applications and infrastructure pose a substantial risk, particularly when utilised inappropriately, such as employing default configurations or neglecting to patch security vulnerabilities. This risk is amplified when there is limited knowledge or systems are used without the necessary approval, such as legacy systems (Pieterse 2021). The respondent was asked if there were ongoing initiatives to raise awareness about cybersecurity within the accounting department. Financial accountants 2, 9 and 12 stated that employees receive an email every 6 months and participate in a course that focusses on identifying phishing emails and scammers. The course includes informative videos that show exactly where to look for signs of phishing and how to recognise them. Emails with a link will be sent to the entire company to access the training, and afterwards, the employees will need to take a short test to ensure that they have gone through the material. The participants acknowledged that they sometimes neglect to read the emails related to cybersecurity and the accompanying videos. They often play the videos in the background without actually watching them, merely to demonstrate completion. This suggests that financial accountants do not prioritise cybersecurity awareness. However, a few participants recognised that the videos do contribute to raising awareness about new scams and methods of protection. In contrast, one respondent explained, as presented in Table 16.

Cybersecurity is critical for the protection of financial data within the accounting sector. Given the continuous evolution of cyber threats, it is essential to implement advanced cybersecurity measures to safeguard financial information, comply with regulatory mandates and maintain the trust and confidence of clients and stakeholders (Hasan et al. 2024). Videos on cyber awareness are distributed to employees within the organisation via email, and they are requested to engage in the subsequent test actively, a significant proportion of employees do not partake. Furthermore, the company has not implemented disciplinary measures for those individuals who opt out of participating. Continuous awareness of cybersecurity is vital for organisations. Robust cybersecurity measures, including employee training, stringent access controls and periodic audits, mitigate risks and safeguard financial data from internal breaches as evaluated by Kankanhalli et al. 2023. Ensuring data security and privacy is a major challenge, particularly in digital accounting systems. Financial accountants need to be especially vigilant in this regard. According to Andronache (2021), the need for cybersecurity awareness has arisen to prevent breaches and educate employees about the significance of staying vigilant against threats.

Recommendations

Digitalisation presents companies with substantial opportunities and significantly challenges the accounting profession. The telecommunications industry must enforce the digital accounting systems principles, as illustrated in the proposed Conceptual Framework in Figure 2, to ensure that the digital accounting systems are fully efficient and effective.

FIGURE 2: Digital accounting systems adoption conceptual framework.

To fully optimise implementing digital accounting technologies, organisations must prioritise acquiring new skills and providing essential tools and IT resources for their financial accountants.

Firstly, companies have failed to provide sufficient training and encouragement for financial accountants to improve their skills in digital technologies. A minority percentage of participants reported receiving training with access to user manuals and recordings of new system training. At the same time, the majority stated that they acquired their understanding of system usage through on-the-job training. Financial accountants recommend that companies invest in additional skills and provide sufficient training to ensure they can effectively utilise systems and navigate obstacles related to digital transformation. The telecommunications industry should prioritise the upskilling of financial accountants in the latest technologies and digital tools to remain current with technological advancements and to utilise ERP systems effectively for reporting purposes, thereby saving time.

Management should identify the skills required by financial accountants in relation to digital accounting systems and incorporate these into the development programme by creating a structured, engaging curriculum that addresses the learning needs of the participants. The organisation should engage experienced professionals with expertise in accounting standards and digital tools to deliver the training. The programme should include practical training for financial accountants, providing hands-on experience with digital systems to offer real-life insights. In addition, technical staff should be available to assist with any system-related issues during month ends, such as facilitating access to recorded sessions and other resources for ongoing learning.

The training initiative must incorporate technical staff to address system-related concerns, establish feasible timelines and provide continuous support. It is essential to offer advanced reporting tools, data analysis capabilities and user-friendly systems.

Secondly, relying on technology in digital accounting systems can streamline manual work. Still, it may also impact business operations because of the dependence on technical support and potential delays in financial reporting. Therefore, financial accountants mentioned that companies must provide IT support to financial accountants to address any issues, especially during the reporting period promptly. In addition, financial accountants suggested that companies regularly update accounting systems to ensure compliance with IFRS and prevent potential non-compliance with accounting standards. This will help avoid inaccurate reporting and misleading financial statements. Consolidating information from multiple systems can lead to time savings, although it may be hindered by limited comprehensive testing and employee resistance. Implementing such a system can present various challenges, particularly regarding resistance and the difficulty of effectively adapting to and utilising the new system. Therefore, the financial accountants recommend that the companies must ensure clear communication and provide strong reasons for the change.

