Abstract
This study aims to examine the relationships of the reliability of the Accounting Information System (AIS) based on the implementation of SysTrust's framework (principles and criteria) as an internal control method to the business performance and the mediating role of the quality of financial reporting in this relationship among Jordanian public listed companies. – Based on the literature review and contingency theory; an integrated conceptual framework was developed to guide this study. The study's conceptual framework consists of three major constructs: the reliability of AIS was conceptualized and measured by the SysTrust's framework (principles and criteria) the business performance was measured by the financial and non-financial indicators and the quality of financial reporting was conceptualized and measured by the IASB's framework fundamental qualitative characteristics. A total of 239 responses were obtained through a self-administered questionnaire from PLCs in the Amman stock market. The empirical findings of the study suggest that the reliability of the AIS is based on the implementation of SysTrust’s framework has a significant and positive relation to business performance and the quality of financial reporting significantly mediate the relationship.
Highlights
Prior researches have shown that information system adoption did increase companies’ performances and operations efficiency, especially in big companies (Saira et al, 2010)
At the scale of importance, the performance of accounting information systems is prioritized highly and this is mainly led by increased competition and revolution of the business environment at various levels, especially on the level of decision-making, since such systems are adopted in such a way that is designed for aiding in decision-making and enhancing an organization’s competitive status
Factor Analysis Results The main purpose behind the use of factor analysis techniques is to reduce the large number of variables that underlie each construct of both dimensions (i.e. SysTrust's components, quality of financial reporting and business performance) into orthogonal indices for further analysis by the regression analysis
Summary
Prior researches have shown that information system adoption did increase companies’ performances and operations efficiency, especially in big companies (Saira et al, 2010). The ultimate aim of building data information systems, as indicated by Al-Dmour, et al, (2016), is to avoid risks at levels of decision-making Such systems are devoted to processing data and transforming it into accounting information according to the users' needs. Such risks, according to Klamm and Watson (2009), have mostly negative effects on integrity, accuracy, reality and availability of financial reports. Irrespective of their size, business companies today must consider the reliability and security of systems more than ever before
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