In addition, financial accountants recommend that adequate support be given during the transition to facilitate a smoother adoption of new processes. Organisations must ensure the new system is compatible with existing technologies or commit to updating outdated systems to facilitate a smooth transition. In the telecommunications sector, integrating ERP with billing systems requires the implementation of data validation rules and automated reconciliation processes to prevent discrepancies. It is essential to regularly assess data processes and use middleware for accurate and immediate data transmission between systems. The financial accountant should collaborate with experienced IT and ERP integration experts to develop a cohesive strategy. To enhance integration efficiency, it is advisable to utilise ready-made connectors and middleware options compatible with the ERP system. Accountants should be engaged from the outset of the ERP implementation and integration process to gather their insights. Most financial accountants demonstrate cybersecurity awareness, emphasising the significance of employing robust passwords and exercising caution when interacting with suspicious links. Continuous training in cybersecurity for accounting professionals should be provided and cross-functional teams that include IT experts to collaborate on the secure management of financial systems should be established. Furthermore, financial accountants recommend making participation in cybersecurity testing mandatory. This should be added to KPIs, and disciplinary action should be taken against those who do not participate in the test. Telecommunication industries should place particular emphasis on financial accountants adopting advanced encryption methods, implementing MFA and collaborating with IT departments to automate regular updates of security protocols. This approach is essential for safeguarding sensitive data. Furthermore, it is imperative to conduct regular cybersecurity evaluations to identify and address any risks within the accounting systems. A proactive approach to cybersecurity, continuous education, robust system management and coordination with IT professionals can effectively mitigate these issues and safeguard accounting operations against technological advancements.

Conclusion

Technology Acceptance Model emphasises that the success of digital accounting systems hinges on their perceived usefulness and ease of use. It is essential to provide continuous IT support to overcome challenges such as system complexity, cybersecurity concerns and the need for upskilling through training. By tackling these issues, organisations can significantly improve the chances of successfully adopting advanced accounting technologies, ensuring that accountants are well-prepared to Excel in a digital-first environment. The study aimed to explore financial accountants’ challenges and experiences when using digital accounting systems.

Firstly, this study found that financial accountants perceive digital accounting technologies as effectively reducing manual work. However, they lack sufficient training programmes to assist professional staff in embracing the digital disruption within the accounting profession. Financial accountants can improve efficiency and accuracy in their financial management processes by proactively tackling these challenges and leveraging digital accounting systems. In addition, financial accountants must remain updated on technological advancements to maintain relevance and effectiveness.

Secondly, many telecommunication companies do not have advanced reporting systems in place. This includes the lack of preparation of financial statements and management reports. As a result, some financial accountants are still manually pulling reports from the ERP system and exporting them to Excel for further manipulation to meet management reporting requirements. There is a need for these companies to upgrade their accounting systems to keep up with technological advancements. To effectively address employee resistance to change and enhance the efficiency of digital accounting technologies, it is recommended that management provide support and encourage staff to improve their digital skills. Furthermore, financial accountants are advised to utilise strong security measures such as encryption, MFA and regular audits to safeguard crucial financial data.

Thirdly, implementing ongoing awareness programmes can enable companies to consistently enhance and maintain a high-security standard. Further research is needed to investigate the significance of digital accounting technologies for SMEs.

Acknowledgements

The authors would like to thank each financial accountant who participated in the research. This article is partially based on the author’s dissertation entitled ‘Exploring the challenges of digital accounting systems in the telecommunication industry in South Africa’ towards the Masters in Accountancy in the Department of Accountancy, Faculty of Commerce, North West University, South Africa on January 2025, with supervisors, Prof V. Moyo and Prof D. Schuttle.

The authors declare that they have no financial or personal relationship(s) that may have inappropriately influenced them in writing this article.

A.M., V.M. and D.S. planned the study together. A.M. conducted the original dissertation from which this article is substantially derived. V.M. and D.S. provided guidance and reviewed the research article.

This research received no specific grant from any funding agency in the public, commercial or not-for-profit sectors.

The data that support the findings of this study are available on request from the corresponding author, D.S.

The views and opinions expressed in this article are those of the authors and are the product of professional research. The article does not necessarily reflect the official policy or position of any affiliated institution, funder, agency or that of the publisher. The authors are responsible for this article’s results, findings and content.

References